Savannah morning news. [volume] (Savannah) 1868-1887, 1884-02-18
SIXTEEN MILLION INVOLVED.
A United States Court Decision in Favor
of the Credit Mobilier of America.


of the Credit MobiIier of America.
An opinion was filed in the United
States Circuit Court on the 10th by Judges
Lowell and Nelson, says a Boston special
to the New York World, which is practi-
cally in favor of the Credit Mobilier as
against the trustees under the Cakes
Ames and the Union Pacific contract.
The cases were those of Rowland Hazard,
Commissioner, VS.. Thomas &. Durant and
others; same VS.. same. The defendants
filed demurrers and the hearing was
thereon, but the decision involves all the
points at issue. Some $16,000,000 are in
volved These suits grew out
OF the same transaction. The
plaintiff in the first case is a
commissioner under the Supreme Court
of Rhode Island. The allegations of the
bill filed Dec Z, 1882, are in substance
that the trustees, Thomas G. Durant and
six others, to whom was assigned the
contract between Cakes Ames and the
Union Pacific Railroad, failed to accOuntfor
many millions of dollars due under their
trust to the stockholders of the Credit
Mobilier of America, and that the trus-
tees have been guilty Of wilful negligence
and misconduct in the management of
the trusts. The prayer of the bill is for
an accounting and for other relief. In the
first suit the plaintiff has associated
with him certain stockholders of
the Credit Mobilier and in the second the
commission proceeds alone. In the Rhode
Island Supreme Court a final decree
against Durant for $16,071 900 was found
in 1882, The bill AYERS that Durant had
disposed of his dividends and was insOl-
vent. The only defendants, who were cit
liens of Massachusetts,, appealed and filed
demurrerS. upon which the cases were
heard some time ago by judges Lowell
| and Nelson. The defendants referred to
are the executors of Oliver Ames and
John Duff and Frederick l.. Ames and f.
Gordon Dexter. The objection was made
in the first suit that the plaintiff appeared
in two capacities, and in the second that
the plaintiff sues only as a commissioner
and not as a shareholder. The other
points involved are discussed in the opin-
ion as follows:
Taking the narrative Of the bill to be
true, as we are bound to do by the de-
murrers, the trustees, acting jointly, have
received many millions OF dollars IN money
and securities, the property CT stOckhOld-
ers, which they still retain and refuse to
account for under the trust agreement,
| and they have also been jointly guilty of
| gross negligence and misconduct in the
management of the trusts, from which
the stockholders have suffered loss. We
| therefore hold, upon the case as stated in
the bill in the first suit, that this court
can render an etlectual decree against che
defendants who have appeared, and has
jurisdiction to entertain suit against
them in the absence of the other trustees,
who cannot be served with process. In
the second suit the court holds that plain
tif,s powers and duties are solely those
of a receiver, and he must be trustee in
that capacity alone.
This is named as fatal objection to the
second suit. In the first suit the demur-
rers are overruled, and in the second the
demurrers are sustained.