The Portland daily press., 1883-09-06
IMPORTANT DECISION.
The Supreme Courr Dismisaes the Suit Of
the Union Pacific Railroad Company v.
the Credit VI obilier.

ANS GF6UAt VVDAhSfs
WARRINGTON, Sept 5.-The full bench of
the Supreme Court to-day dismissed with costs
the suit of the Union Pacific Railroad Compa-
nv v. the Credit Mobilier of America. The
case has been three times argued before the
court, the last time being in March, when the
Union Pacific was represented by Sidney Bart
lett, and the Credit Mobilier by VIM. G.. Rus
sell and George Putnam.
the amount involved was 81, 1898, 600 which
was the sum agreed upon as the basis of set
tlement of accounts between the two corpora
tions after the Credit Mobilier had finished
building the road, and further sum, S268, 900
which it was subsequently found to be due the
Credit Mobilier. When the enterprise was
projected which led to the building OF the Pa
oiic Railroad the contract for building the
hundred miles was awarded to Herbert NJ.
Hoxie of New York, friend of Thomas G.
Durant, the then Vice President of the Union
Pacific Company. As Mr.. Hoxie was unable
to carry out the terms of his contract he made
an assignment of the same to the Credit Mo
Dilier OF America, which was corporate ON
chartered in Pennsylvania, and whom were in
terested in the Union Pacific Road, and the
unfinished portion of Mr.. Hoxie's work was
completed by the Credit Mobilier, as was also
one hundred and forty-six miles additional.
The stockholders OF the Union Pacific and the
Credit Mobier were SUBSTANTIALLY Il I the same.
ed, the balance in favor OF the Credit MoDiiier,
which was the subject of the controversy, was
found by committee, consisting of Mr.. Sher-
man, the Government Director, and Messrs.
Dillon, Macy and Duff. At about this time
the Commonwealth of Pennsylvania brought
suit against the Credit Mobilier for income tax
alleged to be due, and in the lower court judg-
ment was entered in favor of the Common
uaolfh ha Cradit Mohitiar apnQalad and
the Union Pacific as surety for the Credit Mo-
bilier, gave its note for $2,000,000, and after
the termination OF the suit the note was to be
applied toward settling the account between
the Credit Mobilier and the Union Pacific. In
1873 for the first time the Union Pacific,
through its Board Of Management, contested
the claim OF the Credit Mobilier, and claimed
that the original contract, although purporting
10 have been made by Hoxie, was really made
in the interest of Thomas O. Durant, and his
fraud made the contract void. Another ground
of fraud charged was that the estimated cost
Der mile by the engineer who made the pre-
liminary surveys was S38, 600, and that the
contract price as paid Hoxie was $50, 600 per
mile. In answer to the last proposition, the
Credit Mobiier say that after the preliminary
surveys were made, the consulting engineer,
Mr.. Seymour, came to the conclusion that it
was best to have the ruling grade 30 feet per
mile instead OF so as previously agreed upon,
and as this involved much larger cost Mr..
Alo4ic . ContidCt Vi TOV,VOV ppr uiio was Ud5cu
upon this change.
The position taken by sthe Credit Mobilier
was that whatever may have been the original
vice of Hoxie by his connection with Mr.. Da-
rant, it was cured by proceedings in the spring
of 1866, when Hoxie assigned the contract TO
the Credit Mobilier, and the Union Pacific
Company having accepted the same was in law
bound by the terms of the contract. 1t is also
claimed that the Union Pacific Company has
no equitable standing in this suit, as the only
parties who we're ever injured by the secret
ownership of the contract were the holders of
the stock of the Union Pacific Company, ali
Of which were subsequently acquired by the
Credit Mobilier, except 13 shares which have
been unclaimed for eighteen years, and no
owner can be found for them. A still further
legal point relied upon was that the Union
Pacific Company has been guilty of gross
laches In not bringing its suit before so many
years elapsed.
The rescript of the full court is as follows:
There was no sufficient proof of actual fraud,
and no such proof of constructive fraud as to
render the contract open forr reputation after
the votes of April 5, 1865.