The Montgomery advertiser., 1907-01-26
FORFEIT CHARTER
PR0CEDUXNGg ARE INSTITUTED
 AGAINST rHE MANITOBA RAILROAD.
jAttoruey GeneraI of Minnesota De- clarea Company Is Merely . Blfnd for the Great North
 ern CGmpany's Purposes.

General Young today began manda- mus. proceedings in the Supreme Court to compel the St Paul. Minneapolis and Manitoba Railroad Company to show cause why its charter should not be forfeited.
 This company formerly known as the Minnesota and PacihcA Company Is really the parent company of the | Great Northern Railway Company and the Great Northern Is joined in this
 issue as 1t is the. owner of the Mani toba Company's stocks. Attorney General Young has given the Associa- l ted Press a digest of the claims set up in the bill filed in the Supreme Court. The complaint goes into all the transactions of the Great North ern Company with its constituent | companies, forming the merger" known as the Great Northern Railway | Company.
 Attorney General Young says: We have commenced an action in the name of the State against the St. Paul. Minneapolis aid Manitoba Railway Company to forfeit its char ter. for the reason that ever since 1t transferred It's railroad with all its equipment to the Great Northern Rail- way Company on Febuary 1, 1890, 1t has ceased to perform the functions for which 1t was created and has therefore forfeitetd its right to exist under our laws as railway company. s'fWe have joined the Great North ern Railway Company as party to this action, because 1t is the owner of all the stock of the Manitoba Com
 pany andsfor the further reason that in the alleged purchase. of the prop erty and the assets of the Manitoba Company by the Great Northern Com pany, very large amount of water stock was issued by the latter com pany which we claim is void under the law of this State on which the public are now, and ever. since It's issuance ask that this stock be declared void and the payment of further dividends thereon be prohibited.
 we have proceeded withdeliberation in this matter. on account of the mag nitude of the interests involved. It will assist in understanding the trans actions between the Manitoba Compa- ny and the. Great Northern Company to know that the Great Northern Company was created by the stock holders of the Manitoba Company and at the time of the transfers of the property, the stockholders in both companies were identical. It seems that the Great Northern Company was created solely for the purpose of mak-
 
 Great Northern at a price in excess of their value. It is easy to see why, under these circumstances, the Great Northern Company should pay pre- mium of five million dollars on the purchase of the stock of the Manitoba Company.
 "The public are doubtless aware
 that when the gross earnings tax on railroads was raised from three to four per cent. in 1905. the Great North ern Company refused to pay the in- creased rate on that portion of its road in this State which was original ly constructed by the Minnesota and Pacific Company. The latter company had a charter from the territory in which 1t was provided that the com pany never should be called on to pay more than three per cent. on it's gross earnings. The company became bank rupt and in 1879 the Manitoba Com paEy purchased its road and franchis- es. with the approval of the Legis- lature, and ever since the purchase
 the Manitoba Company has claimed
 that it acquired, by the purchase, the same immunity from any raise in its rate of taxation that the Minnesota and Pacific had.
 Last March when the taxes for 1905 became due on this road, the Great Northern, which operates the road un- der an alleged lease from the Manfto- ba Company, paid only per cent and soon afterwards the State commenced an action against it for $120.0o0. being the unpaid per cent of its taxes un- der the new law. In that suit the claim to immunity from any increase above per cent in Is taxes, Is claimed un- der the charter of the Manitoba Com pa1y by virtue of the rights 1t claims to have acquired at the purchase of the road in 1879.
 "The suit is not yet disposed of. and 1t will probably take many years to get 1t through all the courts. The railroad taxes for the year 1906 will be due in few days, and there will be an additional amount greater than that above mentioned in dispute for that year.
 we are convinced that the Manito- ba Company Is no longer entitled to exist as a railway and that the speed lest way to dispose of its claim to ex- emption from the rate of taxes paid by other railway companies Is to have Its charter wiped out, in which event the Great Northern would be obliged to pay taxes at per cent, the same as other companies.
 We are also of the opinion that the Great Northern should not be allowed to pay dividends on watered stock heretofore issued, and that 1t should amount of stock which, according to the records accessible to the public appears to be fictitious, has any right