The New York herald., 1922-03-16
TRANSIT COMMISSION
REACHES DEADLOCK
WITHNTERBOROUGH
Roads Plea for New Delay
in Improving Service
Is Denied.
RECEIVER SEEMS NEAR
Parting of Ways Says
Shearn at Hearing Full
of Tilts.
THREAT OF COURT FIGHT
Prospects Said to Be Good for
Some Change in OnerOus
Elevated Lease.
THREAT OF COURT FIGHT

AS Clarence j. Shearn. special coun-
nounced yesterday in a public hearing
10 investigate the inadequate service
now given on subway and elevated
Inns, the commission and the Inter
borough Rapid Transit Company are
"at TIE parting of the ways"
James l.. Quackenbush. general
counsel of the Interborough. pleaded
for delay in the PRONUNCIATION of bet
terment service orders. He argued the
continued poverty Of his company and
frankly asserted. as TIE New YORK
HERALD last week predicted he would,
that if the commission insisted upon
more efficient and consequently more
expensive service at present it would
have TO bear the responsibility of driv-
ing the Interborougt into receivers
hands.
The Interborough's counsel also con-
firmed published reports concerning
his company's intention to default in
the March 81 payments due under the
lease to it of the Manhattan Elevated
Railroad Mr.. Quackenbush added
that after months of negotiation they
had reached a point at which there
appeared a reasonable prospect of an
amicable settlement with the Man
haitian company. either on the basis of
modification or a cancellation of the
oppressive terms Of the lease.
PIca for Delay Denied.
After long argument the commission
denied Mr.. Quackenbush's plea that
The whole inquiry be postponed for
thirty days. The ruling was that the
investigation must proceed immedi-
ately. but the appearance in person OF
Frank Hedley. president of the Inter-
borough, and of Mr.. Quackenbush was
deferred until next Wednesday after
noon. In the meantime the examina-
ton proceeded. the commissions coun-
sci interrogating other witnesses. while
the rights of the Interborough were
protected by It's Junior counsel, Arthur
Peacock
Judge Shearn, after listening to the
argument for postponement. inquired
whether II there should be an adjourn
ment for reasonable time and then
at the expiration of that time IL the
hearing should result "in an order for
the restoration OF the service on the
subways and elevated roads to that
degree Of efficiency at least that pre-
vailed In 1916. he will accept the order
of the commission and put it into ef-
feet or whether we are to expect the
r~I a. l.n rtsp
Mr.. Quackenbush's reply brought
forth this retort from the examiner:
DO you mean that If the order is one
that would require an expenditure Of
money such as to threaten a receiver
ship. you would take it into the
courts?'
would Have to Go to Court.
"Oh, l should have to. Judge" was
The reply. II don't see how else / could
do 1t. Before / did IL. OF course. 1t would
be my duty to ask the committee repre-
senting the security holders whether
they would advance any further money
10 the company rather than have that
litigation. ] cannot underwrite the fl
nancial ability of the 1nterborough
Rapid Transit Company for the future.
tomorrow. or two weeks or thirty days
from to-day.
THE company is in a perious cond-
ton. IL II escapes a receiversnip, ]
think II will be due to the indulgence OF
this commission about as much as TO
anything else"
II asked the question not that / ex-
pectod any different answer -retorted
Judge Shearn, but to make IL clear
that the commission Is really at the
parting of the ways, IL seems to me,
with the company, In giving 1t further
time in which to wrestle with this re-
ceivership problem. The whole matter.
as ! see II, comes down TO this We are
dealing not with a matter of threatened
reccivership. but with the obligations OF
the Interborough Rapid Transit Com
pany under its contract"
Mr. Quackenbush took the position
that he Was appearing before "a state
body exercising the police power and
not the representatives OF the city as to
Contract No. 3: nothing to do with IL
whatever" There followed a long con-
troversy with Commissioner Hardness
and Judge Shearn.
Contests Comm ission's Power.
You do not contest the power OF the
commission under the contract 10 make
en- order OF service?" asked the Com.
missioner
II certainly do. exactly Your rem
edy under the contract is by contract
your remedy as representatives Of the
sovereign state OF New York is by order.
] say that if the commission makes an
order Of the character intimated | shall
Immediately cite the case of the Inter-
national Railway Company In Buffalo
where tho Court of Appeals said that
YOU cannot make an order which dlsre-
CARDS the financial ability OF the com
pany to carry It out You cannot put
anybody into Jail or you cannot fine any
Continued on Page Six.
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