The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1907-03-01

jected TO Mr. Kellogg assuming that SO
600 of the amount represented loss TO
an old set of stockholders through fore
closure. 1t developed that neither wit
foreclosure, so Mr. Kellogg amended his
question to include improvements or
losses or both"
The witness said that the sl2.o0dOo0 In
question had previously been paid and the
accounts were written off He did not
know If other railroads ever added TO
their capital in that way.
Mr.. Kellogg then asked series of ques-
lions tending to show that certain enter
prises also had been capitalized by the.
Alton. but the witness did not admit this
Certain construction expenses had been
So charged he said Mr. Kellogg elicite,j
bonds had been so charged that while
the books disclosed it. the annual report
would tend to confuse the public IN re-
gard to this item.
In answer to questions from Commits
sioner Lane, the witness questioned the
right of the directors of the Alton in 60
ing back over their books for a period
of many years and capitaliZing the eXpen-
GituTes- He said that each succeeding
board of directors had each year passed
upon the accounts and he thought that
such acts should have been final
Bonds Handed Over.
The witness repeated his testimony Of
last evening as to the transfer of the Al
ton from the railroad company to the
Hallway company through Louis Stanton.
and said that il was evident from the
books that the syndicate had simply
handed over the S22,G00.000 in bonds and
had received the preferred stock and the
st. Louis Peoria & Northern property.
Mr.. Lane asked him how much the Har-
riman interests had paid for the Chicago
x Alton and how much they got out Of
the transaction.
Mr. Hillard was unable to state the
o
As Mr.. Lane continued to press for some
on this point, Mr.. Kellogg
remarked:
Nobody knows"
"Oh. yes rejoined Mr.. Stevensononu
oh yes" rejoined Mr. Severance We
can figure that out. IL will show they
did not lose any
Mr.. Cravath again drew attention to tho
statement of the witness last evening
about the mortgage of the cutoff from
to Springfield before 1t was
built and said that the transaction had
been perfectly proper from both legal
and a moral standpoint
Wanted to Trace the Money.
Commissioner Lane said he had under
stood that but he wanted to know what
had become of the money.
Mr.. Severance said that railroads often
did similar things, out the money had
usually been kept TO build the road.
Counsel Lovett and Mr. CraVath cross
xamined Mr.. Hillard briefly, but he
his position firmly, particular
~ as to the propriety of capitalizing the
Did expenditures upon the Alton.
Mr.. Mahl. controller OF the Hartman
lines. was then recalled and identified
number of exhibits.
Mr. Mahl explained that the resolution
Of the board of directors of the Union
Pacific authorizing Mr.. Hartman to Dor
row money in the name of the corpora
ton was a purely formal matter. It was
done to meet a requirement of certain
California bankers. Mr.. Lovett showed
Dy the witness that the late &. p. Hunt
ngton had like authority from the South
srn Pacific board and that it was a COM
mon business practice.
During the discussion between Mr.. Low
TT and Mr. Hillard Mr.. Harlan read an
extract from the constitution OF Illinois
which prohibited the payment of stock
dividends from the sale of securities
raising the point that he Atoms 20 per
,ent dividend probably was Illegal
Mr. Severance informed The commission
hat counsel for the government had NJ
more witnesses at this time and would
isk for an adjournment without date.
Chairman Knapp then announced that
he hearing was postponed TO a date to be
liked, and adjournment was taken.