Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-04-24

regarding the propriety of his road en-
tering Hsto the contract with the
| Hampton Railroad.
The Noronoco Construction Co. sub
let the work of construction to sew
eral ether contractors. the witness
said, and had nothing to do with the
work as the Boston e. Maine was fur
nishing rails and equipment for the
now line
Mr. Brandeis questioned the witness
regarding the identity Of President Gill
lett of the Hampden Railroad and the
Wcronoco Construction Co. Mr.
Hobbs said that he had no direct
knowledge concerning the matter, but
he stated that he had heard that Mr..
Gillett had been doing some work for
the New Haven in connection with the
New Ravens acquisition of trolley
properties in western Massachusetts.
Mr.. Hobbs could not recall where the
money that financed the Hampden
Railroad came from. He thought some
Of it came from Boston banks. He
had not heard that the New Haven
Railroad. through any of its subsidi-
aries had guaranteed the payment of
81, 100000 to the sHampden Railroad
corporation. This" said Mr.. Bran
deis, is a matter that involves more
than s20n,Oe0 year; isn't it "A matter
for the consideration of the financial
vice president of the Boston & Maine?'
The directors probably passed up
on it, was Mr.. Hobbs reply.
The acquisition by the Boston &
Maine of stock of several of its leased
| lines. including Worcester. Nashua &
Rochester, the Boston & Lowell and
the Concord 81 Montreal at Il cost of
s5.9l2, 496, was then taken up. More
than 10000 shares of the Worcester,
Nashua s-&s--Rochester Railroad were
purchased, from the Mutual Life In
surance Co.tof New York at s160 a
share. Mr.. Hobbs said this stock was
paving the life insurance company
1914 per cent. on it's investment. 9th
er stock of the same road which was
paying its holders 1888 per cent. was
purchased by the Boston & Maine for
$3.50 share.
Mr. Hobbs stoutly maintained that
the purchase of this stock. which was
obtained after the New Haven inter
ests got control of the Boston &
Maine was a good business PROPOSE
ton.
Mr.. Hobbs had previously testified
that the road was unable to purchase
additional freight cars because of lack
of available funds. t,f4l,as
Mr.. Brandsis referred to this state
ment How does it happen the at
torney asked. that YOU spent for these
stocks nearly $1,000, 900, when yon need
ed the money SO much !, for freight
cars2 You had money when you
bought this stock; where did you get
| it?" ION short term notes"
| Was not that improvdent, to buy
something you did not need when You
did SO sorely need other things" u
think the purchase of the Worcester.
Nashua q Rochester was wise
move"
Isn't this case where you can't
have your cake and eat it too?" We've
got the cake replied Mr.. Hobbs
Yes" flashed back Mr. Brandeis,
you've got your cake, but you haven't
any bread"
At this point Edgar ]. Rich, chief
counsel for the Boston & Maine
charged that it was Mr.. Brandeis OBJ
vious intention to create wrong inn
preston" and to offset any misnter-
probation of the company's finances h.
questioned Mr.. Hobbs regarding the
Boston & Names finances at the time
| the stock of the leased lines was pur-
chased. Mr. Hobbs then quoted from
the roads reports to show that at the
time a dividend of per cent had
been earned, certain fixed charges hail
been paid and there was balance OF
$7S3.000 remaining from the years op.
erations.
| THAT was before Mr.. Mellen became
PRESIDENT commented Mr.. Brandeis
1T was before increased wages add
ed $2.500,000 to our annual expenses "
retorted Mr.. Rich.
/ Commissioner Prouty then adjourn
ed the hearing until tomorrow fore
noon.
Earlier in the afternoon, Mr.. Hobbs
had testified regarding the Boston *
Names car shortage. The road, he
said, has been obliged to use cars OF
other lines, paying daily charge -
As cents. The balance paid by the
Boston & Maine to the New Haven on
this account was less than $4,000 II