The daily Argus. (Rock Island, Ill.) 1873-1877, 1875-07-23
Judge Drummond's Decree for the Sale
of the T., r. I. d 81. J.. Il. r.


The decision of Judge Drummond in the
case of the Urion Trust company against
the Rockford, Rock Island e. st. Louis
railroad company has finally been rendered.
1t is very elaborate and exhaustive docu-
ment, and enters into details with re-
markable exactness. 1t will be remember
ed that several weeks ago Mr., Bishop, the
master at chancery, submitted report of
the financial condition of this bankrupt
railroad company, and made several sug
gestions for the guidance of the court. To
this report no exceptions were filed by the
bondholders. and the court accordingly
prepared its decision to meet the exigen-
cles of the case and satisfy all demands in
right and equity. Judge Drummond, af
ter stating the facts in the case, entered a
decree, of which the following are the
most salient points:
!. The mortgage executed ON June Is,
1868, covers all Of the railroad north of a
point on the main line due east of Burling-
ton, Iowa, and was given to holders OF the
first series OF bonds numbering from to
5000 inclusive If the property on sale, las
aforementioned, is insufficient to meet
the demands of the first mortgage, the
bondholders are entitled, for any balance
due upon said first bond series, to share
the proceeds pro rata with the holders of
the second bond series, nom 5erlng from
5000 20 e,0Q0, OF oil the other property
covered by the second mortgage Of Oct %,
1863 Under any circumstances the hold
ers of the second series Of bonds are not
entitled to any part of the proceeds Of
property covered by the mortgage of June
Is, 1868, unless there should be no sur
plus after meeting the demands of the
bondholders of the first series,
| THE PROPERTY IS TO BE SOLD
altogether and not in ST vpral p; reels. The
value of the land covered by mortgage OF
June Is is 81 per cent, of the value of the
entire property of the road, and, as the
principal sum of both series are due, the
property must satisfy it.
2. The Rockford, Rock Island & St
Louis railroad company must pay to the
Union Trust company, of New York, with
in fire days after this decree, the sum o.
$l1, PSI ,535.9 in gold with interest from
May "a, 1875, and costs Of the suit Oh
this sum 81, 254, 2l928 are due on the first
series of bonds, and the balance, 81, 997,
BIG. 81, on the second series.
3. In default of payment the mortgageC
premises, including the entire property anC
branches of the company, are to be sole
by Mr.. Bishop, the master in chancery, a
one property, and not in several parcels, t
the highest bidder at auction. The term
of the sale should 100000 in cash anC
the balance at such time as the court ma!
determine.
4. Out of the purchase money received
| Al - Il, kn oh
pay the cost of this suit. then turn owe
$42, 506.95 s-r.
TO THE UNION TRUST COMPANY
as its allowances for expenses, compensa
ton. and counsel fees, and So, 400 as coun
sci fees for the intervening bondholders
and 500, 1862 20, with ten per cent. interes
from June Is, 1875, to the Orion an
Minersyille railroad company, due to
under contract or terms of lease. Th
Minersville road, upon such payment
r shall convey by deed its entire line to sue
/ individuals as may have purchased it III
der the sale. When these payments hav
been made, the master in chancery sha
+ hold the balance of the money at the dire(
ton of the court.
e 5. The master shall pay over the balanc
of the proceeds of sale to the clerk of tn
court, who shall apply the same, undo
the direction of tine court, to the paymer
of the bonds, coupons, and certificates.
g THE COURT
then enters into the details of the indebted
ness of the railroad company, and give
directions as to the settlement of certa
claims, always giving preference to the fir
bondholders.
A few days ago, several intervenir
;r bondholders filed petition for the adjus
:, ment of certain claims. Yesterday Il
: court referred it to the master in CHANGER
and ordered the receiver, w. Fl. Ferry,
al present himself to said smaster for exami
r alton touching the points involved in &
petition.