The daily Argus. (Rock Island, Ill.) 1873-1877, 1875-03-20
ROCKFORD R. R. BONDS IN
COURT. y
Judge Drummond Decides On the Pr.
critics Of tia Trust Deeds. u
Hs Holds Those Secured by the S.
100000 FIRST Mortgage to
be q First Lien.
which Puts the osterberg Party on q
Back Seat. ,..-.,.
From the Inter ocean, 18th.


Another important step was taken yes
terdav in the case of the Union Trust COM
pany of New York against the Rockford,
Rock Island & St. Louis railroad company,
now pending in the United States circuit
court for the Northern District OF Illinois
This is bill filed by the Union Trust
company as trustees, to foreclose two trust
deeds given by the railroad company. =.
The first, dated June 10, 1868, gwen to
secure the payment of 5000 bonds OF ;$l;-
|OOO each and the coupons thereto attached,
conveys to the Trusscompany the follow
ing described property:
The First Division, extending from hock-
ford to Sterling.
The Second Division, extending from
Sterling to Rock Island.
That part of the. Third Division extend
| ing from Cleveland on the Second Divis-
ion southernly to point on or near the
Mississippi river, opposite Burlington,
Iowa. This. as the road Is constructed,
would extend as far south as Monmouth
at least, and perhaps to Prairie City.
| The second trust deed was dated Oct,
t23. 1868, and recites that the 5000 bonds
have been issued and that the above men
toned trust deed has been executed to Sc
cure them. Also that the company has
resolved to issue 1000 additional bonds tt
aid in the completion OF the road from
Monmouth south. to East st. Louis. AMI
has resolved to secure the second series
l4.OOO bonds, together with the hrs
iseries Of 5000 bonds, by deed of trust OF
1.-The whole road from Rockford to East st
; Louis for the purpose of securing the en-
, tire $4,000, 600 of bonds. ......
The holders of the first series of 500
bonds have filed petition in the case
; asking the court to find that they are en-
titled under the. first mortgage to a frs
lien upon that portion OF the road north c
. Monmouth, and to lien pro rata with tn
holders of the second series of 1000 bond
on that portion Of the road south of MOI
i mouth. Inasmuch as the whole road wi
not sell for more than one-fourth of til
amount due upon the 5000 bonds, til
). question of priority is very importan
- The holders of the second series of 4,0t
, bonds, through the Union Trust compan,
}. deny the priority claimed by tt
J. first series, and the matter came up II
It argument before Judge Drummond We
N terday morning. -. sa a
'. The first series of bonds were represen
J. ed by Lawrence, Vision, Campbell ar
a. Lawrence. Judge Wilkinson, Nissen al
l. Baruum, and Fl. M. Shepard. The Uni'
,e Trust company by Trumbull, Church al
. Trumbull, of Chicago, Mr.. Osterberg,
al Germany, and Evarts, Southmayd al
sp Choate, of New York, in a written brief.
ne After argument Judge Drummond he
ID that the first series Of 5000 bonds were G
- titled to first lien upon that part of t
x railroad north of Monmouth, and also
a share pro rata with the second series
re. of 4. 600 bonds in the proceeds of the 70
" south of Monmouth. 1t is understood tt
-. - formal decision will be given this mol
e ing. aud an order entered to the above
40 feet,