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u6 BETWEEN THE OCEAN AND THE LAKES
of the road from October I, 1853, to June 30, 1854, was in recognition of the interests of foreign c
which were $616,521, had been used for the re- itors of the Company, Moran having placed a large
quirements of the road, among which was the ex- amount of the Company's unsecured, or income,
pense of laying second track.
bonds in Switzerland and other parts of Europe.
Late in the summer of 1854 the fact became pub- The report of the examining committee was not
lie that there were discrepancies in the report made made until October 21st, the election having been
in 1852 by the Treasurer of the Company of the held on the 10th of that month. The report was a
floating debt and the freight and passenger earnings, voluminous and exhaustive analysis of the Com-
This added to the depression in Erie affairs, and pany's financialand physical condition. The corn-
September 14th the Directors ordered an investi- mittee found that the floating debt as reported in
gation of the matter to be made. James Brown, 1852 was understated by more than $1,000,000.
Thomas Tileston, D. D. Williamson, John E. The actual amount was $2,384,406.83. The reported
Williams, Caleb O. Halsted, David Hoadley, John amount was $1,323,053.55. The earnings had been
H. Gourlie, and J. C. Bancroft Davis were selected reported as $3• 537-766-S3- while they were in fact
a committee to make the investigation. Their in- but $3,319,906.14. ' We leave your bod}-," said
structions were to examine into all the books, papers, the committee in its report to the Board, " to deteraccounts,
and transactions of the Company. It was mine the reasons for these erroneous statements,
expected that the committee's report would be ren- and to whom they are to be charged. We can see
dered before the annual election in October, but it no justification for them. It appears in evidence
was not. That election of Erie Directors caused before us that the knowledge of them came to the
more than usual stir in Wall Street.
then Board of Directors a short time after the re-
Two tickets were in the field,one made up by port had been sent to Albany by the Treasurer, and
the friends of the existing Board, and one by stock- that the subject was investigated by their orders.
holders who thought that the policy of the Com- We think they erred in not frankly exposing them.
pany required a change in management. The regu- Since September, 1852, your Board has had to conlar
ticket contained the names of Homer Ramsdell, tend against the effects of a dividend when not
Samuel Marsh, William E. Doclgj, Shepherd Knapp, fully earned and the representation of your floating
Cornelius Smith, Marhall O. Roberts, Charles M. debt at far below its actual amount. A development
Leupp, Nelson Robinson, Daniel Drew, John like this, at the outset, led us to regard all after
Arnot, Ambrose S. Murray, George F. Tallman, transactions with suspicion, and to scrutinize them
Don Alonzo Cushman, William B. Skidmore, Louis rigidly. The results have been highly favorable to
Von Hoffman, Charles Moran, and Ralph Mead, the Company." While approving the existing con-
The independent ticket replaced the names of dition and methods of the management, the commit-
Messrs, Roberts, Robinson, and Smith by those of tec nevertheless chided it, and made suggestions as
John Compton, James Van Nostrand, Samuel follows: " The New York and Erie Railroad now
Wrillets, and Uriah Hendricks. There were four earns annually about as large a sum as was origivacancies
in the old Board caused by the resigna- nally proposed to be expended in its construction.
tion of Henry Sheldon, Gouverneur Morris, Alanson * * * When we see what it has already done,
Robinson, and Edward C. Weeks. The names of while new, incumbered, and without perfect connec-
Moran, Von Hoffman, Skidmore, and Cushman were tions, we have no difficulty in agreeing that it is
new on both tickets, all the rest on the regular ticket destined to do decidedly more with experience,
being those of members of the existing Board. The without incumbrance to the traffic, and with conregular
ticket was elected by 35,000 votes out of nections established. At the same time we cannot
44,000 cast. October 12th the Board elected the shut our eyes to the financial condition. We are
old officers. The election of Charles Moran, who aware of the difficulties with which your Board has
was a broker, and Louis Von Hoffman as Directors had to contend, and bear willing testimony to your