OCR Interpretation

The day book. (Chicago, Ill.) 1911-1917, February 04, 1916, LAST EDITION, Image 2

Image and text provided by University of Illinois at Urbana-Champaign Library, Urbana, IL

Persistent link: http://chroniclingamerica.loc.gov/lccn/sn83045487/1916-02-04/ed-1/seq-2/

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out of the ordinance and so changed
that legally and technically Chicago
Telephone Co. can claim the Auto
matic phone system is actually worth
more than the sale price fixed by the
Walter L. Fisher, attorney'-for May
or Thompson, warned aldermen not
to ask United States attorney gener
al to approve the deal. Such request
would be "foolish," said Fisher, stat
ing he is certain attorney general
would withhold approval and declar
ing: You can gamble on that."
Aid. Merriam tried to break through
the wall of secrecy around Automatic
phone bond jobbing. Prices have
jumped since aldermen lined up for
the deal. Merriam resolution de
manded impounding of bonds till
complete report on bond transactions
is made.. Resolution beaten.
Aids. Charles E. Merriam, Robert
M. Buck and James A. Kearns stood
solid in voting against recommend
ing passage of the ordinance. These
aldermen, led chiefly by Henry P.
Bergen and James Rea, voted- for
what the phone trust wants: Cross,
McNichoIs, Pettkoske, Lawler, Bow
jer, Wallace, Haderlein, OToole,
Rea Toman.
As amended the ordinance leaves
the Chicago Telephone Co. free to
claim the Automatic property is
worth any higher price than stated
in Sec. 4 of the ordinance. Walter
L. Fisher, special counsel for Mayor
Thompson, said:
"Attorney Sidney of the Chicago
Telephone Co. called on me and said
that his company objects to this
ordinance specifically stating that the
'fair value of the property is $1,532,
058. They think it is worth much
.ore than that. They are willing the
finance should state the property
has a use value of $1,532,058, but
they believe situations might arise
where it would embarrass them to
have this ordinance state specifically
that the fair value of the property is
only $1,552,058. Personally, I don't
see why we shouldn't grant the re-auesL"
Committee voted by 10 to 3 to
make the change. Sec. 4 now reads:
"It appears to the committe from "
testimony upon full hearing of all -tgfc
parties in interest that the telephone
plant of Chicago Tunnel Co. to be 4
sold to Chicago Telephone Co. has a '.
value to said Chicago Telephone Co. f
for its use in connection with its owmsg
telephone plant, system and equip- V
ment of $1,532,058."
"In the game of high finance there ,
is a difference between use value and j
sale value," was a comment of Aid. j
Buck. "Why the city of Chicago in
an official document should be f
ashamed to state specifically the fair j
market value of a property it is sane- j
tioning sale of is hard to under- . I
stand." j
B. P. Sunny, president Chicago '
Telephone Co., sat three chairs away
from Fisher. Sunny nodded and
smiled his assent to the Fisher state- j
ment that "the company believes the 1
property is worth much more than
"By this correction, the company
is saving its face," were Fisher's
words. Then at the end of an ex
planation why the words "fair value"
should be struck out, Fisher repeat
ed: "It's saving its face."
Clerk Harrah told the committee
Former "Corporation Counsel Sexton
went to Washington and asked the
U. S. attorney general whether pur
chase of Automatic system in Chi
cago by A. T. & T. would be a viola
tion of the A. T. & T. pledge to obey
the Sherman anti-trust law. Sexton
was told the attorney general doesn't
give legal advice to cities, his job
being to advise the president and cab- J
"He told the city: T won't tell you
whether you are going to commit a
crime,' " broke in Stephen Foster,
counsel for gas-oil committee.
Merriam suggested it would be a
good thing if the aldermen could

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