Page:The History of Oregon Bancroft 1888.djvu/717

 April 22, 1867, proceeded in an entirely different manner to accomplish their end. Seven men subscribed each one share of stock, at $100, and electing one of their number president, passed a resolution authorizing that officer to subscribe seven million dollars for the company. This manoeuvre was contrary to the incorporation law of the state, which required one half of the capital stock of a corporation to be subscribed before the election of a board of directors. The board of directors elected by subscribing $100 each were J. H. Moores, I. R. Moores, George L. Woods, E. N. Cooke, Samuel A. Clarke. Woods was elected president, and Clark secretary. To these were subsequently added J. H. Douthitt. F. A. Chenoweth, Green B. Smith, S. Ellsworth, J. H. D. Henderson, S. F. Chadwick, John E. Ross, A. L. Lovejoy, A. F. Hedges, S. B. Parrish, Jacob Conser, T. McF. Patton, and John F. Miller. Gaston's Railroad Development in Or., MS., 22-3. Before the meeting of the next legislature, thirteen other directors were added to the board, being prominent citizens of different counties, who it was hoped would have influence with that body, and to each of these was presented a share of the stock subscribed by the president. So far there had not been a bona fide subscription by any of the east-side company. In order to hold his own against this specious financiering, Gaston, after raising considerable money among the farmers, subscribed in his own name half the capital stock, amounting to $2,500,000. As a matter of fact, he had no money, but as a matter of law, it w r as necessary to have this amount subscribed before organizing a board of directors for his company. This board was elected May 25, 1867, at a meeting held at Amity. The first board of directors of the Oregon Central (west-side) were W. C. Whitson, James M. Belcher, W. T. Newby, Thomas R. Cornelius, and Joseph Gaston. Gaston was elected president, and Whitson secretary. Both companies, being now organized, proceeded to carry out their plans as best they could. Elliot, as agent of the east-side party, went east to find purchasers for the bonds of the company, while Gaston continued to canvass among the people, and also began a suit in equity in Marion county to restrain the Salem company from using the name of the Oregon Central company, Gaston appearing as attorney for plaintiffs, and J. H. Mitchell for the defendants. On trial, the circuit judge avoided a decision by holding that no actual damage had been sustained. Mitchell then became the leading spirit of the east-side company, and the two parties contended hotly for the ascendency by circulating printed documents, and holding correspondence with bankers and brokers to the injury of each other. A suit was also commenced to annul the east-side company, on the ground of illegal organization. Meanwhile Elliot was in Boston, and was on the point of closing a contract for a large amount of material, when Gaston's circulars reached that city, causing the failure of the transaction, and compelling Elliot to return to Oregon, having secured only two locomotives and some shop material, which he had already purchased with the bonds of his company. A compromise would now have been accepted by the east-side party, but the west-side would not agree to it, and in point of fact could not, because the people on that side of the valley, who were actual subscribers, would not consent to have their road run on the east side, and the people on that side would not subscribe to a road on the other.

By the first of April, 1868, both parties had their surveyors in the field locating their lines of road. Portland Oregonian, March 11, 1868. The west-side company had secured $25,000 in cash subscriptions in Portland, and as much more in cash and lands in the counties of Washington and Yamhill. The city of Portland had also pledged interest for twenty years on $250,000 of the company s bonds. Washington county had likewise pledged the interest on $50,000, and Yamhill on $75,000. Thus $375,000 was made available to begin the construction of the Oregon Central. The east-side company had also raised some money, and advertised that they would formally break ground near East Portland on the 16th of April, 1868, for which purpose bands of music and the presence of the militia were engaged to give eclat to the occasion. An address by W. W. Upton was announced.