Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1907-01-09
Arguments He; I'd in Suit to
Prevent S6O,OoO,OO0 Issue
of New Stock
OLD CHARTER is BROUGHT UP
Great Northern's Right Based on Ter
ritoriaI Grant and an Old Ruling -
Attorney General Doubts Statements
on Which Arguments Are Based -
General News.

ST. Paul, Mlnn., Jan. ~ lie LedliHS
of Mnnesota's suit to prevent the
Great Northern railroad from issuing
s6O,oOO,OOO worth of new stock began
before Judge Hallam in the district
court. The entire day was given over
| to the reading of the railroads answer
and arguments by attorneys on both
sides.
| The state is suing because the rail-
road failed to notify the railroad and
warehouse commission of the proposed
issue, as the state law provides. 1t is
contended, also, that the stock issue
will result in greatly increased freight
and passenger rates. Shippers, it is
argued, therefore, will have to pay for
the stock increase.
Chief interest conferred in the Great
Northern's answers. The railroad bases
its right to issue the new stock on the
charter of the Minneapolis & st. Cloud
railroad, granted by the territory Of
Minnesota in 1856, and on amendments
passed in 1865, in which the Minneap-
oils & st. Cloud railway was given the
right to issue one or more classes OF
preferred stock in an amount not to
exceed s30,000,00O.
The answer declares that all out
standing stock is preferred stock and
that none of its common stock has
been issued 1t further asserts that all
of the $60,000,O00 worth of stock will
be preferred stock, and none of it COM
mon stock.
After reciting that the road has is
sued $150,000,000 in preferred stock UNI
der the charter above cited, the answer
says that in 1898 the railroad commits
sion was advised that the railroad pro-
posed to increase it's capital stock and
! that the question was submitted to At
torney General Childs, who advised the
commission that the railroad had the
right to increase its capital stock
without the consent of the commits
sion. Thereupon two issues of s25, O0O,-
600 were made. The answer says these
issues were made "openly and notori-
ously," with the full knowledge of the
attorney general and, without the con-
sent of the commission, and that. no
protest was made until this day.
The purposes Of the proposed issue
are set forth as being to increase ter
minal facilities, and equipment, pro-
vide second main track, and pur-
chase bonds and stocks of number
of western connections.
Attorney General Young, in opening,
said that the right of the commission
to give authority for stock issues was
the only safeguard of the people. He
declared that absolutely nothing had
| been heard of what had been done with
the proceeds of the $25, 100000 issue a
year ago.
He said it did not lie in the mouth of
the attorney for the railroad to say
| that because the law had been violated
in one instance it might be disregarded
| in another.
He did not believe Attorney General
| Childs had given the commission such
an opinion as was said to have been
given. The records of the attorney
generals office did not reveal that
such an opinion had been given. If it
had such an opinion would not be
| binding and the railroad was playing
1.-THE baby act"
| Attorney Begg, for the Great Nor
thern said the road had no wish to
| violate any law. But he argued the
commission was an arbitrary authors
| ty, subject to no review, and the law
was unconstitutional, as it is tres
pass on the legislative department of
| the state government.