The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1900-08-17
MAY Be A SCHEME
East Jersey Company Said
to be Getting Ready
for Profits.
WHERE JERSEY CITY COMES IN
If Delay With Newark is Sc
cured We May be Given
Pequannock.

| One of the most important matters in
volved in the suit brought by the city
| against the East Jersey Water Company
IS the date on which Newark will OBJ
tain control of the Pequannock water
! shed. The contract specifies September "a
| as the time for transferring the water
| system from the company to the city, but
the company officials have stated that
! they do not intend to turn over the water
! shed until the city pays the balance of
money due on the full contract price of
$6,Q00,000. OF this amount So, 5000 has been
paid by the city; the other 81, 5000 600 is held
in escrow by the Fidelity Trust Company.
OF this 100000 is withheld on the original
| contract price and the other $500000 has
| been deposited as guarantee by the
| company that it would secure the city i'll
! its title to the watershed and the pipe
lines to this city
| 1t has been the belief of the Newark
Street and Water Commissioners that the
company would fight any proposition to
turn the watershed over to the city unless
| the s2,00Oo00, at least, should be paid. The
Commissioners, as shown by the institu-
/ ton of the suit against the company and
! as stated in it, claim that the company
| has not fulfilled its part of the contract
and states the neglect of the corporation.
This includes the transfer of Canstear
! reservoir and Echo Lake, the repair of
Clinton and Oak Ridge reservoirs, the
cleaning of them and the removal of
! shallow fowage, and the perfection of the
! citys title TO the right of way along
which the pipe line has been laid. With
| the existence of all these defects under
| the Terms Of tho contract +he Gam ce,for-
ers would not be Justified in paying over
the balance due.
| But they believe strongly that the city
date set in the contract.
The city has the money ready to be
! paid over, and would be ready and willing
to carry out all the conditions imposed if
| the company had carried out its pro-
| visions.
AS the company demands its money
with conditions as they are, the Newark
| Commissioners think the situation will re-
| quire a resort to the. Court of Chancery
! in an action subsidiary to the pending
| suit. The action will probably consist
! of an application to be allowed to pay
/ the money due the company into Chan
/ cery, to await a decision. One of the
points insisted on by the city is that it
! shall pay the balance of s., 100000 in cash.
| The company contends that the contracts
with the city call for the payment in
| bonds. 1t wants the bonds because they
carry on the whole 100000 worth, a
premium of about 100000 The bonds bear
4 per cent. interest.
| If the bonds be placed in the custody
! of the Chancellor, it is argued by the
| Newark city officials the company will
| secure ultimately all the rights in the
| bonds that they legally possess and will,
| therefore, suffer no financial loss.
| The Street and Water Commissioners,
therefore, regard the payment of the
money into court as a perfectly equitable
proceeding, under which they will be
| justified in demanding possession of the
water works at the time set, September
"a. Such action as the city contemplates
will necessarily have to be taken before
| the date of the transfer mentioned in
/ the contract.
This matter has been considered by the
counsel for Newark but all their pro-
ceedings have been kept secret 1t is APP
| parent, however, to the public at large,
as we'll as to the East Jersey Water
/ Company anu ITS ldWyGIS, tudl InG city
would take some action to acquire pos
session of the watershed. The city's law
yers may have some other plan in view
than to pay the money into court, in
order to secure possession of the water
| system, but, If So it has been kept equal
| ly as secret as all their other actions.
| In connection with the transfer of the
| watershed a little ceremony had been pro-
| posed by Engineer Hersehel, of the East
| Jersey Company some years ago, but it is
doubtful whether it will be carried out if
| the present litigation continues
| Mr.. Herschel had stated that the COM
pany would have a silver key made for
| the different gatehouses and meter
houses, and suggested that this be formal
| ly surrendered to the city. The key was
| to be suitably engraved and some speech
| making was to be indulged in at the pres
] entation.
! Should the company be successful in a
| contention to keep possession of the
watershed after September "a and until
the suit between it and Newark shall be
ultimately decided, it will be in position
| to earn more money than it can other
| wise.
Besides Newark, the East Jersey Com
/ pany supplies Jersey City and Bayonne.
The company receives ss6 million gallons
! for it. At present they receive mixture
| of Pequannock and Little Falls water, the
/ greater part of it at present being from
the former place. Water is sent to these
| places through a separate main from that
carrying Newark water.
This pipe to Jersey City and Bayonne
| will come under control of Newark after
| September q, and then the supply for
4 these places will be taken entirely from
| the Passaic River and Little Falls until
| the work at Boonton. in the Rockaway
i River watershed, is completed. This will
not be done until 1903 or 1904.
/ Jersey City is not at all satisfied with
the quality of water it receives. At the
present time complaints are being made
that the water is dirty. In Hudson
County there are now being used from
5,OG0 900 TO s5,000,000 gallons of Pequannock
water a day. The rest, about 15.0o0,00O
gallons, is Little Falls water.
Recently the East Jersey Company has
been negotiating with Newark for the
sale of its surplus water after next Sep