, 1877-07-15

THE CHICAGO & SOUTHERN.
Thc affairs Of the bankrupt Chicago & South
crn Railroad have already been pretty cxtcr-
siycly aired in the courts, but they were treated
to anothcr expose at the hands of James
Walsh, the present Receiver Of the road, and
who was appointed by Judge Moore i'll the suit
Of tho Fourth National Bank VS.. The Chicago
s. Southern Railroad Company and others. Tho
Company was Incorporated lit 1874 by ]. E.
Young L. Co., to run from Chicago to Dalton,
and agt US au inlet to this city for
the Chicago, Danvillc IL Vincenncs Railroad.
In fact, J. E. Young was General Manager Of
tie latter road, and W. D. Judson, Il member
of the tirm of j. f. Young Il Co, was its Prcsi-
dent. About the same time Il. F. Ealnes anil
tie Commercial National Bank agreed TO ad-
vance to the Chicago s Southern Railroad
Si5,OOO, taking as security S3,0, 600 worth Of
the iirst-1nortgage bonds OF the road. The
bank was to have the balance of the proceeds OF
$llO,0Uo Of bonds, a:ter paying tue ,000 due
to Eancs, and in consideration therefor should
amount of $4,000 Of tue Chicago, Dam
had been Illegally issued by
Young, the general manager, for the aecommo-
dation Of S. j. Walker. As part Of the same
arrangement it was agreed with T. L. Goodell.
President Of the Fourth National Bank, anu
certain Of its Stockholders aud Directors, that
the litter were to advance Il similar sum o[
Sl5,tx)D, and were to TIC partners with Eames
ami the Commercial National hank in the
hnds. They were t., he repaid the S:o,t}D with
interest, ami tic further suul of S20,txD us ::
personal pcrtluisitc to themselves Out Ut tl:
balailce uf the prt,ccc,is OF tile l'ls the two
bauks were to receive payment lnr about
s!U,taN OF the accommodation paI,er of tc Chi
cago, Danv'Ilc u Vineennes Railroad For
Walkers hcuct.
BY part of the same scheme the Directors Of
the Chicago g. Southern Roau resigned, and
Jcssr .. Norton, II. Ii. Hale, b. V. Page, n ).
Bouto,l, and Edwin Walker, each OF whom held
one share Ut stock, and all Of whom were in the
interests Of the two banks, elected themselves
Directors. and then elected n. s. Bouton Prcsi-
dcnt, mud Il. L. Goodell Secretary OF the road.
They then issued trust deed to Henry 4:
Smythe Us trustee to secure 322U bonds for $1,000
earh, with interest at per cent in Sold. These
bonds were divided up as agreed, l00 OF them
going to Eu.ucs. He now claims that thcy were
delivered to him as agent for some one else, but
refuses to tell the nalne Of his principal. Com
plainant thinks it is the City National Bank of
and his brother is its President. In 1S7t, OF
during the present year, the City. National
Bank Ut Ottawa delivered eighty Of these 1U0
bonds to J. D. Cation, but Walsh claims this
transfer was merely colorado IN order to serve
as foundation for the claim that the bonds
for value. Moreover, Walsh asserts that
Eames' prctcusc that he is the agent of third
marty il also only cnlorntle and that ne
now owns the whole 100 bonds. In Au-
rust, 1874, J, Z. Young & CO. received sixty out
Of tic 10O bonds coming to them, which they
us, I'm taking up 49, 795 OF tho acro,u,n o(lation
na,er Of the (ht,:,go, DanyiIlc g. Vinccuucs
Road, given to Walker, and SS;f, 100 of the paper
Of thu. Wabash Coal Company, which had been
DISCOUNTED by ], Z. Young IL Co., anI all OF
whiL was held by the Commercial National
Bank. For these sixty bonds, therefore, the
(hIrapo & Southern Railroad received no con-
siIer,t;on whnteyer. and cDmrloluant charges
tIr,t their ASSIGNMENT +, the bank was frat1du-
lent and void. The only consideration for the
1Oj sonls delivered to Earars was $4,000. The
iii re1naininr bonds. which we're divided
amonr (;oodcfi. Bo1ton. and the DIRECTORS Of
tie Fourth Rational Bank. only realized $50
do to The Chicayo l. Southern Road.
It Is further CHARGED that, at the time of the
Issue of these bonds and The execution OF the
trust-flcrG. there were no bona f1lc stockholders
of the Comnanv. the on!y stockholders the
COMPANY Ilas ind since June. 1874, were the
Directors Buuton. Goodcll, Page, Norton, Hale,
mud Walker, each of whom, held one share, and
they never ever! paid for that much stock, but
held II colurably. to enable them to carry ont