stated in the annual report of the Rock Is- , The Chicago, Rock Island, & Gulf land road, June 30, 1904:

Railway

386.92 “Consolidation of Texas Lines.

“On page 9 of said report, under the “The legislature of the state of Texas, by head of 'Property' and 'Franchises,' occur an act passed March 27th, 1903, authorized the following: the sale of the railroads and properties of “During the year expenditures were made the Chicago, Rock Island, & Texas Railway for construction of extensions and compleCompany, extending from the Red river to tion of system lines as follows: Fort Worth, Texas, with a branch from Fort Worth, Texas, to Dallas, Bridgeport, Texas, to Graham, Texas; the Texas

$111,371 55 Chicago, Rock Island, & Mexico Railway Yarnall, Texas, to Amarillo, Company, extending from the Texas-Okla- Texas

108,615 64 homa line, near Texhoma, to the Texas-New Jacksboro, Texas, to Graham,

, Mexico line at Bravo; and the Choctaw- Texas

32,138 96 Oklahoma & Texas Railroad Company, ex- Red River to Fort Worth, Texas 28,013 04 tending the Texas-Oklahoma line near Tex Texhoma (Texas state line) to ola, Texas, to Amarillo, Texas, to the Chi- Bravo, Texas

9,646 03 cago, Rock Island, & Gulf Railway Com- Texola (Texas state line) to pany, which had constructed a line of rail

Yarnall, Texas

2,328 30 road from Dallas, Texas, to Fort Worth, "In addition to the expenditures during Texas, where it connected with the line first the year as above, there has been transferred named above.

to property account sundry amounts expend* "In accordance with the authority granted prior to July 1st, 1903, for construction ed, the properties referred to were, by ap- of new lines and shops, and purchase of propriate corporate action, deeded to the equipment, which have been heretofore statChicago, Rock Island, & Gulf Railway Comed in the system assets as 'Advances for pany on December 1, 1903.

Construction and Equipment, the property “This consolidation permits the properties represented by such amounts having been in question to be operated by one manage-deeded to the Chicago, Rock Island, & Pament instead of four separate sets of of-cific Railway Company or the Chicago, Rock

, ficials, as heretofore, resulting in economy of Island, & Gulf Railway Company, $23,169.operation and greater efficiency in service. 83. "In stating the assets and liabilities of

"There has also been transferred to this the companies forming the system, the hold account the expenditures made prior to ings of the Chicago, Rock Island, & Pacific July 1st, 1903, for the purchase of shares Railway Company in the bonds and capital of capital stock of the Burlington, Cedar stock of auxiliary lines, together with loans Rapids, & Northern Railway Company and between system companies, have been climi- the Rock Island & Peoria Railway Comnated from the liabilities, and a like reduce pany, also cost of stock of the Choctaw, Oktion made in the value of the assets; the lahoma, & Gulf Railroad Company in exfigures as stated, therefore, represent the cess of its par value and the value of bonds value of the assets and the real liability of the Chicago, Rock Island, & Texas Rail. without duplication."

way Company, owned by the Chicago, Rock Plaintiis also introduced in evidence the Island, & Pacific Railway Company, the twenty-fourth annual report of the Pacific value of said property appearing upon balcompany for the year ending June 30, 1904, ance sheets shown in prior year's report as in which it is set forth:

'Stocks and Bonds of Constituent Com. “They have included therein operations panies,' $16,446,009.73. and affairs of the operated lines and auxil. “On page 11 of said report, under the iary companies forming the 'Rock Island heading ‘New Lines Open for Operation,' the system.'

following statements are made, viz.: “In order to make exhibits comparative “Additions have been made to the operatthe figures for the last preceding year have ed system-mileage since the last report as been restated to meet changed conditions follows: due to the including in this report the op- "By the Chicago, Rock Island, & Gulf eration of the auxiliary companies.

Railway Company, Fort Worth, Texas, to “These lines, tnus forming the Rock Is- Dallas, Texas, 33.26 miles, opened for operaland system, are the following:

tion in December, 1903. Mileage Operated.

“Yarnall, Texas, to end of track west of The Chicago, Rock Island, & Pacific

Amarillo, Texas, 18.40 miles, opened for opRailway

6,760.74 eration in November, 1903. The Chicago, Rock Island, & El

&

“Corrections in measurements, Red River Paso Railway

111.50 | to Fort Worth, Texas, .83 miles.

“Operated system mileage was decreased [The list shows that of the 754 shares 18.22 miles between Yarnall, Texas, and subscribed, 745 were held by one of the atAmarillo, Texas.

torneys of the Pacific company, and of the "Fort Worth, Texas, to Dallas, Texas.- other nine shares, three were held by other This line was completed and the line opened employees of that road.] for operation by the Chicago, Rock Island, & “Under the charter of the Chicago, Rock Gulf Railway Company, December 1st, 1903. Island, & Texas Railway Company, it was

. It is 33.26 miles in length, connecting with authorized to construct a line of road from the line of the former the Chicago, Rock Is- the north boundary line of Texas at a point land, & Texas Railway Company at Fort in Montague county in a southerly direction Worth, and extending to Dallas, where, by through Montague, Wise, and Parker counan agreement with the Gulf, Colorado, & ties; the charter, being afterward amended, Santa Fé Railway Company, it has the joint authorized the construction into Tarrant use of the latter company's terminal facili-county. This charter authorized the issuties.

ance of first-mortgage bonds amounting to “The opening of this line gives the Gulf $15,000 per mile for construction and not company direct entrance into Dallas, ena- exceeding $5,000 per mile for equipment, bling it to compete for the traffic of that im- “When the Chicago, Rock Island, & Pacific portant commercial center.

Railway Company constructed its line to a "On page 12 of said report is the follow-point near the north bank of the Red river, ing statement, viz.:

north of Montague county, construction System Mileage Under Construction. work stopped for a period of time. The By the Chicago, Rock Island, & Gulf Rail Chicago, Rock Island, & Texas Railway

, way Company: ,

Company began the construction of its line Amarillo, Texas, to Texas-New Mexico at the north line of the state in Montague boundary

69.87 county some time after the Chicago, Rock “Amarillo, Texas, to Tucumcari, New Island, & Pacific Railway Company stopped Mexico. The grading for a considerable por- work at a point north of Red river. After tion of this line has been done from Amaril-construction work began on the Chicago, lo westward.

Rock Island, & Texas Railway Company "It was deemed advisable, however, to sus- south of Red river, the Chicago, Rock Ispend active construction until such time as land, & Pacific Railway Company construct

, the business outlook would warrant the ex. ed its line from the point where work had penditure necessary to complete.”

stopped north of Red river, to a connection Upon the hearing counsel made an agreed with the Chicago, Rock Island, & Texas statement of facts, as follows:

Railway Company at the state line. The "The Chicago, Rock Island, & Pacific Rail Texas company finished the construction of

. way Company is a consolidated corporation, its line into Forth Worth in the latter part chartered under the laws of Illinois and of 1893. Some of the same contractors who Iowa. It has been an existing railroad cor- constructed the Chicago, Rock Island, & Pa- . poration for over twenty years. In June cific Railway from Minco south to Red river of the year 1892, and for some years prior also took contracts for work on the Texas to that time, the said railway company

line. owned and operated a line of railway from "On the 2d day of January, 1893, after the the city of Chicago, in a southwesterly di- Chicago, Rock Island, & Texas Railway Comrection through the states of Illinois, Iowa, pany had constructed and was operating its Missouri, and Kansas to Minco, Indian ter- line as far south as Bowie, Texas, it entered ritory. During the year 1892 this company into an agreement with the Chicago, Rock extended its line from Minco, Indian terri- Island, & Pacific Railway Company, a true tory, in a southerly direction to the north copy of which is hereto attached and marked boundary line of Texas in Montague coun

'Exhibit A' for identification. This agree

A ty.

ment went into effect immediately after it “The Chicago, Rock Island, & Texas Rail-was executed, and was acted upon and obway Company was a corporation organized served by said companies until the 14th day under the laws of Texas on the 15th day of of April, 1903, when the same was canceled July, 1892, It had an authorized capital under authority of the board of directors stock of $3,000,000 in shares of $100 each, of each company by a written agreement, a

, of which 754 shares were subscribed for at true copy of which is hereto attached, the time of its organization. Below is a list marked 'Exhibit B' for identification. of the names of the stockholders and the [Exhibits A and B are not printed, as number of shares of capital stock of this they are the contract and cancelation there- . company subscribed for by each, at its origi- of, both made before the present case arose.] nal organization.

“After the Chicago, Rock Island, & Texas Railway Company had constructed its line, from its organization until the 8th day of it issued first-mortgage bonds to the ex. November, 1900, during all of which time he tent of $15,000 per mile thereon, and these was one of the general attorneys of the bonds were purchased by the Chicago, Rock Chicago, Rock Island, & Pacific Railway Island, & Pacific Railway Company, for Company. which it paid the Texas line 100 cents on "The Chicago, Rock Island, & Texas Railthe dollar. The Chicago, Rock Island, & way Company never issued or sold any Texas line cost a large sum of money in equipment bonds, but before it was sold out excess of the amounts for which it issued under special act of the legislature to the bonds, which additional cost was paid by Chicago, Rock Island, & Gulf Railway Comapplication of money subscribed by the pany, it had purchased and was the owner stockholders and by borrowing from the Chi- of between one thousand and twelve hundred cago, Rock Island, & Pacific Railway Com- freight cars of various kinds. During the pany, which money so borrowed has long time it had no equipment of its own, it since been returned with interest.

rented rolling stock from various railway "At the time the Chicago, Rock Island, & companies, but principally from the Chicago, Pacific Railway Company constructed its Rock Island, & Pacific Railway Company, line to Red River there was no town or city and paid therefor prices prevailing between at that particular point, but there were other lines of railway in the state of Texas. towns and cities south, east, and west of "After the Chicago, Rock Island, & Texas there in the state of Texas, and a railroad Railway Company constructed its line into line, being a part of the Missouri, Kansas, Forth Worth from Bowie, and after the & Texas Railway of Texas, 9 miles south of execution of the contract between it and that point.

the Chicago, Rock Island, & Pacific Rail“When the Chicago, Rock Island, & Texas way Company, of date of January 20, 1893, Railway Company was first organized its the most of the passenger and freight trains general offices were located at Bowie, Mon- running over its line from Red River to tague county, Texas, and remained there for Fort Worth and from Fort Worth to Red some time, until the charter was amended River were operated beyond its lines as the removing them to Fort Worth. The first trains of the Chicago, Rock Island, & Pacific general officers elected by the Chicago, Rock Railway Company. The employees operatIsland, & Texas Railway Company, and ing these trains were under the control of their residences, were as follows: M. A. Low, and paid by the Chicago, Rock Island, & Topeka, Kansas, president; J. C. McCabe, Texas Railway Company while working on Bowie, Texas, general freight agent, and H. its line, and they were also under the conF. Weber, Bowie, Texas, vice president, su- trol of and paid by the Chicago, Rock Isperintendent, secretary, and treasurer. All land, & Pacific Railway Company while on these men, prior to the time they were elect- its line. The equipment in the various ed officials of the Chicago, Rock Island, & trains went as far north as the business jusTexas Railway Company had been employed tified, some of the passenger equipment goin some capacity by the Chicago, Rock Is- ing as far as Chicago, and some to Kansas land, & Pacific Railway Company. In 1893 City, while the freight equipment stopped at S. B. Hovey was elected vice president of the points beginning at Chickasha, and from Texas company and remained the vice presi- there north wherever the freight was desdent and superintendent of the Chicago, tined. The passenger equipment coming Rock Island, & Texas Railway Company south stopped at Fort Worth, and the from that date until it was sold out under freight equipment, where the freight was an act of the legislature in 1903. Mr. M. E. handled in car-load lots, went to destinaSebree, who was served with citation in this tion, wherever that might be. case, was, for a number of years and until “Whenever necessary the Texas company the date of its sale, trainmaster of the Chi- would operate a local train to handle freight cago, Rock Island, & Texas Railway Com- between Fort Worth and Red River, but as pany and assistant trainmaster of the Chi- a general rule the through service maincago, Rock Island, & Pacific Railway Com- tained took care of this business. It operatpany, with jurisdiction on that line up to ed a local freight and passenger train beChickasha, Indian territory. Prior to the tween Bridgeport and Jacksboro and after

, time he was employed by the Chicago, Rock ward to Graham from the time that branch Island, & Texas Railway Company he had was built until it was sold out, which was been employed by the Chicago, Rock Island, several years. On the through freight trains & Pacific Railway Company as brakeman, the run made by the crews was from Fort conductor, etc. M. A. Low, of Topeka, Kan. Worth to Chickasha and on the through passas, remained the President of the Chicago, senger train the run made by the crews was Rock Island, & Texas Railway Company | from Fort Worth to Caldwell, Kansas, these crews being handled and paid as above set | Gulf Railway Company now owns and opforth. Outside the Pullman cars, which erates 386 miles of road, all of which is lowere in each passenger train, nearly all cated inside of the state of Texas. It does the passenger equipment used by the Chi- not own any railroad outside the state of cago, Rock Island, & Texas Railway Com Texas. It owns at the present time about

. pany belonged to the Chicago, Rock Island, 1,600 cars, including ballast, refrigerator, & Pacific Railway Company, for which it and cattle cars, twenty locomotives, and paid rental, as provided for under the terms eight cabooses, but does not own any pasof the contract herein first referred to. senger equipment other than the Pullman

“Defendant's witness will testify that the cars which are used in each of its passenger Texas company paid no part of the cost of trains; it rents its passenger equipment operating the Chicago, Rock Island, & Pa- from the Chicago, Rock Island, & Pacific cific Railway, nor did the Pacific company Railway Company, and pays therefor curpay any part of the cost of the operation of rent rental charged by connecting lines in the Chicago, Rock Island, & Texas Railway, Texas. The train crews on both the through nor did either of them participate in the passenger and freight trains are handled in earnings of the other. The relationship be the same way that they were when the line tween the companies is fully disclosed by into Fort Worth was operated by the Chithe terms of the contract dated January 2d, cago, Rock Island, & Texas Railway Com1893, which was observed up to the time of pany, but the Chicago, Rock Island, & Gulf its cancelation.

Railway Company is now operating in many “The passenger conductors, brakemen, and places local trains between local points in train guards wear regular train uniforms Texas. and on the lapel of the coat are the words "The following is a list of stockholders 'Rock Island,' and on the cap is the word and the amount of stock of the Chicago, 'Conductor,''Brakeman' or 'Porter.' Any Rock Island, & Gulf Railway Company member of these train crews, while working owned by each. on the line of the Texas company, may be [The list is not printed, as the record disdischarged by the proper officer of that com- closes that, except directors' shares, the pany; and while working on the line of the stock is held for the Chicago, Rock Island, & Pacific company may be discharged by the Pacific Railway Company. ] proper officer of that company. Either com- "The Chicago, Rock Island, & Gulf Railpany, of course, employs additional men way Company is operating under a lease when needed.

that part of the line of the Chicago, Rock “At the time the contract of January 20, Island, & Pacific Railway Company which 1893, was canceled, the Chicago, Rock Is- begins at the north boundary line of the land, & Texas Railway Company was operat- state of Texas, extending northward to the ing about 140 miles of road, and the Chica- town of Terral, Indian territory, a distance go, Rock Island, & Pacific was operating of about one and one-sixth miles. about 3,300 miles. For a considerable time “Blank passes, properly signed by different after the Chicago, Rock Island, & Texas railroads, including the Chicago, Rock IsRailway Company was

Company was built into Fort land, & Pacific, Texas & Pacific, Houston & Worth it employed and maintained at its Texas Central, and other lines, are someFort Worth office a train despatcher, who times placed with S. B. Hovey, and when so gave orders for the movement of trains over placed he has the permission of such line its line, but as a matter of economy this to fill in the names of parties and counterwas abolished, and the Texas company paid sign the pass, and when so countersigned a part of the salary of the train despatcher such pass is recognized by the line over located at Chickasha to give orders for the which it is issued. The local ticket agents movement of trains over its rails.

of the Chicago, Rock Island, & Gulf Rail“On the 22d day of September, 1903, the way Company sell coupons tickets over the Chicago, Rock Island, & Texas Railway Com Chicago, Rock Island, & Pacific Railway pany, under authority of a special act of the Company's line and nearly all other lines in legislature known as Senate Bill No. 161, the United States, which tickets are duly was purchased and absorbed by the Chicago, honored by the respective roads over which Rock Island, & Gulf Railway Company, and they read. The Chicago, Rock Island, & since that time has ceased to exist as a Gulf Railway Company operates only one railroad or do any business as such.

passenger train each way daily between Fort “At the time the Gulf company purchased Worth and Dallas, while it operates two the Texas company it had constructed and trains each way from Fort Worth north. It was operating a line of road from Fort operates also only a local freight service beWorth in Tarrant county to Dallas in Dal-tween Fort Worth and Dallas, but no las county. The Chicago, Rock Island, & | through freight service. Proper officials of the Chicago, Rock Island, & Gulf Railway | Gulf Railway Company does not now and Company and of the Chicago, Rock Island, & never has paid any part of the salary of any Pacific Railway Company exchange reports officer of the Chicago, Rock Island, & Pacific with each other as to the amount of ex- Railway Company, or of any of the lines change business done.

named as constituting the Rock Island sys"No dividends were ever paid on the stock tem. of the Chicago, Rock Island, & Texas Rail- “Before the Chicago, Rock Island, & Gulf way Company, and none have been paid on Railway Company purchased the Chicago, that of the Chicago, Rock Island, & Gulf Rock Island, & Texas Railway Company, the Railway Company. The net earnings of the Chicago, Rock Island, & Mexico Railway Chicago, Rock Island, & Texas Railway Com-Company and the Choctaw, Oklahoma, & pany were put into betterments and im Texas Railroad Company, M. E. Sebree was provements, and the same is the case with trainmaster of the Chicago, Rock Island, & the Chicago, Rock Island, & Gulf.

Texas Railway Company, and division train"In 1897 L. G. Hastings, then secretary master of the Chicago, Rock Island, & Pacifof the Chicago, Rock Island, & Texas Rail-ic Railway Company, with jurisdiction way Company, reported to the Interstate to Chickasha, Indian territory. Since the Commerce Commission that the Chicago, purchase by the Gulf company of the aboveRock Island, & Texas Railway Company was named Texas lines Mr. Sebree's jurisdiction controlled by the Chicago, Rock Island, & extends over what were the Chicago, Rock Pacific Railway Company, through the own- Island, & Mexico Railway Company and the ership of a majority of its bonds. In 1899 Choctaw, Oklahoma, & Texas Railroad Comhe reported it as controlled by the Pacific pany; otherwise there has been no change in company, through its ownership of a major his employment or jurisdiction for the past ity of its capital stock.

five to ten years. “On the 2d day of August, 1904, M. E. Se- "The Chicago, Rock Island, & Gulf Railbree, who resides in Fort Worth, Texas, was way Company pays a portion of the salary trainmaster of the Chicago, Rock Island, & of a joint train despatcher located at ChickGulf Railway Company, and was also as- asha, Indian territory, under the same charsistant trainmaster of the Chicago, Rock Is-acter of arrangement which existed between land, & Pacific Railway Company between the Chicago, Rock Island, & Texas Railway the north line of Texas and Chickasha, In- Company and the Chicago, Rock Island, & dian territory. He is paid by the Gulf com- Pacific Railway Company. This train despany for the work he does for it and by the patcher, in giving orders for the handling of Pacific company for the work he does for it. trains on the Chicago, Rock Island, & Gulf S. B. Hovey is vice president and superin- Railway Company, is subject to the control, tendent of the Chicago, Rock Island, & Gulf direction, and supervision of the executive Railway Company, and will testify that he officers of the Chicago, Rock Island, & Gulf is not connected with, nor does he perform Railway Company as if exclusively employed any service for, any other railroad.

“After making certain changes and addi- “The rails of the Chicago, Rock Island, & tion, the Chicago, Rock Island, & Gulf Rail- Gulf Railway Company on the line running way Company adopted the book of rules is from Fort Worth north connects at the state sued by the Chicago, Rock Island, & Pacific line with the rails of the Chicago, Rock IsRailway Company for the control of the op- land, & Pacific Railway Company. The eration of its line, and such rules are now point of connection is somewhere near the in force. The cars and engines belonging middle of Red river on a bridge. At this to the Chicago, Rock Island, & Gulf Railway particular point there is no town, station, Company, when in need of repairs, have the or turnout, and the trains going in either work done at its shops at Fort Worth and direction do not stop at said point. It was Dalhart, if the cars and engines are con not possible to build a town or station at venient to these two points; otherwise, the the exact point of connection.” work is done at some other convenient place, It was further stipulated as to Thomas, either on or off the line of the Chicago, Rock the conductor, and Turpin, the ticket agent, Island, & Pacific Railway Company, wher- after they were served with process, as folever the cars or engines may be at the time lows: the repairs are needed.

A. L. Thomas "was, at the date of said “On the 2d day of August, 1904, the Chi- service, and is now, and has for many years cago, Rock Island, & Gulf Railway Company been, a conductor running on and handling had a different president and altogether dif- passenger trains for the defendant, the Chiferent executive officers from any of the cago, Rock Island, & Pacific Railway Comlines above listed as included in the Rock | pany, the Chicago, Rock Island, & Texas Island system. The Chicago, Rock Island, & Railway Company, and later on the Chicago,

by it.