The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1903-04-04
DECISION DUE
NEXT MONDAY
Argument Finished in the South
ern Pacific Injunction Case.
F0RAKER'S CLOSING SPEECH
MAIN POINTS OF THE MATTER
IN CONTROVERSY.
FORAKER'S CLOSING SPEECH

n AsHVULE, Tenn, April 3-The
N hearing of arguments I'm the
Southern Pacific case was Tee
stunned today before Judge Lurton.
Court adjourned yesterday while the
closing argument was being made by
Senator Foraker Tor Talbot j. Taylor a.
Co. Senator 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. Tn
plaintiffs attorneys took the ground
that the Union Pacific was before the
court as "a stakeholder of the Southern
Pacific.
Senator Foraker today, iu reply 20
question by counsel for the defendants
as TO why the suit was not brought i'm
New York. said it would have been
quite as convenient for the complain
ants. but that the suit could not be n-
stituted against corporation in a dis
4 trict where it had no residence. He
said the complainants in applying Cor
an injunction wished the court 90 COM
pel defendants 90 DO what &C. is their
duty to perform.
Question by the Court.
Judge Lurton then asked Senator For
Bker 90 state what other relief was Pc
sired IL an Injunction was not granted
es prayed. Senator Foraker replied
that the injunction was asked 90 pre-
vent the voting of the stock held by
the Union Pacific al the coming meet
ing on April s. and 90 prohibit the le3s-
ing or severing of the Central Paci1-.
The speaker said that both roads had "a
common terminus at Portland and th8
they are competitors in transeoutnen-
tai traffic The affidavit of Traffic
Manager Stubs was read that it On"
ni0n Pacific wished % ci-ert business
from the Southern Pacific it could De
done by changing the tariffs.
Senator Foraker said 300 better proof
of their being competitive lines could
De given and that by "a cnange of rates
business could be diverted 90 the Ju On
Pacific
III they are competing lines, said .
Senator Foraker. what are the rights
OF bona dde majority stockholders This
suit was brought 20 ascertain the !
rights Of stockholders. and complain /
ants argue and insist that the corpora I.
ton should have "a board of directors .
free from the touch or influence of cay D
other Ilne and who would be devoted f.
% the interests OF the Southern Prcihc I.
company
Contract Illegal
While this injunction was seeking Oh (
prevent the execution OF contract (
said Senator Foraker the compliments F.
contend that this contract. is Illegal. /
There was no redress of the wrong .
done by one corporation 20 another un-
less the act complained of was Illegal, /
and there would have been no iliegalty /
iu this contract had it been entered INTO J
between the directors of both compa- .
MES acting solely for the public inter .
ests they represented.
Senator Foraker insisted that The .
contract was illegal for the reason that F.
il was Con contrayentiou of public policy .
and against such action. The state
meut that the Southern Pacific was be-
ing improved for the benefit OF stock
holders was no answer and mat the I.
defendants were doing wrong honestly
was no defense.
The law. said Senator Foraker will T
not tolerate repuEnanJ trustee5hip. The
courts iu all such matters have taken
the position that stockholders have
right 90 have the property managed for
their interests. The speaker said that
while there were allegations i'm the bin
which had not been supported by evil
dence that they were not reck.essly and
idly made.
The defendants had said they had no
intention of seyeriug the Central from
the Southern Pacific. yet they had spent
SEQ 900. 900 I'm improving 30. They wanted
"a thorough transcOntinental line from
Chicago 90 san Francisco. Certain lm-
provements had been made but not one
word had been said in court concern
ing them. The earnings of Che south
ern Pacific. over and above operating
expenses and fixed charges were being
spent on Improvements and these sums
amounted 90 many millions.
Cut-oF Question.
one could not help thinking that If
the Union Pacific had no Idea now Of
acquiring the Central Pacific the time
would come when they would think of
st. and this would be- where they had
made the road more valuable. and
should they decide 90 sever 10 from the
Southern Pacific it could be done Ia five
minutes by "a resolution adopted az a
meeting of the directors.
The cut-od in Salt Lake. said Senator
Foraker. would cost Sl3000.000. and yet
the defendants came into court without
saving "a word about 10 or the great
tunnel through the Sierras. He spoke
of the recent fall of "a section OF the
cut-0n into the lake 90 show the i'm
practlcabuity of the scheme
Senator Foraker said that Do was not
necessary for the complainants 90 show
that the defendants were doing wrong,
but to show that they might do lt IN
changing tariff rates that would work
a detr.meut to the stockholders OF the
Southern Pacific.
Senator Foraker in closing, said the
important question was restraining the
Union Pacific from voting the Southern
Pacific stock 8t The annual meeting Ho
c0nteuded that tho two roads were
competitors and that the tendency was
toward Capitalization and monopoly.
Huge Deficit
Senator Foraker read AN affidavit /
from Kenneth g. White showing
u tement of the operations OF tho
Southern Pacific from June so. 1902. 90
January. 1903. The gross earnings for
that period were S52,9S5,55l, and net
earnings sl2.5l5e2S. leaving deficit for
the period of S40246S9S. The mon;h of
January Increased the deficit SL11301O
Senator Foraker stated that in the face
of a showing like this. counsel for de-
fondants cOutended that C0mpalnants
had no right tO complain. If the Union
Pacific wanted tO build tunnels. cute
offs and the like. they should issue Sc
curities and not put the burden OF debt
un0n The present stockholders. The
Union Pacific takes these earnings of
the Southern Pacific 10 make its Inn