The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1872-07-26
THE RAILROAD CASE.

IHE RAlLRUAD GASE.
CONCLUSION OF THE ARG U1LENT FOR
TIE PETITIONERS.
The Arguments and Authorities for An
Adjudication In Bankruptcy-Finai
Adjournment Of the Court for the
Term.
The bankruptcy proceedings upon the petit
ton of Dcaniel E. Scanned, of New York, in re-.
the Greenville and Columbia Railroad Com
pany, were concluded yesterday in the United
States District Court before Judge Bryan;
Messrs. D. T. Corbin and George D. Bryan ap-
pearing for the petitioner; Messrs. A. G..
Magrath and C. D. Melton and John T. Rhett,
of Columbia, for the railroad company, and
Messrs. Porter & Conner, Simonton & Barker
and Jos. D. Pope, of Columbia, for various
creditors.
Mr.. Corbin resumed his argument by citing
the case of Samson, assignee of Clark, vs. Bur-
ton, claiming that the court had Jurisdiction
Notwithstanding the fact that the State Court
at Columbia had taken possession of the prop
erty of the road with view to administer its
affairs, and proceeded 10 answer the objection
that even II this should be granted no good
would follow. He claimed the same position
as occupied by the parties In the case quoted,
and held that if the road were iDsolvent the
creditors O. the road had right to have Its
property distributed according to the bank
rupt law. From that case the court would
perceive that it possessed powers in the prem
ises. If the order of bankruptcy were granted
all the property that was rot then In the actual
possession of the court would be taken posses
sion of at once, and an inquiry be made
as to the condition of those suits institu-
ted in the State Courts, and whether
they did not tend to hiuder and delay
the operations Of the bankrupt act. He would,
perhaps, point out some feature, some suspi-
cious aspect, of those suits, and prosecute all
the right which the bankrupt had in that case,
and do 1t not In the interest Of any one cred
ttor like the South Carolina Railroad, that
seemed to be present in all Its power, but In
the interest of all the creditors. 1t was the
right of these creditors, If the road were insol-
ested, to take care of their interests; and If it
were 10 be found that any agreement had been
made resulting In preference, the court
would Immediately enjoln any such agreement
and say 1t was all done in fraud of the bank
rupt act. Theposition he next took was that
the Greenville and Columbia Railroad was a
commercial corporation, and, as authority
for that position, he cited the case of SWEET vs.
the Boston, Hartford and Erie Railroad Com
pany, to be found in the Law Times, vol.
4, p. ia, and also the case reported in the
American Law Review, January, 1871, p.
376 In explanation ofthe powers of business
corporation, he said that 1t was created for the
specific purpose of transsctiDg business, aud
that business comprehended anything that
anybody might be engaged In for the purpose
OF a livelihood or gain. In the same connec-
ton he called the atteHtion of the court to the
Fifth Bankrupt Register, p. 81, referring to
the case of the Alabama and Chattanooga
Railroad Company VS.. Jones, in which the de-
cision of Judge shipley was sustained. The
result of that decision was that while 1t was
held that the railroad corporation was abusi-
ness corporation, it was not put Into bank
ruptcy on the petition, but subsequently
went into bankruptcy; the allegations
were defective, and 1t was dismissed on that
ground. The next position taken was that the
interest coupons severed from the bonds OF
the Green7ille and Columbia Railroad were
commercial paper, and that the nou-payment
thereof within fourteen days after maturity
was an act of bankruptcy. In support of this
ne quoted from Bump, page 80. He held that
the coupons were the same as promissory
notes, payable to bearer: that they come
strictly within the law of commercial paper,
and under the law of this State any one
holding that pape- oouid bring an action and
recover without reference to the bonds. he
cited the case of in re. Ncodemus, Sd Bankrupt
Register, page S.; Law Times, vol. 2, page
1853; Bankrupt Register, vol. 8, page 81, and
others in support of this position. In pursuing
his argument Mr.. Corbin came to the question
whether that corporation was bankrupt
and insolvent at The time it commit
ted certain acts of bankruptcy, holding
that If a corporation issued paper of COM
mercial character and failed to meet 1t at
maturity, 1t was legally bankrupt. he pro-
posed to show that the company was insol-
vent at the time it made certain payments to
it's creditors In full, and thereby gave those
creditors the preference. He endeavored TO
snow that the company was insolvent because
it had not sufficient assets to meet its liabili.
ties, referring to the report of the president of
May 2, 1872, and to the testimony of Mr..
Magrath and Colonel Low, and also to the re.
port of Superintendent Dodamead. In the
matter OF the bonds in the hands of the Ware
house Company. he said that they had legally
passed thereto through the financial agent OF
the road, Mr. Klmpton, in New York; that
when they did pass, 1t was for the pur-
pose OF raising funds for. the use of
the company at time that their
legality was not questioned, and regarded as
good In every particular. The difficulty was
that they had lost confidence In Mr.. Klmpton,
and that he had cheated them in some way.
On the allegation of having given preference
to certain creditors by paying them their
claims In full, he said that tie road now de-
.toa tbot tbov Sptao5oa tN r,oLo NJ, nrofor-