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 Cerm-rrj\ "W e-e* 
 
Library 
 
 OF THE 
 
 University of North Carolina 
 
 This book was presented by 
 
 
Doc. No. 66.] 
 
 [Ses. 1858-'9. 
 
 Ordered to le Printed. 
 
 Holclen & Wilson, Printers to the State. 
 
 REPORT OF JOINT SELECT COMMITTEE TO EN- 
 QUIRE INTO THE MANANGEMENT OF THE 
 WESTERN NORTH-CAROLINA RAILROAD. 
 
 HI 
 
 The joint select commitee, to whom was refered a resolu- 
 tion of the two Houses of the General Assembly, directing 
 them to enquire into the management of the Wesrenr North M 
 Carolina Rail Road Company, submit the following report : 
 
 The committee have not had time to make anything like a 
 thorough examination, of either the financial condition, or the 
 management of the said road. The facts which they are 
 about to submit, have been obtained from the statements, not 
 under oath, made by the President, and Engineer, and from 
 certain written documents which accompany their report. 
 Their investigations have been confined ^exclusively to part 
 that of the road from Haile's to Morganton. 
 
 It appears from the reports and statements of the Chief 
 Engineer, that the estimated cost of the work, from Haile's to 
 Morganton, was six hundred and sixty thousand dollars, and 
 the distance 23 45-100 miles. These estimates were made in 
 1856, and submitted to the stockholders on the 31st of August 
 of that year. By the provisions of the original and amended 
 charters, individuals and corporations, who were solvent, were 
 required to subscribe one-third of the estimated cost of the 
 work and pay in cash 5 per cent of the amount, by them 
 jQr* repectively subscribed, and thereupon, upon the certificate 
 |j^ of those facts by the President and Treasurer of the compa- 
 ljl£ , ny under the seal of the corporation, the board of Internal Im- 
 
 &^ 
 
2 Document 1$o. Q6. [Session 
 
 provements is required to cause the public Treasurer to sub- 
 scribe in behalf of the State double the amount. On the 10th 
 of August, 1858, a certificate, stating that two hundred and 
 twenty thousand dollars had been subscribed, as was provided 
 in the amended charter, by the county of Burke and by an- 
 other party, and that 5 per cent had been paid into the Treas- 
 ury of said company, and that the parties making the sub- 
 scription were abundantly solvent, was made by R. C. Pear- 
 son, Prst, and R. F. Simonton, Treasurer, with the seal of the 
 corporation attached. A copy of the certificate is hereto an- 
 nexed, marked A. The facts in regard to these subscriptions, 
 as far as the committee have been able to ascertain them, aie 
 as follows : In pursuance of the provisions of the amended 
 charter, a proposition was made by the county court of Burke 
 to the people of that county to subscribe $100,000 to the stock 
 of the Western North-Carolina Railroad, which was rejected 
 \>f a majority of the qualified voters. Subsequently another 
 proposition was by said Court, submitted to them, to sub- 
 scribe fifty thousand dollars, and upon the vote being taken, 
 a majority of the qualified voters cast their votes in favor of 
 it. It was insisted, by those who were opposed to the sub- 
 scription that the County Court of Burke, having submitted 
 one proposition to the people of the county, and that having 
 been rejected, their power in the premises was ended, 
 and before any bonds were issued, a bill of injunc- 
 tion was sued out, restraining the authorities of Burke 
 county from issuing said bonds, and that is now pending in the 
 Supreme Court. In regard to the subscription of one hundred 
 and seventy thousand dollars by another individual, that in- 
 dividual is Charles F. Fisher, Esq., Prst. of the N. C. Rail 
 Road. It was stated to us, that frequent efforts were made 
 to obtain subscriptions to prosecute the work, all of which 
 were unavailing. Of this there can be no doubt. Finally Mr. 
 Fisher, after making other propositions, which were declined, 
 proposed to subscribe the remainder of the stock necessary 
 to obtain the subscription on the part of the State, and take 
 the whole contract from Haile's to Morganton at the estimates. 
 These terms were accepted by the company, and Mr. F. sub- 
 Scribed the stock, and the contract was awarded to him on 
 
 H 
 *' 
 
185S-9.] Document Xo. 66. 3 
 
 the 10th of Jane, 1858, and he entered into bond without se* 
 eurity to do the work. The subscription* and the contract 
 were contemporaneous and dependent acts. It is not pre- 
 tended he would have made the subscription without the 
 contract. As there have been some insinuations that the es- 
 timates were made specially with reference to the contract 
 with Mr. Fisher, the committee in this connection deem it 
 due to truth and justice to say, there is no evidence from 
 which any such inference can be drawn. The contrary is 
 abundantly clear. Whether Mr. Fisher would be 'abundantly' 
 solvent for one hundred and seventy thousand dollars, this 
 committee do not know, and having no evidence before them, 
 are unable to express any opinion. 
 
 With respect to the payments of five per cent, upon the sub- 
 scriptions made by the county of Burke and Mr. Fisher, the 
 facts, as far as the committee can ascertain them, are as fol- 
 lows : First, as to the county of Burke. The chairman of 
 . the county court drew a draft on the county trustee for twen- 
 ty-five hundred dollars. That draft was not paid then, nor 
 has it been since. Unless that draft was a payment in cash, 
 no such payment upon the part of the county of Burke ever 
 has been made ; indeed, as stated in a previous part of this 
 report, whether the county of Burke has made any subscrip- 
 tion binding upon her, is yet to be settled by the judicial tri- 
 bunals of the country. The majority of the committee have 
 a very clear and decided opinion as to whether there was in 
 fact, and in law, any payment whatever, made by the county 
 of Burke, but they refrain from expressing that opinion, out 
 of deference to one of their number. In relation to the paj 7 - 
 ment by Mr. Fisher of five per cent, upon his subscription 
 of one hundred and seventy thousand dollars, it is stated by 
 the President of the road, that on account of previous transac- 
 tions between the Company and Mr. Fisher, they were in- 
 debted to him more than the five per cent, on his stock ; that 
 no actual payment was made by Mr. F., it being deemed an 
 idle ceremony, to pay him the amount which the corporation 
 owed him and immediately receive it back. The original of 
 Mr. Pearson 's Tetter in relation to these payments marked B., 
 
4 -Document Xo. 66. [Session 
 
 is herewith submitted, the object of the committee being to 
 do entire justice to all the parties concerned. They also sub- 
 mit a detailed statement of the estimates made by the Engi- 
 neer, marked C. Of the correctness of these estimates, the 
 committee have no means of enabling them to form any 
 opinion. They are not Engineers, and if they were, many of 
 the items depend so much upon the character of the country 
 through which the road passes, without an examination, they 
 would be totally unable to judge of their correctness. They 
 will remark this, however, that at the time when the esti- 
 mates were made, iron was higher hj some eight or ten dollars- 
 per ton, than when Mr. Fisher took the contract, which was on 
 the 10th June, 1858. The estimates for the excavation of 
 rock, it will be observed, are a little over six to one for the 
 whole estimate for that part of the road. As we have before 
 observed, this strikes us as being large, larger than would be- 
 found to be the fact upon any railroad m the country. Again :■ 
 in regard to the amount of iron for turn outs. It is put down 
 at eight per cent., and amounts to $11,023, This seems to the 
 committee as being a very liberal, if not an extravagant 
 amount for that part of the road. Of this, however, the 
 members of the General Assembly are quite as competent to 
 judge as the committee, unless they had some data, upon which 
 to form their opinions. 
 
 In closing this report, the committee feel it their duty to 
 call the attention of the General Assembly to the necessity 
 of providing some more reliable mode of ascertaining, in cases 
 where the State is to subscribe to public works, upon the con- 
 ditions that individuals and corporations who are solvent have 
 previously subscribed, and have paid in cash a. certain part of 
 their subscriptions, that those conditions have been complied 
 with than now exists. "We understand the board of Internal 
 Improvements, upon a certificate made to them by the Presi- 
 dent and Treasurer of the corporation with its seal attached, 
 that the conditions precedent have been performed, feel bound 
 to direct the Public Treasurer to subscribe on behalf of the 
 State. 
 
 Now the facta disclosed in this case, show how deficient the 
 
1858-'9.] Document No. 66. & 
 
 law is. It may be, the highest judicial tribunal of this State- 
 will hold that the subscription' made or rather attempted to be 
 made on behalf of the comity of Burke is void. It may turn 
 ont in others, if not in this case, that the certificate of the 
 solvency of the individual subscribers is false. Yet according: 
 to the construction of this charter, and others like it, if an in- 
 solvent man, not worth five hundred dollars, was to sub ;cribe 
 two hundred thousand, and a President and Treasurer cor- 
 rupt enough to certify he was solvent and had paid five- 
 per cent, in cash, could be found, the board of Internal Im- 
 provements would be bound to direct the Public Treasurer to 
 make the subscription for the State. The certificate ought to' 
 be made under oath. Besides and beyond this, the board 
 ought to have power, and it should be made their duty in all 
 cases where they had the least doubt, to examine and ascer- 
 tain the binding obligation of the subscriptions, the solvency 
 of the subscribers, and also whether the cash payments re- 
 quired to be made, were really, truly and bona fide made. 
 To enable them to make this investigation, the- board should 
 have power to examine witnesses on oath. There are other 
 views in regard to the management of our public works, which 
 have suggested themselves to the committee,, but deeming' 
 them not within the scope of the investigation, which they 
 were directed to make, they refrain from any remarks upon* 
 them. 
 
 Whether any, and if so, what steps should be taken in view 
 of the facts disclosed by this report to protect the interest of 
 the State, the committee deem it most proper to leave to the 
 General Assembly, without any recommendation on their part. 
 
 All of which is respectfully submitted. 
 
 DAVID OUTLAW, 
 for the Committee* 
 
Document No. 6&. [Session 
 
 (A.) 
 
 Office of the Western 1ST. C. R. R. Company, ) 
 Morgan ton, N. C, August 10th, 1858. j 
 
 We the undersigned President and Treasurer of the Western 
 North-Carolina Railroad Company, do hereby certify that 
 in conformity with the provision of an act of the General As- 
 sembly of North-Carolina, entitled "' an act to amend the 
 act incorporating the said Western North-Carolina Railroad 
 Company," that the sum of ($220,000) two hundred and twen- 
 ty thousand dollars was the amount determined on by the 
 Board of Directors of said company as necessary to be sub- 
 scribed by private individuals, or by Counties, to carry out 
 and comply with the 1st and 2d sections of said amended act. 
 We further certify that the said sum of two hundred and 
 ninety thousand dollars has been subscribed as provided in said 
 act by the county of Burke, and by another party, on which 
 subscription 5 per cent, has been paid into the treasury of 
 said Western North-Carolina Railroad Company, and which 
 said county and party making such subscriptions are regarded 
 by the company as abundantly solvent. 
 
 In testimony whereof, R. C. Pearson, Esq., President of 
 said company, and R. F. Simonton, treasurer thereof, have 
 hereunto signed their names and affixed the seal of said cor- 
 poration, the day and year first above written. 
 
 R. C. PEARSON, Pres. 
 R. F. SIMONTON, Treas. 
 
 The above is a true copy from the books of the Board of 
 Internal Improvements. 
 
 GRAHAM DAYES. 
 
 January 17th, 1859. 
 
1858-9.] Document No. 66. 
 
 (B.) 
 Raleigh, K C, Jan. 21st, 1859. 
 
 W. L. Steele, Esq., Chairman, <&c. : 
 
 Sm : — I have the honor in compliance with your request 
 to furnish you with the facts connected with the payment by 
 Charles F. Fisher, Esq., of the 5 percent, on 1,700 shares sub- 
 scribed by him to the capital or joint stock of the Western 
 North Carolina Railroad Company. 
 
 Mr. Fisher had subscribed stock liberally when the books 
 were opened under the original charter, and became a con- 
 tractor at the first letting of contracts for a large amount of 
 work. The company had likewise made a contract with him 
 to lay the tract from Salisbury to Statesville. 
 
 Most of Mr. Fisher's work was completed, and the residue 
 in much forwardness at the time the additional stock was 
 taken, for building the road from Halo's store to Morganton, 
 and the company was in his debt more or less from the time 
 he' commenced operations. 
 
 When Mr. Fisher came forward to pay the first instalment 
 of 5 per cent, on said 1700 shares of stock before the subscrip- 
 tion by the State, the company owed him (as well as I now 
 recollect) over $11,000. I did not consider it necessary to pay 
 over to him $8,500 on account of what was due him, and re- 
 ceive it back at the same instant, nor to require him to go 
 through the same forms with respect to the 5 per cent, due 
 from him. 
 
 The five per cent, on the 500 shares subscribed by the coun- 
 ty of Burke, was paid by a draft drawn by Thomas G. Walton, 
 Esq., chairman of the county court, (by whom the subscrip- 
 tion on behalf of the county had been made) as the county 
 trustee, or the person having the custody of the county bonds, 
 and this draft for $2,500 was accepted by the treasurer as cash, 
 and he charged himself with the amount on the books of the 
 company. 
 
 These payments by Mr. Fisher and by the county of Burke 
 
8 
 
 Document No. 66. 
 
 [1858- J 9. 
 
 were made before the certificate was made to the Governor 
 and Board of Internal Improvements, under which the State 
 made her subscription. 
 
 I may here add that in the contract made with Mr. Fisher 
 "for building the road from Hale's to Morganton, he agrees to 
 take at par the $50,000 of bonds issued by the county of 
 Burke in payment of her subscription, so that the transaction 
 with respect to the first instalment on the Burke subscription 
 was tantamount to a cash transaction, even if it should be 
 held that five per cent, in actual cash should be paid to the 
 company in such cases. 
 
 Respectfully presented, 
 
 E. C. PEARSON, 
 President Western JUT. C. R. R. Company. 
 
 (C.) 
 Estimates on 23.46 miles of the Western JST. C R. R., for 
 which Charles F. Fisher is contractor : 
 
 899*463 cubic yards of earth excavated + $17.92, $101,260.00 
 
 138,520 " " of rock " + 80, 110,816.00 
 <6,276 cubic yards of arch, culvert, and 
 
 bridge masonry, + $6.66, 41,807.75 
 
 5,231 cubic yards dry stone masonry, + $3.30, . . 17,261.00 
 
 100 feet lineal bridge supporters, + $25 per foot, 2,500.00 
 
 1 small county road bridge, 250.00 
 
 68,836 sills + 33^ cts. each, (post & white oak,) 20,650.71 
 
 $354,545.50 
 
 Contingencies, 10 per cent, on the above, 35,454.50 
 
 Iron for 23.46 miles — 833 tons per mile, 53 lbs. 
 
 per yard h $70 per ton, 137,795.26 
 
 8 per cent, for turnouts, 11,023.00 
 
 Tracklaying, + $500 per mile, 11,730.00 
 
 8 per cent for tracklaying, 938.40 
 
 Chairs, spikes, &c, &c, &c, 14,083.34: 
 
 $565,570.00 
 Add for land damages, 5,212.00' 
 
 $570,782.00 
 JAMES C. TURNER, 
 Chief Fngmeer W. N. R. R. 
 
 mm 
 
UNIVERSITY OF N.C. AT CHAPEL HILL 
 
 00042071667 
 
 FOR USE ONLY IN 
 THE NORTH CAROLINA COLLECTION