History of Alexander, Union and Pulaski Counties, Illinois, Part 10

Author: Perrin, William Henry, d. 1892?
Publication date: 1883
Publisher: Chicago, Ill. ; O.L. Baskin & Co.
Number of Pages: 948

USA > Illinois > Union County > History of Alexander, Union and Pulaski Counties, Illinois > Part 10
USA > Illinois > Pulaski County > History of Alexander, Union and Pulaski Counties, Illinois > Part 10
USA > Illinois > Alexander County > History of Alexander, Union and Pulaski Counties, Illinois > Part 10

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HISTORY OF CAIRO.

from the passage thereof. The final section requires that -unless $20,000 is expended on the canal within five years from the date of the act, it shall be forfeited. In February, 1839, the Legislature amended that act as follows: " That the said Cairo City & Canal Company shall not be obliged, as au- thorized by its charter, to lay off and con- struct a canal to unite with Cache River, should the same be deemed injurious to the health of the city-and the twelfth section of said act, which requires a certain amount to be expended on said canal within five years, is hereby repealed."

We have given verbatim enough of this remarkable charter, in its ultimate results one of the most important that . was ever granted by the State of Illinois, for the reader to see for himself that it is one of two things, namely, either the most amazing in the complete simplicity of its author's ideas, or Machiavelian in its transcendant ability to hide the iron hand beneath the vel- vet glove. No State document was ever drafted that could look more innocent, and at the same time appropriate to itself com- plete and sovereign and autocratic powers, in the name of building a canal from the mouth of Cache River to and through the city of Cairo to the extreme southern point of land. If the company ever thought of building a canal from the mouth of Cache through the city, they would not only have to curve it several times on its route, to keep the canal from running into the river, but they must have known they would have to erect great and strong artificial levees on both sides of their canal to prevent both rivers from rushing from their long-occupied beds, with an angry roar, souse into the canal. On the other hand, if they never did contemplate building the canal, then, indeed, is its mas- terly shrewdness patent at a glance. Cer-

tainly, even an Illinois Legislature would have discovered the cat in the meal-tub had the incorporators gone before them and asked for a charter to found a city, and, without any canal attachment, asked for such complete powers of the right of eminent domain over private property, real and per- sonal! If they ever intended to build a canal, they were soon cured of that hallucina- tion, as is shown by the amendment of 1839, which simply permits the whole canal scheme to be dropped, and yet leaves all the great powers that were originally granted the com- pany intact. So far as can now be ascer- tained, the company never abused or exer- cised to the ill of any one these powers con- ferred by the charter. If there was a pur- pose lurking beneath the fair face of the fundamental law of the new city, it, perhaps, was not in the idea of its author to use it to wrong or oppress any private citizen, and it would only be invoked as a last resort to pro- tect the vital welfare of the future city.

As stated above, this Cairo City & Canal Company charter became a law March 4, 1837, and not March 4, 1838, as probably the compositor made Mose Harrell say, in a sketch of early Cairo that he published a few years ago. The date is important, because on June 7, 1837, "The Illinois Central Rail- road Company," which had been incorpor- ated January 16, 1836, and authorized to construct a railroad, commencing at or near the confluence of the Ohio and Mississippi Rivers, and extending to Galena, released all its rights back to the State of Illinois, con- ditioned, however, that "the State of Illinois shall commence the construction of said rail- road within a reasonable [time, and to com- mence at the city of Cairo and build north to Galena. "

On the 27th day of June, 1837, there was an agreement entered into between the orig-

HISTORY OF CAIRO.

inal Illinois Central Railroad, by A. M. Jenkins, its President, and the Cairo City & Canal Company, by D. B. Holbrook, its President, by which it was stipulated the railroad to be constructed by the Illinois Central Railroad " shall be commenced at such point in the city of Cairo as the Cairo City & Canal Company may fix and direct. This release of the Central Railroad of its franchise back to the State was caused by the wild craze that had taken possession of the entire State on the great internal im- provement system, that so quickly landed the Commonwealth in bankruptcy, and abruptly stopped all State progress for several years. This was a sad and severe lesson to the young State, but probably in the end it was for the best. On the same day of the above agreement, namely, 26th June, 1837, the Cairo & Canal Company having obtained, by purchase, the lands in Town 17 south, Range 1 west, on a portion of which had been laid ont the city of Cairo, mortgaged the entire property to the New York Life Insurance & Trust Company, to secure certain loans and moneys advanced by English capitalists.

The release made by the Illinois Central Railroad Company was accepted by the State, on the conditions imposed, and the State commenced at Cairo the construction of the railroad, which the railroad company had been authorized to construct to Galena; and the Cairo City & Canal Company pressed forward the improvements it was making, upon which, up to February 1, 1840, it had expended, of borrowed money, about $1,000,000. It had erected mills, various workshops and houses for its em- ployees, and there had congregated here about 1,500 souls. But on February 1, 1840, the great internal improvement system, which had been inaugurated by the infatuated State Legislature of 1837, was repealed, and the

work upon the Illinois Central stopped, after the State had expended, as stated, over $1,000,000. While the bursting of this bubble seriously crippled, financially, the entire people of the State, it was especially disastrous at Cairo. It was the work upon the railroad that had brought the people here, and when not only the State was bank- rupt, but the Cairo City & Canal Company was insolvent, the railroad defunct, the banker of the company in England had failed, and all work and improvements were abandoned, the people fled, and desolation brooded over the town, where now "the spider might weave, unmolested, his web in her palaces, and the owl hoot his watch song in her temples."

On March 6, 1843, the Legislature passed an act to incorporate the Great Western Railway Company. While this was a rail- road charter, authorizing the construction of a railroad upon the line of the original Illinois Central Railroad, yet it was, in fact, a re-incorporation of the Cairo City & Canal Company. After the enacting clause, it says: "That the President and Directors of the Cairo City & Canal Company (in- corporated by the State of Illinois) and their successors in office be and they are hereby made a body corporate and politic under the name and style of the ‘Great Western Rail- way Company,' and under that name and style shall be and are hereby made capable, in law and equity, to sue and be sued, de- fend and be defended, in any court or place whatsoever, to make, bave and use a common seal, the same to alter and renew at pleasure, and by that name and style be capable in law of contracting and being contracted with, of purchasing, holding and conveying away of real estate and personal estate for the purposes and uses of said corporation; and shall be and are hereby invested with

HISTORY OF CAIRO.

all the powers, privileges and immunities, which are or may be necessary to carry into effect the object and purposes of this act, as hereinafter set forth; and the said corpora- tion are hereby authorized and empowered to locate, construct and finally complete a rail- road, commencing at the city of Cairo, thence north by way of Vandalia, etc.," almost exactly as specified in the charter of the original Illinois Central Railroad.

This act of incorporation was merely the grafting into the Cairo City & Canal Com- pany a railroad franchise, which in no single clause diminished the original powers of the Cairo City & Canal Company, but enlarged and extended them throughout the entire length of the State. So completely were the two companies made one, indeed, so fully was the railroad merged into and absorbed by the canal company, that the officers of the city company, including the President and Directors, were made the officers of the rail- road by the legislative act. It should be borne in mind that the State had expended over $1,000,000 in work upon the Illinois Central Railroad, and all this was turned over to the Cairo City & Canal Company and the Great Western Railroad (all one and the same thing) and this was turned over to the new company in the following rather loose language, in Section 12 of the incor- poration act: "The Governor of this State is hereby authorized and required to appoint one or more. competent persons to estimate the present value of any work done, at the expense of the State. on the Central Rail- road; also of any materials or right of way; and whatever sum shall be fixed upon as the value thereof, by said persons, shall be paid for by the company, in the bonds or other indebtedness of the State, any time during the progress of the road to completion, and any contract entered into under the seal of

the State, signed by the Governor thereof, shall be legal and binding, to the full intent and purpose thereof, on the State of Illinois."

Section 14, with equal State liberality and vagueness, goes on to specify that whenever the whole indebtedness of the company shall be paid and liquidated, the Legislature of the State of Illinois, thereafter then in session, shall have the power to alter, amend or modify this act, as the public good shall require, and also that of the City of Cairo & Canal Company; and the eleventh section of the act incorporating the said Cairo City & Canal Company, which limits its charter to twenty years, be and the said section is hereby repealed, and this act be and is de- clared a public act, and as such shall be taken notice of by all courts of justic . in the State, etc.

Two years after this, March 3, 1845, the Legislature repealed the act incorporating the Great Western Railroad Company. This repealing law like all other legislation upon that subject, was no doubt passed at the in- stance of the railroad company, or rather of the Cairo City & Canal Company. On its face, it has the appearance of a design to give back to the State all its rights and privileges except those pertaining to the founding of a city here and the construction of a canal from Cache to and through Cairo.

But on February 10, 1849, the Legislature passed another law, which repealed the re- pealing act, and starts out by saying that the President and Directors of the Cairo City & Canal Company, under the name and style of the " Great Western Railway Com- pany," chartered March 6, 1843, and that William F. Thornton, Willis Allen, Thomas G. C. Davis, John Moore, John Huffman, John Green. Robert Blackwell, Benjamin Bond, Daniel H. Brush, George W. Pace, Walter B. Scates, Samuel K. Casey, Albert

HISTORY OF CAIRO.

G. Caldwell, Humphrey B. Jones, Charles Hoyt, Ira Minard, Charles S. Hempstead, John B. Chapin, Uri Osgood, H. D. Berley, Henry Corwith, I. C. Pugh, John J. Mc- Graw, Onslow Peters, D. D. Shumway, Jus- tin Butterfield, John B. Turner, Mark Skin- ner and Gavion D. A. Parks be associates with said company in the construction of said railroad. and are empowered and reinstated, with all the powers and privileges contained in said act of incorporation. and are also subject to all restrictions contained in said act of incoporation-the act in force March 3, 1845, which repealed the charter of the company, to the contrary notwithstanding. This reviving act then proceeds to extend the privileges of the Cairo City & Canal Company in a most liberal manner. It authorizes them to construct the Great Western Railroad from the termina- tion set forth in the said charter, at or near the termination of the Illinois & Michigan Canal to the city of Chicago. Section 3 is important enough to give it entire, as follows: "And the right of way the State may have obtained, together with all the work and sur- veying done at the expense of the State, and materials connected with said road, lying be- tween the termination of the Illinois & Michigan Canal and Cairo City, are hereby granted to said company upon conditions as follows: Said company shall take posses- sion of said road within two years of the passage of this act, and as far as practicable preserve the same from injury and dilapida- tion; and said company shall, within two years from the passage of this act, expend $100,000 in the construction of said road, and $200,000 for each year thereafter, until said road shall have been completed from the city of Cairo to the city of Chicago.

SEC. 4. The Governor of the State of Illinois is hereby authorized and empowered

to contract with and agree to hold in trust, for the use and benefit of said Great West- ern Railway Company, whatever lands may be donated or thereunto secured to the State of Illinois by the General Government, to aid.in the completion of the Central or Great Western Railroad from Cairo to Chicago, subject to the conditions and provisions of the bill granting the lands by Congress, and the said company is hereby authorized to receive, hold and dispose of any and all lands secured to said company by donation, pre-emption or otherwise; subject, however, to the provisions of the eighteenth section of its charter. [This clause was to the effect that all lands coming into the hands of the company, not required for use, security or construction, should be sold by the company within five years, or revert to the Govern- meut.] Provision was then further made that the Governor should, from time to time, as the company progressed with the work, des- ignate in writing the proportion of such lands donated by Congress to be sold and dis- posed of.

In order to complete the list of incorpo- ration acts, that had a direct reference to the owners and proprietors of the city of Cairo, it is proper here to explain that on January 18, 1836, the Legislature incorporated the Illinois Exporting Company. The act states that "all such persons as shall become sub- scribers to the stock hereinafter described, shall be and they are hereby constituted and declared a body politic and corporate." It proceeds to enable the President and Direct- ors of the company to "carry on the manu- facture of agricultural products; erect mills and buildings; export their products and manufactures, and enter into all contracts concerning the management of their prop- erty. The capital stock is $150,000, and may be increased to $500,000; meetings and

HISTORY OF CAIRO.

general places of business of the company to be at Alton; may select any other place of business; may erect mills, etc., in any county in the State, by permission of the County Commisisoners' Court. James S. Lane, Thomas G. Howley, Anthony Olney, John M. Krum and D. B. Holbrook are appointed Commissioners to obtain subscription to the capital stock of the company; any one could become a subscriber by paying $1. Provided, the provisions of this act shall in no case extend to the counties of Edgar, Green and St. Clair, etc., etc.

On September 29, 1846, in consequence of the general and financial disasters, resulting from panic and widespread bankruptcy throughout the commercial world, the parties interested in Cairo, the mortgagees, judg- ment creditors, owners in fee and otherwise interested, after a series of consultations, agreed and did form and create the "Trust of the Cairo City Property," conveying the property to Thomas Taylor, of Philadelphia, and Charles Davis, of New York, as Trustees.

On May 10, 1876, the Trustees of the Cairo City property, having expended in making material improvements about Cairo $1,307,- 021.42, of which $184,505.64 was expended upon the levee running along the Ohio River, . and $149,973.23 upon the levee running along the Mississippi River, and $70,445.06 upon the protection of the Mississippi River bank, and $571,534.08 upon general improve- ments, and $330,553.41 upon taxes and as- sessments, found themselves unable to pay two loans obtained from Hiram Ketchum, of New York-one on October 1, 1863, for $250.000, and the other on October 1, 1867, for $50,000, to secure which, mortgages, of the dates given, had been executed. The mortgages were, therefore, foreclosed, and the property of the Trust of the Cairo City Property sold to the bondholders under the

mortgage, and a new, and the present, trust was formed, called the Cairo Trust Property, under the control and management of Col. S. Staats Taylor and Edwin Parsons, the Trustees.

On the 14th of February, 1841, the Legis- lature passed an act conferring upon the Cairo City & Canal Company "all the powers conferred upon the Board of Alder- men of the City of Quincy, as defined be- tween the first and forty-fifth sections of the charter of that city," and these grants were confirmed for ten years.

It is possible there were other laws passed for the benefit of the many charter companies that depended and hinged upon the Cairo City & Canal Company, but we have not, so far, found them. But in all these acts and doings, one fact is distinctly seen: Many people believed that it was all, practically, the work of D. B. Holbrook, and that, as a rule, up to the time that his path was crossed by Judge Douglas, the names of D. B. Hol- brook and the Cairo City & Canal Company were practically one and the same thing. He was certainly a man of great activity of intellect, shrewdness and untiring industry, and while all conceded him this, yet many deemed him utterly selfish, and indifferent to all interests except his own, and that he was a shrewd and dangerous marplot, who brought evil to Cairo by his reckless greed of power and money. In speaking of the crash that came upon Cairo in 1841, Mose Harrell, among other things, enumerated, as the chief cause thereof, to have been the fail- ure of the banking-house of Wright & Co., London, through which continuous loans to the City Company were anticipated; the sus - pension of work on the Illinois Central Rail- road, upon which so much trade depended, and the general abandonment of the system of public works inaugurated by the State in

John. M. Toler

HISTORY OF CAIRO.

1837, and he says: " Possibly another reason was the monopoly of which Holbrook was the head. Under his rule, no person could be- come a freeholder in the city; ground there could not be purchased or leased; all the dwellings were owned by the company; Do one could live in the city, unless at the pleas- ure of Holbrook, as even the hotels were the property of the company. More than that, the company were empowered (with) all the rules and regulations for the municipal gov- ernment, such as a Mayor and Common Council might establish. The company could declare a levy of taxes and enforce its col- lection, and could expend the money as it chose." In a letter published in the New York Herald, and of date October 3, 1850, we extract the following: "In 1835, Mr. D. B. Holbrook, originally from Boston, pro- cured from the Legislature of the State of Illinois his first charter for the Cairo City & Canal Company, and he also procured a charter for the Central Railroad Company, from Cairo to Galena. He subsequently ob- tained a third charter, for the Illinois Ex- porting Company, with authority to carry on transportation by land and water, and to in- sure against risks from fire and water, and to carry on manufacturing business gener- ally. He also purchased and revived a de- funct bank charter, known as the Cairo Bank, and one or two others I cannot specify. Mr. Holbrook at once organized the Cairo City & Canal Company; took the stock himself, and had himself elected President; also or- ganized the Central Railroad Company, by a nominal payment of $1 per share (which was never paid in, but a note given in lieu of the money), and elected himself President. He also organized the Illinois Exporting Com- pany, in the same mode; and also organized the Cairo Bank, and put one of his instru- ments at the head of it. Subsequently, D.

B. Holbrook, as President of the Cairo City & Canal Company, entered into a contract with D. B. Holbrook, as President of the Central Railroad Company; and D. B. Hol- brook, as President of the Central Railroad Company, further contracted with D. B. Hol- brook, of the Illinois Exporting Company, and D. B. Holbrook, as President of that company, contracted with D. B. Holbrook, as President of each of the other companies, that each of said companies might exercise all and singular, the rights, privileges and powers conferred by law upon either; by which all companies were to be consolidated into one, and exercise the several powers con- ferred upon each. * In 1836. the Illinois Legislature adopted its mam- moth system of internal improvement, and among other enterprises, commenced the construction of a Central Railroad as a State work, Mr. Holbrook having surrendered his charter for that purpose. After having spent about $1,000,000 on įthe road, the credit of the State failed, and the system was abandoned. A charter was subsequently granted by the Legislature to the Cairo City & Canal Company, by which that company was authorized to construct the Central Rail- road. At the last regular session of the Legislature, while a bill was pending before Congress, making'a grant of land to the State, in aid of the construction of the rail- road, a law was passed, transferring to the said company the right, of way, and all the work which had been executed by the State at the cost of $1,000,000, together with all the lands which had been, or should here- after be, granted by Congress to the State in aid of the construction of said railroad. How this act was passed remains a mystery, as its existence was not known in Illinois until Judge Douglas brought it to light in a speech at Chicago in October last. In that

HISTORY OF CAIRO.

1 speech, Judge Douglas denounced the whole

transaction as a fraud upon the Legislature and the people of the State, and declared that he would denounce it as such in the Senate of the United States, if an application was ever made to that body for a grant of land, whilst the Holbrook charters, and es- pecially the act referred to, remained in force."

The letter proceeds to give an account of how Judge Douglas finally compelled Hol- brook and his company to execute a complete release of their charter to the State, and then says: "But for the execution of the re- lease by Mr. Holbrook, and the surrender of all claims to any railroad charter, or rights and privileges under any act of the Illinois Legislature on the subject, the grant of land would never have been made by Congress. Thus it appears that Mr. Holbrook has no charter for a railroad in Illinois, and no claims to the lands which have been granted, unless the State of Illinois refuses to accept the release, or makes a new grant to D. B. Holbrook, which, unless its members are crazy, it is not likely to do. I have deemed it necessary to make this exposition of the facts in the case, in order that capitalists in New York and elsewhere may not labor under erroneous impressions in regard to so impor- tant a matter, affecting alike the honor of the State of Illinois and that of Congress."

A full and complete account of the nego- tiations, correspondence, etc., that resulted in this important transaction, will be found in another chapter in the account of the building of the Illinois Central Railroad. We give here these extracts from the letter of " An Illinois Bondholder," merely to show the tenor of the attacks that were in that day made upon Holbrook, and the wide and pro- found sensation the appearance of this ex- traordinary financier made all over the coun-

try. The reader (can now readily see there are many historical inaccuracies in the let- ter, yet, at the time it was published, it was a strong document, and had evidently been carefully prepared by some one who had studied well the subject. It is possible the writer was a jealous rival of Holbrook's, and one who conceived that his own success could only be accomplished by first pulling down Holbrook and his company. Certainly, there is too much feeling displayed in these attacks upon this remarkable man by his cotempo- raries, to cause all their statements about his unholy purposes to be now implicitly re- ceived, and given to the world as attested facts. A patient and impartial investigation of the times, and the general circumstances surrounding D. B. Holbrook and his asso- ciates in the Cairo City & Canal Company, leads to the conclusion that they were seek- ing sincerely to improve the great West, and to build here in Illinois great cities and rail- roads, and that neither the glory nor the blame, nor the wise and beneficial acts, nor the mistakes of the company properly be- longed wholly to Holbrook, as were so widely charged in his day of activity here. His as- sociates and co-incorporators in the Cairo City & Canal charter were among the most eminent, patriotic and just men in the State in their day. They have mostly passed from earth, and all have ceased from the active struggles of life, and of Breese, and Casey, and Judge Jenkins and Miles A. Gilbert, the only one living, and the many other co- laborers in the early work of improvements in Illinois, their untarnished ¿memories will ever remain a rich legacy to the people of Illinois. The finger marks of these men will ever remain upon the early history of the State. Each one of them worked in his own chosen or allotted sphere, yet in harmony with his other incorporators, and together

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History of Alexander, Union and Pulaski Counties, Illinois, Part 10

Author: Perrin, William Henry, d. 1892? Publication date: 1883 Publisher: Chicago, Ill. ; O.L. Baskin & Co. Number of Pages: 948

Author: Perrin, William Henry, d. 1892?
Publication date: 1883
Publisher: Chicago, Ill. ; O.L. Baskin & Co.
Number of Pages: 948