New-York tribune., 1908-03-14
D. & II. INQUIRY ASKED.
Charges Filed seith Public SerUice
Board Later Uithdra5cn.
lBy Telegraph so TIE Tribune. J

albany March l3-Charges waste of stock
,oders' funds. payment OF excessive dividends
while virtually facing bankruptcy. conspiracy 10
prevent competition in passenger and freight raf-
., ,r central and northern New York State. vio-
la,ioa Of the Hepburn act and numerous coIiat-
<-al customs Of the high finance variety are
,,ase against the Delaware & Hudson Railroad IN
8 petition for investigation filed to-day with
she Public Service Commission OF the "a District
Purchase OF the United Traction Company OF
.4bauy and Troy from Anthony ~ Brady and as
aeaies at $50 while the stock never had been con-
6ered worth par by lis small holders in this re-
rion the issuance Of S.eeo.e0 common stock by
that ooTnpany-practically water-which was bought
N ~ par BY the Delaware & Hudson, which there
,pon compelled the traction company 10 use the
1lroceeas 70 acquire . controlling interest IN the
1gn6son River Valley Railroad Company, a trac-
;ion concern paralleli2g me Delaware d Hudson
north from Troy. and TIE payment OF per cent
dividends while the finances of the company were
badly involved are instances cited by TIE peuuoh-
ers 10 Justify investigation.
The petition was fled about a to-day by
Henry NJ Ward. of Ward. Mellen & Woodbridge.
O. New York acting fC- Hynlans z Zoon, bank
s-s of Amsterdam Holland, and John T keegan,
or Milwaukee. The Dutch concern and keegan,
ine petition cites. both holders OF convertible
oebeuiure bonds issued by the Delaware Hud-
ron n January 1876. and file the petition as stock
holders AT $50 O'Clock a formal notice OF with
drawal Of the petition filed with the conI''is
sicn. Much speculation as 10 the reason for this
sc:icn Is rife here.
one reason fo- the impairment of the stock and
outstanding securities OF the railroad company
given by the petition the payment OF s'''HE'-
(5l for the purchase Of the entire capital stock
s5ea0 a00-ot the United Traction Company TINS
road is consolidation Of several small companies
with lines IL this city and Troy and line connect
ing the two cities, and would be coInpeltoE OF
the Delaware Hudson
After this property had been acquired the Peti-
ton oes or the directors. in December, 1906, de-
cls-ed q dividend for 1877 al the rate OF Per cent
r,avapIe quarterly whereas the dividend in other
wears had been at the rate of 10 per cent THIS
per cent rate actually was paid Yet on Decen-
Der g. ieo-. while this high dividend was being
rsid the petition says the roads total liabilities
exceeded SCI orc al0. and there were, in adoition
vouchers and accounts payable for nearly SleneI'.
one item designated as sinking fund-S4oo,ef(-had
70 be carried as liability where in former years II
had been an asset OF upward OF sS,efe The cash on
land vas about s2oo0c,1 while the floating debt OF
SO aoace9 was in substance ana effect all payable
On demand" The road at that time was contem-
Mating borrowing s6ce0en0 tide it over until a
r-oposed loan OF S2aaaolso. be secured by gen
c-al mortgage. could be effected Again. with af-
-ars II this condition The petition continues, the
directors met and declared q per cent dividend
ro- 1aS amounting 70 more than s3.e3"eo0-
when the Delaware & Hudson got possession ~
fre United Traction Company the petition alleges,
= elected chosen directors and caused an issue
~ & 90 600 additional common stock purchased that
stock Al mar and caused the proceeds 70 be used
n hL,v controlling interest in the Hudson Valley
77s57-oss COMPANY. The petition says that this
ad and all its lines had been built il the cheapest
sf-1e manner from inferior stock; that its road
- and rolling stock We're IN eXecTable condition,
- -ra- f. was not even earning its fixed charges
= ,~zre-trg expenses- Il actually had been Of
esres to the Delaware & Hudson for 100000 Just