The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1886-07-28
UNDESIRABLE LEASES.
Receiver Henderson Wants to Surrender Two
Lines of the l., B. & W. Eastern Division.

In the United States Circuit Court, yesterday,
G. E. Henderson, receiver of the Indiana
Bloomington 6 Western railway, filed report
asking instructions relative to the surrender of
the Cincinnati Sandusky & Cleveland, and
the Columbus Springfield & Cincin-
natl division of the system. In
March, 1881, the Indiana Bloomington g. West
ern leased the two divisions named for period
of ninety-nine years. The guaranteed rental
was $500, 600 per annum, which, it was agreed.
should be paid monthly in sums of $25, 900 EACH
in addition to which balance of SO 1-3 per cent
of the gross earnings and receipts should be paid
quarterly. The contract provided that eight
one thirtieths of the rental should be paid to
the Columbus, Springfield & Cincinnati company
and twenty two one -thirtieths to the Cincinnati,
Sandusky G. Cleveland company. and one-ffth
of the balance to the former and four-ffths to
the latter. Although the receiver claims in
his report that the rental was paid promptly
when it became due, in February, 1882, suit
was brought against the company for
for the first quarter, and for $18, 232. So
on rent for the second quarter
AS basis for this demand,
it was averred that the T., B. & w. should
earnings derived by the Cleveland, Columbus,
Cincinnati & Indianapolis Railway Company
from the operation of the road between Spring
field and Dayton instead Of 33 1-3 per cent. of
the rent reserved and paid by the l.. B. & w.
under a prior lease. The l.. B. g ". insisted
that it was required to pay only SO 1-3 per cent
OF all earnings and receipts which should come
into its possession and control This, however,
was not sustained by the courts.
The two leased roads have been operated by
the l.. B. & w. at heavy loss. The receiver
states in his petition that the average annual
thelease amounted to 1924, 238. The yearly rental
received under the lease 1914, lit, showing
that the lessons actually received annually 49,
938 in excess of the yearly net earnings derived
from their operation of the roads In the mean
time. up to April, 1885, the L. B. q w. expended
$3.50. 900 in .improving the two roads.
The receiver says that the location of the
roads and the competition at all important
points is such that it is utterly impossible for
him to operate the roads and pay the lessons
the amounts of their demands without incurring
heavy annual deficit. He thinks, further,
that it is impossible TO operate the roads and
pay the minimum guaranty of $500 900 a year
without heavy loss He therefore asks the in
structiop of the court as TO whether he shall
surrender the property, after an accounting, or
continue to operate the roads and pay the lessons
one-thrd of the amount which shall actually
come into his possession receiver For the
purpose of rearranging traffic relations and track
connections. the receiver asks that if the court
decides to surrender the leased lines he may first
be given ample opportunity to make the neces-
sary preparations for the separation of the lines
He says that the volume of business which the
l., B. d. w. sends eastward largely exceeds the
west bound traffic from the leased lines, and he
will be able, if directed, to make advan-
tageous arrangements with Eastern lines for
connections and interchange of traffic.