Toilers of the Sea

When the Federal Government stepped in twelve years ago to salvage his foundering Dollar Steamship Lines, President R. (for Robert) Stanley Dollar was grateful for the chance to abandon ship. His famed globe-girdling shipping line, founded in 1901 by his canny Scottish father, Captain Robert Dollar, was crusted with the barnacles of mismanagement, and carried a top-heavy load of holding companies.

The Maritime Commission accused the old captain's heirs of using the holding companies to set up a "milking system" to pay themselves fat salaries while the line was drained of its assets. In addition, the line owed the Government $7,500,000, and $2,000,000 to other creditors. Its net current liabilities exceeded assets in 1938 by $46,367.

With the rocks of bankruptcy dead ahead, Stanley Dollar turned 93% of the voting common stock over to the Maritime Commission and bowed out. No cash consideration was involved, but in return, Dollar was absolved of personal liability for the line's debts.

Overhaul. The Government changed the company's name to American President Lines, Ltd., ran the line as a U.S.-supervised private corporation, and pulled it off the rocks within a year. After pouring in $4,500,000 to slick up the ships, the Government cashed in on the wartime shipping boom. By 1943 the line was able to pay off both the new financing and the $7,500,000 Dollar Line debt, most of it, says American President, out of earnings.

By war's end the Maritime Commission had done so well that buyers became interested. In 1945 a syndicate headed by Charles U. Bay, now Ambassador to Norway, bid the flattering sum of $8,600,000. But shrewd, red-faced Stanley Dollar, who had been enviously watching the line's balance sheets throughout the war, had different ideas.

Even though the Government's profitable operation was paying $5 a share on the preferred stock, the majority of which is held by the Dollar family ($1,369,720 has been paid out, in all, under Government operation), that was not enough. Dollar filed suit and stopped the sale. His claim: the Maritime Commission did not own the line. Dollar said that when he transferred the controlling stock to the Maritime Commission in 1938, he did not transfer title. He had merely posted the stock as collateral for the debt that had now been paid off. Thus, A.P.L. belonged to him, Dollar argued, and the Government should hand it back.

Seamanship. The flabbergasted commission countered that Dollar had described himself in writing as "former owner" of the line and, in fact, had written off the stock as a capital loss on his income-tax return. The commission won the first round in federal district court in Washington, which ruled that Dollar had sold his company. So the commission confidently continued to build up the line, acquired virtually a new fleet of ships, including two 23,515-ton passenger liners, the President Cleveland and President Wilson. Under President George Killion, onetime chain-store executive and former treasurer of the Democratic Party, the line's operations were streamlined and costs cut. Last year's profit after taxes: $2,517,989.

But last July the commission got another rude shock; the circuit court of appeals upheld Dollar. Last week, the U.S. Supreme Court refused to hear the case, thus, in effect, ruling that the line should be handed back to Dollar.

For his smart legal seamanship, Stanley Dollar will get a line with 18 modem vessels and more than $61,757,716 in gross assets, compared to $27,560,835 at the end of 1938. Jubilant Stanley Dollar was more than willing to take over. If a new Government appeal does not prevent return of the stock, he hopes to call a meeting within a week or so and elect a new president. The chances are good that Dollar, even though he is 70, will be the new boss, and that his famed white dollar sign will go back on the stacks. Said he: "Justice has prevailed."

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