Untitled - Clpdigital.org

272 BETWEEN THE OCEAN AND THE LAKES
from the control of the Chicago and Atlantic Rail- of 18S5 of $3,915,984.37, and an increase of expe
road if possible, President Ring had recourse to the of $2,041,121.41. The earnings were sufficient to
courts. On that day the Farmers' Loan and Trust pay expenses and leave a surplus of $14,610.95.
Company of New York asked for the appointment of Nearly $2,000,000 were expended in work on the
a Receiver for the Chicago and Atlantic Company road " that should have been done in previous
before Judge Walter O. Gresham, at Chicago, on years," the report declared—ballasting, train-sheds,
the ground that the company was in default of inter- cross-ties (the laying of ties alone costing $708,-
est on bonds. The motion was opposed by counsel 193.oS); 10,000 tons of steel rails were put down;
in the interest of Mr. Jewett. The plaintiff cited $450,000 worth of new rolling stock was added;
the Jewett hostility to the Erie, and declared that he $214,000 was expended in ballasting. The followwas
diverting business from that railroad by using ing Board of Directors was elected for the ensuing
the Chicago and Atlantic against it, although the year:
Chicago line had been built by Erie funds to make John King, J. G. McCullough, J. Lowber Welsh,
it an adjunct of its own as a western outlet. The Courtlandt Parker, Henry H. Cook, William Libby,
hypothecating of the $2,500,000 second mortgage William A. Wheelock, William Whitewright, George
bonds of the Chicago and Atlantic Railway Company W. Ouintard, Ogden Mills, William L. Strong, Willwith
Grant & Ward as collateral for a loan, under iam B. Dinsmore, Morris R. Jessup, James J. Goodthe
Jewett management, was referred to, and the win, William N. Gilchrist, Josiah Belden, Joseph
claim was urged that the Western company was Ogden.
indebted to the Erie in that amount, this being John King was reelected President; S. M. Felton,
before the settlement of the Grant & Ward trans- First Vice-President ; Andrew Donaldson, Third
action.
Vice-President; A. R. Macdonough. Secretary; Ed-
April 8, 1886, Judge Gresham decided that Jewett ward White, Treasurer.
had been made Trustee of the Chicago and Atlantic To all outward appearances Erie was sailing
Railroad Company simply because he was President smoothly along toward a safe harbor at last. The
of the New York, Lake Erie and Western Railroad annual report for 1887 sparkled with statements of
Company, and could be relied upon to control the increased earnings, increased surplus, increased tonroad
as the western outlet of the Erie. Judge nage, increased passenger traffic, increased rates, in-
Gresham held that the holders of the past due and creased steel rail-laying, increased equipment quota.
unpaid coupons were entitled to their money, irre- The same Board of Directors was elected, the same
spective of the arrangement between the two com- officers; the same policy prevailed: "Retrenchment
panics, and that if the}- were not paid it would and Reform." In 1S88, 13,000 tons of new steel rails
become necessary to appoint a Receiver. A Re- were laid, and forty-one new locomotives purchased.
ceiver was subsequently appointed, and August 12, November 27, 1889, the Board of Directors—which
1S87, the road was sold to the Erie for $6,000,000, was the same, except that S. M. Felton, Jr., had
and August 31, 1887, the company was reorganized succeeded Joseph Ogden, and W. F. Reynolds had
as the Chicago and Erie Railroad Company, with all taken the place of Director Dinsmore, who died in
the stock in possession of the Erie, which gave that 1888—resolved to resume payment of interest on the
Company virtual ownership of the line. S. M. Fel- Company's income bonds in January, 1890, the first
ton, First Vice-President of the New York, Lake interest that had been paid on them in nine years.
Erie and Western Railroad Company, was elected January 21, 1890, the Board voted that a dividend
President of the new company. Eben B. Thomas, of 1 per cent, on the preferred stock had been earned
Second Vice-President of the Erie, was made Gen- and was payable for the quarter ending December 31,
eral Manager.
1889, and would be payable quarterly thereafter.
The annual Eric report for 1886 showed an in- " The time had arrived when extraordinary expendicrease
in net earnings of the entire system over those tures for improvements and the necessities of the