New-York tribune., 1921-12-02
|. R. r. Heads
Refuse Call
To Testify
icsntlnusd frs,n page one)

the commission, opened the proceed
ings Addressing Mr.. Belmont Mr..
Shearn said:
1.-THE commission desires to question
you concerning certain matters that oc-
CURED during your trusteeship of the
lnterborough Rapid Transit Company,
the lnterborough Consolidated Corpora
Ton and the marlborough Metropolitan
company, matters relating especially
to the declaration Of dividends by those
companies when, as it appears to the
commission, q very serious question
arises as to whether the dividends were
not declared out of capital.
Waiver Demand Made
"lnasmuch as the declaration Of
those dividends, if there was an i'm
pairment of capital at the time, would
carry with it a responsibility not
only civil but criminal, it seems
TO the commission that it is nec-
essary to ask you, before putting
any questions, whether you waive i'm
munity by reason of being compelled to
respond to questions.
Il wish to make clear that in ask
lngahis waiver there is no implication
from the commission that any such
liability as l have suggested exists, but
the commission does not want to be
tended by any one that by reason of
Section 20 of the Public Service Com
mission Law we have, with our ewes
wide open, granted immunity from pos
sible prosecution. Section 20 provides
that no person shall be prosecuted for
or on account of any act or trans
action which he shall under oath have
testified to or produced documentary
evidence. With full understanding Of
ocly 4l,o.
will waive immunity."
Before Mr.. Belmont could reply Mr..
Nicoll arose and announced that the
directors refused to sign "any such
paper Mr.. Nicoll continued: sAs to
the charges made before the commits
sion, and repeated in tho newspapers,
that, out of the sale of the securities
Of the Consolidated and Interborough
they have realized large gains, profits
m ana advantages, we are Informed by
the directors that such transactions as
were had resulted in a large loss and
that many of the directors are now
heavy sufferers by reason of the dcpre-
citation of the securities Of the COM
panies in recent years"
Transactions "Open Book
In response to Mr.. Shearn, Mr. Bel
mont said the statement Of his coun-
sci was his answer to the question.
Il have no right to speak for nv
associates, but my transactions and nv
connection with this company are an
open book to you, sir. and to the pub
lic." said Mr.. Belmont.
They are open except that we cam
not ask you about them without grant
ing s:,l immunity" snapped Mr.: Shearn. .
the witness retorted. "Waiving i'm
munity means nothing. The only rea-
son l have consented to this is that I
am representing not only my own in
terests but the interests of the COM
pany. am told that I might jeopa rdize
them. AS to imputations, I resent
them"
Mr.. Shearn shot back: "The commis-
slonr at any rate it's counsel, equally
resents the imputations that you have
put upon the motives Of the commits
sion in pursuing what seemed to us to
be. very necessary and very peril
nent and Selevant inquiry"
Il cannot conceive how it can involve
any circumstances that any one should
wish to avoid for you to make the ex-
planation and justification, if any suci,,
of the facts that have been brought out
at this hearing" Mr.. Shearn added.
ut was largely to give you that oppor-
tunity that you were called"
I'VE are here TO do it," said Mr.. Bel
mont sharply.
Transit Board Nettled 1.
Chairman McAneny interpolated to
say that in view of the sympathetic at
titude of Frank Hedley, president of
the lnterborough, the commission was
proceeding along lines that would be
welcome. He then outlined the aims of
the commission and said the commits
sion was "nettled" by the statement
presented by the directors Wedne sday,
in which they suddenly changed their
minds about voluntarily appearing.
Mr.. Belmont replied that the board
was in accord with the statement Of
Mr. Hedley that the Interborough
wished to cooperate with the commls-
sion.
Referring to Mr.. shearn's question
ing Of the legality of the Interborough
Consolidated merger, Mr. Belmont said,
gazing squarely at the commissions
special counsel:
"There is no one who knows as much
about the company as Mr.. Shearn. He
had the opportunity of knowledge Of
these subjects more than any one else
because of his personal relations with
Mr.. Shonts. lie knew all about the.
transaction which he deliberately called
illegal without proof. Against the opin-
ion of Mr.. Shearn are the opinions of
our very best counsel"
Mr.. Belmont said the Interborough' S
original plan to give the city unified
system had at one time better prospect
than at present.
Move for Unifcation
"But when it was done by this cor
poration" he resumed "it was called
q monopoly and condemned. When it is
suggested by your commission, it is
called an excellent move. So there is
not very great consistency in the view
as to what the city needs and what we
! were doing. If we made mistake in
measuring our cloth that is another
matter, but to impugn our motXes is
something we feel ought to be- dis
posed of by tribunal where the pro-
ccdure is fair. / feel that my conscience
is perfectly clear"
Reviewing the history of the Inter
borough, Mr.. Belmont said that in the
beginning plan had beeiNproposed by
the Hewitt commission which would
have tended to prevent the distressing
conditions Of to-day. "But" he con-
tinued, through the mistaken policy
of the press and the abuse which began
very early, tho Elsberg bill was passed,
which prevented the City from lending
adequate credit.
"Now, that wasn't done by the COM
pany, and we advised against it. we
are on record before the commission
as being ready to build the East Side
and West Side subways under what