The New York herald., 1879-03-08
THE UNDERGROUND RAILWAY.

STOCKHOLDERS SUIT BEFORE JUDGE LARRE-
MoRE--soME CURIOUS FACTS ABOUT THE
FORMATION OF THE COMPANY AND THE VALUE
OF ITS STOCK.
A very curious suit. growing out Of the formation
of the Broadway Underground Railway Company
and involving the possession of nearly 100000 of
the capital stock of that organization. came before
Judge Larremore yesterday in the Special Term OF
the Court of Common Pleas. Ir seems that among
the original grantees named the act of incorpora-
tion Joseph Dixon. who. together with one
William M. Reynolds brings suit against Alfred Z.
Beach, former president Of the company. to recover
the alleged value of certain certificate Of stock
which Dixon claims he delivered to him for safe
keeping. but which has been unlawfully converted
by the defendant to his own use.
THE COMPLAINT.
The complaint in the case, which 10 somewhat
vouminous states in the outset that the.Broadwsy
Underground Railway Company organized with
it's capital stock amounting to So 0OO divided into
shares of 500 EACH The corporation. under the act
passed June l. 1885, was empowered to carry on the
business of transmitting letters. packages and
chandise in the cities New York and Brooklyn and
the North and East rivers. by means OF pneu
tubes to be constructed beneath the surface of
the streets and public places and under the waters Of
the rivers. The company was in the first instance
organized under the name OF the Beach Pneumatic
Transit Company. but, under supplemental act en-
larging franchises. subseq merged into
the present company. The defendant, 1t the time Of
the organization Of the first company held the Offices
of trustee and president which offices he continued
to no until October 1873 On the I'd of May, 1870.
the corporation issued to Dixon 5295 shares of the
capital stock in payment for certain property neces:
sary for the business OF the company, which he had
transferred to them At about the same time tho
president Of the company settled the value OF the
value OF the shares issued to him and valid for the
issuance of the stock. Subsequently three GER
entitled to shares of the full paid cD
stock of the corporation and numbered respectively
H. 15 and IL. signed by the defendant presi
dent by the supplemental act the corporation
granted the right to construct and operate under
ground railway. extending from the Battery. under
broadway. to Madison square. thence under Broad
way to its junction with Central Park and Eighth
avenue with a branch railway from and under Mad-
son square and Madison avenue to the Harlem River
and under the bed OF that river to the northerly
shore, by means OF tubes of enlarged interior dia
meter. Under this act they also allowed to form
railroads. 1t Is claimed that this grant increased the
value Of the capital stock of the corporation
alleged Dixon delivered certificate No. l6. represent
ing 1765 shares of the stock to the defendant for
safe keeping only, the same to be returned
by him whenever so requested. He says the stock
then and now is valued at S176500. and although
he has demanded its return the defendant has re-
fused deliver it him. and has unlaw
fully to his own use. Dixon, in June last, sold to
the plaintiff Reynolds, for valuable consideration.
large part. but less than the whole of his claim
Judgment against him tor Sl75.50O, with costs.
THE ANSWER
Mr.. Beach, in his answer goes into an elaborate
history of the corporation from its inception. and
positively denies the alleged conversion OF the
stock or that 1t was ever in fact delivered to
him. He asserts that the capital stock
actually issued but that in pursuance of
lutons at their meetings. which were attended by
the plaintiff Dixon, who OF the original
grantees. the capital stock was simply apportioned
without being actually issued. He says that the
certificates have been detached from the certi
fcata hook md he haa 1al An at
value. When the new company was organized lac
was made president, but that he has ceased to hold
any Ctce in the concern, and is in way Liable in
dividually officially. He says further that plain
titf's rights the same as they have always
been.
On aftidavits setting forth the alleged unlawful
conversion of the certificate by the defendant an or
der OF arrest was issued against him and the case
to vacate this order OF arrest. number OF volumi
nous afhdavits were read on both Sides and ut the
conclusion OF the argument Judge Larremore took
the papers, reserving his decision.