"NEW YORK, _March 18, 1872_.
"MY DEAR SIR,--I have this morning received your letter of Saturday,
and hasten to answer it, as I am to leave this city for Pittsburg this
afternoon.
"Your statement of the facts connected with the arrangement to pay you
a counsel fee of $10,000 by the Erie Railroad Company, for services in
the Cleveland and Pittsburg Railroad, is strictly correct, all of which
came within my personal knowledge.
"At the time, since, and now, I held and hold the position of president
of the Pittsburg, Fort Wayne and Chicago Railway Company, which company
then held, and still holds, a very important contract relation with the
Cleveland and Pittsburg Railroad Company. It was this fact that caused
me to take an interest in the complication in which the Cleveland and
Pittsburg Company was involved in 1869, and which had been brought
about through the action of a director of the Erie Company, that
company at the time (as was believed) holding a majority of the stock
of the Cleveland and Pittsburg Railroad Company.
"To free the latter company from the litigation in which it was
involved, I came to this city and had an interview with the then
president of the Erie Railway Company, who condemned the whole
proceedings of what was called the 'Erie board' at Cleveland. He agreed
that a portion of the members should resign, and that you and myself
should come into the direction and the executive committee. I returned
home, and, after a conference with J. N. McCullough, Esq., then and now
president of the C. & P. R. Co., a plan of reorganization was agreed
upon, as set forth in your letter. To this date nothing had been said
to you on the subject. On coming to this city, and developing the plan
to you, you declined to go into the board or have anything to do with
the business, for the reasons stated in your letter. I said to Mr.
Gould and Mr. McCullough--the latter more than once--not to urge the
question on you any further, as you might take such a decided stand
that we would not be able to overcome your objections, but that the
plan should be proceeded with, and we should elect you into the board
and take the chances of getting you to serve. This was done, and you
were elected without consulting you farther or obtaining your consent.
After the reorganization of the board the arrangement that you should
be the umpire in the executive committee, and have charge of all legal
proceedings and be general counsel to the committee and board was
arranged as you state, and without first consulting you. I took it upon
myself to make such arrangements as would bring harmony into the board,
believing you would acquiesce in such arrangement as I might make.
Before you came into the Cleveland and Pittsburg board a resolution
was placed on the minutes electing you the general counsel, and fixing
the compensation. It was also proposed that owing to the interest which
the Erie Railway Company had (controlling a majority of the stock),
and the interest which the Pittsburg, Fort Wayne and Chicago Railway
Company had by its contract with the Cleveland and Pittsburg Railroad
Company, that each of those companies should retain you in their
respective behalfs touching those interests. All this was done without
any indication from you as to what you would do.
"I afterwards learned from you that the Erie Railway Company had paid
you the ten thousand dollars, as agreed, without waiting for you to
render a bill. The five thousand dollars agreed to be paid by the
Pittsburg, Fort Wayne and Chicago Railway Company has never been paid
or even spoken of since.
"The compensation above referred to was for those specific services
and for no other, so far as I ever heard or believe. Those services
continued to the close of the year, when you retired from the board. I
remained in the board during that year and ever since.
"I will add that the arrangement made in 1869 was of large pecuniary
benefit to the stockholders, and gave to the affairs, as well as the
stock of the company, a stability they had never before had.
"I believe what I have written covers the whole case--at least I
have so intended--and if, after I return from Pittsburg, it shall be
found that any facts have been omitted, I shall be glad to supply the
deficiency.
"Truly yours,
"G. W. CASS."