New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1869-11-30
THE ERIE WAR.
COMMENCEMENT


WHAT MR.. VANDERBILT THOUGHT OF TIE
JERSEY CITY HEGIRA. .
The Erie RdaWdy Company agt' CoIne',"o
Pander6aL-The pleadings in this suit were PuOiu.N -
The TRIBUNE in January Of this year Inc Lrie no. y
charges that in july 1868, certain OF thelr WI
r,,crlorly Mr. Drew and Mr. Eldridge, made an ar
raneement with Mr. Vanderbilt to purchase hVe miohs
of the stock; that the money was 10 DC pau ou. Vi |
Erie funds; that this arrangement was ono
10 get rid Of the Erie Of 1S61-S ana lhaV MI
bu was nrfieeDs frauds. It therefore claims PACK from
Mr. Vanderbilt all the moneys and assets pad MN uhder
that arrangements The was formally opened 10 Sc
onre its Mace on the calendar some ten days ago.
MIR. yanderbilt's testimony was taken quietly ont OF
Court on inst and the came up for 1orha
trial yesterday before the Court Neither Mesrs Fisk nor
Gould were present Mr. Vanderbilt at the open
ing Of the court but later the day Mr. Vanderbilt came
IN and sat by his counsel, rather obscurng MI Drew
who had taken seat further back. Mr. Field was the
sole counsel for Erie Mr. Vanderbilt was represented
by Mr. Rapalo. exJudge Noah Davis, Judge Beach ana
T. Buril was added their forces At the commence
Inent Field called for various parties whom he had
snbpenaed Mr. Drew though present. was not heaIa 10
answer Mr. Schell, Mr.. Work, and Mr.. Bioodgood an
Mr FdS erv Sd stated his case and commenced
to read the disposition of Mr. Vanderbilt which has been
Mr.. Rapaiio made formal motion to dismiss the COM
Mr. Field wished to know If they made amouon which
they knew could not succeed
Mr. Rapallo was ready 10 argue the motion,
Judge barnard said that he had looked at the COM
plant thought If evidence supported 1t there was
Mir Field then continued the reading Of the deposition.
portion testimony, relating TO the purchase by
Erie at TO- with bonds Of the Boston Erie and Hartford
Railroad struck out Till connection with the oher
transactions should be shown but subsequent portion
of his testimony relating to the same matter was au-
Mr. Allaire paying-teler Of the Manhattan Company,
was called witness, and testified 10 the payment OF
moneys, and were credited by him.
To Mr.. Horace +. Cark-He had been payingteller as
YIxo Nov Mr. ar
pare a statement OF the Erie Railways account from Eeo
10. 1851 He did not know from what sources to Eine
was sweed about the 18th Of March, he dld not
know whether the bank would show the Of
the Fries dcpots the receivingteler could better tell
that Clark explained that 1t might become import
tire fictitious stock Mr. Alare continued: The Erie
Railway at one time very heavy 1t was not
James G. Rieck broker, testified that July II, 1868.
Eric stock ranged about 7O on the 18TH OF July IL was
Cross-examined-Had sales book showing the fuctu
atons in stock from February 1865 on the LIST of
FEBRUARY 1885, sales made at 7i during February
it ranged from 70 TO rs about examination 1t ranged
sale S2b before % on the second call 1t sold 4 that
was not an unusual fai Tor Ere Stoes hSGIusea
tude occurred from Feb. l TO that date -, o.o
BY Mr. Feld-DO you recollect remarkable huctua
ton in the Central Railway stock
This produced discussion which ended in the striking
ont of the testimony fluctuations. 1t admitted
that the interest SOOOOO from the date of its pay
Mr. Field stated their total claim s2,l9366 Co. and
rested. -,
Judge Beach moved TO dismiss the complaint on
ground that Of action was made 0utno proof
of fraud aud conspiracy given and in fact the Ere
Railway had frauduenty paid out money 1t could not
sue to recover back us money ne cVtu noI Sc Nc
there any evidence TO support the complaint NO
only evidence the bearing on TINS was Mr. van
delbnFs testimony which directly negatiyed such
allegations Tho checks which paid, paid out
the Erie moneys but they were paid by the officers az
individuals. MrNanderbllt was not bound 10 inquire
that being officers Of the company they had rightly
come possession Of them aud had the night to dis
pose OF them they did. But in another view the com
plant alleged thar the Erie Railway Company had made
tins payment ana had pald CUT inns money ana that ~
had 10 right 10 make purchase OF It's stock Now II
this were true the Erie Railway was not te party 10 SCI
1t aside. The Erle Railway was party 10 Inc Irnsde-
tiOn aud settled that parties TO an illegal trans,
AGAINST each other beng in pari decto Tie stock
holders the only parties who could bring such
would prevent any fraudulent disposition of company
properly by its officers from being rescnded. or
course such things were DONE when done by
the officers of the corporation The defendant
had with remarkable fatuOusness persisted IN
saying that the Erie Railway owed him nothing that he
had claim on them Yet ne got from Mr. Drew halt q
million more than the stock was worth, and 100000
OF payment funds Of the Company What the
plaintiff insisted was that their money unawfully
paid out should returned them As for the stock,
defendant could settle for that with those who got II
brought against Vanderbilt, Eldrdge, and Gould for
Mr. Rapao argued in reply that it too late for the
plaintiff after averring that had PAID out this money
by authority of the Directors, and claim that the
nent was Unauthorized 1t Of the Company.
Mr. RapalO proceeded at length to argue that cOrpO
would not be permitted in Court OF Equity 70
resciud contract on the ground that such contract
WAS ultra Vrs This held regard 10 eXeCutOTy
contracts had never Dutn one been doubted
as 10 its application In executed contracts.
They had shown that there was any thing wrong in
tis action OF the Directors They had not shown that
Mr. Vanderbilt knew that tins payment was made by
funds AL that they claimed IN that direction was
that Mr. Vanderbilt should have suspected it when he
the checks OF the Company suppose the Ene d.
sought Opurchase house from his Honor would
he bc bound 10 inquire the COmpany's right puT
and would the Company be allowed TO get back
their money after they had occupied the house and 1t
burned dOwni
Mr. Field-suppose else took their money and
paid IL out.
Mir Rapallo-Then the Company should not aver that
bOughtit. Mr.. Rapao proceeded 10 argue that the
complaint clearly averr6d That this purchase was by au-
He should prese another point that the Erie Railway
not forbidden to purchase lts own stock Mr. Field
them 10 purchase twenty millions Of its stock
Mr. Field denied that he had ever so argued The com
plant had two aspects-one that MI vanderbilt had
had obtained OF It SOOOOO0 without any valuable consd
GRAFTON. On the evidence as it stood, they
got nothing whatever for this million. Mr. Drew
got some Stock the Company nothing AS to that
million there no doubt, until Mr. Vanderbilt OK
there was patent fraud whether sold Drew TO the
Company. The stock sold at 80, when not more,
at over g. AS Mr.. Vanderbilt had chosen 10 put his
statement il seemed him that they could recover
large "a money judgment they could on any circum
stances As the stock that could, If the suit
ended here, he made the subject OF claim by Mr. Van
derb the bonds, he understood 1t, were admitted by
Mir Vanderbcs answer Their case was thus made out,
certainly for the million OF dollars and for the bonds,
and, a he believed for the rest.
ExJudge Davis replied for defendant. He claimed
that the face of the complaint fraud appeared
against Mr. Vanderbilt which court could recognize;
bnt charge there might be OF constructive fraud was
by fiat negatOn of the only witness called 10 prove
Commodore Vanderbilt, whom the plaintiff had made
his own witness, and could not therefore contradict.
There statute produced 10 show that the Erie
Railway Company was prohibited from purchasing IT'S
own stock But there proof that the Enc Railway
had paid its money Its checks were given over and
those checks pad with the Erie money but vas 1t 70 be
presumed that Messrs Fisk and Could had stolen these
checksl Was II not the presumption that check was