The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1879-08-19

THE BANKRUPTCY CONSPIRACY.
"Soon Erie had itself placed in the hands of
n receiver on the plea, among others, that the
second consolidated bonds, which 1 had been
placing with much difficulty here, were ille-
gal. Immediately on hearing this movement
induced John Morris, of the firm of Ashurst,
Morris g. Co., solicitors, to visit New York and
ascertain what was really needed to restore the
companys credit. l provided 1000 for Mr..
Morris and agreed that Sir Edward Watkin
should also CO. paid him $4,000 for his ser
vices This movement, which was thought in
America to be hostile to Erie was really not so.
Messrs. Morris and Watkin were sent back to
England without being allowed to complete
their investigation regarding the appropriation
Of the funds, with instructions to begin suits
against all parties who had assisted in sending
them to America"
WHERE THE MONEY WENT.
CoRREspoNDENr-What was the object Of
| these suits!
Mr.. MCHENRY-To distract attention.
CoRREsPoNDENT-IIow do you think the
money sent to America was spentl
Mr.. McIIENRY-I cannot tell, but can guess
l have a strong opinion that much of it has
gone to construct the Texas Pacific line Erie
certainly derived benefit from it. / was
talking with Jay Gould the other day. He put
the matter very concisely by saying that when
he left the road the bonded debt was
| SOS, OOO, 900; now it was about $7O,OOO,OOO,
while nothing had been added to the mileage,
equipment OF business The third rail, he un-
derstood, had been provided by assessing the
shares.
QUESTION OF HISTORY.
| CoRREsroNDENT-What about the suit and its
results
MIR. MC1IENRY-After nearly four years Skin
mishing by commissions and heterogeneous
the Master of the Rolls took only u few hours
to decide that had 10 right to make any pay
ments for Erie without the formal authority Of
the Board Now, Watson was in London for
seven months. 1 saw him daily and of course
his instructions were chiefly verbal regarding
payments and remittanccs the Erie account.
The Master of the Rolls refused to allow me
the commission which Watson promised, hold
ing that was acting friend of Erie, there
fore not entitled in the absence of evidence re-
garlng American law. The Master of the
Rolls, who / must say is one of the ablcst Of
the learned English Judges, held that the pur-
chase of the shares by Erie was nctra cires.
His Lordship stated that under the English
aw no railway company can purchase the
shares of another, and the United States
were originally British colonies he should
identical. / suppose it didn't strike His Lord
ship that other nations had also settled in
America. New York, for instance, was Dutch
colony. And suppose he did not reflect that
ut the time of the Declaration of Independence
no railways even private corporations ex-
listed and that laws regarding such institutions
might and do differ.
SYMPATHY FROM AMERICA.
CoRREsroNDENT-Whati is the opinion Of your
American friends on the easel
Mr.. McIIrNRY-I have received from many
American gentlemen in London at the time this
strange judgment was found such j. Choatc,
vanderpoel and Judge Ashbcl Green, expressions
of sympathy and promises of active support.
They have pointed out the New York lsws under
which the purchases clearly within the power
! of Erie 1t cannot be law or justice that 1, act
ing at the request of the president of railway
which derived the full benefit of my response
bities. should be made liable The Atlantic
and Great Western Railway Company, although
never consulted regarding purchases unknown
to its Board for months afterward issued
bonds to pay the greater portion of these shares,
of these bonds but this engagement like all
others Erie with Atlantic repudiated.
THE LEN TALLoNIs.
CoRRrsroNpENr-What course will you now
take
Mr.. McHESRy-If it is fact that Erie is not
liable to me for the transaction, then certainly
Watson Barlow and IIurlbut are liable in
divduals, and their responsibility will rigidly
enforce. Judge Burke, of Cleveland. writes
me that great frauds were practiscd on my
friends in the purchase of Cleveland and Co.
lumbus shares. and If proceedings are taken he
doubts not we will be able to recover mill
ions of dollars. SO far from litigation being
ended it appears to me that it is only now be-
thinning. | shall issue shortly TO proprictoIs