, 1873-12-21
The Pennsylvania Company Against
John B. Sherman.
The Latter Claims to Have Been De.
frauded Of Pro 6table
Business.
priynto Interests Of Railroad Officers III
tho Enst Liberty Stock
Yards.

tho United Circuit Court. It waa' tile cnse Of the
Pennsylvania Company against Slsmuol ". Allor-
ton, Joseph Mcpherson, 4. u. AHer-
ton, md John B. 8Aorman, damages to tho
amount Of a500,000 being ciaimol> Aftor along
aud exhaustive hearing, III which oninont coun-
Bol on both sides put forth their boBt efforts III
bohaf OF their respective cfionta, a verdict was
givon for the dofendants. Tho caao, bcsidoH ba-
Ing full Of knotty law points, Inns most inter-
osting history, tho outlines Of Which 1t Is tho
p,rposo Of this article to brioay skotcl. Tho
beginning Of those tranBactons, which llava sinco
resulted In vast amount OF lttig ge,tion mud the
auxiliary isBues Of which still Involve about
e750,00o, was neatly lon years 'tso. at that
timc, tho business Of shipping 1,A' stock from
tho West to tho East had begun TO- assume large
proportions, aud formed no small part Of tho
freight earnings OF thorairoada oat1ng to ollesoa-
board. For tho sake Of gaining increnlsod buBncsB
In stock shipments over its linos OF railway, tho
pcnnsylyania Company, on tile 1tth Of April,
1864, loasel the stocls-yards Mt ]GaHt Liberty,
nenr Pittsburgh, to Samuel ". .hlcrton and
JoBenh McphorBou for a term oil ten yoars. the
instrument being aignod by those two parties,
each of whom affixed Lis individual Heal. It
was, however stipulated aa part oi. the agree.
1nont with tito Company, that MnaHrs. 3. W.
Abortion aud Mcpherson wero to for IN copart-
,,orahip iu tho management Of tho Hast Liborty
yards with 4. III. Abortion and john B. Sllor-
man. In fact, it was mainly for tina purpose Of
securing the influence Of tho two lnst-namod
gonti emon that tho Pennsylvania Company OK
ocuted tho lease, as 4. N. Alerton VIVA then
largoly identified with livestock sltumentB over
the Now York Cont:al Road, while Atr. Sherman,
then as now. was heavily Interested 10 tho Banso
business in Chtcngo, and soou after bocame
suporintondont Of tic Union Stock -Yards
Tho agreement WIS that the lesseeB cf tho East
Liherly yards aud their partnors III tln, business
should uso their utmost ondoayors arul influence
to secure for the Pennsylvania Rnilr1ad all Of
tho livestock iroights to philadelpha md Dalti-
more, and !" fur proportion 10 tho cities cast
Of Philadelphia.
operation in April. 1904, under the management
OF Sum Allerton. A1eBHsB. Sherman Ms AlcPler-
son residing IN Chcago and 4. n. Ellerson i'll
New York. In August Of d tho same }ear, sam n
Sherman most gloomy account Of tho sncccHB
Of tho East Liberty enterprise, representing to
him that it Ind proved to bo a losing business,
and was likely to dag tho n,embors Of tue firm
still deeper into tho miro of financial disaster.
On tho strength Of these representations. Sher-
man gadly consented to dissolution 'o1 the CO.
partnership, which was made complete.
About two mouths later, ho came into POSSES
phase upon the matter. IIo lonrned that, so far
from resulting in loss. tho East Liberty schema
WAS decided financial success, with rsEpidly ill.,
oreasing business He was convinced that lie
whom, in November, 1854. lie found carrying on
b thriving buBinosB at East Llberty. It had
proved to be good thing, and Aorton had it
all to- himself. Shormnn nt onco bcga1 suit in
Now York to hayo the dissolution Of paltnerHhip
declared void, on the ground that it tssd noon
brought about by Misrepresentation and fraud,
After lingering in tho Now York Courts for
moro thnn yeur. this suit was di .missed.
up the fight, and in 1866 lie brought suit il tho
Superior Court at poughkecpsio for Nh ek:ter to
compel Sam Allerton to rondcr nn account of tho
| busjuesB, which he had continued to carry on iu
but appeal was taken to tho suprolnc Court, mud
| tic Judgment of tue Superior Court wns re-
| versed. Thon the suit WAS takon' to the Court
| of Appeals, wdcro Tho Judgment of the Superior
| Court was affirmed, aud an order to account was
entered against Sam Abortion. THIS was. in tho
| fall of 1879.
Alorton's next stop was to procure tesnpora-
| ry injunction against the enforcement Of the
order to ncconnt, but, upon full argument and
hoariug, tho injunction was dissolved. An nc
count Of the business was thon furnished, by
Aorton. but it was beloved not to be g. true
statement, ind 1t was excepted to by sholrnhn in
tho Superior Court Mt Poughkcopsio, where tho
proceeding. is now pending. Up to Dec. 81. 1850.
| 2122, QUO, and, at the rato Of incrcnse III b,,s-
ness, 1t ii believed that tho profits hayc lr,en at
loast S100 900 por an1l',m from 1hat time up to
| Feb. 4, 1870, When tho loase was cancolad aud
tor1ninutcd by tho Pennsylvania cotppanyt
! aguislBt whose action both a. n. Allerto1l and
| Sherman entered protest.
III April, 1878, tho Pennsylvania Company be-
gan tho suit in Cnicago, iu tue United states
| non-perforinance OF contract, alleging that moi
ther 4. NJ. Ailorton nor john 3. Sherman Ind
used their influence towald securing for tEt3 rail-
road company its fair proportion Of livestock
SGT up the fact that a. ii. Allorton was inBtru-
montal in tho traQBfor Of tho patronage Of John
r. Alexander, tho heaviest livestock Shipper in
America from the Pennsylvania to the New York
had bought MI interest in tho National I3took-
coauocted conn With tic % Now York i Eric
Road. Whether these allegations vera or
in tho case, na it was shown that Alexander went
ovor to tho Nav York Central in Junc, 1874. and
that Sherman = purchase Of stock In tlH, NJ.
tional was made on the 31st of February. 1870,
Liberty loaso by voto Of the Board of Nirec.
tors of the Pennsylvania Company.
1t appenrs that tho suit just decilcd il Chi
cago was directed only agaiuBt MessrA. q. N
full performance Of contract by samuel Alb,rtol
and MCPHERSON, though both wero ma(ls co.
defendants aa u mattor Of form. cla'lsibla the
ory. or. at least, reasonable Inference. ia THU
identified with tloHo Of tho plaintiff, atul tllal
tho name of tho Pennsylvania Company it OIL,
uHed as convenience. It ID also limited taat il
| all probability some Of tho officers Of tho Com
pany nre privately Interested with AIlcrlsm ii
tllo East Liberty business, and have taken. th
mea,,a to avoid the payment OF the profits, witt
interest, to Alorssrs. sherman aud a. n. 4 llor
ton. The ena il not yet, by any % nt ! nns u
Judge Dlodgett. all appeal will DO takon by th'
plaintiff to tho United States Supreme Ctnrt
involving tho expenditure Of yet more mnapoy
time, ana lcgal talent. Collateral aotiont,. ar'
Aiessrs. Sherman nni A. ii. A>lerton to set asid
the resolution OF the Board Of Directors Of tin
Pennsylvania Company. passed. OH the cyl q
Doccniher, 1864. and taking OBJECT Fob. 8, 1870
by which The lenHo Of tho East Liberty Shock
Yards was torn,inatoil. Tho reason sot forth il
tho resolution for tho cancellation of tho loaH