New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-09-08
Common, Preferred
Grand Trunk Stock
Declared Valueless
Taft Dissents From Majority
of Findings of Board of
Arbitration i'm Canadian
Case; $4,000, 600 Issue
Snec;a, Disputch to The Tribune

OTTAWA. Sept. 7.-The long-awaited
Grand Trunk Railway system arbitra-
ton award was handed down to-day. In
unfavorable to the company than had
been expected here and will come as a
distinct shock to financial London.
The preferred and common stocks are
described as valueless. The majority
of these stocks are held in England
The majority report held that the COM
pany was practically bankrupt and head
ing for q receivership and therefore
no value attached to the preferred and
common stocks. William Howard Taft,
now Chief Justice of the United States
Supreme Court, who was arbitrator of
the Grand Trunk, in long dissenting
Judgment fixed no specific figure of
value, but dissented from the majority
Of the findings. Sir Walter Cassels,
chairman, ana Sir Thomas White, arbi-
traitor of the Canadian government,
found that the stocks in question are
worth nothing.
Question of Moral Obligation
The majority held that if there was
any moral obligation for compensation
it was matter for the government and
Parliament and not for, the tribunal
The amount of the stocks involved in
the arbitration was roughly SGT 900 O0O
While Cassels and White held that
the road was in poor condition physi-
cally and that an enormous amount
would be required to get it into shape,
Mr.. Taft maintained that the. standard
set by the government was ode luxe
The majority justified the exclusion
of the evidence as to the reproduction
value as irrelevant, while Mr. Taft
X La
the United States, from which most of
on some points with the majority, but
argued that the system was of ines
Unable value in developing the do
minion and conditions under which it
labored were brought about under cir
cumstances for which it was not re-
sponsble and that the company, therr-
fore, was entitled to consideration.
He did not suggest what it should Ie-
ceive.
Mr. Taft described the Grand Trunk
Pacific as the tragedy" of the Grand
policy as directed from London been as
wise and prudent as that of the officials
in Canada the fate of the railroad
might have been different.
In concluding his statement, Sir
Walter Cassels said: 81 have given
the best consideration l am capable of
giving to the important questions sub
mitted for our consideration and am of
the opinion that our award should be
that there. is NOS value in any of the
four classes of stocks"
Whites Opinion
In rendering judgment, Sir Thomas
White, arbitrator for the government,
concluded that the earning powers of
the company do not justify the assump-
ton that any profits would have been
available. He said:
Having regard to it's own continu-
ing heavy deficits, the necessity for
making provision for deferred and ex-
traordinary maintenance and the CAPT
tai construction and it's heavy liabili-
ties in respect Of securities of the
Grand Trunk Pacific bearings it's
guarantee, the Grand Trunk Railway,
but for the financial support of the
government since May /, 1920, must
have been forced into receivership.
"Any question as to compassionate
consideration of. the shareholders must
be for the government and Parliament
Of Canada to deal with and not for
the board"
An appeal is possible for the COM
pany, or it may seek compensation on
compassionate grounds. 1t is as
sumed an appeal will be taken