The Washington herald., 1907-10-08

New York. Oct. John 3. Mcdonald
recited before the public service commits
sion to-day the inside history Of his flop
in the early part of 1905 from the Bel
mont to the Metropolitan Street Railway
interests. Mr. Mcdonald said that ne had
had a Misunderstanding with Mr.. Bel
mont, both in regard to plans for future
work and In regard to financial matters
and that he had gene over TO the other
side under assurances that the Metro
politan Street Railway Company would
build new subways II the contract was
awarded to them.
Mr.. Mcdonald went ahead upon these
assurances and entered into obligations.
one day, when he was in the midst Of his
plans he awoke to the fact that the
METROPOLITAN and the marlborough COM
panies had merged. Mr.. Mcdonald de-
clared that he knew absolutely nothing
about the merger until he saw the an
nouncement on the bulletin boards
Pays Him $4,000 a Year.
He protested. and the Metropolitan
Securities Company paid him $4,000 for
release from its contract obligations Ia
connection with the proposed extension OF
the subway system. and 100000 for
further release from obligations in con-
nection with the Mcdonald project Of
building two tunnels under the North
! River
Besides this. the Interborough-Metro-
poIItan Company entered into f1ve-year
contract with Mr. Mcdonald, agreeing to
pay him $4,000 a year for the privilege OF
calling upon him in the future. Thus far
Mr.. Mcdonald has been drawing his sal
airy and waiting for call.
! Mr.. WINS pointed out that nothwith-
standing the fact that the entire scheme
of subway and tunnel construction has
been abandoned. the entire $4,000 paid
ont by the Metropolitan company is be-
! ing carried IN its books TO the property
and franchise account" thus constituting
an asset
But what interested the commission
chiefly was the fact that the Metropoli-
itan Securities Company, under It's con-
4 tracts with Mr.. Mcdonald, was appar-
entity not obligated 90 bear any Of the
EXPENSE Of constructing the new subway
/ system.
/ So far as the contracts submitted to-
day show the Metropolitan company
agreed only 10 establish a system Of
transfers with the subway lines.
Entered Into Agreement.
The financing Of the subway enterprise
was undertaken by a syndicate Of indi-
viduals who entered into a hard and fast
AGREEMENT with Mr.. Mcdonald to fur
nish funds Yet papers introduced In evi-
dence to-day showed that the Metropoli-
/ tan. when It paid Mr.. Mcdonald Sl50.00o
understood that II was 10 be used 10 de-
/ fray such expenses as he had incurred
prior 10 January /. 1901" Mr.. Mcdonald
| IN return for the money which was paid
TO him, renowned all claim upon the
company relative TO the transfer agree
ment Whether the syndicate Of finan-
/ ciers who were behind the subway enter
prise paid any part OF the expenses was
not brought out to-day
/ Mr. Mcdonald obtained his $4,000 from
the Metropolitan In settlement Of the
subway matter soon after the merger
/ was announced. The 500 COO, which
closed I'D the tunnel enterprise. was paid
| on January 81 Of the present year. A
survey Of the river was about as far as
| the project got.
Although ne is vice president OF the In
terborOugh- Metropolitan Company, Mr.
| Mcdonald said he was drawing no salary
for his services. The contract which he
has with the Electromagnetic metropolitan
provides for the performance by him OF
/ future work Mr.. Mcdonald admitted
that he was paid anyway, whether he
did any work or not, but he would rather
work Since he had entered into the
contract, he said, the whole matter OF
subway construction had been in abey-
auCe.
ShafTer. 18th and l, Executes Floral
] ,F r,ripac