Los Angeles herald., 1907-07-14
QUOTES COURT DECISION
IN DEFENSE
CORPORATIONS SAY THEY MAY
GO ELSEWHERE
Method Of Fixing Value of Franchise
In Question Is Clearly Shown
by the Man Who
Did II

IT won't say that the supreme court will
decide against the franchise assessments
rs they now stand, but / do state most
alphabetically that IT is my humble opinion
that such exorbitant taxes will not stand
in court and I promise YOU gentlemen,
that unless they are materially reduced
there will be suits filed, and In very few
days, too"
With this parting shot, Attorney Walter
]. Trasik chief counsel for the Huntington
interests in Los Angeles, took leave of the
equalization board yesterday at noon.
The corporation attorney was smarting
under the effect of a clever defense of the
assessments made by Ben Ward, in which
the latter had sprung a surprise in the
shape of an excerpt from the proceedings
of the interstate commerce commission.
whereby it was shown that % per cent OF
the stock of the Los Angeles Railway
company had been sold to the Southern
Pacific interests for S4,5OO000.
Ward Produces Evidence
After submitting to bitter arraignment
at the hands of Trask, Assessor Ward
produced as evidence the minutes of the
New York hearing when both the Union
and Southern Pacific railroads were under
investigation, and as Ward stated, ne
.'produced the record to show that he
KNOW WHdl ne was tdhlHS cDOut
After the session adjourned it was gem
orally conceded that Ward had decidedly
the best of the argument, despite the elo-
quent plea and strident tones of Trask.
Corporations May Move
Attorney Trasl< had intimated that all
of the big corporations would move their
headquarters to another county or another
state il the present assessments on their
franchises prevailed
He objected to the assessment of $4,000
900 on the franchise of the Los Angeles
Railway company, and insisted that it was
not worth more than s., just what 1t cost
to get it, After begging of the board to
fully consider the condition into which
they would drive the city and county If
they supported the figures of the assessor,
he added that he would leave the matter
in their hands.
Assessor Ward had been standing just
back of Trask during the latter's TRADE,
and when it was finished he came forward
with few deliberate steps, his gaze fixed
on spot in the ceiling
They Won't Move, Says Ward
.All of this talk of Brother Trask of
the tax ridden corporations leaving home
to escape their just dues is all tommyrot,
he began. THAT is if 1 may be allowed
the expression" he continued, and the
crowd laughed.
what good would it do them to leave
Los Angeles? They would be taxed wher-
ever they went, and even If they did move
their offices from the city do you mean to
tell me, Mr.. Trask, that all of the stock
holders would move, too?
"No, of course they wouldn't" said
Ward in answer to his own question, as
Trask ventured no reply.
''And if they remained here we would
assess their stock. Wen sure get them,
either goin' or comm" he chuckled in a
happy tone.
Huntington Not a Resident
Mr.. Huntington is not a resident of
Los Angeles" interrupted Trask THE
supreme court of New York state has de-
cided that he lives at Oneonta, N. Y, and
his stock in this company is not subject
to assessment here unless you want to
repeat some more of your double taxa
ton"
WELL" Ward began again, with all
respect to Mr.. Huntington L am glad to
find out where he lives, but 1t was flung
at me in the last campaign that he ex-
pected to have to pay his taxes here"
Here Trask took advantage of Wards
stopping to get paper to repeat again the
enormity of the offense of taxing fran
chises, but desisted when he saw that the
assessor was ready to proceed.
Now, for the benefit of Brother Trask
and his down-trodden franchise taxed
friends, and without either being called to
the witness stand or waiting for cross-ex-
animation, am going to state the author
ity for my basis of valuation of the
stock"
Basis of Valuation
He then proceeded to read from the ex-
cerpt that $4,500,000 was the very least that
Harriman's block of stock in the Los An
geles Railway company could be bought
for, and that the purchase was ratified
and Endorsed by the directors of the
Union-Southern Pacific companies.
Now. gentlemen figured that If As per
cent was worth that much the balance
that could not be bought, was fully as
valuable; therefore l considered the COM
pany's securities worth S10,5O0,000, took 50
per cent of that sum, subtracted the
value of the tangible property and found
the franchise worth just what it is as
sessed for.
IF it isn't worth that how else can you
account for the great margin between the
value of the tangible property and the
market value of the stock?"
THAT doesn't represent the value of the
it, answered Trask. IT remember that
sale, 1t was published in the papers at
the time
What Supreme Court Says
''Well. the supreme court has decided
that the value of a company's stock is the
- g. a