The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1872-07-19
THE RAILROAD CASE.
MORE VENTILATION OF THE SECRETS
OF THE GREENVILLE RING.
Financial Ku-KIux urren derin .
Themselves and Confessing their Com.
spiracies.

Themselves and Contrasting their Con.
spiractes.
The bankruptcy proceedings upon the pc
tition Of Daniel E. Scanned, of New York, in
re. the Greenville and Columbia Railroad
Company, were continued yesterday morning
10 the United States District Court before
Judge Bryan, Messrs D. T. Corbin and Geo,
D. Bryan appearing for the petitioner, Messrs
A. G. Magrath and G. D. Melton and John T.
Rhett, of Columbia, for the railroad company,
and Messrs. Porter & Conner, Simonton &
Barker and John D. Pope, Of Columbia, for
various creditors.
The redirect examination of President W.
J. Magrath being continued by Mr.. Corbln, he
testified as follows: The new bridge over the
Broad River has not been built, the engines
and cars have not been purchased, nor the
new rails laid as suggested by Colonel Doda-
mead In his annual report. He advised those
things as good and useful things to be done,
but not as necessary things. The bridges, &C.,
have all been, kept in thorough repair. The
interest account last year was s242, ,2S5 "a. The
witness made long explanation Of hts rea-
sons for believing that the completion OF the
Air Line Railroad would not be detrimental to
the Grcenville and Columbia Road, stating
that the great cotton mart OF the Southern
States was New York, that cotton sought that
market always by the cheapest route, and that
by the Greenville and Columbia Road, and
via Charleston, the distance was fsur hundred
and forty miles, while by the Air Line Road,
and via Portsmouth, the distance would be
six hundred and sixty-two miles, committing
the sea miles according to the contracts with
the respective lines of steamers. The ex-
penses Of the South Carolina Railroad In 1869
were sIxty-flve per cent. of Its earnings, In
1870 sixty-two, and this year they will be less
than sixty two per cent. Sixty per cent. is
fair average of the expenses of the roads
throughout the country, but the Greenvllle
Road has less necessity now for liberal e1-
pendltures than the South Carolina Road.
Re-cross.examlnaHon by Judge Magrath:
The superintendent is subordinate TO the d..
rectors. His reports are intended as intorma-
tion for the company, and not as binding to any
line of action. His suggestions are not made
with reference to tie financial capacity Of the
road at any particular time. My purchase Of
the road showed that did not deem it insol-
vent, and the amount of the purchase money
Indicated It's value to me over and above all
Its liabilities would not sell out for what
gave for 1t. have heard within three weeks
OF person who wanted to buy it for more
tha4I gave for it. The effect Of the Green
willie road passing into the hands of persons
who would operate it in the interest OF people
outside of the State would be very detrimental
to the lowaR part of the State. Out of $4,000
bales of cotton shipped over the road last
year, 81, 900 came to Charleston. If the road
passed into other hands, not one bale would
come to- Charleston.
Mr.. Charles q. Manson, the assistant treas
urer of the Greenville and Columbia Railroad
Company, was next called by Judge Magrath,
and testified that he had been instructed by
President Magrath last April to 60 to New
York and ascertain the nature OF the claim OF
the Commercial Warehouse Company. He.
saw the president and two Of the vlce-presi-
dents of that company, who said that cash
loan of $3.50, 900 had been obtained from them
by H. d. Kimpton, as financial agent Of the
road, who had given therefor three notes
signed by John ]. Patterson, as vice.presidens
of the road, and that the money had been
given to Kimpton. The loan was made at
seven per cent. interest and s600,0OO OF
Greenville aud Columbia second mort
gage bonds were deposited as collsterals,
upon the face value of which the Ware
house Company was to charge fVe-elghts
per cent. per month commission, making
the commission and interest amount to
thirty.seven per cent. per annum OF the
amount OF the loan. If 1t became necessary
theBwere to sell the collaterals to repay the
loan, and for this they were to receive two
and a half per cent. more upon the face of the
colaterals. The loan was made In the sum-
mer oflsH. Three notes we're given, each at
four months time, for $4,000, $4,000 and
s25, 900 respectively, and dated June, July and
August. No report Of that negotiation was
ever made to the company by Kimpton. In
his account current in January, 1872, he men
toned three cash loans for s75,UOo, 1000
and $25, 900 respectively, which the witness
SuUpUS6Q, kEOm tuC VI oA1AOuhbpf w
be the ones above mentioned. The witness
produced the minute book Of the directors Of
the Greenville and Columbia Railroad Com
pany and read various resolutions and
proceedings of the board. The first was
on May %, 1872, In which the pres
ent board of directors resolved that
In view of the Indefinite statement Of
facts regarding the claim of the CONNER
cial Warehouse Company, and whereas they
were about to sell the bonds In their hands,
the president be authorized to take steps to
prevent or stop such sale, as they regarded
the transaction fraudulent. BE found no
record of 100000 Of bonds being put In Kimp-
toms hands for the purposes of this transac-
ton. On May l, 1871, a resolution was found,
which was introduced BY Joe Crews and car
ried, that Kimptou be furnished with -
notes for the amount due him, and - bonds
to secure the payment of the - debt On
April %, 1871, an executive committee was
appointed, consisting of Frederick Bush, Joe
Crews and Niles g. Parker. Kimpton's trans
actions with the company were very large,
and would be naturally supposed to involve a
large correspondence, but the new board,
when they came into office, did not find