The Washington herald., 1921-05-18

n EFORE considering how it happened that the
N Washington Traction and Electric Company
failed in 1901, bringing the Washington Rail-
way and Electric into being, it is of interest to
spend a little more time with the Washington and
Great Falls Electric which secured in 1000 the char
tee to buy the roads already owned by the
Washington Traction and Electric and merged
der that Just why these who had all
these roads. and who had already merged them
under the Virginia corporation, went to Congress
for this second charter is evident unless it
to hide their operations and clean the slate.
As The Herald has said, this charter, secured
for second merger of roads already merged,
made no mention OF the merger accomplished. 1t
merely gave the Washington and Great Falls Elec-
trio the right to buy these identical roads il they
still operated individually for their individual
account. That they were not is evident from the
foreclosure of the holding company a year later.
Maybe they were preparing in advance for that
failure which they had decided to bring about 1t
is also. incident that the company chosen to get
the right of purchase already had it, but with
limited bond issue.
The Washington and Great Falls Electric had
been originally chartered in 1892. 1t was a small
affair with stock limitation of $4,000 and bonds
limited to the amount OF stock unpaid This char
ter amended in 1894 to route etc, with
peculiarity intrudng, except that it also amended
road whose is not mentioned in the caption
OF the act which reads: ITO amend an act en-
titled. AN act to incorporate the Washington and
Great Falls Electric Railway" This shows again
how they did things in those days which past.
No one believes they can repeat, in this day.
The charter was again amended in 1896 when
the power to purchase clause added and the
bond issues for such extended to S65o,ooo
A month after getting this authority it took
e.
organized in Maryland by allied interests The
combination dropped into the Washington Traction
and Electric hat in 1899. 1t then this partc-
ular tail was chosen from dozen others of
like financial inconsequence, to wag the dog.
This final merger charter went into much de-
tail as to how it should acquire these roads already
eobblcd up in the Washington Traction and Elec-
tric by these gentlemany Robin Hoods. 1t
authorized to take over each road only it got
the consent in writing OF the owners of record
OF three-iourths of the capital stock OF each
pany or by the of the owners OF three-fourths
OF the capital stock OF each company represented
at a special meeting called and held prescribed
bv the bylaws" etc. As the Washington Traction
and Electric owned each and all these roads, this
provision was quite superfuous. what the
old woman called "subterfugy."
The stockholders Of these companies still
further protected with scrupulous exactness. Each
stockholder OF record"-the Washington Traction
and Electric was all OF the4-had to be notified
by letter OF the purchase, and the right of court
appeal and apprasement was reserved to aggrieved
stockholders The franchise of the w. & G.. F. E
was also preserved the operating charter of
the merger and here probably will be found why
this particular tail chosen to wag the con-
sohdated canine. But in every way the fact that
there had been a prior merger of these roads was
concealed from Congress.
The only restriction placed upon its activities
was in the form OF amendment insisted upon
by Senator La Toilette, which provided that
while this railway merger might an electric
power company, it could not merge it by re-
ceiving IA transfer OF the property or franchise"
OF such company. This has proved OF much con-
sequence and has been of great value in protecting
the patrons OF the Potomac Electric Power Com
pany in the matter of electric rates. 1t is this
amendment the w. R. & E. wishes to get rid
of for its own benefit, not for that of the folks
who pay the bills. The Washington Traction &
Electric had already merged this company with
these railways and this new charter thanks to
the Senator, dissolved that much of that Mormon
household.
Finally this very peculiar charter transaction
gave the w. & G. F. E. the right to change its
name to any other it might prefer and it did
change it February 4, 1902, to the Washington
Railway & Electric which, strangely or not diff
ington Traction & Electric.