The sun., 1919-07-12
Is Freed From Receivership by
Oral Order of U. s. Judge
Mayer.
2 CT. TRANSFERS GRANTED
This Is First Step in Disinte-
grafton of New York Rafl-
ways Company.

avenue surface line be released from
the receivership Of the New York Rail-
ways system and returned to It's owners
for independent operation. The order
provided for a charge OF cents for
! transfers between cars of the Eighth
| avenue line and those of other lines of
the Green Car System at interesting
points. The order. in written form and
fixing a time for a severance. with a
| resulting charge for transfers, will be
signed Monday afternoon.
The decision marks the beginning of
the disintegration of the New York
Railways Company. q loose consolidation
OF most Of the surface lines OF Manhat-
tan which was formed on the ruins Of
the Metropolitan Street Railway Com
pany. Other lines. neld as the Eighth
| avenue line by a lease calling for a
specific annual rental and the payment
OF all taxes. are expected to be returned
to their owners in the near future.
This course Of action has another OBJ
1ect than to bring about an early in
crease in fares through a charge for
transfers. As explained by THE Sum
on Wednesday, a plan for the reorgani-
cation of the New York Railways Com
pany, formulated In outline on the basis
OF survey of the system undertaken
by Job E. Hedges. ms receiver, in
wolves the elimination of control Of i'm
portant units by leases calling for a
rental fixed when consolidation occurred
twenty-five years ago. In tho case of
the Eighth avenue line the rental was
fixed at $4,000 a year and the pay
ment of all taxes by the lessor. The line
was run at loss OF between s250,000
and 100000 last year. In the reor-
sanization 1t may be found expedient
to lease the line. but II this done the
rental will be a percentage Of the net
revenue and not a fixed yearly sum.
Transfer Charge Explained.
In fixing the charge for transfers at .
cents Judge Mayer said that he did 50 to
show sympathy with the attitude of
Lewis Nixon, Public Service Commits
sioner. In making an order permitting
the New York Railways Company to
charge for transfers at that rate at the
ninety-nine intersectins points over
which the Public Service Commission has
jurisdiction. In proposing the severance
Of the Eighth avenue line three weeks
ago Morgan J. O'Brien, counsel for its
stockholders, said that an arrangement
would be entered into with the receiver
for the New York Railways Company
providing for a cent charge for trans
fers severance was asked because of
the failure of the lessor to pay rent
during the last nine months.
The capitalization of the Eighth Ave-
nue. Railroad Company Is 100000.
There are 100 shareholders. but the
ma Jority interest is closely held by
members of the Hays and Tate families.
descendants of the builders, Joseph
Tate is president and William Hays
vice-president.
Col. Henry L. Stmson and Bronson
Winthrop, counsel for the receiver. did
not object yesterday to the petition of
the stockholders OF the Eighth avenue
line. Mr. Winthrop asked that delay
be had, however. He said that the
order of Commissioner Nixon had not
been entered.
Judge Mayer said that It was his in
formation that the delay in entering the
order was due to the necessity OF the
careful working out of its legal phrase
ology rather than to doubt by Commits
sioner Nixon as to its provisions Mr..
Winthrop said that this was true. The
lawyer added that there were objections
to details of the plan OF operation pro-
posed by counsel for the Eighth avenue
company.
Franchise IL Lacking.
The Eighth avenue company is play
ing the part here of a company anxious
to get back It's line without being in a
position TO operate IT," said Mr.. Win
throp. THE most serious objection lies
in the fact that the company has no
franchise to operate south Of Chambers
street in West Broadway. 1t would take
several months to build a crossover so
that cars could be started on the return
trip northward. Besides this objection
the company has no power house"
Michel Kirkland, counsel for the
Eighth avenue company. said that the
routing OF cars could be arranged as
when the line was part OF the green car
system. He said that the Eighth avenue
cars could use the Cortlandt street loop
OF the Ninth avenue company to turn
around until crossover could be in
stalled.
elm all of the twenty-five years that
the City Railways Company has oper-
ated these lines" said Mr.. Kirkland, "all
that has been done has been to scramble
them. They talk about a lack of power
Why. the receiver buys his power. He
has no powerhouses of his own. We
have agreed 10 buy power OF him at a
price fixed by him for ninety days. He
has offered to provide us with seventy
two cars. The lines need normally l40
cars. We ask the court TO direct the
receiver to let us have cars to the limit
Of his ability up to 40"
To Arbitrate Differences.
Judge Mayer suggested that matters
upon which the receiver and counsel for
the Eighth avenue line had not reached
agreement be left to him as arbitrator
in order to avoid litigation. He said
that 1t was perfectly plain that tho line
was a burden to the receivership estate
and should be severed.
1T shall make an appropriate order to
this effect" said the court. 81 shall
direct the receiver to turn over to the
Eighth avenue line equipment to tho
limit OF his ability and its needs. The
legal questions involved will be consid-
cred from time to time.
my position on the transfer matter
Nixon is in the nature OF temporary
solution OF the present financial sItua-
ton of these roads. In view OF the eff
fort he has made in this direction he Is
entitled TO the full cooperation OF tho
court. So far as the severance of the
Eighth avenue line 10 concerned II will
be merely financial and legal, and will
involve no inconvenience to the public.
will authorize the receiver to enter
into an agreement with the Eighth Ave-
nue. Railroad Company under the con-
ditions as laid down by Commissioner
Nixons order precisely as IL no sever
ance had taken place"
Receiver Hedges said that in view of
the determination OF other leased lines