Spirit of Jefferson. [volume] (Charles Town, Va. [W. Va.]) 1844-1948, 1874-04-21
JEFFERSON COUNTY rs. Thee CEN
TRIAL IMPROVEMENT CO..

to this county, and indeed to the entire VAL
ley, at present we surrender to4the following.
article from the Clarke Courier
The people of Clarke have been surprised
to hear that Jefferson county has brought suit
in the Circuit Court of Clark, and that in th;se
| suit restraining order has been awarded,
enjoying the Shen. Valley r. r Company
from holding any futher meetings either of
its stockholders or of its board of directors,
until the further order of tie court In con-
sequence of their order. the Stockholders
meeting called for the 7th instrnt, at Front
Royal, was not held aud all further action of
the company was inhibited until the further
order of the court
Two questions arise in the minds Of all, as
to the effect which this action will have upon
the prospects of the road. and whether it is
likely to retard or advance its completion p
We have examined carefully the bill of com.
plant, which is upon file in our Circuit Court,
with the view of determining Alright the ques-
tions propounded.
The bill, in brief attacks the three con-
tracts under which the Central Improvement
Company has been constructing the road
made respectively in August 1870, August
1872. and April 1878, upon several grounds,
but mainly by reason of the Credit MohiIier
feature of contract No the contract of 1870.
In the language of the bill it is charged that
the then president of the company and the
now vice president, together with other me,n>
bers of the then board of directors, sufficient
to constitute a large proportion if not ma
jority of the board, were at the time the said
contract was ratified and approved by the
board, actually largely interested in the stock
of the G. I. Company, and gives the amount of
stock so held by some Of the bnard-that thus
it was not the Central Improvement Company
contracting with the board Of directors of the
Railroad Company. but the G. / Co. con-
tracing with itself; and as it takes two to
make bargain valid in law, this contract was
void. because no two parties to the contract.
The bill then recites the prices which were
to be paid the contracting parties, and AYERS
that the high prices agreed to be paid were
the result of this oue-sided contract or the C.
[. Go. making contract with itself
The price to be paid was S35, 600 rcr mile
This price in made up as follows: In the
first mortgage per cent gold bonds to the
extent of S25, 900 per mile to be received at
70 cents in dollar; in second mortgage
| bonds of like character to the extent Of S10,>
| 600 per mile at so cents in tie dollar; in the
stock of the company, to be taken at par. ST.
| 600, 900: county bonds to the extent subs
scribed along the line of the road, and what>
ever remained then duo the contracting com
pauy was to be paid them iE the stock of the
railroad company. at its market value six
months after the completion of the road
The bill states, that the cost of the road
to the Railroad company. if built under this
contract, would have represented an in;iebt-
edness exceeding $50, 900 per mile. and tren
goes on to show that, by actual estimates
made by engineers of the work done in JEFF
fersoD county. the graduation and masonry
for which the G. I. Co gets SIS coo per mile,
cost ONLY about 81, 500-that the same dis,
proportion between cost ard value of similar
work EXISTS in Clarke county; and referring
to acaual estimates made by tho chief engi>
neer of the company, ayers that the actual cost
| of graduation and masonry from Shepherds
town to the Chesapeake & Ohio Il Il. is ST.
S3+ per mile, while the price to he ra;d in
the securities of the company. reduced tn cash
at the rates above set forth, is Sl5, 900 PER
mile.
The bill then states as follows: ''That the
cost of constructing the road from SheJ herds
town to the Chesapeake and Ohio as required
| bythe terms Of the contract-not including tho
| cost OF the right of wav, which the Shcn V
Railroad Co. is bound to furnish to the con.
| tracing company-as is ascertaincd nv the
cost of graduation and masonry, male hv the
| chief engineer, aud the-cos of sunnrssruc>
ture, siding, ballast, &C., as is asccrtained by
| dlslnteresfed and competent engineers will
not exceed for the whole line from Shcp
hcadstown to the junction aforesaid. $4,000
per mile, yet by the terms of these contracts.
made under the circumstances above detailed
the Railroad company is made to pay in cash
| S35 GOO per mile and in the payment Of this
sum are made, by the contracts to incur an
Indebtedness. bonded and otherwise, exceed
ing $50, 900 per mile.
''That by reason of these contracts the in
| terests of the G 1 Co is directly antagonistic
to the interests of the other stock holders: that
while the county and individual stockholders
are only interested as stockholders in the
enterprise the contracting campany's largest
interests in the contract for construction. and
thus by their overwhelming power in meetings.
may subordinate or utterly destroyed the stock.
in order to advance their interests under the
| contract"
1t further says, that it is thus in the power
of the contract'n" party to control entirely
the election of the board of directors and
states. in effect. that the Shen V Il K. Co.
is but another name for the G.. T. Co: that
they have no security that the mortgage bonds
will not he wasted and the proceeds souan>
dercd, and thus the only resource for builds
ing great public work be DESTROYED that
finally, by reason of the overwhelming mower
of the c. |. Co., in the stock meetings. there
can be no responsibility under the contracts,
because this would be to expect the C. I. Co.
to hold itself responsible
The bill then asks that all these contracts
may be declared void and annuIed by reason
OF the fraud in contract No l. which taiuts
Nos. 2 and 3-that the mortgage bonds issued
under the contracts may be surrendered for
cancellation that the stock, 81, 400 600, held
by the G. I. Co. and voted under the provi-