The New York herald., 1877-03-04
THE COURTS.
Another BOmbsheIl in The Delaware and IIud-
son Canal Company Litigation.
A BUSY MARCH TERM.
Settlement Of a viii Suit Before the
Lawyers Bag the Estate.
SERVING PAPERS ON LEGAL HOLIDAYS.


The legal fight growing out OF tho strenuous efforts
being made Tor the appointment OF u receiver of the
Delaware and Hudson Canal Company promises to be a
hoty contested one IN the courts As Is well known
shc resembling by Judge Donohue Of his order 'inad-
vcrtcnty" given 10 show cause why receiver should
not be appointed did not, by pny means terminate the
warfare renewed onslaught made this giant
corporation. which resulted IN second to show
cause being granted why SUCH should not bc
appointed which Is set down for argument o-morrow
Supreme Court, Chambers before Judge
Lawrence. Pending tho argument upon this
order TO show cause, aud not satisfied
evidently with tho complaint OF Mr.. Henry Il. Ander-
son. published exclusively in the HERALD following It's
presentation in court, and which the basis
OF the order to show cause, supplemental affidavit
was submitted yesterday TO Judge Barrett in Supreme
Court, Chambcrs by Mr.. Edward Brow counsel for
Mr. II. X. Anderson who brings tho suit against the
Delaware aud Hudson Company having for lis object
the appointment OF receiver In handing up the az
Gduvat TO Judge Barrett Mr. Brown stated IN open
courrits purpors, with vicw MS he said that there
should bc no repetition Of "inadvericntly'' signing
Greer IN The case. Tho following is the affidavit, tho
statements embodied in which fully explain them
Bvvcs
city and County Of New York. ss--Georso W. Stow.
beng duly sworn says:-Tbat he RESIDES at No. 40G
West Twcnty-ihird street, the city OF New York;
that no Is pubc accountant and expert bookkccpcr.
and that In The Of his business had OCCASION
IN the year 1873 examine tho affairs and business
the Rensselaer, and Saratoga Railroad Company that,
in Of his SAID invcstigao dcponcnt dis
severed the following facts, which ho believes TO be
sTuc c:-That on september 30, 1867, the capital stock
81 SAID railroad was $soo.00o; that .rioro September
50, 1868, II Increased TO 81, S5v 600, aud that
PRIOR TO September 80, 1850, further increased
TO $3,0O0,0O0 at which ngure or amount 1t stood on
the 3Uth day OF September 1870; that just PRIOR
May l, 1871 the amount OF stock increased to
$4,000 600; that the lease OF said road 10 defendant
in ths action took effect May l, 1871 that at the
or tho execution oil tho SAID lease Thomas Dickson,
president oi dcendan and also other directors OF
icnd,nt also directors III SAID railroad company,
ana the said Thomas Dickson WAS also director ana
one OF the officers oil dcendant that by the terms of
SAID lease 'he defendant guaranteed seven per cent
interest the entire Indebtedness OF SAID railroad
company, ana interest dividends the ratio Of
per cent pcr annum Oh the capital stock which had
thus been incrcased that ny the terms OF said lease
the defendant agreed keep SAID road good repair
al The expense Of the defendant; that for several
years 10 tho leasing OF SAID road the earnings
thereof had been usu 1icicnt to JUSTLY guarantee OF
such rate OF interest dividends Oh such Increased
capital as the following statement will show:
That Tor the respective
year ending Sept. 80 1862 1870 1871.
the gross ST. 59 O01 81 656 169 ST. GOA
That Tor each Of said
years tho
Including leases taxes
and inainten nee 1,1s7,352 1.l5442c l,2l9 522
Balance. ........... $4O664Y 55Ol,7 7a9 1907 172
That Tor each of said
years tho payments
for interest on bonds
wero ................ sso97 l17,yss lo7ss9
Leaving net earnings
~ each ycar......... $307, ,952 1884 All $249 1888
That the only Increase In the mileage railroad
from September 80, 1868, September 30, 1870 was
fifteen miles, and that IRON the latter date to Septcm-
Der 30 1871, tho increase OF mileage was only five
mics That the net earnings as shown above uiunly
demonstrate that the defendant not justified IN
interest dividends on SO large an amount
of capital stock at tho rate OF per per
num- that the increase Of mileage from September So
1865, to September 30 1870 would justify the
n In Zat nj Z
u does not appear from any statement by said
railroad company that surplus earnings had been
pendod IN construction or that additional properly
$3, 200. 600 TO $4,000, 600
DepOncnt turther says upon Information aud belief
that The defendant, through its onicers about
the I'd day OF september 1865 entered into written
agreement with the Erie Railway Company, the or,g-
nal which agreement dcponcnt believes to be low IN
the possession and under the control OF the decudans
officers. That under SAID agreement defendant pur-
chased 1900 bonds Of the Boston, Hartford and
Eric Railway Company, amounting to 81, 300 900. ut
the rate Of ninety centson the dollar, and paid SAID
Erie Railway Company tor the same cash, the sum
OF 81, 600 That by SAID agreement sad moneys
to used by the Eric Railway Company In con-
structipg aud cqupping the Jefferson Railroad That
the persons representing the Eric Railway Company
IN SAID agreement contracted with Owen Fonda TO
build SAID Jefferson Railroad Tor 81 00O 700 OF the
gage bonds and 81 OUO 90 OF the capital stock said
Jefferson Railroad Company; that subsequently said |
contractors agreed 10 accept and did accept for
structing and equppine said Jefferson Railroad, |
$1,000 0C0 cash. In lieu OF bonds and said stock
That The proceeds oi the Boston, Hartford and Eric
Sl,JD
oractors, leaving balance OF $3.50 900 due them
That said contractors accepted $l00 900 OF the stock OF
sad Jefferson Railroad Company at par on account OF
SAID balance, leaving 5000 QUO then due them that
h- defendant received ana paid for $50 bonds Of said
Jslrrson Railroad Company for the balance. That |
tho completion OF road the Erie Railway Com
n, leased The same IRON The Jefferson Railroad Com
any. guaranteeing IN said lease TO pay the
mortgage bonds amounting TO 81 900 600 and also
.s.drnds the stock of said company amounting to
s., 600 900 That although said Jefferson Railroad
was built almost entirely with tho money furnished
np tcu dopgr nj nun md
bts never owned said railroad, and has received Tor
said moneys only the SAID Boston, Hartford Eric
boida and the said JeneTsOn Railroad bonds, that on
The said securities OF the Jefferson Railroad Company,
acquired as above, there remained margin what
ever, but the said Jefferson Railroad bonded for |
It's entire cost and the stock Of said Jefferson RaIi-
road Company was divided among Tho persons
who negotiated and brought the said az
oil September 2. 1865
DeponcDt further says that by tho express terms Of
the SAID agreement OF september 1855 the defendant
covcnaDtcd ana agreed among other things furnish
tor transportation over said Jefferson aroad each
and every year alter 1872 less than 500 Of
coal, and, in default oi so doing, agreed pay,
liqudated damages. ny pcr the quantity
TO which 1t should DO in default and the defend
ant further agreed supply railway company
all the coal used by II IN Transporting the coal under
SAID contract at the rate OF y cents per
with the Of mnlng &c. that said defendant also
further agreed pay all United state taxes
on coal transported over said railroad and that u
agreed in SAID contract that the should in
torcc during the continuance Of tho O
parties thereto.
Dcponent further says. upon information and belief
u
director IN the New York and New England Railroad
Company, which succeeds To all the rights OF the Bos-
ton Hartford aud Erie Railroad Company, in which he
was also drector--has been frequently importuncd
To take s0ino action with view OF protecting The
tercsts which defendant has IN said companies arising
from Defendants ownership Of the bonds OF said /
Boston. Hartford ana Erie Railroad Company, but
no action has been taken by him in projecting
such interests, Notwithstanding u steady depTc-
citation IN sad securities has been going
over sincc their ownership by tho defendant Dcpo-
Dcnt further says, upon Information and belief
a A.