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4 % b J t f Mr, Wm. Reinhardt - Los Angeles Please refer to your copies of my letters to Mr. James M. Montgomery dated December J0t 1953 and January 27» 1954, relative to transfer of certain items of transits pipe and fittings from Railro&d aocounts to LVL&W MOB account so that when the District takes over the ledger value thereof will be added to the basic purchase price in accordance with Agreement BCML.D. 11342, Also please refer to your letter dated December 17, 1953> requesting that I handle this matter with the Water District and ascertain if they will desire to acquire any of these materials in connection with the sale of the water facilities to them. Mr, Montgomery has not replied to my letter of January 27th, and I therefore called him on the phone and requested advice as to what stand the District is going to take with respeot to the acquisi­tion of the transite materials listed in attachment to my letter of December 30th. Very much to my surprise, Mr. Montgomery seemed to take the position that, since the materials in question were purchased primarily for use in connection with the water facilities being sold to the District, these materials might be deemed to have been included in the purchase price and that he wanted to ascertain the District's ideas in this respect before answering my letter of December 30, 1953* I told Mr, Montgomery that our inquiry as to their desires in this matter was merely a matter of courtesy since the Agreement with the District does not require that we consult with them as to the kind