New-York tribune., 1902-01-25

the shippers point Of viewY' asked Commits
sioner Clements.
Then he can go into court and secure rea-
sonable rate"
At this point Commissioner Prouty inter-
rupted with little story Of the woes of the
commission.
"Out in Iowa" he said ut was complained
that the grain rate too high We went out
there and investigated. and discovered that the
complaint was just, and ordered reduction, a
reduction to reasonable rate you say.
What happened? The roads paid no attention
to 1t, and the courts decided that ruling
could not be enforced"
Well Mr.. Hill answered. laughing, Il was
talking of what ought to be, and of what 1 am
willing and anxious TO bring about. If these
rates cannot be enforced the law should be
fixed so that it can be done"
COMPETITIONS HIGH RATES.
Mr.. Hill averred in answer to further interro-
cation in regard to the effects of competition.
that commercial war between roads really re-
suited in higher tariffs.
They cut each other to the heart" said he.
and then patch up agreement whereby
everything is higher than ever. The rebate Sys-
tenn is a part of competitive warfare and you
know the rates the general shipper gets thereby.
He pays the freight which the large shipper has
lodged. Roads are bound to hustle for business,
and they will do much TO secure the patronage
of a large shipper"
had been made, express or otherwise. respecting
q division of traffic or earnings, which involved
the Northern Pacific, the Great Northern or the
Burlington He replied: mo understanding
directly or indirectly"
"Or with the Union Pacific SYSTEM" he was
asked.
None whatever" he replied
He also declared that to the best of his recol-
lection the Great Northern had never had a
traffic agreement with any other railroad.
Chairman Knapp then produced a copy of the
charter of the Northern Securities Company
in the bylaws declaring that the right of a
shareholder to inspect the books of the corpora
ton shall be subject to the will of the di-
rectors.
Mr.. Hill said he was not aware that such a
provision existed in the charter
Mr. Hill talked vigorously and earnestly. At
the close of the session, when Chairman Knapp
offered to allow Mr.. Hill to start for New-York
If the latter felt that staying in Chicago would
inconvenience him seriously, Mr.. Hill declared
that his time belonged to the commission. and
that he desired in every way to aid it to the
extent of his ability. Chairman Knapp there
upon said that Mr. Hill would be again called
TO the stand tomorrow morning.
Mr.. Hill and Mr.. Hartman both reached Chi
cago this morning. and Mr.. Hill. accompanied
by Mr. Grover. his attorney came at once before
the commission
Darius Miller. first vice president and traffic
manager Of the Chicago, Burlington and Quincy,
and former traffic manager of the Great North
ern, was the first witness. Mr. Miller said that
the Burlington was absolutely Independent in it's
operations and in the making of rates.
Have you received instructions from either
Mr.. Hin or Mr.. Hartman in regard to making
rates?' Mr.. Day asked.
Il have received none" the witness answered
Commissioners Prouty asked the witness to
what extent the Northern Pacific and Great
Northern were competitors, and Mr.. Miller put
the competitive traffic at about % per cent.
He declared that the Burlington was not a
competitor of the Great Northern and Northern
Pacific. He said the two Northern roads had
made frequent agreements to maintain rates
but said he know of no penalty ever having been
imposed for violation Of agreements.
MR.. STUBBS's TESTIMONY.
J. c. Stubbs traffic manager Of the Southern
Pacific and the Union Pacific, followed Mr..
Miller. Mr.. Stubbs said that E. H. Hartman
chairman of the board of directors Of both
roads but that he was appealed to only in
extraordinary cases. Mr. Stubbs said no such
case had arisen since his appointment and that
he had proceeded under his general instructions
from Mr.. Hartman. He said that rates gen.
orally had been fairly we'll maintained but that
there had been decentralization in Colorado and
Utah. He declared that the Southern Pacific
and Atchison, Topeka and Santa Fe were COM
Atchison road to division OF the oil and
sugar traffic?" asked Mr. Day
None whatever" replied the witness, There
is division OF the orange traffic. but this is due
TO the fact that about 30 per cent OF the crop is
tributary to each line"
The witness averred that the Union Pacific
and the Southern Pacific were competitors al /
though he admitted that he believed the Union
Pacific controlled the Southern Pacific. He
declared that this control could have no effect
rates owing to the existence of competition
"a look at the map will show you what this |
competition is" Mr.. Stubbs observed paren- |
thetically.
The commission adjourned at 5:15 o'clock un- /
til tomorrow morning. with Mr.. Hill the /
stand.
Mr.. Hill In his testimony gave an estimate of
the holdings Of the Northern Securities Company /
in the Northern Pacific and Great Northern !
companies. and was then asked by Commits |
soner Clement:
What does your plan contemplate shall be
ba Sfo oft he Pnrlin in uhp pteUe
1t stands, whether in the name of a railway |
company individual?'
That would depend upon it's extensions and |
the amount Of money II would need to pay off |
the bonds at the end of five years which It had !
the right to do-say $500, 900. They have to |
build other lines, and they build them with the |
proceeds Of stock rather than mortgages. and II !
would be whatever that amounted to-"
Then in organizing this new Burlington COM
pany its capital stock is issued at par for
money!"
YES that's right
And whatever stock 1t has since issued, 1t
has issued at par for cash?"
That is right"
And the plan is to increase its stock only
occasion may require. and sell that stock at par
for CASH."
That is right"
THE cash to be used either in retiring the
bonds or in extending the system, or for other
legitimate purposes?"
That's right"
But in any event, whatever the capital stock
of this new Burlington company may be at any
time, it will be the equivalent of just much
money actually paid into its treasury"
That is entirely right
The stock at par?"
Sold in the open market?"
Il think 1t will have friends enough to take It
without open market"
OPPOSITION TO MERGER