Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-09-23
Lawyers for Utilities Heads
Hold Value of Securities
Endangered.
STIPULATION AGREEMENT
REJECTED BY BOARD
Mcpherson Says Central Corpora
ton Does Not Own Stock Of
Washington Company.

A battery of legal talent failed In an
effort this morning to head or public
hearing before the Public Utilities Com
mission into the question of whether the
Washington Gas Light Co. Is or is not
owned by q foreign corporation. and
to substitute for the hearing a stipula-
ton of facts on which court could
determine the question.
The public hearing. the lawyers said,
would have q disastrous effect upon
stocks and bonds of the Washington
Gas Light Co. and its multitude of as
ISOLATED, subsidiary and controlling COR
porations, firms and trusts. These dig
astrous consequences would be avoided
by STIMULATING the facts, they said.
The public hearing started on with
questioning of Col. Albert e. PIERCE,
president OF the Central Public Service
Corporation Of Chicago, which Is be-
lieved to own the local company. If
this fact can be established, the COM
mission will go to court in an effort
to have the Chicago Corporation divest
4eSSaA Va Ass 0tOGh ia b4AC 1uCdI COAAAPdny.
Roberts Outlines Plan.
At the outset of today's hearing,
Assistant Corporation Counsel William
A Roberts, trying the case for the
commission, said that he expected to
prove that the Washington Gas Light
Co. was owned by the washington a.
Suburan Co.'S, common law trust
which Is not separate entity, but is
control association in the nature OF
a corporation, every move of which Is
directed by the Central Public Service
Corporation. Its Office management, he
said. and its directors are changed at
the will of the G. p. s.
He said that the WestfieId Trust is
fictional set-up to conduct operations
many hundreds Of times more extensive
than its capital assets would allow; that
its capital Is now intact and has not
been spent. Peirce is said to own the
Westfield Trust, which, in turn, directly
or indirectly, Is said to own the shares
In the local company.
Mr. Roberts said that he would show
that Peirce and many of the officials of
the Central Public Service Corporation
and its numerous subsidiaries played an
intimate and insistent part in the man
agement and voted the stock Of the
local company and that they took an
equally active interest in the affairs of
the Westfield Trust and the Washington
and suburban companies. This control
was exercised, he said, by numerous
largeN loans and collateral trust agree
mentS made TO subsidiaries, the effect
Of which was to destroy the power of
the recipients to act Independently.
Mcpherson Seeks Agreement.
Then d. r. Mcpherson, general coun-
sci for the Central Public Service Cor
poration, rose for the purpose of try
ing to get the stipulation agreement
put into effect. He said that in the
Fall of 1923 COL PIERCE had been APP
preached by certain Washingtonians
and became interested in the purchase
of the Washington Gas Light Co. He
was advised at that time that the La
Toilette anti-merger. act stood in the
way of the acquisition of the local COM
pany by the G. p. S. Nevertheless, the
c. p. s. desired to own this company
the last one of the large gas companies
to stay outside OF the fold Of holding
corporation control.
This he characterized as laudable
ambition and one which was achieved
by the creation of the Seaboard In
vestment Trust, a Massachusetts conf
mon law trust, which purchased 109,-
900 of the 10000 shares of common
stock in the local company. That trust
now doing business under the name OF
Washington g. Suburban Co.'S, still
owns the same stock. The Central
Public Service Corporation never owned
and does not now own O single share
of the stock, although 1t does own up
ward of $20,00O,000 of the funded debt
Of the Washington 81 Suburban Cos.
Mr.. Mcpherson then said the man
agement of the local company by the
Central Public Service Corporation,
(ContiniIed on PAGE 2. Column 81