New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-04-12
SUBWAY CONTRACT LEGAL
Justice BIackmar Hands Down
Decision in Supreme Court.
WAITED FOR WAGNER LAW
General Opinion Is That Decision
Was Held Up Pending Gov
errors Signing Bill.

The CITY won the first step in the process
NJ securing a judicial determination OF inc
legality and constitutionaIty of It's pro-
posAd contracts for the construction OF
new and extension subway lines by n de-
cisjon handed down yesterday by Justice
RIsckmar. OF the Supreme Court, Brook
Ign.
Tho much criticised preferential pay
ments. so-called, which assured the operat-
ing companies returns upon their invest
naents-providing any money should De
earned by the proposed lines-the decision
points out, is not a guarantee, Tor IN no
contingency Is the city's credit pledged tor
this sum or any part of it." As TO the
violation of the constitution through the
lending Of money or credit or in aid of
corporation, the decision says: The city
does not give its property. 1t leases IT,
There is no expressed prohibition in
the constitution against mingling public
and private property, or against partner
chip"
The arguments before Justice Blackmar
were heard on March Z, and Z, and the
lawyers handed in their briefs on March
IL. II is the opinion of those acquainted
with the situation that tina justice pur-
poselY withheld his decision until after the
Wagner law had been signed by the Gov
ernor, modifying the rapid transit act in A
manner that made the legality of the pro-
posed contracts clearer. The opinion is
based on the statement of the decision.
which reads:
This action is to enjoin future acts of
public officials and must be determined un-
der the law as It exists at the time the
decision is rendered and not at the time
h. a.NfsN NJ a
sid of counsels' argument in examining the
amendments to the law, but 1t seems TO me
that they are broad enough TO cover those
elements of the proposed contracts claimed
10 be illegal. IF the proposed contract is
authorized by the statute It Is legal unless
the statute Is unconstitutional. AS
the last act was passed for the purpose of
authorizing the proposed contracts ] as,
sunne that the contracts when drawn VIII
square with the act The only powSr that
operate a subway is that granted II by
statute An examination Of the bill which
recently became a law shows that pooling
Of the receipts of the subways with those
of the railroads operated by the lessees Is
authorized, and so are the so-called prefer
entail payments theretrom TO the lessees
The only question left IS whether they vio-
late the constitution. hold that they do
not, and therefore direct judgment for the
defendant.
In the decision the justice confines his at
tention 10 the proposed contract between
the city and the Interborough as typical
After showing that the city does not pro-
pose 10 give, but to lease, its property, q
fight not curtailed by any constitutional
provision. the decision takes UP the intent
Of those who drew UP the constitution. it
reads:
At that time all railroads were built and
operated by private corporations IN the In
tsrests of their stockholders The city's pur-
nose in securing municipal road is not 10
make money. Profit may arise incidentally,
hut the citys purpose IS TO promote tho
Welfare and convenience of the citizens.
Herein lies the difference between private
railroad company and municipal cor
poration. The city is justified in insisting
,lpon f1ve-cent fare over the whole sys-
tenn although that may tend to make the
operation improbable.