The Sun.
London, England, 1868-04-08 00:00:00

appointment of his son-in-law, George A. Osgood,
as a receiver to take charge of the money accruing
from the extra issue of shares made by Drew. The
Vice-President was produced, and bailed ; and the
shares rose to 751 ; but Drew, who seemed to have
unlimited powers of manufacturing stock, again
flooded the market, and down they went to 71:1. The
day closed with loud threats ; the Drew party defying
the warrants of the New York Court, and their oppo-
nents threatening to seize the property of the Direc-
tors, who aided him, each being supported by the
different courts to which they applied, confounding
the confusion already prevailing. Monday was the
16th, and the Vanderbilt party having failed in their
legal proceedings agains t their opponents,hired a gang
of 40 roughs,who were to receive $50,000 if they cap-
tured Drew, his associates, and the books of the coin-
pany. They proceeded to the Erie Long Dock,
but failed there to catch the directors, and feared
to attack them at the hotel, where they remained
armed to the teeth, with the approaches guarded.
The police force of the town was called out, and
armed patrols of citizens protected the streets. On
that day the Drew party applied to the Drew Court,
and procured an injunction to prevent George A.
Osgood from acting as receiver until the llth April,
when the case was to be argued, and they have an-
nounced their intention of proceeding against the
three Erie directors who support Vanderbilt for
damages, which they lay at two million dollars, for
the interruption the business of the company had
suffered. While this battle was progressing the
contest at the Stock Board was renewed, Drew
again "bearing" heavily, succeeded in pressing
down the shares from 72 to 66, causing a general
panic in the railway market, two banking houses in
the Vanderbilt interest being reported to have failed.
The indefatigable Drew was not content with fight-
ing the battle on his own ground, but carried the
war into the enemy's camp. lie fomented a
general strike for wages on the New York
Central and Hudson River Railroads, by
which thousands of the Vanderbilt labourers
have turned out. The report of the Executive
Committee, dated March 9, was also published.
the power of the board is therein maintained to
convert into stock and sell the bonds of the com-
pany under the general railroad law. " Our pre-
decessors," it states, "had claimed and exercised the
right as early as 1863, had reported the same to
the Legislature, and had continued to exercise the
right, and to report their actions to the Legislature
without criticism. The New York Central Rail-
road Company had exercised the same right also,
to the amount of over $3,000,000, and had from
time to time reported their doings to the Legisla-
ture without criticism, and the holders of stock
created by such conversions in each company had
exercised their right of voting as stockholders with-
out challenge. The same may be said of the Hud-
son Railroad Company, and of most of the railroad
companies in this State. The construction of the
law was universal in favour of the right to issue
convertible bonds, and to convert those bonds into
stock if called upon, even though the amount of
capital stock should be increased thereby beyond
the amount named in the charter; and it never en-
tered into our heads to doubt a right so uni-
versally claimed and exercised." The report
goes on to allude to the suits instituted in the name
of Mr. Frank Work, then a director of the board,
wherein he charged a former board in collusion
with Mr. Drew with frauds in his contracts with
the company, as well as the present board in per-
mitting the conversion of the Buffalo, Bradford,
and Pittsburgh Railroad stock. It is also urged
against him that he obtained the summary removal
of Mr. Drew from his office as director, and peti-
tioned for his removal from his office as treasurer,
although he had voted for Drew both as director
and treasurer, knowing the facts which he alleges
to be fraudulent. The Report states that Mr. Work
was placed on the board in the interest of the
Hudson River and Central Railroads, and on the
Erie board refusing tobecome parties to the gigantic
monopoly schemes of Vanderbilt for the benefit of
the Central line he went over to the enemy. The
legal opinion given by Mr. Charles O'Connor is
that any certificates of stock issued by the directors
of the company are valid, but if the eminent lawyer
gave this opinion there are many who wholly dis-
sent from it. To create and sell unlimited stock
is acknowledged to be beyond the power granted
by the charter. It is clearly a ruinous policy for any
directors to act on. The broad fact is certain, that
Daniel Drew is gambling with the interests en-
trusted to him by the proprietors. Do the stock-
holders suppose that they can be benefited by their
shares being deprived of all value? Yet this is clearly
Mr. Drew's object. He has sold a vast number of
if he cannot buy
sharesw
backhi c ha
td oa notfig übreel o
hn
eg to
can
u him; a
afford
ord when called
upon to return to the board the securities with
which he was entrusted, his loss will be enormous ;
of course it is his object to prevent this by any
means, and to do this the resources of the property
are freely used : that is, he avails himself of the
property to injure the property, having created an
interest, in conjunction with other of the directors,
adverse to that of the shareholders. Many of the
proprietors reside in England ; and it would be well
for the magnificent
if not thus
magnificent line they
own,
m to
whichl
wouldpteary
handsomely,
manipulated to benefit mere speculators. Cer-
tainly Mr. Drew's proposal now announced to carry
first-class passengers between Buffalo and New
York, a distance of 350 miles, for five dollars in
currency, has the aspect of a ruinous measure for
the Erie Railway, whatever injury may be inflicted
on the New York Central. Of course the effect of
thrusting the shares down will end in Vanderbilt
getting the control into his hands, if he can pay up
for all the shares bought, and in the election next
October for directors he will have the game in his
own hands.