Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1885-10-10


ions: There was the million dollar note
when would become due on the 9Th of October
Z then next ensuing, upon which there was due
over $4,000. 1t was claimed that the assets o.
the w. ID. Co. would not pay its debts within
some SIX millions. Coltons share of the deficit
would be about s666,666 The charges against
! amounted TO some 500, 600. He found the
assets OF the estate to be On deposit with the
W. u. Co.. S429,090; a residence assumed to
De worth $4,000; a ranch worth $4,000,
ana some other matters probably of little i'm
] poftance There was also Colton's share OF the
/ stock and bond dividend of uncertain value but
ehtlreiy unmarketable. There were the 20,IO0
shares OF central Pacific stock, and an equal
/ amount OF Southern Pacific stock, pledged to
secure the mlllOn-dOllar note Also 1915
SHARES OF the K N; 9. l. stock, said to be worth
par, or SlsI,90O. Tue main Solcitude of. Mr.
| Wilson, aside from the charges which were
thought to effect the reputation OF Cotton was
IN regard to the s700G00-which would fall due
III october. He made inquiries in regard 10 the
available means of the estate, and came 10 the
conclusion that she could not possibly meet paw
iheht cue on this note tha. the stock pledged
70 secure II was not marketable, and if sold by
Inc pleqgeesi would not bring near the amount
| lie testliies: Il believed if these gentlemen
| foreeloSed the pledge of the 10000 shares OF
STOCK which they held to secure the balance
que on the mathematician note, they would ac-
| qulre that stock, with a very large SIM nm
pald-over half million dollars, probably
iplly half million of dollars" He also thought
| they might wind up the W D. Co satfnirs aud
| bring Mrs. Colion largely in debt there
! He frequently conversed with Mrs Cotton
about this probable result and explained to her
me dlIIculty OF meeting this obligation, and its
| probable consequences.
PLAINTIFFS ANXIETY TO RETIRE FROM THE BUsI-
MESS.
| Soon after her husbands death. Mrs. Cotton
had resolved to get what she had out of the rail
road business, II possible; and after this showing
| no doubt she realized the absolute necessity Of
doing so, or. rather she realized that She vas in
the power of the defendautS-that if they insist
ed upon speedy settlement it would involve
I her husbands estate in insolvency The dafand
1 ants were fully aware of the helpless nondition
CT the plaintiff. The answer AYERS as a reason
| for not presenting their claims against Colton's
/ estate that they were repeatedly urged by VIII
son and Ieyis TO deSiSt from so presenting them
| and make an aniicab.e Adjustment for. if they
| asserted thelr legal rights. they would not only
| leave Mrs. Cotton without property, but would
| expose the memory OF her husband TO disgrace
! Croker says they figured that the Western De-
velopment Company had not sufficient assets 10
, pay its debts, II 1t had to be wound up immedi-
ately; that ii would require great many wears
! of handling these securities, and to nurse them
and bring them before the public. Ii forced on
| the market they would not bring much. if any
| thing. Nobody knew anything about them and
there were millions Of these bonds and stocks
and no man would buy except at a low price
They were satisfied that if they were forced TO
settle these affairs il would sweep eyer;thing
enough to meet her share of the debts. and there
was no other way but 2 lump settlement
Now, 1t being thus manifest to every one that
Mrs. Cotton was unable to go on with the de-
PENDANTS and pay her Indebtedness, that not TO
settle was financial ruin, it was only natural
that Mrs. Cotton should use her utmost enGcavor
to retire from the business with definite sum
of money, entirely freed from the responsible
ties and complications of tn hazardous aud nm
certain business in which they were engaged
All parties, think. understood the situation
The defendants believed, threatening as the as
pect OF .atfalrS then was, that they could sue
ceSStully ride the storm and that the pluiDtif'
could not pay up and go on with them. That
her only chance was compromise Wilson, as
stated At first applied himself mostly to the
charges against Cotton. These involved the
reputation OF his dead friend, and would he
used, he thought, by the defendants as an ex-
cuse for not dealing literally with the widow of
their late associate. They would use 1t as a rea-
son for standing ON their legal rights and there
by would render CDlton'S estate iLsOlyent In
this examination be was able to explain some
items Of the charge, but generally his inyestiga-
tons turned out adversely. He Spent several
months in his examination of the affairs of the
various CORPORATIONS. but was evident paralyzed
with the thought that IL mattered but little what
| he discovered, unless the defendants would re-
lent, and recede from the position they had
taken. He constantly insisted upon a settle
ment. He admitted that she was unable to nav
the maturing obligations and continue in the
business.
MRS. COTTON SOUGHT THE CONTRACT
That she was unable to make the deposit with
the W. D. Company, which would pay her share
must not be overlooked in judging the conduct
of the parties. Mrs. Cotton sought the contract
Her agents or counsel seem to have taken the
position that the defendants were hound for
some reason 10 pay her for her interests and let
her go. The defendants on the other hand al
ways took the position that they did not wish to
buy her out No just settlement could be made
short OF legal settlement The affairs of the
w. d. Company must be settled and liquidated
Let her pay her note and contribute her share
toward the Indebtedness of the W ID. Comp0ny
inc Ill
they could, and Mrs. Cotton should have her full
share. They all knew that this was iInpOssible
Stanford testified that Wilson told him she was
not able TO pay the balance OF the million-dollar
note, and was unable to find any one able ana
willing to advance the money! Wilson fire.
quently argued with them as to the value of the
assets, and insisted that they ought not 10 stand
on their legal rights, but give her a liberal
sum- That whatever the present value of
the securities, they, knew that ultimately,
when their railroads were completed they
would get more for them. The defendants in
effect, said very likely; Then let Mrs Cotton
pay up, and we Will do as well for her as for our
selves And when reply was made You know
she can do that, and must sell, and is willing
10 take less than the real value; it was replied
Then II she cannot meet her obligations and
, must sell now, the values are matters of pure
speculation Mr.. Huntington arrived in Cali
iornia July 10Th. The next day after his arrival
Mr. Wilson urged him for Il compromise He
was promptly told that it was OF no use Hunt
ington did not wish to increase his interests in
California. They had all they wanted TO do
and would much rather she would keep her in
terest, pay the debts of the Western Develop
ment Company, and square the other accounts
and, II there was anything left let it be settled
in that way. Finally, however. if she insisted
upon going out, or was unable to stay in. they
would settle on certain terms These terms
We're not at all admissible and were promptly
rejected Wilson was, however. now in dispair
Twas idle to think really of litigation They
could not defend against the million dollar note
IL would soon be due, and to enforce that he
thought, meant the insolvency of his client
lie expressed his feeling in letter to Mrs Col
ton August 18TH
They stand very fixed on their first propo-
sition. They would not listen TO mine OF one
million of dollars, as we determined. They
seem relentless, immovable and inexorable
am sorely puzzled, but we need have no i'm
mediate fear of anything being done by them
not at least for ten days. In the meantime we
must clearly count our strength and calculate
the risk, and trace out all results to their posi-
pie end They ever refuse arbitration
they assume that they know values better than
all others, and evidently feel that they are mas
tiers of the situation.
DEFENDANTS DID not WISH To BUY PLAINTIFF
OUT.
He says he meant by this "they would not
advance dollar on their proposition, which
have related, and said that that was their
ultimatum, and inst they would not give any
more, and satisfied me at the time that that
was an ultmatun with them that il was not
said for effect, but was & matter for me to
accept il or not that that was the end of the
Cotton might go ahead and fulfill her contracts
they would prefer she would do so.'' He SAYS
also it had been mentioned several times in
their later negotiations that they did not care
to buy her out. They would do it at certain
prices, but would prefer that she should go on
and meet her obligations, and he enabled to
meet her advances Tor the needs of building
railroads, If they would be called for from
time TO time. They had not money to pay out:
they wanted money.
Further he says: = feel to Il considerable OK
tent that had not accomplished what hoped
to accomplish, and things looked disastrous
and bad and my inference was that they stood
upon their values they had fixed 10 the differ
cnt pieces of property which was before US
the Western Development Company, the rail
road company, etc; that they knew values bet
ter than other people. They felt that they were
Independent OF our accepting the PROPOSITIONS
that we could accept il or not, as we pleased -
This shows. think. very clearly the point at
issue between the parties, and also the precise
figure the estimates OF values cut in the negotia-
lions. The plaintiff all the time insisted upon
a lump Settlement-a settlement before the ma
turty OF the note i'll October. The defendants
whether sincerely or not, assumed all the way
through that they did not wish to settle or buy
her OUT They pretended, at all events. that
they preferred legal settlement Let the w
ID. Co. go into liquidation, or let Mrs Cotton paw
the note and advance enough to pay her share
ofthe claimed deficit in the W u. Co If YOU
insist ON our buying you out, however we viii
only do il on this basis. We believe these est1-
mates of value are fair, and we think we know
their value better than any one but If you
think differently pay up and we will give Won