Evening star. [volume] (Washington, D.C.) 1854-1972, 1925-04-17
SHIP BOARD DENIES
POWER OF COURT
TO REVIEW SALES

| ~ SN-|S
Continued from First Page)
| business men and organizations on the
| Pacific Coast testifying to the backing
of the Dollar interests.
Three DO Not Sign.
Commissioners Plummer, Thompson
and Benson. who opposed the sale,
| either to the Dollar interests or the
Pacific Mail, did not sign such affi-
| davits and IL was indicated that Com
missioners Plummer and Thompson
would file separate answers.
! 1t is the view of Government coun-
sci that although the proceedings
were brought against the Shipping
Board commissioners, they were sued
collectively as board, and il was in
dictated that If any of the dissenting
members should seek to answer indi-
vidually as commissioners their status
before the court would be challenged.
Government counsel also commended
| that the Pacific Mail, which at present
operates the ships for the board out of
San Francisco to the Orient, has no
property right in the vessels and that
| the board had not infringed upon the
Pacific Mails rights.
Government counsel in the answer
| filed today asserted that in awarding
the sale the board gave prime con-
| sideration" to the permanently of the
service to be maintained and added
| that, with all other factors consider
| ed. the price offered by the Dollar in
! terests was in reality higher than that
| of the Pacific Mail, the only other
! bidder.
Sold Ships to British.
| Discussing the Pacific Nails opera
| tons, the answer alleged that in the
| year 1915 the service maintained to
/ the Orient from San Francisco by Pa
| cifiC Mail Steamship Company was
practically abandoned by the stock in
| terests then in control of the plaintiff
corporation; that plaintiff at that time
| decided to go out of the Oriental trade,
closed up it's foreign offices. and sold all
| its passenger ships then being operat-
! ed in that service, including the ships
! Mongolia, Manchuria, Korea, Siberia
and China, to the International Mer-
| camille Marine Company, which the
| defendants aver is corporation
whose policies are largely controlled
! by and subject to the direction of Brit
| lsh interests.
| subsequently the steamships Ko-
rea and Siberia were sold to Japanese
/ interests, who have operated and still
| operate the said steamships in COM
petition with the Governments ships
now in the California Orient service.
| Bought Smaller Ships.
1.-The steamship China was eventual.
1 ly transferred to the China Mail
Steamship Co., a Chinese-owned cor
poration which operated the steam
| ship China in this same service, also
| in opposition to the American Cali
/ fornia Orient Line until the Chinese
I limo iDtn h1 r1l-
| Thereafter the plaintiff purchased
| three small Dutch-built steamers,
| namely, Ecuador, Venezuela and Co
! lumbia, which they put on the San
! Francisco Orient Line in the place of
the five large, fast passenger vessels
sold when plaintiff abandoned it's
service, as aforesaid. These three
small steamers were the only ships
| being maintained by the plaintiff at
the time it secured the No. operat-
! ing agreement with the Shipping
| Board hereinbefore referred to-"
! Government counsel charged the
Pacific Mail with lack of good faith
in the bid it submitted. which called
| for a part-cash, part-deferred payment
plan under a stock arrangement, de-
claring that this did not observe the
terms and conditions of sale previous
| ly laid down. The latter, 1t was as
serted, were adopted by the board
after consultation with both parties
and supplanted the original adver
tisement calling for bids and offering
extended negotiation.
Terms Not Met.
Their offer, it was added, was one
that lawfully could not be accepted
and was made in the hope and eX
pectation that the board would be
unable to effect a sale without fur
Their long negotiation and delay"
AS for the subsequent offer of the
Pacific Mail to change the stock for
a bonding arrangement in payment, it
was said this did not pretend to
meet" the terms and conditions of
/ sale.
| 1t was further denied than an ap-
praised value of $2,500,000 was given
| to each of the vessels by an appraisal
committee of the board, but rather,
on July l, 1928, value of 1880 900,
which does not now directly repre-
sent the price that can be obtained
for such vessels where the sale there
of is coupled with the conditions that
they shall be maintained in a certain
specified service upon the Pacific
| coast"
Denies Sales to Aliens.
| Gale H. Carter, president Of the
Pacific Mail Steamship Company, in
a statement, said the answer cannot
truly be considered the answer of the
entire Shipping Board, but only of the
| four members"
TT is true" he said, 1.-THE Pacific
| Mail in 1915, when controlled by the
| Southern Pacific Railroad, sold GER
tain transpacific ships to the Atlantic
II Transport Company, an American
| corporation. With the subsequent
sale of two of these ships to the Japa-
nese the Pacific Mail had nothing
to do.
Shortly thereafter the present con-
trolling interests acquired from the
Southern Pacific Railroad a majority
of the stock and the remaining ships
and provided new capital with which
new ships were ho;IEht. Thcsc ships
were placed in the transpacific service
under the American flag, SO that when
America needed American ships in the
war the Pacific Mail had five fine
steamers operating to the great Orien-
tai markets and connecting the United
States with it's Pacific possessions. At
that time the Dollar interests had
transferred or sold their overseas
ships to foreign flags, and, denouncing
American shipping laws, had removed
operating headquarters to Vancouver,
British Columbia.
n TT se, Id l.