Mr. HULSE. To the Turner Construction Co., and immediately referred to Colonel Crocker, who was in charge of the work at the Army supply base, and to Major Perrine.

Mr. REED of New York. Have you their reply to that?

Mr. HULSE. No; I do not have it. I read that letter for the purpose of showing how important it was, and how absolutely necessary. Now, we heard nothing more from the matter until on September 4, 1918, and I have the original orders ordering us to place this material at Black Tom, or Caven Point, which was in the upper bay.

Mr. REED of New York. That is what I mean; whether you received such instructions.

Mr. HULSE. Yes; we received these orders, written to the Turner Construction Co., and signed by Major Sweeney. Now, this material was taken to Caven Point, there dumped, and then by another subcontractor pumped out of the water again and put onto the land, that being the mechanical way of handling it. This states:

We have been requested by Van, representing the Lehigh Valley Co., to begin delivering on this at the rate of 6,000 cubic yards of material. You will please see that the Great Lakes Dredging Co. are advised to dispatch these 6,000 yards of material daily to Black Tom.

That was the first order we had.

The CHAIRMAN. That says they had an arrrangement for 6,000 cubic yards daily, and they were after delivery?

Mr. HULSE. We were directed to deliver.

The CHAIRMAN. They said they had this arrangement with the Lehigh Valley, and the Lehigh Valley was calling for it?

Mr. HULSE. The Lehigh Valley, Mr. Chairman, was the dredging company-not the dredging company, but the pumping company-it was the pump that was there, and they were ready now to take it out and to put it on the land, and they were stating they were ready to do it.

The CHAIRMAN. Under whose orders was the Lehigh Valley Dredging Co.?

Mr. HULSE. Under a subcontract of the Turner Construction Co.; it was not really the Lehigh Valley, it was the Cuyahoga—they called that particular dump the Lehigh Valley-I think that project was known as the Lehigh Valley.

The CHAIRMAN. What is the date of that order?

Mr. HULSE. That was December 4, 1918-in the midst of the stress of the war, and with the necessity of getting this Army supply base up as soon as possible. Then, we got another letter on the following day, stating:

It is requested you instruct the Great Lakes Dredging & Dock Co. to deliver to the Lehigh Pump at Black Tom Island, not less than 6,000 cubic yards per day, until further advised.

Then we are again instructed on September 14, saying that the Sea Gate dump was temporarily out of commission, and on this, account it will be necessary to deliver all of the material possible to the Lehigh Dredge at Black Tom Island, and send the balance to sea. Then again, in October-October 3--there was a complaint that the dredging company was not getting enough, and they were not getting it over there fast enough, and we were urged to see if they could get it over there. It was claimed they were only getting

4,000 cubic yards a day, and they should have 6,000, but for the last few days the average was cut down to 4,000 cubic yards at Black Tom, and they requested it might be well to take steps to see that the daily average of 6,000 cubic yards was maintained.

Mr. WILLIAMS. I suppose they wanted 6,000 cubic yards so that the pump could be operated to capacity and operated economically. Mr. HULSE. Yes, sir; they wanted to operate economically.

The CHAIRMAN. What were the relations between you and the pump company?

Mr. HULSE. They were subcontractors; the Turner Construction Co. is the general contractor.

Mr. WILLIAMS. The pump company was a subcontractor?
Mr. HULSE. Yes; a subcontractor of ours.

The CHAIRMAN. Why did the War Department, or the department in charge of the work get an order from the pump company for more dirt and then deliver it to you? It seems to me your subcompany would have come to you.

Mr. HULSE. This is not a letter from the subcompany. These are letters from Major Perrine, of the War Department, directing us. The CHAIRMAN. If you will follow my question, I asked what was the relation between you and the pump company, and you answered by saying that the pump company was a subcontractor under you, and then I asked why it was necessary for your subcontractor to take it up with the Government, if they were not getting enough yardage.

It was

Mr. HULSE. That last letter is from the Government. saying the dredge company is not delivering it over there fast enough, and the Army officers wanted it faster-they wanted 6,000 cubic yards a day.

The CHAIRMAN. I understood you to say this letter was from the pump company?

Mr. HULSE. No; this was an order from the Government.

Mr. WILLIAMS. I think it is apparent that the Government was interested in seeing that the whole business be operated efficiently and economically, and they wanted to hurry this dirt over for the pump company, so they would have a full capacity of dirt. Mr. HULSE. I did not quite get that.

Mr. WILLIAMS. I understood from what you said that the department who wrote that letter said the pump company was only getting 4,000 cubic yards, and that they ought to have 6,000. If you were delivering it over there, why did they not take it up with you?

Mr. HULSE. Because we did not handle this delivery; we were always acting under the Government, but it was a complaint to us to see that the dredge company got the 6,000 cubic yards over there, and the Government was insisting and again insisting that we see that it got over there.

Mr. SIMMONS. This letter here in the first paragraph, it says

We have been requested by Mr. Van Stone, representing the Lehigh Valley Co., to begin delivering on this contract at the rate of 6,000 cubic yards of material, as called for in our contract with the Lehigh.

Evidently the Lehigh had a contract direct with the Government. The CHAIRMAN. Then, they were not a subcontractor.

Mr. HULSE. They were subcontractors; yes, sir-they simply used that language. These subcontracts were all drawn by the Gov

ernment.

The CHAIRMAN. I understand the Government was paying your bills and giving you 2 per cent.

Mr. HULSE. One and six-tenths per cent.

The CHAIRMAN. You took no risk; you were just getting a profit? Mr. HULSE. We took the risk, of course, we were furnishing all of this service.

The CHAIRMAN. Certainly, for a cost plus, and a profit?

Mr. HULSE. It was not entirely a profit, because we have to pay all the services of our general employees and officers and office expenses.

The CHAIRMAN. Attorneys' fees, and so forth?

Mr. HULSE. No; I think if the committee would inquire of any reputable contractor they would be told they had never heard of a job being done for 1.6 per cent.

The CHAIRMAN. It depends on the size of the job.

Mr. HULSE. No; not for that much money-not for 1.6 per cent. The CHAIRMAN. Your company was not taking it for patriotic motives, were they?

Mr. HULSE. I think so, largely.

The CHAIRMAN. There certainly was a lot of costly patriotism in this country at that time.

Mr. REED of New York. If you will pardon the interruption, just before I get away from the thought-the Turner Construction Co., as I understand it, was the only company capable of doing this work. That is one of the very largest companies, and one that specializes in this particular line of work.

Mr. HULSE. In reinforced concrete, I think it is the largest.

Mr. SIMMONS. There has been a statement made regarding the fees, and I think the contract ought to go in. The last printed proviso is for the cost of the work, is from $10,000,000 to $12,500,000. If the cost of the job is less than $10,000,000 the contractor was to receive a fee of $250,000; if the contract is over $12,500,000 the fee was to be 2 per cent, but in no event was it to exceed the sum of $400,000.

Mr. HULSE. Which amounted to 1.6 per cent.

The CHAIRMAN. In fact, what was the profit to your company on that particular job?

Mr. HULSE. As a matter of fact I do not think it is possible to determine that precisely.

The CHAIRMAN. What did the Government pay you?

Mr. HULSE. $400,000, 1.6 per cent on the cost of the work. I do not think anybody will ever find a contract being done for that amount, at any rate, I do not believe so.

The CHAIRMAN. Where a contractor has all of his bills paid, and it has made a profit for you of $400,000 additional, without any risk?

Mr. HULSE. Well, I do not know about that; he has got all of his overhead in every case to sustain. No contractor-there is no use of my standing here and saying a contractor can not do the work for that, but I suggest that I do not think you will find that

any reputable contractor would ever say that work could be done at 1.6 per cent, and the contractor live, even on the largest contract. Mr. WILLIAMS. As I understand it, the contract is not in question. I would like to ask the witness if it is true that during the progress of the work, and at all ends of it there were Government inspectors who were watching it, and whether you were doing this work under the direction of the Government in all particulars. Mr. HULSE. Absolutely.

Mr. WILLIAMS. Am I right in the matter of inspection?

Mr. HULSE. Absolutely; there were Government inspectors over there every day seeing the material being dumped.

Mr. SIMMONS. If you will address yourselves to the question as to whether or not attorney's fees is an extraordinary expense, not contemplated by the agreement to be borne by the Turner Construction Co. out of the per cent it received, we will get right down to brass tacks of the point involved.

Mr. ALLGOOD. Are you retained by the Turner Construction Co.? Mr. HULSE. We are the general counsel for the Turner Construction Co.

Mr. ALLGOOD. Do they pay you annually?

Mr. HULSE. No; we have no annual retainer.

Mr. ALLGOOD. You are only paid for the cases in which you actually appear?

Mr. HULSE. Yes, sir.

Mr. ALLGOOD. How much of this $27,000 was attorney's fees and how much was costs?

Mr. HULSE. There was $20,000 for attorney's fees, and the rest of it was for expert witnesses.

The CHAIRMAN. How much time did the case involve?

Mr. SIMMONS. May I suggest we can save time by deciding first whether there was any liability on the part of the Government.

The CHAIRMAN. I wanted to get that in the record. How long a time did this case involve?

Mr. HULSE. We were working on it a year; there was not a month, scarcely a week, that it was not necessary to devote time to preparing to have the testimony.

The CHAIRMAN. That is true in every lawsuit-how long was this case in court?

Mr. HULSE. Oh, about a week.

The CHAIRMAN. Putting in the testimony?

Mr. HULSE. Yes, sir; putting in the testimony.

Mr. WILLIAMS. And, then, was there an appeal?

Mr. HULSE. No; there was no appeal. If I may state, in as much as the question was raised, we never heard of this suit until the New Jersey Central sent us a letter in which, if I may read a little of it

The CHAIRMAN. What is the date of that?

Mr. HULSE. This is a letter dated February 27, 1920, from the general counsel of the New Jersey Railroad Co. to the Turner Construction Co.:

The president of our company has placed in my hands the matter of your company having deposited dredged material on the property of this company at Caven Point, Jersey City, N. J. It appears from the papers submitted to me that the dredging in question were placed upon this company's property

without its consent, and clearly under such circumstances it will be entitled compensation from you. Estimates show it will cost between $600,000 $800,000 to remove this material, when we come to make improvements to property

And so on. The Turner Construction Co. when they came to told us that that was substantially true, that it would cost fr $600,000 to $800,000 to take that material from where it had b deposited and cart it out to sea, and I do not mind telling you I sw some blood for the Turner Construction Co., and I found out w the condition of the evidence was with regard to placing this 1 terial there.

The CHAIRMAN. What was the condition of this land where it placed?

Mr. HULSE. It was under water when we started; now it is ab water.

The CHAIRMAN. Did you contemplate there would be any seri trouble in proving it was an improvement?

Mr. HULSE. It was a great question and there was much und tainty about that-it was what a jury might infer out of conflict testimony.

The CHAIRMAN. What possible purpose could any company h in wanting to take dirt from land which was put to raise it ab water, and take it away and put it under water?

Mr. HULSE. The New Jersey Railroad Co. on this trial claim and they did have plans for a great docking and pier system, and would require the excavation not only of the material that we h put there but of a great deal more material, and that they had take it all away to do this.

The CHAIRMAN. But the court held against that?

Mr. HULSE. Well, the jury did after we put in our testimony, b to be in such a position, with nothing but a jury's inference betwe you and $610,000 is a serious situation. The jury could have, wi the evidence in the case held to the contrary.

Mr. WILLIAMS. Oh, yes; a jury could do anything.
Mr. HULSE. Well, that is it, and that is where we were.
The CHAIRMAN. But the probability would be different.
Mr. HULSE. It was conflicting evidence.

Mr. SIMMONS. A higher court would not have interfered wit the judgment.

Mr. HULSE. No; a higher court would not have upset the verdict Mr. SIMMONS. If the jury had decided the other way, the damage would have been something in the neighborhood of $600,000.

The CHAIRMAN. I do not comprehend that there was much dan ger in them doing that?

Mr. HULSE. May it please the chairman, who can tell, and ther is all you have between your client and $600,000.

The CHAIRMAN. A good lawyer, like yourself, did tell.

Mr. HULSE. Well, we could not tell; a great many things happened in the preparation of the case, and that was the very thing we had to do. We had to go all over the country to find the witnesses; there was not one of them in New York, none of them in the employ of the Turner Construction Co. When we did get Major Perrine, we found that he had an interview with Major Bessler, we found that the talk, according to his testimony, had been very