The real object of recording Mr. Waite's appointment at all on October 29, 1896, becomes the more a matter of speculation when we note that on the same day and through the same judge, against whom there is no suspicion of bad motives, and without a contest from any one, the gas companies found a technically legal way out of the poorly fenced enclosure into which Judge Tuthill's decision of January 14, 1895, forbidding dividends on the gas certificates, had driven these enterprising and mutually loving companies.

It was made to appear to Judge Gibbons that at some time since July 2, 1894, the Fidelity Company had transferred its shares of capital stock of the Chicago gas companies to Frederick P. Olcott, Anthony N. Brady and Walton Ferguson, who have all along been prominent in the Wall street end of this illegal combination, and who now, by some hocus pocus, seem to be substituted for the Fidelity Company in the issuance of the $25,000,000 of certificates.

Having discovered this much, Judge Gibbons' further "findings" become especially interesting. He says: "Since the entry of said order of January 14, 1895, there have accumulated a considerable amount of earnings of said gas companies, respectively, which should in equity and good conscience be distributed to the persons entitled thereto, and that many of the persons who would be entitled to receive dividends declared upon said stock are in needy circumstances and require said dividends, and that the same ought, in good conscience, to be distributed and paid to them, and that it is just and proper that the said Chicago Gas Light and Coke Company, People's Gas Light and Coke Company, Consumer's Gas Company and Equitable Gas Light and Fuel Company be permitted to pay over to the natural persons now appearing upon the books of said gas companies, severally, as aforesaid, as stockholders of said companies, any dividends that may, in due course of business, be declared by said gas companies respectively.

"It is ordered that any portion of said decree of July 2, 1894, or of said order of January 14, 1895, which enjoins and restrains the Fidelity Insurance, Trust and Safe Deposit Company from receiving dividends on stock held by it in any of the four above named corporations, and enjoins and restrains said four corporations from sending dividends to the said Fidelity Insurance, Trust and Safe Deposit Company shall not be extended or construed so as to prevent from receiving dividends the said Frederick P. Olcott, Anthony N. Brady and Walton Ferguson, or any natural person or persons into whose name or names the said Fidelity Insurance, Trust and Safe Deposit Company has transferred or shall hereafter transfer any of the stock which it held at the time of the entry of said injunction order, or the assigns of any such natural person or persons, or so as to prevent any of said four corporations from paying dividends to the said Frederick P. Olcott, Anthony N. Brady and Walton Ferguson, or any other natural person or persons or their assigns."

Meanwhile the trust is as perfect as ever, and is holding its monopoly in the manufacture and supply of gas to the city and the citizens of Chicago with rather more success and less friction than in 1889, when the State of Illinois, by its chief law officer, commenced the first attack upon it.

The inquiry naturally arises whether this combination is greater than the State of Illinois. The laws seem to be adequate. The courts, when applied to, have enforced the laws, and yet the trust continues to flourish in all its strength, accumulated during the nine years of its existence.

The members of the bar who brought the cause of the people before Attorney General Maloney and his assistants of 1894, solicited him, as we have seen, to apply not only for an injunction against the gas companies from paying out dividends, but also to apply for a receiver and for a judgment of ouster, but he confined his proceedings simply to the injunction.

The result as above shown, has been that whilst the Fidelity Co., of Philadelphia, has been enjoined from collecting the net earnings of the gas companies, Messrs. Olcutt, Brady and Ferguson exercise that function in its place, and they are the gentlemen who have been connected with the New York management of the trust on Wall street for a great many years.

It then comes to this, that there are seven Illinois corporations which are exercising their functions in the manufacture and supply of gas in Chicago, whose streets, alleys and other public places they are using without compensation, as their right of way for their mains and supply pipes, and they are exercising their profitable franchises in defiance of the final decision of the highest judicial tribunal of the State, and of two acts of the Legislature, each of which is valid. (See Appendix for some of these acts and decisions.)

It is perfectly clear that, with the defiant attitude of each of the original companies composing the trust and the admitted fact that each of them is in the trust, (because they have each of them consented to a decree by Judge Windes so finding), the laws of the State of Illinois and the disposition of the courts to enforce them would have been entirely adequate to have disrupted this trust years ago, if he who was charged with the duty of enforcing those had taken a reasonably proper course to that end and earnestly followed it.

It would seem to be a plain proposition, that a quasi-public corporation, like a gas company, whose net earning are being pooled with the net earnings of six other gas companies and divided pro rata amongst the holders of trust certificates, and whose management is directed by a common control of all seven companies, can be prevented from thus violating the laws of the State of Illinois. The statutes provide a certain, swift and sure remedy, by depriving such corporation of its franchise to manufacture and sell gas in the State of Illinois, and, in the meantime, vests the courts with the right to issue an injunction and appoint receivers.

Only the reckless passage by the Illinois Legislature of an act relieving the gas companies from their continuing illegality by legalizing their combination, without any adequate return, can destroy the power of the city to take advantage of this illegality in dealing with these companies.

If the inquiry is made as to what can be done, the answer is perfectly plain. Let the public interests be represented by the public prosecutor with the same honesty, earnestness and singleness of purpose which are brought to bear by earnest and competent counsel representing important private interests; and

then the way is as clear from difficulties to the result of disintegrating this gas trust as it is in any private cause for a plaintiff, with the truth, justice and law on his side, to bring his adversary to justice.

Either the Attorney General or the State's Attorney can do this. Even if there should prove to have been arrangements entered into between the State and the gas companies at the time the quo warranto proceedings were abandoned, which would bar the State from attacking the gas trust (for such it still really is) for its earlier violations of law, nothing can stand in the way of legal attack upon the companies for their present daily continuance of illegal methods.

Indeed, although both the present Attorney General and the State's Attorney should decline to act in the premises, there is still a way out. If the city of Chicago shall be successful in April, 1897, in securing a majority of honest aldermen and an honest mayor, whose campaign expenses are not contributed by the gas trust and who is not otherwise complicated in his relations with the gas trust, a certain and speedy remedy is at hand in the matter of reducing the price of gas to the city and its citizens to a figure which will be reasonable, or about 75 cents per thousand cubic feet.

CHICAGO CITY COUNCIL.

No reform is possible, but matters will grow worse rapidly, and contracts and laws binding the hands of the people for a generation or more may be passed at any time, unless the people become awake to the necessity of selecting city councils and legislators that will protect their interests.

As an illustration of the Chicago council of 1884, Alderman Manniere writes the Bureau as follows:

"You ask me for particulars relating to my personal experience in the matter of letting the contract for supplying the city with gas in 1884. I find in referring to the records, that on February 14th, 1884, the city comptroller requested the gas company to submit proposals for supplying the city with gas for the current year, and on March 3d following the company replied that they would supply gas for $1.00 per thousand feet through burners then in use and on a basis of the time table of 2,336 hours and 30 minutes, then in force. This reduction in the price of gas from that charged the previous year of $1.65, was the result of the competition brought about by the Consumers' Gas Company being in a position to supply gas to the city and private consumers.

"Several unsuccessful attempts were made by us to get the city council to accept this proposition, but the matter was delayed by dilatory motions of one character or another, until July 21st of that year, when the gas company withdrew its proposition, stating that as their attorney had advised them that the city was liable to the company for the gas consumed since the first of January at the price paid as per contract of the previous year, that the company would hold the city at such price, but that if the city would accept their present proposition at once, they would supply the gas for the balance of the year, beginning August 1st, at $1.00 per thousand. On July 28th Alderman

Colvin moved to close the contract on that basis, which was carried, though my motion as a substitute to make the contract on the basis of their first proposition of $1.00, was defeated by a vote of yeas 5, nays 25. In other words, 25 members of the city council deliberately voted to pay the gas company 65 cents on all the gas consumed for the first seven months of the year. It was generally surmised that this 65 cents the company never received the benefit of, but that it went into the pockets of the aldermen through the company. On the following year the city comptroller again asked for proposals to supply the city as heretofore with gas, to which they company replied that they would do so on the basis of $1.25 per thousand feet, this being 25 cents per thousand feet more money than was charged the private consumer, which proposition, on motion of Alderman Colvin, was accepted. Prior to this time the size of the burner was 4 feet (per hour), and the hours of consumption 2,336 (per year), both of which were increased to 5 feet for the burners, and 3,918 hours for the lighting-an increase of consumption at the burners of 20 per cent., and one-half again as many hours, or rather 1,582 hours in lighting. I took up the matter personally with the vice president and general manager of the company, who assured me that the books of the company only showed that it actually received $1.00 per thousand feet, and the 25 cents excess, he intimated, was paid into the city council, though he had no positive knowledge of it. The reason for the increase of consumption was then apparent, for it increased the boodle to just that extent. As such increased consumption created an alleged debt considerable in excess of the amount appropriated for that service, I appealed to the Citizens Association to have the city enjoined from paying such excess, on the grounds that a corporation could not create a liability or expend any other money than was appropriated for the specific purpose at the time of the passage of the appropriation bill for the expenses of the city for its fiscal year. This injunction was not only granted, but was sustained by the courts. Just before the closing of Mayor Hopkins' administration, the city confessed judgment to the gas company for this amount, which was, as I remember, $185,000, which amount is now running at 6 per cent. interest.

"I can only express in closing my wonder as to how long the people will submit to this order of things, and continue to elect questionable men for mayor and dishonest aldermen to represent them, as well as being governed by partisan politics in the regulating of their municipal government."

CHICAGO GAS COMPANIES CERTIFICATES.

Early in 1895 the ownership of the majority of the Chicago gas certificates changed hands as a result of a speculative Wall street deal. The new owners, anxious to bull the certificates in the market in order to unload them at a high price on the innocent and unsuspecting public, devised a scheme intended to result in the resumption of dividends. The majority of the $25,000,000 Chicago gas certificates, bought by the speculators at a low price, were deposited with the Central Trust Company of New York, and the latter issued against them its own certificates. These Central trust certificates have since represented the stockholders' interest in the Chicago gas companies, as

did the Fidelity Trust Company's certificates formerly. The purpose of this move, as previously stated, was to enable the speculative owners of the certificates to cause dividends to be paid, the money for that purpose having accumulated in the treasuries of the several companies. It was thought that the injunction against the payment of dividends by the Fidelity Trust Company would not hold as against the Central Trust Company. It was finally decided, however, that it would be unwise to attempt to evade the decision of the court, and no dividends were declared until November, 1896. Then, as already indicated, the committee representing the equitable interest in the Chicago gas companies through their holdings of Central trust certificates, were successful in convincing the Attorney General that the shareholders were entitled to the surplus earnings over fixed charges, and he made no objection to the decree of Judge Gibbons, already described, permitting the resumption of dividends, which for several years previous he had strenuously opposed. A dividend of 112 per cent. was accordingly declared. It was given out in New York, where most of the Chicago gas certificates are now held, that the company, during the interregnum of dividends, from 1895 to the latter part of 1896, had accumulated a surplus of about $2,000,000, making it comparatively certain that the holders of Chicago gas will get 5 or 6 per cent. dividends, although these certificates originally represented no cash investment in the gas business, but merely an equitable interest in a combination which had been declared illegal by the highest court in the land.

An attempt was made at the last session of the Legislature to secure the passage of legislation permitting the Chicago gas companies to consolidate. The scheme failed in consequence of the measure, which passed the Legislature, being vetoed by Governor Altgeld. The attorneys of the speculative owners of Chicago gas, who had failed to perfect a scheme for the payment of dividends in violation of court orders, and had also failed to secure an act from the Legislature permitting consolidation, then set to work to devise a plan for the consolidation of companies under existing laws. In a decision rendered by Judge Showalter of the Federal Court, in December, 1895, in a suit brought to secure a legal opinion on this question, it was held that under the statutes bearing on the subject two companies have the right to consolidate. The attorneys held that under this interpretation of the law the two original companies could unite, and these in turn could absorb the other companies one at a time. The Attorney General took a different view of the law, which he set forth in an opinion on the subject given out early in 1896. The owners of the controlling interest in the Chicago Gas Company decided to ignore the Attorney General and go ahead with their plan of consolidation. A new company was formed, called the People's Consolidated Gas Light and Coke Company. The papers in the case were sent to Springfield to be filed with the Secretary of State, as required by law, but the latter, on the advice of the Attorney General, refused to accept them. Mandamus proceedings were then instituted to compel the Secretary of State to accept the articles of consolidation. The case was carried by consent at once to the Supreme Court, and the latter set the hearing for the October term.