The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-12-02

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ity How u the Gordian knot 70 be cutf TO relieve
the corporation from its great embarrassment no.
the difficulty by substituting as the receiver In
TINS cause the general receiver OF the fund;
e sas means w an tSs enS
In which it now labors; for Mar. Receiver Dawes,
unasr aus general powers and under tne appoint uni
! be then In condition where the Erie Railway Oom
pany VIII suffer embarrassment. Besides TINS tue
Court win thus relieve the records Of the stats trl.
now appears on them. The siidavi.s presented on
Gw s sa s
dissipaed IN the most dsordery ana most dlsnonest
manner Mr.. Jay Gould should not De appointed
| receiver. lie Is an officer OF the corporation, and
as such Officer was party to the Illegal acts COM
mitted. As treasurer and president OF the corpora
ton and as one of the Executive Committee he tH
not competent to be appointed receiver. That prln-
| ciple has been held by the greatest lurists.
Counsel cited precedents and decisions In support
OF point and OF the point that there should
| not be two receivers OF the one lund.
@ making Mr. ne IN a n 10
suit would have upon the proceedings in the State
court.
answered by Mr. BelmOnt's counsel.
Mr.. Rapallo said the suit in the State court was
founded on the rights OF Mr.. Belmont holder of
lately issued stock OF the company In addition To
the legal stock which ne held he also held stock OF
w"nd nnv asct n,s rahs az n IN sn,S SUI.
stock. The Two suits were entirely independent OF
each other and there was no conflict in the two posi-
tions
MIR. 0'Conor remarked that Mr.. Belmont was
creditor in the one case and stakeholder in the
other.
ARGUMENT OF MR.. sroUaHToN.
Mr. Stougnton followed in the opposite side OF the
question: The case, he thought, had been rather
obscured than Illuminated by the mass OF afiuayits
and by the arguments Of counsel and he would en-
deayor to present the simple and he conceived,
the Important points OF the case 1t came before the
court on two petitions-One by Mr.. Belmont and his
partner, claiming the benefit OF the suit brought by
| Whepley against the Erie Railway Company, ana
| Court first that Mr. Jay Gould be set aside as
receiver and himself substituted in his place.
The general ground on which Mr.. Belmont
sought to come In that he possessed some
| stock such as Whelpley said he was the owner OF
| and was therefore entitled to the same relief.
Mr. Belmont, therefore, claimed not only the benefit
OF the adjudication made in behalf OF Whelpley, the
complainant, but the benefit or participating IN the
fund, over winch MIR. Jay Gould was appointed re-
ceIver. He therefore, affirmed the regularity OF the
proceedings, and must go hand In hand with the
| complainant in It's prosecution The claim OF Mr..
Davies rested on different ground. He said that on
the 23d Of November last he was appointed q re.
the supreme Court Of the state Of = New York,
not only OF the fund set apart by this court,
but OF ali The property OF the company. as
| If he were corporation sole. ii there
was any proposition that was beyond question
it was that there was now no receiver OF the Erie
Railway Company, that the order of the Supreme
Court OF the state wAs as entire nuty as II II had
| been voted and made by a mob IN the street. He
SAID this with great respect for Judge Sutherland,
for whose honesty and purity OF character and IN
1 tention no man has a higher estimate than himself
|
! COLLISION.
Mr.. Davis--we said obtained in chambers.
Mr.. Soughton-TO what case do you refer p
| Mr.. Davis--The Mcintosh case.
! Mr. Stoughton-I refer to the order obtained from
Judge Batchford 1t has been urged that that order
was obtained by COLLISION, and he had heard crii-
esms made with regard to the obtaining Of that order
which re dsllked TO hear, and which were not only
| unjust, but would rcc0l on those who made them
The Court would bear IN mind that when the appli-
cation for the order was made II was made
on bill Of complaint in this case and
The benef, or which Belmont and his partner
received The Court will remember that all that the
hn was tnis n az camnan Wha au oe'ore
theoryy Why that certail bonds had been issued
the amount OF several millions by this company,
vertibe INTO stock, and the person claiming to
parcel or this stock, the complainant in the suit,
lilies his bill alleging that that stock is Invalid
because the company had no power TO issue II, and
he asks to have 1t so adIudicated and that he be
entitled TO Judgment against the company for the
That complaint put forward another idea-that
thus ought to be suit against part OF the |
assets OF the company; that there might be
money enough In case recovery should be had by
the plaintiff and 10 meet the Judgment which might
be obtained In this suit for other parties similarly
situated. He COUNSEL thought that Belmont and
partner who claim the benefit Of that suit hardly
be heard 10 complain or to criticise or insnuate
that the suit was brought by COLLISION. What
Why, that the attorney Of the company appeared In
the District Court and waived nouce in the appli-
cation for the appointment OF receiver. He as
sented 10 nothing; he merely waived notice OF
service What followed? The learned judge, In.
structed only by the bill-having notice Of what
with no knowledge that this hasty order to be
made by Judge sutherland-wlth no knowledge
participation In any OF the proceedings Of the
state Cour;-he Judge Blatcnford) made the
order which is The subject OF criticism an TINS sut
What Is sne fact presented 10 the learned JudgeS
He found Jay Could had been placed in the position
OF treasurer OF the company; he did not know it
tnen, but n turns out here, by the unanimous vote
OF the stockholders at election duly and properly
held. He Judge Blatchfordl found Gould charged
with the possession OF all the moneys OF the com
pany. in charge of the property and money OF the
corporation, and he converted him into an ofcer OF
the Court, placing hinl IN itct under the Jurisdc.
ton 81 the Court ana making him alnenabe to the
Court. by that order he did not lessen the
capacity OF court Of Justice 70 take hold
tue Judge granting the order ordered him
Could to give bond in a penalty Of a million
OF dollars. Did that order lessen the capacity OF the
creditors OF the company or the stockholders OF the
company 10 get their rights or 10 their Just
demands from the company by making Mr.. Gould
receiver OF the money already in his hands, tue
Court subjected him 10 the authority OF the Court
not only by removal but by punishment If he should
violate his duties. Ind not the Judge also when he
ordered HIM 10 give bond IN a million OF dollars, put
him under the further obligation 10 bold safely and
TO account Tor Justly all the money In his handsS He
should lake To know by what right upon what
ground counsel dare suggest criticism on the con-
duct ol "a learned Judge or that OF the parties VINO
90 before inn under such circumstances when all
that has becu done was 10 Increase and strengthen
the securities winch they say were so IRAN and UNI
certain.
the IDEA OF impuing anything TO the learned Judge
who granted the order.
Mr. stoughlon-Therc have been also charges
made against counsel IN the case.
Mr.. O'Conor--We. have said nothing against
counsel.
Mr.. StoughtoD-Nill counsel then explain what
they mean nv Couson, for IL takes two persons To be
guilty 81 collusiOnY ftwas by cUnplainans counsel
going 20 that Court and getting an order that IN
crcases the security Of the company, he should like
know by what right any human being dare TO charge
him with collision. tie would add that there was
a circumstance connected with the criticism on the
court and the withdrawal OF IT, the appearance OF
an article IN q newspaper which unfortunately
one Of the counsel Tor the moving parties IL
known 10 he closely connected with, and which
ne trusted they should disposed OF salts
factoriy after the disclaimer that had been
made hy counsel on the other side. Counsel
then read Judge Blatchford's order appoint.
lug Jaw Gould receiver and continues: DO gentle
men on the other side say that Mr.. Gould Is subject
10 their impuatons, or does he stand In such re-
lation TO this controversy and these parties that he
should not be left IN that position II the
court decidedf Why should Judge Davies