The Iowa transcript. (Toledo, Tama County, Iowa) 1858-1866, 1866-02-14

he says that he yields to no man 10 MS al
miration of Horace Greeley.
The New Haven Railroad Case.
Lame as Justice is said to be- she travels
steadily and surely--at all events in some
cases. II lacks but few months of twelve
years since the financial community was
paralyzed by the news that the President Of
the New Haven Railroad Company had been
flooding Wall street with spurious certifi-
Gates Of stock, and had run away to hide his
guilt and his shame in foreign lands. So
vast was the extent Of the fraud, and SO high
had stood the character Of the criminal, that
people at first refused to believe the news.
Schuyler was not only member Of the
church and . scion of our "hereditary no.
bility," but he was man personally we'll
known in Wall street, universally esteemed
and respected, king among railway men,,
3 potentate among fnanciers. Yet this
Schuyler, as it was soon proved, had issued
fraudulent certificates Of stock in the New
York and New Haven Railway Company to
an amount exceeding two millions Of dollars,
had foisted them on his friends and ac-
quaintances the bankers, brokers, and
money-lenders of Wall street, and had run
away, leaving no trace Dchlnd.
After the first shock, Wall Street turned
its after tion to the practical consequences
Of the development. There was S3,O00,OO0
of genuine stock Of the New Haven Road,
and $2,O00,OOO or more Of stock fraudu-
lently issued by Schuyler. The stock had
been active, and on the morning when the
fraud came to light, there was hardly q
banker or broker in New York who did not
hold directly or indirectly some shares.
How could the so-called spurious stock be
distinguished from the genuine? The bro
kers studied tho subject, and finding that all
the certificates were alike, all duly signed
and registered, and all to outward appear
ances equally valid, concluded that no dis
tinction could be made between them, and
that the Company--being bound for the acts
Of its officer-must be equally responsible
for all. This was the sense Of the New
York Stock Exchange, and Of the bankers
and brokers throughout the country. They
therefore summoned the New Haven Rail-
road Company to recognize all the certif-
Gates, whatever their origin, and to trans
fer them on their books.
The Company refused. Its counsel took
the ground that though the Company was
responsible for all acts Of its officer per-
formed within the scope of his official duties,
it was not responsible for acts committed
beyond that scope, much less for crimes
committed by him. And some Of the subor-
dinate clerks of the Company undertook, BY
q process never clearly explained, to sepa-
rate the so-called spurious stock from the
genuine, and to pronounce two-thirds OF the
floating certificates Of New Haven stock
absolute waste paper.
Naturally indignant at this proceeding.
the brokers dubbed together and instituted
legal proceedings against the Company to
compel them TO recognize the so-caled spu-
rious stock. More than half the leading
lawyers Of the city were retained on their
behalf. The Company accepted the issue,
retained able counsel on its side, and pre-
pared for . long fight. The stock was
struck from the list Of the Stock Exchange.
and has never since been bought or sold at
the Board.
The suit began in the fall of 1854. 1t
took many shapes, and came up in various
ways. There is hardly leading lawyer at
the bar whe has not been engaged in il at
some time or other, either for or against the
Company As rule the press and public
sentiment were throughout in favor Of the
brokers. People generally took the common
sense view Of the case, and decided that as
loss must fall upon somebody, it was more
equitable that it should fall on the Com
pany, which had erred in the choice of an
officer, than upon innocent holders of stock
who had been guilty Of no negligence, and
could not, by any possibility, have protected
themselves against the event. But the Com
pauy stood unmoved. 1t had long purse,
an obstinate Board of Direction, and an in
genious party of lawyers. Year after year
dragged on, and but little progress was
made. Every technical difficulty was urged
by the Company every side-issue was elab-
orately discussed; every possible motion
was made: every point of law raised: and
thus, as we. said, year after year passed !;
the law costs Of the injured brokers were
steadily on the increase, and they seemed to
be no nearer judgment and redress. AT last,
some six years after the commencement Of
the suit, judgment was obtained in one of
the cases. 1t was substantially in favor Of
the Company.
This was SO discouraging to the litigants
that many Of them, worn out by long watt
ing, loss Of time, and heavy law costs, con-
cluded to accept compromise which was
judiciously offered by the Company. On
condition Of Withdrawing their suits and
giving no further trouble, they received one
snare VI Ecd1 SILVIA ZOE CScIy wv SA"ANS "
so-callcd spurious stock. Thus at least
one-half Of the claims were adjusted at the
cost Of all the net earnings Of the Company
for several years.
But there was one man among the prose-
cutors of the Company who was not discour-
aged. This was Cornelius Vanderbilt. lie
had lent money to Schuyler on the so-called
spurious stock. He had examined the stock
before he lent his money, and had proved
the certificates correct. He was nOt now
willing to admit that they were otherwise
The adverse judgment did not dismay him.
Ii the Company had patience, so had he II
they had long purse, SO had he.-~ y they
could fee able lawyers Zone Of the Compa-
ny's counsel is said to have received no less
than 100000 for work in this single CASEY,
80 could he. He rejected the proffered COM
promise with derision, and babe his lawyers
appeal, and prosecute the appeal with vigor.
Encouraged by his example, other victims
of the fraud declined to accept the compro-
mise, and appealed their cases likewise.
Then followed more tedious years Of post
ponements, arguments on side issues, mo-
lions and countermotions, and all the legal
mannuvres which are SO profitable to law
yers and SO heart -sickening to needy seek
ers after Justice. There is no doubt but the
Company based its hopes in great part upon
the probable death of Commodore Wander
bilt. If he died, there was every reason to
believe they might succeed in wearing out
the other suitors, and either inducing them
to accept the proposed compromise or de-
feating them altogether. And he was an
man, over seventy, with heart-disease $50
twas sadly, with \ fondness for fast horses,