Grand Trunk Railway vs. Grand Trunk

Foreword

The following treatise, originally written as a brief on 15 August 1969 with the then stated dual design of showing the intent to include the Grand Trunk Railway System (GTR) in the 1918 formation of the Canadian National (CN), and that the Grand Trunk (GT) was created, rather than being taken over by the CN in 1923; was in response to a query for assistance regarding an argumentative discussion. However, it went somewhat beyond achievement of the aforementioned clarification, in that it also set the point where distinction between the GTR and GT is made, and additionally that, commencing in 1925, the CN did begin, slowly, to absorb its recently created GT.

Access to several additional sources between 1969 and 1974 promoted insertion of applicable revisions and on 25 July 1975 the brief was redrafted for presentation as a treatise due to actually treating four avenues of Interrelation instead of two. With CN having now closed the books on the GT subsidiary Cray May 19, 1980, the treatise is again presented with that fact made a part of the record.

John R Davis
South Paris, Maine
28 February 1990

By virtue of signature above, all rights reserved by the author are extended to include CNRHA "permission to reproduce this treatise or notions thereof in any form without further consultation with the author."

On 20 December 1918, the Order in Council of the Canadian Government approved the formation of the Canadian National Railways from plans drawn in 1917 to consolidate, under the Canadian Government, those railways that were, or on the verge of, going bankrupt.

That the intention for the Canadian National Railways to include the Grand Trunk Railway System (GTR) and its Grand Trunk Western subsidiary ((GTW) composed of former Chicago & Grand Trunk assets) this early, prior to its actually doing so, is a fact, established in 1917 upon promulgation of a majority report from a Royal Commission of three men, which had been appointed by the government in 1916 to study and seek the best solution to the financial plights of the Dominion's railroads. Their report proposed that the Canadian Northern (CANOR), Canadian Government/ National Transcontinental Railway network (CGR/NTR), Grand Trunk Pacific (GTP), and GTR lines be controlled and operated as one system by the government. On 1 October 1917, the government placed the CANOR under its control and on 20 November 1918, operationally assigned the CGR/NTR to the CANOR Board of Directors. The two systems were formally combined as the Canadian National Railways (CN) one month later, 20 December 1918.

Further establishment of this is contained in the blueprint for renumbering and classifying locomotives, dated in November 1918, and promulgated for execution in the early part of 1919, that had been drafted during the consolidation planning stages of the CN, for placing all the locomotives belonging to the various railways onto one roster. Not only did this renumbering blueprint assign the numbers and classes for those engines on the GTR 1917 stockbook and 1918 roster, it went further; by excluding those the GTR expressed intention to retire through 1921, and providing for those that were currently on new construction orders, right down to the sub- class intermingling of these engines with those of the other railways which had been constructed to the same or similar design-and specifications.

In addition, GTR engines and equipment commenced to operate on former CANOR and CGR/NTR lines, and engines and equipment from those roads on various districts of the GTR in the early part of 1920, in accordance with an act passed by Parliament on 1 June 1919 which stipulated that administration of all railroads the government had or would be acquiring should be placed under the jurisdiction of a CN Board. Further evidence of the intent for the GTR to be within this singular administration is borne by the fact that fifteen of the large 500-class Pacific type locomotives being constructed by Montreal Works in 1918 under an earlier order placed by the former CGR, were redirected for Eastern Township and Southern Ontario District GTR use, and delivered in GTR livery as the GTR 1500 series, first in an "on- lease" status, and then sold outright to the GTR in 1922 for enabling their use on GTR Lines in New England.

While it initially appeared relatively simple to formally amalgamate the GTR into the CN as had been done with the other roads, particularly in view of how, following the death of GTR President Hayes in the SS TITANIC tragedy, the GTR quickly mismanaged itself into a precarious financial condition parallelling the near-bankruptcy experienced by the CANOR in 1914 and 1915, such was not to be.

One of the contributing factors to the GTR's exclusion during the December 1918 consolidation was that the GTR lines in the United States, produced much-needed revenue from the increased traffic following America’s entry into World War I, and the first. few years thereafter; had upon entry in that conflict, been brought under the control of the United States Railroad Administration section of the, an event that rendered the GTR U.S. Lines eligible for receipt of fifty new locomotives from the inventory being erected for the U.S. War Department along with hundreds of new freight cars, with which to supplement their own for the war effort.

A second, perhaps stronger, factor was that the majority of GTR stock was held by investors in England, who campaigned for the GTR to continue on its own, primarily from reviewing the outcome of stockholders in the CANOR and CGR/NTR bankruptcies; and also from envisioning the revenue generating from the GTR's U.S. lines would partially defray the deficits in the company vaults and eventually bring them at least a token return on their investments.

A further illustration of the attempt to remain on its own is that of March 4, 1919, when the GTR defaulted on its ownership of GTP securities, placing that road into receivership under management of the department of Railways and Canals, and eventual operation by the CN Board on 12 July 1920.

Unfortunately, ownership of the GTP securities, and the huge deficits arising from operation of that line had already so weakened the parent GTR that it proposed to the government on 10 October 1919, for the transfer of all its own assets and liabilities to the CN. The Parliament completed the acceptance of this proposal on the 5th of November, and ordered the CN Board of Management to take control of the GTR on 21 May 1920, pursuant to an agreement whereby the value of the shares representing the stockholders equities would be established by arbitration.

As soon as the terms of the sale were arranged and announcement of it made in early 1920, bitter arguments broke out between stockholders and the arbitration committee, but meanwhile the operation of the GTR lines began to be coordinated with the other roads which composed the CN,, although the GTR remained under separate management. Arguments concerning the compensation of stockholders continued through September 1921, when the protests over the appeals of awards to the various stock classes became so heated, further action on the issue was delayed until May 1922.

Amalgamation of the GTR had evolved into an impatient issue, the government desirous of completing its transcontinental network, and the GTR management being concerned over the material condition of a goodly number of engines and equipment which were entering their year of being operationally pooled in service on the other lines of the CN should the consolidation not take place; and particularly as the general speculation other governments including Canada, had that the post-World War I economic boom experienced within the United States and on the GTR lines therein, would commence declining rapidly by 1921 did not take place. The stockholders continued, now more vociferous,, to press for going on as a separate railway.

In the summer of 1922, United States Ex-President Taft was engaged to represent the GTR in the litigation and the protracted hearings did finally produce a finding to conclude the lawsuits over the stock values — worthless. This decision was sustained by the Privy Council in London on 28 July 1922, and the last obstacle to complete the final amalgamation was over, or so it seemed.

During November 1922, the CN submitted to the Order in Council a plan that sought complete dissolution of the GTR when opportune for reshaping the CN financial structure, and to carry out overall reorganizations within both the CN and the GTW subsidiary of GTR, which CN would continue as such, for enabling periodic transfers of the GTR's accounts to those of the CN, particularly of the New England Lines in the United States.

This plan, with some minor adjustments, was approved by the Order in Council on 30 January 1923, concluding the amalgamation of the GTR and completing the formal consolidation of the lines originally intended to become the CN system.

It was initially intended that everything GTR would assume CN identity, and the corporate structure immediately revised to reflect it. One significant instruction issued subsequent to 30 January 1923 and dispatched to all system shops directed that on and after 1 May 1923, all locomotives and car equipments were to be renumbered and relettered to Canadian National prior to departure from the shop for resumption of service. However, geographical and operational conflicts being experienced during the early transition of GTR into CN (such as mis-shipments from other points to Oxford, Maine ended up in Oxford, Nova Scotia or Oxford, Michigan) were seriously compounded by international legal technicalities that suddenly arose on 8 May 1923 when U.S. registered locomotive 5582 (ex-GTR 206) was not allowed to leave the United States after having arrived from Montreal with CN lettering applied at the Pointe St. Charles shop, and again on May 13th with U.S. registered locomotive 3700 (ex-GTR 440) also being denied exit from the United States carrying the CN lettering Portland’s. East Deering shop) had applied. Canadian registered locomotive 920 (ex-GTR 1020), which had arrived in Island Pond May 2nd freshly renumbered and stencilled CN the day previous at Richmond house, was in the meantime being dispatched back and forth across the boundary line working one side of the Island Pond-Richmond wayfreight runs.

As CN had found continuance of the former GTR's reliance upon U.S. registered motive cower for handling one side of scheduled manifest runs and the bulk of extra freight-ht movements a necessity in Montreal-Island Pond operations, the stoppage of 3700 at the boundary line dictated the resolve of these technicalities be of paramount expedience; whereupon CN hastily established a separate capital account to cover the New England and Eastern Township lines as a new subsidiary, entitled simply "Grand Trunk", ("GT") and issued instructions to East Deering, Island Pond and Richmond for lettering U.S. registered motive power accordingly. 5582 was restencilled at East Deering on May 15th, while Mogul 733 (ex-GTR 1416) which had arrived from Richmond on 14 May with CN lettering was restencilled at Island Pond May 15th prior to being dispatched to Gorham. 3700 was relettered to GT at East Deering- on May 17th, and thereafter all three locomotives went in and out of Canada without difficulty.

CN chose this identification largely because those were the two words GTR had been affixing to its locomotives and car equipment since 1892 as a means of conserving time and labor expenditure, stencils were still on hand; and as the majority of locomotives had not yet been relettered since acquisition of the GTR, it removed the urgency in administrative documentation, by using the existing GTR stock account books through deletion of the words "Railway Company", "Railway System", or the initial "R", whichever was necessary where it appeared, until such time it was deemed convenient to transfer the item entry onto the CN's own account.

So it is at this point in time, 15 May 1923, where the name "Grand Trunk" stood of itself for the first time as a legal entity, and where a clear line must be drawn to distinguish properly between the GTR's "Grand Trunk" misnomer and the "Grand Trunk". All reference to material/pictorial matter containing the GTR usage of "Grand Trunk" in relation to the r)re-CN days of formal amalgamation should be done only by its chronological legal titles in full or by the initials "GTR.' The name "Grand Trunk" with initials "GT" pertains solely to the certain, specific areas and equipments as was delineated by the CN, and can be used only in that regard.

The specific areas that became GT on 15 May 1923 were the properties of the non-C& GT- derived Michigan Lines, Portland Division Lines (Eastern township and New England, the latter also containing the lines in New York state), with car equipment as assigned; and the accounts of some 1300 former GTR locomotives, many of which were not on these lines, nor ever destined to be assigned or to appear on these lines, or to be lettered for the CN's GT although in actuality most still carried the "Grand Trunk" label from the GTR days.

Thus consolidation was planned, partially undertaken, the taking over of the GTR delayed, then the amalgamation finally approved, distinction made between the titles and usage of GTR-GT, and so the final chapter of the perplexing consolidation appears complete. Or does it?

The renumbering and relettering of the former GTR engines commenced on 1 May 1923, and while it was some four years later than had been originally envisioned, with very few exceptions these engines fitted the numbers which the blueprint of November 1918 had intended for them to occupy. Although most of these former GTR engines were carried on the GT capital account subsequent to 15 May 1923 as GT, only those on the New England Lines and some of the Eastern Townships Lines of the Portland Division, actually were to receive lettering for the new "Grand Trunk".

The Michigan Lines properties, locomotives and car equipment assigned the GT capital account were reflected as "GT — leased to GTW", and those few engines which received the new CN numbers in Michigan during the year 1923 carried "GT" in small initials on the lower corner of the engine cab and on the tender frame, while the tender side was stencilled "Grand Trunk Western". It would seem as if no time was lost in reviving Practices the former GTR had been noted for, as evidenced in the 1910 locomotive stockbook by showing certain non-C& GT-derived engines as "GTW" under the road column although neither the name the initials represented nor the initials themselves appeared in pictorial recordings of the Particular engine during that time. In the same book, a number of non-C& GT-derived engines are shown as "GT" in the road column and as "West of Rivers" in the remarks column, indicating use on the GTR's GTW subsidiary West of the Detroit River.

On 1 January 1924, the CN reorganized the GTW subsidiary line, with all GT-leased to GTW property, locomotives and car equipment being removed from the GT capital account, and placed onto the GTW capital account as an outright sale. The GT initials were removed from the cabs and tender frames of those Michigan engines on which it had been affixed. As an informational note, those C& GT- derived locomotives on the GTW subsidiary of GTR which were to have application of CN's roster number and lettering for the Grand Trunk Western during 1923, carried no ownership-denoting initials as did the GT-leased to GTW engines; while the new locomotives delivered to GTW from the builder in 1923 that had been ordered under the GTR tenure, carried cab and tenderframe initials “GTW" in addition the full Grand Trunk Western name on the tender. These initials were also removed after the 1 January 1924 reorganization.

The CN's retrieval of the "Grand Trunk Railway System" label for the subsidiaries joint advertising use also created a unique oddity to further confuse the rail enthusiast, when the twelve U-3a class locomotives CN had ordered for the GTW from American Locomotive Company were delivered. 6300-6311 arrived at Battle Creek, not lettered GTW as Schenectady had done on the locomotives it delivered in 1924 and 1925, but with a Grand Trunk Railway System monogram apparently patterned from the one appearing on CN's system public timetable The shop forces prominently painted out the "Railway System" portion and stencilled in "Western".

The physical renumbering of the former GTR locomotives was not completed until late in 1925. Several small restructurings

during that year and 1926 removed portions of the CAT capital account onto the CN's, especially locomotives, and by December 1927, the GT capital account carried only the locomotives, car equipment and properties assigned to the Portland Division. Throughout the 1930s the capital account continued to be reduced to where, in 1936, only the Berlin Sub-Division and the lines in New York State remained GT.

At each reorganization of the CN during the 1940s a little more of something was taken away, and with the exception of the ex-GTW (formerly GT- leased to GTW) engines that had been assigned the GT roster in the late 1930s and early 1940s, but without removal from the GTW capital account, the few remaining GT locomotives were placed onto the CN capital account in 1950. This left the GT capital account consisting solely of the trackage and building properties on the Berlin Sub-Division, the Black Rock and Squaw Island yards at Buffalo, the shared yard and terminal rights at Suspension Bridge and the Rouses Point yard, and a scattering of non-revenue rolling stock.

It is interesting to note that during the period 1924 through 1950, the GT capital account was steadily being- reduced whereas the GTW'S, excepting for the locomotives sent to Canada via the Lend Lease Program over several years receding the United States entering World War II, remained virtually intact. Considering that forms and instructions in use by operating and administrative personnel of these two subsidiaries from the mid-1920s onward, differed only in the name affixed to such documents: GTW on the GTW, CN on the GT; and that operating policy books and pamphlets used throughout the CN system contained the roadnames of the CN and subsidiaries Grand Trunk Western, Central Vermont, and Duluth, Winnipeg and Pacific only, one below the other on covers and title pages. It would appear CN hoped to erase the name Grand Trunk from the eastern section.

But whatever the purpose, a minor reversal occurred in 1954, with two diesel units, the 1861 and 1862, being delivered and placed on the GT capital account, Physically lettered "Grand Trunk" on the hood sides and a small "Grand Trunk Railway" within the Maple Leaf emblem on the hood ends. Additional units similarly lettered followed in the next several years, and the capital account of 1958 reflected a total of twenty-one diesel locomotives. Then in the early 1960s, the CN entered a program of visual redesign, and Grand Trunk units and car equipment began displaying a large, continuous-motion initialized "GT" as an emblem matching that adopted by parent CN for modernizing its image.

And due to the detraction a "W" presented in designing this image of continuous-motion, CN directed GTW to use the initialized "GT" symbol on units and car equipment, adding further confusion to the minds of those not familiar with the two subsidiaries, for now we could see GT "GT" units occasionally operated on GTW lines in multiple hookup with GTW "GT" units, and GTW "GT" units often could be seen working over the GT lines multiplied with GT "GT" units.

However, in 1963 the CN once again seemingly strove to erase the eastern subsidiary identity, transferring, the trackage and building- properties of the Berlin Sub-Division and those in New York State, onto its capital account, but leaving,- the diesel units and a small amount of non- revenue rolling- stock on the GT account. In 1968, all but the Buffalo switching units 7225 and 7226, which had been reflected as "GT — leased to GTW" the previous year, and Rousels Point switcher 8205, which was placed on the CN's capital account were transferred to the capital account of yet another CN subsidiary, the Central Vermont Railway, a line that in the pre-amalgamation days had itself been a subsidiary of the GTR.

Still, in 1972, even though the units transferred to the Central Vermont continued to operate over the Berlin Sub-Division of CN New England Lines carrying the large GT initialized symbol, six new pieces of non-revenue rolling stock were received at Island Pond for the Portland line; flatcars with removable, modular type living quarters for maintenance of way crews. Two of these cars, oddly, carried reporting marks "GTE" while the others were stencilled with only the initials "GT", and with no official reasoning for it released to guide us further, it could only be interpreted to reflect "Grand Trunk Eastern" and perhaps significant of things to come. After all, in 1973 CN had reorganized all of its incorporated United States rail operations (which did not include the Crew England Lines): GTW, CV , DWP (once a CANOR subsidiary), merged them with the GT Leasing Corporation which operated an automobile-rack and piggyback flatcar leasing- service, and an inactive GT Land Development Corporation, into one company with a singular capital account, entitled "Grand Trunk Corporation (GTC)".

During the latter half of the 1980s, CN referred to its Berlin Sub-Division variously as New England Lines/Lines in New England, then referred to it as its Grand Trunk East, Grand Trunk Eastern line in releases to the media regarding status of sale negotiations in late 198 and in public relations coverage when the transaction was completed and effected on 10, May 1989.

The briefest summation for distinguishing between GTR and GT is: GTR was a corporate system of itself, GT was a subsidiary of a successor system. The GTW has always been a subsidiary, first of GTR, then of CN, and now of GTC.

Despite the GTR/GT obituary appearing in newspapers on Saturday, 20 May 1989, the final chanter may not yet be written after all.

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