The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1903-04-04
WILL DECIDE
NEXT MONDAY
Matter of Southern Pacific
Handed Down Then.
HAD NO JURISDICTION
D NO JURISDICTION
Claim Made the u. P. Not
Before the Court.
UEn-r-


Nashville. Tenn.s April 3.-The hearing
sf arguments in the Southern Pacific case
was resumed today before Judge Lurtoa.
Court adjourned yesterday while the clos
ing argument was being made by Senator
Foraker for Talbot J. Taylor & Co. Sena-
tor Foraker finished today The most
important point raised was that of the
jurisdiction of the court The defendants
argued that the Union Pacific was not
!. before the court. The plaintiffs attor-
'neys took the ground that the Union
Pacific was before the ceutr as a stock
holder of the Southern Pacific
Senator Foraker today in reply TO a
question BY counsel for the defendants
as TO why the suit was not brought in.
New York. said it would have been quite
as convenient for the compliments, but
that the suit could not be instituted
against a corporation in district where
it had no residence. He said the COM
plainaRts in applying for an injunction
wished the court to COMPEL defendants
TO do what it Is their duty to perform
l.
aker to state what other relief was de-
sired il an injunction was not granted
as prayed. Senator Foraker replied that
the injunction was asked tp prevent the
voting OF the stock held by the Union
Pacific at the coming meeting on April &,
and TO prohibit the leasing or severing
CT the Central Pacific. Tho speaker said
that both roads had common terminus
at Portland and that they are COMPETE
tors in trans-continentaI traffic. The
affidavit of Traffic Manager Stubs was
read that if the Union Pacific wished to
divert business from the Southern Pacific
it could be done by changing the tariffs.
Senator Foraker said no better proof
OF them being competitive lines could be
given and that by a change of rates bus
fness could be diverted to the Union PACT
fc.
If they are competing lines said Sen
etor Foraker, what are the rights Of
bona hde majority stockholders? This
suit was brought to ascertain the rights
of stockholders and compliments argue
end insist that the corporation should
have a board of directors free from the
touch or influence of any other line and
the Southern Pacific company"
While this injunction was seeking 10
prevent the execution of a contract, said
Senator Foraker, the complainants con-
tend that this CONTRACT is Illegal, There
was no redress for a wrong done by one
corpora ton TO another unless the act
complained of was illegal and there would
have been no nlegality in this contract
had it been entered into between the
directors Of both companies acting solely
for the particular interests they repre-
scented.
Senator Foraker insisted that the con-
tract was illegal for the reason that It
was in contracention Of public policy and
against such acts some remedy sho lld
be had. The statement that the Southern
Padi6c was being improved for the benefit
OF stockholders was no answer and that
the defendants were doing wrong hon
estly. was no defense.
The law. said Senator Foraker. Will no-
tolerate repugnant trusteeship. The
courts in all such matters have taken
the position that stockholders have a
right to have the property managed for
laeir interests The speaker said that
which had not been supported by evil
dence there was not one -recklessly or
idly made.
The defendants had said they had no
intention of severing the Central Pacific
from the Southern Pacific Yet they had
spent S2o.090o0o in improving it. They
wanted = through Ians-Continental lire
from Chicago To san Francisco. Certain
improvements had been made. but not
one word had been said in court con-
corning them. The earnings of the South
erp Pacific over and above the operating
expenses and fixed charges were being
spent on improvements and these sums
amounted TO many millions.
one could not help thinking that If the
Union Pacific had no idea now of acqui--
ing the Central Pacific. the time might
come when they would think of II and
this would be when they had made thu
road more valuable and should they de-
sire to severe II from the Southern Paci-
fee II could be done in five minutes. by
a resolution adopted at meeting Of the
directors
The cutoff in Salt Lake. said Senator
Foraker. would cost sl3. ooe GO and yet me
defendants came into court without say
ing word about it or the areat tunnel
through the Sierras. lie spoke of the re-
cent fan Of a section of the cut-oT into
the lake 10 show the impracticability Il
the scheme.
Senator Foraker said Il was not neces-
sary for the complainants to show that
the defendants We're doins wrong. but 10
show that they might 60 it in changing
tariff rates that would work . detriment
20 the stockholders Of The Southern PacI-
fc
Senator Foraker. in closing. said the
important question was restraining the
Union FaciGc from victims the Southern
Pacific stock IT the annual meeting. ~
contended that the two roads were CON-
petito-s and thaJ the tendency WIS
toward Capitalization and monopoly.
Senator Foraker read an affidavit from
Kenneth @. White showing statement
Of the operations CT the Southern Pacific
from June - 1870. 10 January. 1913. The
gross earnings for that period were 81
eS5.551 and net earnings S12575. 0GS. leav-
ing 4 deficit FOR the period Of s4246.S9a.
The month Of January increased the de-
felt Si.17S.a71 Senator Foraker stated
that in the face Of a showing like this.
counsel for defendants conten6ed that
complsinants had no right to complain.
IF the Union Pacific wished 10 build tun-
CharnberIain's