Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1872-09-28
ALABAMA AND CHATTANOOGA
RAILROAD.
Something Additional About its Legal
Status.

An Atlanta, Ga, special dispatch of yes
terday saws that thirty miles of the Aiaba-
ma and CHATTANOOGA railroad were seized
Yesterday by order of Gov. Smith and the
telegraph cut along the same section OF the
road. The seizure was alleged to have
been made for the better security of the
States endorsed bonds. Two Receivers
had possession of the road and were
operating it ander a decree OF the Unteo
States Supreme Court.
We take the following from the Chatta-
nooga Herald of the 26th lust.
For the benefit of lawyers and parties
having interest to know the preSeht legal
status of this road, we give the following:
Suit in equity between Seth Adams,
Francis B. Loomis and John q. stanton,
Trustees of the First Mortgage Bondhold-
ers of the A. & e. L. r. Company, com.
pldinants, and the q. Il G. Il. r. COMPANY
Lewis Rice, A. c. Lippitt and Daniel n.
Stanton, Trustees, etc, and others, deTend-
ants, was brought in the Circuit Court OF
the United States for the Fifth Judicial
Circuit, sitting for the District OF Alabama,
at Mobile.
On June 20, 1872, motion was made be-
fore this court, Justice Bradley presiding,
TO have Receivers appointed to take charge
of and operate said road, repair, protect and
care for its property; also that lnJunctlen
issue forbidding any and all other parties
than such Receivers to interfere Win, or
To assert sny control oyec said road or any
of the property thereof.
The principal allegations upon which the
motion was prayed, are set forth IN the &C.
cree as follows:
at appears, by the afidavits and proofs duly
submitted and filed in this cause, that the pro
merry i'm question: tO-wit: the railroad and con-
neetinp works and other property late OF the
Alabama and Chattanooga Rallroad company
which are embraced in and covered Dy inc mOIV
gage known as the first mortgage OF sald COM
1a1v are rapidly deteriorating In value, ana De
ing wasted scattered and destroyed, whereby
the security of the first mortgage bondhOldeTsi
and the interest of all other persons Gomez nc
in said property, are subject 70 great hazaiu anu
in danger OF entire sacrlnce'
The recognition of the endorsement by
Alabama of the first mortgage bonds as
valid: the failure of both Company and
State to pay due interest in full, and the
purchase of the road by the State under
the Bankruptcy proceedings c0nsumated in
the District Court of the United States Tor
| the Middle District of Alabama are then
set forth, and followed by this section:
"And whereas, as in the present condition OF
! said Droperty it is impossible, without great
| sacrifice, to dispose of the same In any manner,
| and whereas it has been proposed ana agreeu W
the parties interested, that all further opposiUoI
| to the proceedings in bankruptcy against salu
| company in the District Court for the Mlddle
! District of Alabama shall be withdrawn, and
| that the said proceedings shall be affir1nel, any
! that all other proceedings for the appontmel,
| of receivers in the several State ana plstrlG'
Courts shall be discontinued so that the proceed
ings in this suit shall have full effect and opera
I Is III
Receiver, or Receivers, shall be appointed In TN,
! cause, to take charge of said property, anu pun
the same into proper condition Tor us pLsset ~ al
! ton and disposition for the mutual oenent VI oil
parties interested therein"
The order is then made that Lewis Rice,
| of Boston, and William j. HARRISON, OF Ala
bama, be appointed as Receivers OF SAID
road and ali its property of what KIND
soever; that they have full control to man
age and operate the road; 10 raise money for
purposes of repair and to clear title to the
amount of one million two hundred thou
sand dollars, by loan or otherwise, to Sc
cure the repayment of which sum the roaC
is made liable in the first instance as against
all and every other debt. Said Receivers
are to make oath faithfully to perform
their duties and are to give an approved
bond in the sum Of two hundred Thousand
dollars.
The order closes: cit is further ordered
that an injunction do issue against the de
PENDANTS, and all persons claiming, or acting
by, through or under them, or either Of
them, and all other persons, to restrain tnen
from interfering with the said Receivers II
taking possession of aud managing said rail
road and property"
The rights of Alabama, as created by he
statute and adiudicated by the Bankrup
Court, are asserted and affirmed, and be
responsibility as endorser continued.
Under this order, Judge HARRISON, one Q
the Receivers, took possession, and it wa
understood that Gen. WofiOrd had retire
from control of the road as Receiver on be
half of the State of Georgia. Trains wer
Yesterday started hence under the new
management, but were seized upon a
Trenton by the Sheriff of Dsde county
Georgia. There the matter rests, until
is seen whether or not decree of Unite
States Court is to be successfully resiste
bv the local authorities of a county. VIVA
the real or pretended legal grounds of tn
seizure are we have not yet learned"