New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1883-01-03
THE MERGER AGREEMENT VOID.
JUSTICE DAyIs's oPINIoN-REFUsGNG To MODIFY
The INJUNCTION ORDER.

TIE INJUNCTION ORDER
Chicf-Judge Noah Davis on December 20
granted temporary injunction IN favor OF the Metropo-
itan Elevated Railway and = IL. Knecnnd restraining
tho Manhattan and NcwYork companies from
forcing and acting certain agreement OF NOyem-
Der H. ssh known the merger agreement; and from
paving any dividends under said agreement and from
celvng the surrender OF any stock OF the NowYork
Metropolitan companies and from issuing any stock OF
the Manhattan Company In exchange FOR any stock
surrendered and from paying the bonus of $40 share
20 stockholders OF tho Ncw-York Company upon such
surrender a. provided I'm the merger agreement" The
object of the suit I'm which the temporary injunction
was granted tn have the merger agreement or No
vember H. 1881 declared null and void The order 90
show cause why the injunction should not be continued
was made rcturnablc to-day. Yesterday David Dudley
Field in behalf Of the defendants applied to Justice
Dav. for nn order modifying the temporary injunction
order granted by him Francis C. Barlow appeared for
the plaintiffs, Late Ia tho afternoon Justice Davis
handed down n decision denying the application. The
opinion Il In substance IA follows
There l. nothing whatever In the injunction order IN
this that In any degree affect, the validity OF tho
lease aud the subsequent notifications OF the lease Of
the elevated rilways TO The Manhattan Company.
These questions have been settled as hr h0 this Court Is
concerned Nor Is there Amy thing In the order thnt
strnns the Manhattan Company from carry Ing out tho
provisions Of the modified lease by pai ing tho rent aud
d-chnrgiug all tho other obligations It imposes. The
Injunction order II limited to the merger agreement Of
November l. 1881, ana the company Is restrained nom
doing any other net under that agreement until the
turn day 81 the order to show can-e TINT agreement
has not been completed ny inc consent oI al Tue Hiock-
holders ol either the NrwIOrk or Metropolitan Com
paniez IL remains IN many respects inchuntc. have
given the question OF tho validity OF that agroemcnt
much consideration, and am 80 strongly impressed
with tho idea OF the entire lnyaidty That Zee! my
duty To decline 10 Interfere Win the injunction order
Th. question will Immediately be presented To tho
Special TcrIn and feel that ought not to discuss II
length Ihe appuchuoh u hnue e. Pd,te ana although
counsel have been heard at length. mean merely
to suggest the grOunl on which decision Is based IN
such manner that denying the application can
have prejudice In the formal motion yet To be- heard
produce the Impressions In my mind that the merger
agreement IA wholly void to al the parties thereto
will only add that II that agreement be invalid. the
ernl parties rrmundcd 10 their respective rights
under the lease and its notifications. And these in
provide for the payment rents Of the
amounts payable dividends under the merger agree
men Injurious consequence can follow from the pay
distributing them dividends until the final adjudca
tion OF the validity Of the merger agreement. That
dividends be paid 10 the rs and second preferred stock
holders OF the Manhattan Company, the Manhattan
COl.pan may perhaps be compelled To pay the same
under the lease as rents aud be greatly enDar-
Iassed IN recalling the dividends from the parties who
ground nor excuse to assert that the Manhattan Com
persons who hold the bonds OF securities.
The decision Of Chief Judge Davis had the rare quality
OF pleasing both parties. President Kneeland, u
h sno vSS4V and SOmpSy directors
eruted because It sustained the validity
OF lease of the railroads to their company and
the modified agreement OF October ~, 1881, ny when
the guaranteed dividends reduced from 10 10 per
cent. meeting OF the Executive Committee OF the
Manhattan Company held at the house OF OF the
members last night IL decided, In view OF the de-
cson 10 pay the interest on the hrs MORTGAGE b9ud9
the Metropolitan Railroad which fell due yesterday but
was not paid.
President Kneeland yesterday afternoon characterized
the refusal of the Mamie Company 20 pay the inter
the Metropolitan bonds, after admitting that IL
had been earned as base attempt to nure the Metro
D0lltan Company.
Russell Sage. one OF the Executive Committee OF tho
Manhattan Company said last night; at has turned
out Just as supposed IL would. The tripartte agree
ment has sustained, and that the only object
we had In view. The agreement OF merger may be
invalid but tho previous agreement Is declared
legal II { Is just what We want We
will take up tina Manhattan stock
perhaps and put things back where they were before
The merger Of November Id, 1881. Then where Is Mr.
kneelandl We will pay his company the per cent div
blends and the company do with themUust what 1t
pleasesO