Evening public ledger. [volume] (Philadelphia [Pa.]) 1914-1942, 1917-09-05
LEWIS VERSUS LEWIS

the acceptance by the city of the Tay-
lor lease, Mr.. William Draper Lewis, as
reported in the EVENING LEDGER on that
date. said;
The lease gives the l.. II. T. absolute
control for the next fifty years OF the
lines constructed by the city. There
Is no real recapture clause. True there
is what is designated recapture clause
but this clause is drafted on the as
sumption that the city should not take
back its property without at the same
time buying the property of the
p. r. r. This is fundamentally trronJ.
The right of the city TO recapture
its own property should not be
saddled with the condition that the city
take over the property of the lessee.
The p. r. T. has monopoly Of the
street railway business in Philadelphia.
It has not the money to provide transit
facilities needed by the people The
city Is willing to pledge its own credit
to borrow the money necessary to con.
struct these facilities. If it wishes to
hire the p. r. T. to operate the city's
highspeed lines it should retain the
right to terminate the contract and
take back its property at any time
after reasonable notice to the company.
The recapture clause as drawn would
be unsound, therefore, even If it pro-
Vided that the city should buy, when it
desired to recapture its own property,
the facilities operated By the T.. +. T.,
and it would still be unsound even
II the constitutional provision limiting
the borrowing capacity of the city did
not make it impossible for the city ever
to have enough borrowing capacity to
exercise its right of recapture.
Mr.. Lewis then went on to discuss prob.
able incurrences of debt in relation to the
city's borrowing capacity, and continued:
In either case. the proposed recap.
ture clause is ineffective. This. how
ever, is not its fundamental defect.
Its fundamental defect is that 10
prevents the city from taking the
operation of its opn property into its
oion hands untH 10 buys all the
property belonging to the lessee.
The Smith. .Mitten lease, Article xxx,
under the caption. Fright Of Recapture
Reserved to the City" says
In addition to the right reserved by
the city under Section Eleventh of the
1907 Contract to purchase all the prop
erty. leaseholds and franchises of the
Company on or after July /, 1857, the
City shall have the right at any time
between July /, 1927, and July /. 1867.
upon giving the Company six months
notice of its intention so to do, to termi-
nate this Contract, recapture its own
property and acquire all the Company's
property, leaseholds and franchises by
paying to the Company at the date
named In the said notice an amount
equal to the amount which has been
paid in upon all it's capital stock out.
standing at the time of the purchase
and recapture, together with (a) any
dividends on new capital stock unpaid
under Article XXII, Paragraph 1, Item
4, and (b) an amount equal to any un-
paid portion of dividends in each year
At the rate of one million five hundred
thousand dollars @1,5OO,O0O) per year
from the date upon which this Con-
tract shall become effective TO the
date of recapture; etc, etc.
In other words, the caption. Right of
Recapture Reserved to the City" appears
to be fatally misleading. No right of re.
capture of its own lines alone is reserved
TO the city. 1t can recapture its own lines
only by purchasing at the same time the
entire property OF the p. r. T.
Apparently condition which Mr.. Lewis
on May 25 declared to be Fundamentally
wrong" using the words, Its Cthe recap.
ture clause's) fundamental defect is
that it prevents the city from taking the
operation of its own property into it's own
hands until it buys all the property be.
longing to the lessee" ceased to be a
Fundamental defect" on August II, when
Mr. Lewis stamped the Smith. .Mitten lease
with his approval and appeared as its
special sponsor.
No matter how hateful in operation the
proposed lease might be to the people, no
matter how fatal to the public interest,
~ no process under the sun could the
grip Of the company on the city's lines be
loesed unless the company by default
faithfully to observe. keep and fulhn"
It's obliEations made 1t possible for the
city 70 "apply for cancellation of the
Leoze ana Of the Contract of which it
forms part to court We can ind
- prsvIsiop anyvhsre Cor recapture by
o. Nv x - 90 lines Nay. more'
p>sIasaily shis morn,