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Mr. DRAKE. Yes, sir; for the reasons previously stated.

Senator TALIAFERRO. What was the account that you depleted in making certain cash payments to the Cramps?

Mr. DRAKE. It was a depreciation account which had been established by a charge to operating expenses from time to time during the time the steamers were deteriorating. We had made a credit to a depreciation fund, which had accumulated at that time up to $102,000. Some time prior to that the fund was suspended, because we thought the market value of the steamers was in excess of the way they stood on the books. The depreciation fund had carried them down to less than their current market value; so the depreciation account was suspended, and the balance remained to the credit of that depreciation fund, and was drawing interest in the trust company.

Senator TALIAFERRO. And you used that in repairing the ships because you thought that the repairs would so improve the ships as to take the place of that fund to the credit of that account?

Mr. DRAKE. A part of the work that was done on the ships was properly chargeably to operating expenses. Only $226,000 of it was charged to capital account. A certain percentage of the repairs were structural in their character. Two hundred and sixty-five thousand dollars was the total that the bonds were sold for.

Senator MORGAN. I will proceed now, Mr. Drake, by calling your attention to page 246 of your former examination, in. which you described the condition of the stock that Mr. Taliaferro is alluding to. I will just read what you stated, and put it in the record here. (Reading:)

“Senator KITTREDGE. Who are the stockholders outside, in addition to the Panama Canal Company?

“Mr. DRAKE. There are 39 stockholders in the United States. The list of the stockholders is filed with the Isthmian Canal Commission. I apologize for not bringing it here. I had no idea it would be required, but there are 39 stockholders in the United States and 17 in France and England, in addition to the holdings of the canal company.

“Senator KITTREDGE. You say Mr. Cromwell is a stockholder? “Mr. DRAKE. Yes. “Senator KITTREDGE. The list you mention will give his holdings? “Mr. DRAKE. Yes. “Senator KITTREDGE. And those of the others? “Mr. DRAKE. Yes. I can supply that if it is required. “Senator KITTREDGE. I wish you would.

“Mr. DRAKE. It is of record with the Commission, but I will furnish it.”

Then follows, from what I suppose you furnished subsequently, a statement on page 247 of a list of all the stockholders, with the residence of each one, and the number of shares of stock held by each one, which footed up 70,000 shares.

Mr. DRAKE. 'Yes, sir.

Senator MORGAN. That was all the stock of the company. I will insert that list here without reading it. I wish to call attention, though, to one or two statements in it.

(The complete list referred to is as follows:)

List of stockholders of Panama Railroad Company.



Number of shares

1 1 10

1 1 ..

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1 1

68, 531



Boyard, Xavier

24 State street, New York....... Brown, Vernon H.

29 Broadway, New York. Cahen, Rudolph T., Marquis de Torre Alfina. 26 Exchange place, New York, care of L. Von

Hoffman & Co. Caben, Ugo Chesebrough, Robert A

17 State street, New York, Comstock, C.B..

34 West Twenty-tifth street, New York Coudert, Chas...

71 Broadway, New York. Cromwell, Wm. Nelson..

49 Wall street, New York D'Anvers, Albert Cahen

26 Exchange place, New York, care of L. Von

Holman & Co. D'Anvers, Louis Cahen

.do D'Espeyran, Felix Guillaume Sabatier 9 Rond Point des Champs Elysees, Paris,

France. D'Espeyran, Mme. L. C.C. de Barrois d'Orge

val Sabatier.
De Lesser, A. L. F.B.C

Care Mallet Freres & Co., Paris.
De Lesser, A. R. A.C.
Dinsmore, W.B

59 Broadway, New York. Drake, E. A

24 State street, New York. Einsiedler, Charles..

27 Williams street, New York.
Escott, Rev. Edward Sweet, and Cox, Henry The Red Cottage, Lyme Regis, England..

Felton, Samuel F

Monadnock Building, Chicago, Ill.
Franklin, Wm. B.

Hartford, Conn Gallaway, Robert M.

42 Wall steeet, New York. Garr, George

14 West Forty-fifth street, New York Gates, I. E...

35 Wall street, New York Gautron, Jean Pierre, liquidateur.

Paris, France Gebhard, Wm. H

New York, N. Y.. Gordon, Jas. R...

112 Wall street, care of Czarnikow, McDou

gall & Co. Haines, Augustus Montague.

45 Wall street, New York, care of J. Kennedy

Tod & Co. Hopkins, A. Lawrence

Williamstown, Mass Huiin, Maurice

Paris, France Hudson, Woodward.

Boston, Mass. Hurtado, Mercedes.

19 Whitehall street, New York, care of Hur

tado & Co., in liquidation. James, Angelina Henrietta

99 Grove Lane, Denmark Hill, London, Eng

land. Jennings, F. B.

15 Brond street, New York.. Lampre, Édouard

Paris, France Leverich, C, D., & Bro..

48 Wall street, New York Mackay. Mary C

6 Wall Street, New York, care of A. K. Mackey. Maddock, Henry.

21 Barclay street, New York. Manning, John B

2 Wall street, New York .... Manning, Mary Mills, D.O..

15 Brond street, New York. Montefiore, Madam E.L

26 Exchange place, New York, care of L. Von

Hoffman & Co. Motley, J.M.

12 John street, New York.. Murray, Williama..

112 Wall street, New York, care of Czarni.

kow, McDougall & Co. McCullough, John G.

21 Cortlandt street, New York Newton, Anna M..

24 State street, New York. Oppenheim, Ernest L.

Johnston Building, New York, N. Y Oppenheim, Edward L..

.do Palmedo, U

26 Exchange place, New York, care of L. Von

Hoffman & Co. Park, T.L

345 Broadway, New York Parker, J. H

Cotton Exchange Building, New York
Pegler, Stephen Francis and Francis

Amscott House, East Redford, England
Phipard, Harvey Fisk.
Phipard, Win. George

Care of H. T. Phipard, Singer Manufacturing
Phipard, Chas. Butler..

Company, 149 Broadway, New York.
Phipard, Clarence Lester
Raphael, Lewis .....

45 Wall street, New York, care of J. Kennedy

Tod & Co. John Henry Savile and Chas. John Mander, ...

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233 10

1 IS

5 15


1 150 10 10

$4 2 1 1



executors estate of Anne Raphael. Simons, J. Edward

14 Nassau street, New York. Von Hoffman, L., & Co..

26 Exchange place, New York. Total

1 10


NEW YORK, March 6, 1901.

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Senator MORGAN. You have here the statement that Jean Pierre Gautron, liquidator, whose residence is at Paris, France, held 68,534 shares. That is the statement that you put in here. Now, he was the liquidator of the old company, and at that time that stock stood in his name; and that was at the date of your examination, wbich was February 26, 1902. Now, on the date of that examination all of this capital stock, including those 68,534 shares, was held by the liquidator of the old company on your books?

Mr. DRAKE. The stock list was correct, sir.
Senator MORGAN. The stock list was correct; yes. When did that

. stock ever pass by transfer or otherwise on your books to the New Panama Canal Company?

Mr. DRAKE. I should have to get a transcript of the stock ledger in order to tell that, sir. I will give you every change in the holding of the stock. We keep a regular stock ledger that shows the changes by transfer.

Senator MORGAN. Mr. Drake, when you have the opportunity of referring to your records I wish you would state that fact to the committee and inform us when the transfer took place of this same stock to the New Panama Canal Company. Do you recollect that it ever did take place?

Mr. DRAKE. There were several transfers of the bulk of the stock, sir. My recollection is that it passed once from the old company to the new and back from the new to the old again; but the stock list will show that perfectly.

Senator MORGAN. Have you any knowledge of the facts that caused this vibration and change of stock from the old to the new company which you have just mentioned ?

Mr. DRAKE. Not the slightest.

Senator MORGAN. But you remember the fact that it did change from the old to the new, and from the new back to the old ?

Mr. DRAKE. Yes, sir; 1 do, because it was part of my duty to sign the certificates.

Senator MORGAN. Where was this stock held-by which of these companies, the liquidator of the old company or the New Panama Canal Company-at the time of the transfer to the United States?

Mr. DRAKE. I do not know, sir.
Senator MORGAN. You do not know?
Mr. DRAKE. No, sir.

Senator MORGAN. When this stock was held by the old company, who voted it in the board ?

Mr. DRAKE. Whoever held the proxies.
Senator MORGAN. Well, who was it?
Mr. DRAKE. The records would show that.
Senator MORGAN. You do not remember?

Mr. DRAKE. Generally, Xavier Boyard. I think in almost every instance he voted the proxies of the French stock, when it was held by either of the companies.

Senator MORGAN. So that he held proxies from either of the companies, whichever happened to hold it?

Mr. DRAKE. Yes; they would be sent to him just before the election.

Senator MORGAN. Boyard was the standing representative of both companies, as proxy?

Mr. DRAKE. Yes, sir.

Senator MORGAN. But you have no information or recollection in regard to the vibration of this ownership of the stock backward and forward between Gautron and the new company?

Mr. DRAKE. Not the slightest, sir. Senator MORGAN. Did you ever discuss that subject with anybody! Mr. DRAKE. No, sir; it was none of my business. Senator MORGAN. I thought everything about the railroad was some of your business.

Mr. DRAKE. When any stock is offered at the office of the company for transfer it is my duty, and I am obliged, to transfer it, and as an officer of the company I sign the certificate. I have not the rigtit to question the transfer.

Senator MORGAN. Did it create no surprise in your mind that this vast amount of stock, 68,534 shares, was passing backward and forward between one company and another?

Mr. DRAKE. Not the slightest, sir. Senator MORGAN. It did not? Mr. DRAKE. No, sir. Senator MORGAN. And you have no recollection of the dates of these vibratory motions of that stock—this oscillation?

Mr. DRAKE. No, sir.

Senator MORGAN. Was it before or after the date of this treaty that I will now call your attention to? There are two dates here. One was the 31st of March, 1902, and the other was the 18th of April, 1902, in the letter which Mr. Hay wrote to Mr. Concha, and which I will read. [Reading:]


Washington, April 21, 1902. SIR: I have the honor to acknowledge receipt at your hands of a communication dated the 31st of March, 1902, and another of the 18th of April, inclosing a proposal of the Republic of Colombia for a concessionary convention or treaty between the Republic of Colombia and that of the United States of America respecting the completion, maintenance, operation, control, and protection of an interoceanic canal over the Isthmus of Panama.

I am directed by the President to inform you that I shall be ready to sign with you

the proposed convention as soon as“First. The Congress of the United States shall have authorized the President to enter into such an arrangement; and

“Second. As soon as the law officers of this Government shall have decided upon the question of the title which the New Panama Canal Company is able to give of all the properties and rights claimed by it and pertaining to a canal across the Isthmus and covered by the pending proposal. Accept, sir, the renewed assurances of my highest consideration.


Was it before or after that date that the old Panama Canal Company ceased to be the owner of this stock, according to your records, and the New Panama Canal Company was substituted as the owner?

Mr. DRAKE. I do not know, sir.
Senator MORGAN. You do not know?

Mr. DRAKE. I can produce the record, though.

Senator MORGAN. The dates are very important, you see, Mr. Drake.

Mr. DRAKE. Yes, sir.

Senator MORGAN. You will give them exactly as they are when you make your statement?

Mr. DRAKE. Yes, sir. May I suggest that that will be answered by my giving you a certified copy of all the transfers of the stock that have been made since the date mentioned, sir?

Senator MORGAN. That will be very good.
Mr. DRAKE. What is the date, please, that I shall start from?

Senator MORGAN. I have given two dates here. One is the 31st of March, and the other is the 18th of April, 1902.

Mr. DRAKE. From March 31, 1902, to date?

Senator MORGAN. Yes, sir. Now, Mr. Chairman, I desire to have printed in the record, without reading it, a communication from the Hon. John Hay to the Hon. William P. Hepburn, chairman of the Committee on Interstate and Foreign Commerce of the House of Representatives, dated May 15, 1902, and the following papers transmitted at the same time, including a letter of Mr. William Nelson Cromwell, general counsel of the New Panama Canal Company, dated March 31,

I offer these in order to show the beginning--the first statement of the relations between Colombia and the Panama Canal Company, in which Colombia consented to the sale by the Panama Canal Company of the property of that company and also of the Panama Railroad Company.

(The papers above referred to will be found printed at the end of Mr. Drake's testimony.)

Senator MORGAN. Now, in order to identify more particularly the character of that agreement, which is furnished by Mr. Concha, the Colombian minister here, I will read the first article in that proposed treaty, which Mr. Hay said he was ready to sign, by direction of the President, whenever Congress authorized such a treaty to be entered into and whenever the titles to the property of the Panama Canal Company were ascertained. [Reading:

ARTICLE 1. The Government of Colombia authorizes the New Panama Canal Company to sell and transfer to the United States its rights, privileges, properties, and concessions, as well as the Panama Railroad, and all the shares or part of the shares of that company, with the exception of the public lands situated outside of the zone hereinafter specified, now corresponding to the concessions to both said enterprises, which public lands shall revert to the Republic of Colombia.

" But it is understood that Colombia reserves all its rights to the special shares in the capital of the New Panama Canal Company, to which reference is made in Article IV of the contract of December 10, 1890, which shares shall be paid their full nominal value, at least.

“The railroad company (and the United States as owner of the enterprise) shall be free from the obligations imposed by the railroad concession, excepting as to the payment, at maturity, by the railroad company of the outstanding bonds issued by said railroad company.”

I will also read the second article.

"ART. 2. The United States shall have the exclusive right to excavate, construct, maintain, operate, control, and protect a maritime

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