The New York herald., 1876-12-15
Mandamusing the Toledo. Wabash and
Great Western Railway Company.
FIGHT OVER CONVERTIBLE BONDS.
Delving the Depths of the Emma
Mine Speculation.
RAILWAYS AND PRIVATE PROPERTY.
Legal BattledOor and Shut
tlecOclx.

On the application of Mr.. Henry s. Bennett, coun-
sci for the equipment bondholders OF the old Toledo
and Wabash Railroad, Judge Brady yesterday granted
an ex partc order directing the directors OF the To-
lcdo, Wabash aud Western Railway Company to show
in Supreme Court Chambers, on the goth inst.
why a mandamus should not issue against them.
From the petition which the order was made IL ap-
pears that Benjamin A. Ham, John W. sullivan and
Gustavus A. Rollins have been appointed committee
10 prosecute on behalf Of themselves and other hold.
ers OF tho equipment bonds OF the old
Toledo and Wabash road. That road became
subsequently merged with other roads into the
Toledo, Wabash and Western Railway Company,
and under tho articles OF consolidation that
company assumed all tho obligations and bonds fol
which each of tho component roads liable at the
time of and bolore the consolidation This aggregate
indebtedness amounted to somewhere in the neighbor
hood Of SIS 00o which included the bonds and la
Dlites OF eight different railroads. including those Of
the Toledo and Wabash. After this consolidation went
into effect the President and direct ors Of the
pany concluded to tuna this Immense debt issue
bonds the consolidated company and retire and
Gel all the floating bonds Of the various smaller
panics which merged In II. SO they created q
grand consolidated mortgage Of their entire
property situated In different States, whereby,
IN consideration OF S20.0000OO, they conveyed
the property to two trustees, aud, upon this
as security, they TO issue consolidated bonds to
amount $40 600 900, which they to offer in
exchange Tor ike amounts OF the floating bonds Of the
smaller roads which had been merged. The equipment
bondnolders OF the old Toledo ana Wabash road, hold
ing 5000 900 of Indebtedness, omitted in tho
OF these consolidated bonds, and though they
ciaimeu their right to the exchange, which tho new
company never dcned yet, under one pretext or an
other, the exchange was put of from time to tmc The
equipment bondholdcrs meanwhile patiently waiting
dated mortgage executed the company concluded
put second mortgage of s5,ooooo on their prop
ISSUED thereon payable in gold. About a
year aro the company dciauted IN pay
closure proceedings we're instituted. under which the
enrc road sold subject to the lien of the grand
consolidated mortgage. 1t then became the interest of
the purchasers under the foreclosure proceeding to
prevent the equipment bondholders from obtaining tho
consolidated bonds IN exchange for their equipment
bonds for without that exchange the equipment bond
holders would have lien property, but in
OF exchange their lien would be PRIOR to tho gold
bondholders, While these foreclosure proceedings
were pchding committee Of the stockholders and
equipment bondholdcrs, styling themselves "pro-
tcc,ion commIttee," was organized to oppose
, these foreclosure proceedings ON the ground that
lhcy would have the effect Of extinguishing their
rights. Mr.. Ashley, who subsequently, became and
Is director OF the Board, acted chairman Of
that committee and he nj first most violently and
zcaously advocated the which he elected
to protect; but through some mysterious arrangement
his zeal abated and 70 the astonishmert and cnagrin
Of the equipment Sondholders as plaintiffs claim, he
the road under the foreclosure proceedings and
elected director OF the newly organized company.
The equipment bondholders in this condition affairs
organlzeu new committee. with new chairman, and
through their counsel both in this State and OHIO
are now seeking by mandamus and bill IN
equity 10 maintain and enforce their rights. Tho
petition, whichls signed and verified by Mcssrs. Ham,
sullivan Rollins. first sets forth the incorporation OF
the old Toledo and Wabash road which originally
issued these equipment bonds, aud its subsequent
Increment into the Toledo Wabash and Western
Railway Company, which assumed tho payment OF
those bonds; second, the making osthc consolidated
mortgage aud the appointment OF trustees to define
and carry out the provisions which authorized and
t,, rbanun nj flnn hfanf ftR
tho consolidated bonds; third the Official report
81 the directors announcing 10 the equipment bond
holders and how the exchange could bc made;
ourtn the fact that the directors and officers have
rtused 10 make the exchange and tho
sedera hnyp maSe 10 them for Peef n91S
that the directors Of the company made new gold
bond mortgage, which was inferior to the consolidated
mortgage sixth IL that tho company defaulted
on that mortgage, and that, in consequence, II
.orecioscd seventh, It then AYERS the organization Of
this Protection Committee, under the leadership OF q.
b. Ashley as chairman to oppose those foreclosure
proceedings and rcces At length the manifesto which
he put forth that OCCASION; eighth, 1t reues the
TACT that Mr. Ashley went over TO tho enemy and
left the equipment bondholders In tho lurch;
ninth, It recitcs the sale under the foreclosure
proceedings with the connvanco OF Mr. Ashley, and
tho ciort made 10 cxtnguish The rights OF those
whom ne was pledged 10 protcct tenth, It sets forth
the Board OF Trustees. giving their
names and residences tho fact they have in
their possession 1e unsigned blank forms OF the
vertibc bonds whic they refuse to sign and deliver
10 Tho equipment bondhoIdcrs 1t also forth tho
names residences oil the trustees whose duty
Il
tue fact that there Is new arrangement OF Ash
ley and his associates to 60 INTO crcc. by which
the equipment bonds are 10 be extingushed and
the equipment bondhodcrs utterly remedyless
unless tho Court interposes by the summary remedy
mandamus to compel tho directors and trustees to
sgn issue the bonds The order granted by Judge
Brady directed to the Toledo, Wabash and Western
Railway Company, to James Roosevelt It's President
and 10 o. ID. Ashley, 1. NJ. Adams, @. W. Field and
number Of others, its directors and orders them to
show cause why mandainus should not COM
pei them to sgniand deliver the convertible bonds TO
t,o mt lhn al fho Ia,
tfs The whole amount represented IS about 5000 00o
THE GREAT EMMA MINE BUBBLE.
Tho suit OF the Emma silver Mining Company (IIm-
tcd) OF England against Trenor W. Park, Henry H.
Baxter and william NJ. Stewart continued yester-
day, before Judge Wallace, In the United States Cir.
cult Court f. W. s,oughion, for the plaintiffs, con.
tnued his argument, which was opened tho day be.
fore, occupying tho whole of tho morning session.
Mr. Sloughton said that the previous day no had
that stage wherc arrangements had boon con-
cluded with Baron Albert Grant looking to tho
organization OF the company, and abou ,
to show under what circumstances tho dire C.
tors we're brought in Before going further, no
would say that stewart wns q party 10 the
and subscribed the agreement by which
Grant undertook for fl00,0 0,00o to launch the matter
on England. Under tho arrangement Grant & Co.
$500 900 for procuring So 600 600 OF sub
scriptions, and inc amount was To oe paid 10 Park
Co after deducting the sioo,coo spoken ot Had It
been that certain hidden party receive
onc-Gnh of the total subscription tho would
have been looked upon with disrust and would not
havo realized a dollar. The English law framed to
prevent such frauds requires that all OF this
character should be detailed on the prospectus such
failure, under the English law, was fraud. aud
long since verdict 10 Tits effect given
against Baron Grant Mr.. stonghion then
showed how the Board OF Directors was
formed and said tho evidence would show for what
reasons prominent induced TO lend their
names 10 the enterprise ono OF these reasons was
the lact that tho American Minister was be one Of
the directors. Mr. Scbcnck's influence secured by
the promise of TO- 00O shares and a guarantee OF Two
per cent month each shnro or their par value al
any :imo he should desire. This $50 900 Of stock
rcslizce about 80, 900 pcr nnnum Mr. Schenck who
certainly made mistake by going the concern on
any Representations Colone Sturt, OF tho British