New-York tribune., 1881-03-27
THE COURTS.
THE TELEGRAPH Suits.
MOTIONS BEFORE JUDGE sPEIR IN THE SUPERIOR
COURT, CnAMBERs-TnE ERFORTs TO PUNISH

Juug6 Cpelr, IN Jne OuperlOr OOurt, Nham-
granted Friday last order returnabe yester
day. to show cause why the American Union aud At
lantic Pacific Telegraph Companies should not be
brought parties defendant In the suit brought b.
William g. Williams against the Western Union telegraph
Company and its directors and the Union Trust Com
pany aud also why the Injunction order granted In
that accn by ChetJudge Sedgwick should not be va
Gated the motion for such injunction be reheard.
The application OF tue American Uuion and Atlantic and
Pacific Companies k based upon the grounds that these
Panes interested in the subject mater CT the
suit that they have already delivered their property
10 the Western Union Company under the contract Oh
January 49, that the plaintiff now claims that II the III
junction order OF Judge Sedgwck be hnay upheld the
whole contract OF sale between the telegraph companies
will incapable OF execution account OF iai-
Of dn Integral and material part Of IT, and that
therefore, the pettionng companies are in danger OF
being deprived. by judgment in an action to which
they arc not parties power to obtain or enforce
the payment by the Western Union Company Tor tue
property of the petitioners which has been revocaDy
delivered to It,
Ills also claimed that as Judge sedgwlcks decision
was based upon the assumption that the value of the
property represent which the Sl5,OOOOOo OF said
stock was be distributed the shareholders OF
the Western Union Company was not in fact equal to
Sl5 0OO OoO the Injunction order made upon mis-
conception OF tho facts the premises, and that upon
showing the fact by the adayis in respect 10
tho actual present vane OF the property, the injunction
should be dissolved The affidavit OF Thomas T. Eckert
tho president OF the American Union Company, shows
that the agreement of January 10 was made upon the
basis OF actual valuation OF the present property OF
tho Western Union Company.
Judge Sper sat yesterday In Special Term OF the su
perior Court to have the arrangement the motion
made on behalf OF Mr.. Williams to punish tho western
Uoion Telegraph Company and the Union Trust Com
pany contempt OF court IN issuing certificates Of III
dcbtedness TO ts shareholders IN lieu OF the stock which
1t had been enCned from ssulng large array OF couu
sci on both sides present Mt the opening of the
court at halfpast o'clock Everett Wheeler for the
American Union Company insisted that the motion 10
bring this company defendant Ia tho suit ana 70
vacaie Judge sedgwlcks injunction order ought to be
first argued and determined before the contempt pro-
ceedngs should 90 Judge Sper thought there was
no connection between the two motions.
ExJudge Fullerton then spoke in support OF the motion
to punish the defendants the Williams suit for a con-
teupt He said Judge sedswick had refused TO in
corporate the injunction Orer the expression cerd
Gates OF because already covered by
the general employed and the counsel fol
the defendants present and heard the observation
OF the Court 10 show issue of the certificates
of indebtedness was palpablo violation OF tho inunc
lion It was only necessary consider the fact that they
possesged all the attributes stock certhcates They
we're tra sfcrrabe the hooks Of the company, dvi
dcnds be declared them and they arc assgnabe
in all respects like certificates Of stock Under the name
OF interest he said div dend OF Z per cent had been
declared on these certificates within few days after
they had been issued In OF all these facts, Judge
Fullerton thought II plain that the defendants hah
been guilty Of q contempt ~ court.
ExJudge yohn X. Porler then read the ahldavits Of
Dr. NOrvin Green George 5. Bamu and Others ia Oppo
sion TO the motion. DIR. Green In hts affidavit says:
al aver and depose tha, object OF the proposed
dlstribliou Of the Si5.h26.59o of stock among the
OF the company 10 epresent tho actual
Investments OF surplus earnings 1866 tho basis
OF It's value The actual vauo OF such Investments
In fact carefully estimated by he directors o! the
pany prior TO the OF the certificates Of Indebtedness
and 1t was their deliberate judgment based upon such
estimation and valuation. that the thea actual value OF
such investment reraiply not less than 2G50O
exclusive OF the stock held by the Western Union Tele
graph Company In tha Atlantic AID Pacific Company
aud the actna such investments TO the company
is very much greater their cost entered u2Onhe
books an as appears Ia tho reports and statements OF
the company"
Dr. Green aso shows that n the surplus earnings OF
the company had been invested as they were In
stead OF being distributed m dividends. the company
would have obliged to borrow money to mako the
necessary purchases and improvements. and that the
purchases aud made had been from time 10
time approved by stockholders " the company with
out a dissenting voice. Mr. nanln in his affidavit
alleges that he present IN court upon the settlement
OF the terms OF injunction order made by Judge Sedg
wick assnciate cOnsel with Judge P0ref ana lhat
the pressOn Certificates OF indebtedness contained
in the DrOpOsed order submitted by Mr. Sowell,
pressly stricken ont by Judge sedKwick ON the objection
raised by Judge Porter that the expression though found
in the plaintiffs bill had been omitted nom the prayer
John T. Parsons on behalf OF the Union Trust Com
pany opened argument In opposition to tue motion
lie inaintained that would he extraordinary 10
punish officers OF tho comphny for allowing the
transier OF certificates OF Indebtedness, when II was
remembered that Judge Sedgwick had in express terms
refused 10 grant injunction against the issue OF such
certincates. The Trust company was merely Hakc
holder In the transIeOn and It's action had been taken
in good faith and the advice OF four OF the most
learned aud dstin guished counsel In this city.
Wager swayne followed Mr. Parsons, aud declared that
If the dispositions or Courts were Ike tbat OF the pam
ton OF defendant ia equity woud pc deporaoo ior no
would be subjected TO power at once malignant ana
capricious. Ia reply 10 Judge Fulerton's argument
that the certificates Of Indebtedness were nothing more
less than certificates or stock under another name,
Mr. Swayne argued length that there an entirely
material distinction between tho Two kinds OF cerlin
Gates, and quoted from many decisions to support ms
position. Tue Western Union Company was Indebted 10
It's stockholders and II certainly had right to pay its
Indebtedness or TO give acknow wedgements OF It. The
INJUNCTION OF Judge sedgwck mad reached this right
In any way enjoned It's exercise, and therefore the
companies had done nothing which they nad peen ether
expressly nr implicitly forbidden to do
Mr.. Seweh, on the part Of Mr. Williams, followed Mr.
ewayne and closed the decnshi0n He said be ala not
to discuss the question OF private veracity between
himself and Judge Fullerton on the one side and Judge
Porter the other rasen tins argument In regard
10 the language claimed 70 have been used by Judge
Sedgwck on the settlement OF tho Injunction order.
The whole question turned ON the single point whether
the spirit Of tho order mad been violated obeyed
Stock he said was the right proportiOnate share in
the profits OF the corporation and the certificates OF
indebtedness entitled their holders TO the dividends
as stock certificates they must be considered Tor All
ntena and purposes stock and therefore within the
meaning and prohibition OF the injunction order.
The case then submitted, and Judge spelr an
nounced that he would reserve his decision.
THE MERRIAM ASSESSMENTS.
The Merriam assessment case, just decided
by the Court Of Appeals dspOses OF large number OF