New-York tribune., 1907-09-20

did not include rentals on the Third avenue line
and the Metropolitan Street Railway Company
amounting in all to S4.6CO,OOO, thus leaving
deficit of 1924, 600 for the year.
The statement showed funded debt Of Sll1-
26S,0oo. Mr.. WINS asked for an explanation OF
that. because according to the report TO the
stockholders on June 80, 1906. he said, the
funded debt appeared to have been S10S.S9i'Vo
showing a discrepancy of several millions.
Il presume that is the bonds of lines the
stock of which is owned" explained MT Crs-
vath. Mr.. Root admitted that 1t had not heeh
the custom of the company to carry Oh It's ac-
counts liability the state franchise TAX
when reporting to the State Railroad ComInls-
sion, that the company had calculated on not
paying that tax.
DEFICIT OF S10.OOo.ooo.
Il call the attention of the commission said
Mr. Ivins. "to the fact that this deficit or WV
GOO 600 does. as A matter of fact, include in the
item of construction and equipment. leases and
franchises. a very large item of discount that
this does not carry as Hability-among the
liabilities here appearing there is no apparent
liability to correspond with the one set out In
this simplihed statement. showing taxes OF
81. 500 COO and also that among the liabilities
there is no entry here or as far We can find
in their books of their obligation as practically
very large amount Of outstanding Indebtedness
of sub companies
Il think you will find that the New York
City Railway Company did not. by the terms
of the lease. guarantee the principal said Mr.
Cravath You are reading the balance sheet
Of the New York City Railway Company. and
of course il is not the principal obligeor on the
bond issue of the Metropolitan Street Railway.
1t is only the interest
Then the total obligation should appear on
the books of the Metropolitan Street Railway"
asked Mr.. WINS.
Yes and that is where 1t appears" replied
the railways counsel. "Of course, the guar
antee would not appear the books of the
Metropolitan Street Railway, but where it as
sumes the principal obligation. il should as I
understand IT,"
WORKING ON a NEW FENDER.
The fender now used had been found iInprac-
ticable for New York conditions, said Mr.. Root
and the company perfecting another, which
he thought would be far superior to the old type
He intended going before the commission and
asking its permission to equip its cars with the
new type Of fender at the proper moment.
. Mr.. Moorehead who had come to the hearing
in the mean time, then took the stand He teS-
titled that he had turned over all the cancelled
checks he could find to the commissions ac-
countants: that with the records of the Metro
politan Street Railway Company prior TO 1902
he had had destroyed records of some of the old
companies that had come into the system years
ago. He said that the reports sent to the State
Railway Commission always corresponded with
those made annually TO the stockholders. In
regard to the destruction of the books, he said
he had not talked with Mr.. Whitney, Mr.. Do
Ian Mr. Widener Mr Vreeland of Mr.. Cravath.
ha n memoranda of the and
documents he had destroyed. A journal from
July l. 1902. was the only record OF the Met
ropolitan Street Railway Company prior 10 1902
that Mr.. Moorehead said he thought still
in existence. A good many Of the checks and
stubs for the period ended in 1902 were still in
existence. he thought and he admitted that pos
sibly from these the destroyed books might be
reconstructed.
Mr.. WINS then referred 10 the checks made
payable TO Quigg.
o.-why were they charged 10 The construction
account? 81 presume he WAS employed on CON
Q.what kind of Gonstructi,9n ion work is Mr.. Quisg
DO you mean 10 say you think the check
which he did, Al do.
Mr. Moorehead said that he had carried the
check TO that account because he had been In
formed it should go there. He did not recolIect
who gave him that information, but said he had
got a receipt for the check He could give
more definite information about the other
checks made payable to Mr.. Quigg.
Mr.. WINS asked him TO make a careful search
for the checks and vouchers representing the
$65,Oo0. as he particularly Interested in
having them. The hearing was then adjourned
until this afternoon, when Mr.. Root will be
called.