The Democratic advocate. [volume] (Westminster, Md.) 1865-1972, 1901-04-27
Argument in the Canal Case.

Argument in the Canal Case.
The future disposition cf the Chesapeake
and Ohio Canal is matter of much interest
to the whole people of the State. To preserve
the waterway as competing transportation
line the State has waived its rights as to earn
ings in favor of the bondholders of 1874 and
of the repair bonds Of 1873 and Of claims for
labor, &c. The bonds and claims have long
ago been bought mp at heavy discounts, and
the holders Of the bonds Of 1874 have been
operating the canal by decree of the Circuit
Court for Washington county for the past ten
years. majority Of these bonds are held
hv persons in the interest of the Baltimore
and Ohio Railroad, and it is virtually the
Baltimore and Ohio Railroad Company which
is operating the Canal. The surviving trus-
tees ofthe Chesapeake and Ohio Canal bond
holders are John X. Cowen, President OF the
Baltimore and Ohio Railroad Company, Hugh
L. Bond, Jr., general counsel for the same
corporation, and Joseph Bryan, and these
trustees are opposing sale OF the Canal by
the State and asking for continuation OF their
lease for another term of FIVE years.
The ADVOCATE last week stated that in
1890 the State had bona fide offer for the
Canal from the Washington and Cumberland
Railroad Company, which offer included the
payment Of twenty five per cent. OF the prin-
cipal of the bonds of 1874; $4,000 to be ap-
Piled to the payment of claims for work, labor
and material between January l, 1877, and
January |, 1890; $50, 600 to be applied to the
payment ola judgment against wharf property
at Cumberland; the principal aud interest OF
the repair bonds of 1878, amounting to 5000,
600. and an annuity to the State OF $4,000.
The sale at this offer was very vigorously
opposed by the Baltimore and Ohio interests
Mr.. John K. Cowen, then general counsel
and now president of the company, rushed into
print to prove the Canal property was worth
about So. 600. OOO Not only was the sale Wig
orousIy opposed, but majority OF the bonds
of 1914 were hastily bought and an application
made TO the circuit court for Washington county
for an order 10 permit the bondholders 10 re-
pair and operate the Canal, The order was
granted. and miserable farce at operating The |
Canal followed, AT the end of FIVE years the |
trustees applied for an extension OF the time,
that they had not had ample time to |
demonstrate fully the earning capacity OF the |
Canal. and the time was extended for another
Ave years. The last extension expires on
Nav LIST. and now another five years OF lease
is asked.
The matter came up at Hagerstown before
Judge Stake last Saturday. Hon. lsidor Ray
ner. Attorney General, represented tue State.
further extension OF the time, and
arguing for sale of the corpus OF the Canal.
His argument was regarded AS "unanswer-
able'' by many lawyers present, and IN the
course of his remarks he forced the admission
from Mr.. Hugh l.. Bond, one OF the trustees
and general counsel OF the Baltimore ana
Ohio Railroad Company, that I'VE 1.-THE trus-
tees have been trying for ten years to wipe
out the interest of the State.
That is what everybody knew who had any
Of the matter, but it was unex
peeted that one of the trustees and general
counsel of the Baltimore aud Ohio Railroad
Company would admit it.
According TO Mr.. Rayner The trustees have
been Maid by the Chesapeake aud Ohio Trans
portation Company, virtually the Baltimore
aud Ohio Railroad Company, $780, 900 a year,
a ann insufficient to meet the interest upon the
bonds. In fact, said Mr., Rayner, no money
has been passed-the matter being only one
Of entering figures upon books. Mr.. Kayner
went on to show that-if the earnings oil the
Canal were not sufficient to pay interest upon
the bonds, there could be no hope OF ever
paving the interest; and that as the water
way was continually deteriortaing and business
falling off the States interest would be for
ever lost should sale be denied and the ga
nal continued in the hands of the trustees Tor
another term of FIVE years.
The proposed sale of 1890 was termed
steal If that was true, it must be admitted
that the Baltimore and Ohio is now and has
been for ten years engaged in worse than
steal Tire proposed sale of 1890 provided
for the payment OF part OF the prneipai OF
the bonds of 1874. The Baltimore and ONO
is now not only not paying even the interest,
but its general counsel coufesses TO an inten-
ton to destroy the States interest. The OBJ
;ect of this, as stated last week, is TO prevent |
with the B. & O. in the coal and |
and otner trade of Western Maryland. What |
that corporation is doing is being done under
the forms of law, but it is stealing none the |
less.
Our readers will find on the fourth page OF
this issue synopsis of Mr.. Rayner's argument.