New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1916-02-03
Thompson Committee to
Ask Traction Man
to Explain.
CONTRACT GAVE
BIG COMMISSION
Directors Were Told II Was to
Pay Certain Obligations"
Banker Testifies.

Theodore r. Shonts. president Of the
lnterborough, will he asked next Mon
: day morning 70 tell the names Of tho
men with whom he is alleged TO have
4 incurred certain commitments and
/ obligations" in closing contracts for
/ the lnterborough's share in the dual
transit system with the city, and why
/ S2.000.000 was necessary TO wipe out
/ the certain commitments and oblga
I tons
These questions will be put because
| Of the amazing story told by George
W. Young. financicr. 10 tho Thompson
4 committee yesterday. Young, who had
+ e'udcd the committee for months, was
suddenly produced through the efforts
of cambridge Colby. counsel to the
committee. Mr.. Colby was also chief
counsel 10 Nr Young in the latter's
fight for the 100000 estate left b.
his wife. Nine. Nordica. the prima
donna.
/ Shonts. according to Young. or June
4 "a. 1918. tried TO get him and other
/ directors OF the InterhorouCh TO vote
/ the contract 20 Shonts's friend. John +.
Stevens, for the third tracking Of the
Second, Third and Ninth Avenue 81
lines Young William 4. Reed and
the late Gardiner VI. Lane stood TO
gcther and refused TO vote for the con
tract because il provided that Stevens
would receive a 10 per cent commits
sion, which would amount to $4,000
900. Il was with this commission, It
was testified. Mr.. Shonts expected 20
wipe out these certain commitments
and obligations"
Morgan Blocked Contract.
Senator Thompson has long Known
that Mr. Young could tell this story
and last summer he and other members
Of the committee went O. Boston 20
the Office OF Lee. Iigginson 6 Co. and
tried 70 obtain papers that would how
Mr.. Lanes objections 20 this alleged
deal related by Mr.. Young yesterday
Several weeks ago J. =. Morgan. jr.. tes-
titled that Mr.. Lane told him that the
Stevens contract did not meet with his
approval and Mr.. Morgan brought
about its death.
Regarding this same contract, Milo
r. Maltbie. former Public Service Com
missioner. testified that the day after
the special meeting of the INTERIOR
ouch directors. who refused 20 approve
the 10 per cent contract with Shonts's
llltIUs NAFN tl4fr NUNls+af Ol4 il'o Wv 81 tf'
itlatiye. went TO the Public Service
Commission and asked them 10 APP
prove the contract II was also tes-
tilted before the committee some weeks
back that Mccall, Cram and Wood were
ready TO vote for the ShOnts-Stcvens
contract. but that Msltbie and Williams
were opposed to It.
Mr.. Young testified that he and Nj.
Lane. after the meeting OF June "a,
went % Mr. Lanes Office in this city,
AT 43 Exchange Place, and compared
notes Concerning this Mr.. Young
made memorandum AZ the time, which
was read into the record.
Memorandum of Meeting.
The memorandum read:
Upon leaving the Office Of the Inter.
borough board to-day Mr.. Lane re-
quested me 20 60 10 his Office with him.
On reaching the Office we proceeded 10
Mr. Lanes private room. and Mr. Lane
showed me memorandum which he
had drawn up, stating what had taken
place at the special meeting held on
Tuesday.
This memorandum. in addition. went
On 10 state that following the speclal
meeting Mr. Shonts had taken him
aside and stated that he wanted nm
lir Lane 10 understand the reason
for entering into such contract with
Mr.. stevens: that neither himself nor
Mr. Stevens nor Freedman the late
Andrew Freedman. an lnterborough d.
rector was 70 receive any beneht from
this contract. but that IN connection
with the securing of the contract winch
had been closed between the city OF
greater New York and the lnterborough
Mr. Shonts had found II necessary to
make certain commitments and incur
certain obligations. and that II was by
means of the stevens contract that he
expected % meet and pay these com
mitments and obligations. Mr.. Lanes
memorandum further stated that upon
learning these facts Mr.. Lane had gone
10 the Office Of ]. y. Morgan & Co.
and advised J. p Morgan, jr., Of what
had transpired at the meeting referred
20 in mis- memorandum and Of the state
ment which had been made 20 him by
Mr Shonts.
A the special meeting of the board Of
directors. besides those already men
toned az being present, these also at
tended: John Pierce. Frank d. {. Sui
Gvan and Edward j. Berwind, directors,
and j. l.. Quackenbush. counsel 10 the
Interborough. and VI. Pepperman, Mr.
Shonts's assistant.
Mr.. Young said that Mr.. Lane asked
Mr. Shonts 20 read the contract when
il was learned that the lnterborough
was 20 pay all expenses incurred by
Mr. stevens while carrying out the
contract, so that he would have $4,000
GOO clear. Nh Reed objected.
MIR. Shonts. Mr.. Young testified. told
the board that the reason he wanted
Mr. Stevens was because he had worked
with him on the Panama Canal and
know, his ability When Mr.. Shonts
was naked where M Stevens's ONCE
was he told the board IT was IN has
head.
A letter from Mr.. Lane 10 Mr. Young,
dated October !, 1913. which Mr.
Young said referred TO the memoranda
both made of the alleged s2,OOO.OOo
deal. was read into the record.
Senator Thompson said he would I'M
mediately ash the Legislature 10 ap-
roinf a committee 20 confer with INC
Massachusetts Legislature to arrange
for the passage % comfy la"
whereby the Thompson committee can
20 over the papers and other record,
left by M Lane regarding this alleged
transaction. They tried 20 examine
them last summer. but the hassachu-
sets courts ruled they had no righi
10 40 so.
George 4. McAneny. when on the
stand several weeks ago, told the COM
mittee he had heard from Mr.. Young
M This (Thurs) and