Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1907-02-28

QUESTION TO BE TAKEN
INTO FEDERAL COURT
Objections of Unwilling Witness
8eS 0veuuIed by Commits
sionerS Who Resolve to Test
Right to Require Answers,
IBy Morning Journal Special Leased Wire

IH, Morning Journal Special Leased Wire. /
Ncu york, Feb. 21.-Counsel for
the government renewed their att
tlck on the financial methods Of the
Hartman group in the Chicago and
Alton railroad before the interstate
commission his afternoon
when they called Charles w. billiard
controller Of the road, as a witness.
billiard testified hat he became
coutIollcr in October last, when under
the joint arrangement for The nan
upcmcnt Of the property, the Rock
island took its turn. billiard said
his FIRST task was to find money 10
curry on the improvements under way
There was money in the treasury fpi
The current expenses. but not enough
to carry on the improvements. which
included z cutoff of 3iH miles OF
road from a point near Murrayville
tu Springfield. There was not enough
money TO complete the building Of this
line, said the witness. ! looked into
the question Of raising money by
mortgage" he continued. "and ! dis
c'"ered f"1t it had already been
mortgaged."
DO understand ghat this road had
been %mortgaged before it was built
asked Commissioner Lane.
Yes. / was told that it was covered
by the mortgage of 1900. and there
was ndthing that could be done except
To- pint a second mortgage on Il, which
would have been poor security" said
Hiltiard.
Mr. kellogg then read the mort
gage to show the lire had been COW
erred by it. and the witness said.
"All the bonds were gone. ! found
Fray, tho h,1LE that tha thfpIgpp mil
lion dollars had never been oaid Ia
stanton for the stock; thai the three
million dolllrs had never been paid to
stanton for the road, but that the
fWcnty-tWo hiffien dollars in BOMBS
had been turned Ove to the syndl-
c8tc who delivered the stock and the
road though the intermediary. Mr..
Stanton
The commission wanted to Know
what the books showed had been oc-
tually expended in connection with the
handling of the property, but while
The witness was searching for the
records the session was adjourned
uutiI tomorrow. Mr.. billiard will be
recalled tomorrow morning.
+. II. Hartman concluded his tcS-
timouN al the morning session, and
his examination brought forth nothing
of special Importance. He was sue
cecded on the stand by Otto H. Kahn,
one of the leading members of the
firm of Kuhn. Loeb & Co., which has
financed many of the important deals
of the Hartman party. and a former
director of the Union Pacific. Kahn
remained on the stand until MD
afternoon. and under examination OF
g 4. Severance. Of counsel for the
government, told of the reorganiza-
ton of the Union Pacific. There was
q special inquiry as To the commis-
sions paid to Kuhn. Loeb & CO.. and
1.-The inter-relatiOns of the firm, the
witness and Jacob Scniff, with the
Union Pacific. The witness said the
firm had received a commission equal
to- per cent on the purchase ot
southern Pacific. a commission OF
pre- cent dividend with other under
writer's on the issue OF Union Pacific
controVortible bonds at a reduction OF
3 per cent. The witness spiritedIy
defended the acts Of his firm. ana
cited instances where It a s"Iu
stocks to the Union Pacific AT a ilg-
ure below the current market. Mr.
Kahn made an extended defense OF
the Alton transaction. based on iut
methods and conditions of the time.
Mr.. Hartman. during his testimony
again invoked the question OF pilNat'
business against interstate commerce
and refused 10 answer n|terf'EatI"HS
H- 80 his individual stock deals ana
AIR. Kahn refused to dtvulge any
thing specific as to the business
transactions undertaken by his firm i'm
behalf of clients or outside of inc
Union Pacific directorate. He ana
his counsel. Paul p. Cravath. urged
the same objection made by ATTORNEY
G.. MiIburn in behalf of Mr.. Hartman
and added the special plea "i lu'