Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1876-01-04

delivered 10 this city yesterday and substance
of which was published in the Gazette OF that
date:
In TIE CIRCUIT OF THE UNITED STATES FOR
THE EASTERN DISTRICT OF VIRGINIA.
Albert f. Richards ct al.
vs..
Tie Chesapeake & Ohio Railroad.
BoND.J
% the fourth of October, eighteen hundred
and seventy five, the compalnants. filed their
bill iu this court in behalf of themselves and
all others in like interest, alleging that they
were the holders Of certain of the SIX per cent.
COUPON bonds issued by the defendant, to the
extent of SIS 100000, for the completlon OF
their road from Rlchmood to the Ohio River
That the payment of these bonds and The IN
tercst thereon accrulug was secured ny "nat
was claimed to be the first mortgage on said
road, walcl! mortgage was duly executed oy
defendant on the 18Th day OF January 1917,
and conveyed to William Butler Duncan ADD
Phil G. Calhoun, ctizeus of New York, as
trustees, all the franchises and property OF said
company then constructed or thereafter 10 be
constructed or acquired by the defendant.
The bill alleged that the company had made
default ia the payment OF the interest 90 these
bonds since the lst day of November, 1878,
and that complainants bad required the trus-
tees. Duncan and Calhoun, to torecose The
mortgage above referred TO for the bcncht OF
the bondholdcrs named thereto, with the proper
offer of indemnity 70 them tor expenses, ana
that thew had failed and refused TO Institute
proceedings therefor.
The bill concluded with an allegation OF the
total insolvency vi the defeodant, and with the
ordiua,y prayer tor an lojuucuon and receiver,
restraining the trustees aud deteodaut corpJ'
ration from di5posing Of the mortSaged preml-
SEES without the order of this court, and tor a
sale and distribution Of the proceeds among
the bondholders according t. their respective
priorltles.
This bill, properly verified, being exhibited,
the court ordered the motion for an injunction
and receiver to be set for hearing on the 22d
day of October following, provided a copy
thereof and of that order was served on the de-
PENDANT on or before the 7th day of October,
1878, and in the meantime, until the hearing
| If the motion, restrained the defendants from
disposiug Of the mortgaged property except IN
the Ordinary way OF the business of trausporta
ton Of Sail company Prior to the hearing Of
these N tons, however the complaloants, by
| neti,ion, brought to the knowledge OF the court
| the fact that large number Of judgments had
been obtained against the company, and that
executions had been issued thereon, aad that
| the sheriffs Of the various counties through
| which the road passed had seized portions OF
the mortgaged property and We're about to
seize aud sell other portions, aud they asked
! that to preycEt immediate and lrrcparabe To-
| Jury to the mortgages, d temporary receiver
might be appointed, which was done accord
ingy and Henry Tyson was so appointed.
Prior to the 22l day Of October, the day set
| for the hearing of the motion for an injunction
and permanent receiver, the defendant trus-
| tees filed petition to the court, stating their
surprise at the filing of the bill, alleging that
| no adequate demand to foreclose had been
made upon them, and asked that they, being
| the proper persons to conduct the suit OF fore
closure, might be allowed to become complain
! ants aud not defendants therein, which request,
| with the consent of all parties. was allowed.
| The trustees then, with large majority OF
their cestui que trusts and other creditors, to.
ge,her with the defendant company, asked the
court 10 advance OF the day fixed for the hear
ing of the motion therefor TO appoint w. o..
| Wick ham, the vice president of the defendant
company. receiver. All parties agreed that
receiver should be appointed.
| The couit however, refused to take any &C.
| ton rclating to the appointment until the 22d
| day Of Octobcr, the day fixed and advertised
! for the hearing OF that matter. 20 this last
named day the defendant company appeared
| and filed au answer to the rule to show cause
Why an injunction should not be awarded and
| a permanent receiver appointed. The answer
admitted the Insolvency Of the company aud
asked again that Williams G. Wickham might
| be appointed permanent receiver. But the
answer disclosed the fact to the court, not as
yet stated 10 the proceedings, that the mort
gage to Duncan and Calhoun, uuder which
| com plaiuanls claimed and which in the bill is
alleged to be frs. mortgage, is not SO 10 fact.
| This answer alleges it to be- the fourth, while
other exhibits now filed show it to be the fifth
mortgage in point Of time.
But the court, Notwithstanding the almost
unanimous consent OF parties, refused to an
point Wicknam, and it still adheres to the con-
illusions then formed.
1t appeared to the court then as it does now,
that the Chesapeake and Ohio Railroad Com
pany is overwhelmed with debt secured and
unsecured. How it became so it is not for us
to dltcrmiDe But the court, when called up.
on to appoint receiver for a corporation to-
tally insovent, who is to be the mere servant
OF the court, upon whose fidelity and ability to
manage during the tendency Of the suit the
property entrusted 10 MN, the court must rely,
ought not and ought not 10 be expected 10 ap-
point person under whose charge and control
the resources of the road had been exhausted,
its property IL d upon execution, and the nc-
ce ,sity for recetver brought about.
The receiver is not the receiver Of the bond
| holders or secured creditors. He is the mere
hand Of the court. The unsecured creditors
whose charccs of dividend are remote have a
| deep interest 10 knowing that the road, while
It's assets are being marshaIcd, and its creditors,
| their claims and priorties ascertaincd, is free
| from the control Of those whose ADMINISTRATION
of its aft .irs ended in bankruptcy.
Upon the refusal of the court to remove its
receiver, Duncan aud Calhoun, trustees uoGcr
the so-callGd first mortgage, who had, as before
stated, by general consent become complain
ants, filed their amended BILL ln this bill it
is set out that the Chesapc;,k: and Ohio Rail-
road Company is wnat is known as IL c)nsoli-
dated company. LIS component parts were the
Virginia Central Railroad Company, the Blue
Ridge Railroad Company, and the Covugton
and Ohio Railroad Cemrany. The bill further
H.