Iowa County democrat. [volume] (Mineral Point, Wis.) 1877-1938, 1886-12-10
AN IMPORTANT DECISION
Judge Gresham Renders Decision on the
Wabash Bond Case.

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Wabash Bond Case.
CHICAGO, Dec. Judge Gresham
rendered his decision in the now famous
Wabash receiver case, this afternoon.
suit of the bond holders of 1867 and 1879
for the foreclosure of all lines of the
! Wabash system east of the Mississippi
river, and also the Beers bill for the
foreclosure of mortgageg on - Chicago
division. Judge Gresham gave lengthy
opinion, reviewing the whole case from
the time the receivers were appointed in
| 1884 to date, together with the lease of
the Wabash company to the st. Louis and
Iron Mountain company. The court also
reviewed the efforts of the purchasing
committee to reOrganize the company
and place it on a new basis and indicated
that said committee had signally failed
in all its efforts. There was no ploba-
bility of its even succeeding in putting
the corporation on surer foundation.
The procedure on which the receivers
were appointed was severely criticised.
Their appointment was originally made
by the United States court at St Louis on
the application of the company itself.
Another scathing feature of animadver-
sion by the court was certain orders which
from the court authorizing the receivers
to use the net earnings of the lines to
pay the coupons of such bonds, the hold
ers of which assented to the plan pur-
sued by the committee, while the coupons
of other bonds were ignored and left I'M
paid. The court said that the order ad-
verted to this taken with the four million
dollars OF floating ind -btedness of the
Wabash company that had been held as a
menace over the heads of non-assenting
bondholders as a measure of coercion
by the members of the purchas-
ing committee, and the Judge did
not believe that the court at st. Louis
supposed for the moment that the order
given would be used as it had been, other
wise it would have never been granted.
The order referred to was made Septem-
Der p, 1886. Judge Gresham decided
that he had jurisdiction, for the reason
that the bulk of the property covered by
the mortgage in question, was chiefly in
this district and that proper showings
have been made on mortgages on which
foreclosures have been asked. He held that
they should be foreclosei and the present
receiver removed. Leave was therefore
given to the mortgage hondholders of
81 and 10, to file the bill in the United
States district court at Springfield, ask
ing for receiver for their property. 1t
was held that the application for the ap-
pointment of a receiver for the Chicago
division of the system could be filed here
and would be entertained. They were, it
was held, entitled to such receiver and
their case, from the showing made, was
good. In the course of his decision.
Judge Gresham said that it had been
40 nl,,, -Aa4 81
Russell Sage, Jay Gould, Sydney
Dillon. Charles Ridgely and Hopkins
were the sole owners of the stock of the
Ellsworth coal II ines ard that it had been
also made plain that Humphreys, as re-
ceiver had bought vast quantities of coal
of himself, as the Ellsworth coal com
pany, paying more than the market
price. The judge also said that it was
plain that Humphreys as receiver of the
Wabash had made a rebate in the freight
charges to himself as the Ellsworth coal
company, amounting to nearly 100000,
or more than the total c. pital stock of the
coal company. The court said: There
is evidence tending to show that the
price for coal purchased for use was too
high, and that the freight upon the coal
was too low. The relations which these
tive corporations sustained to each other
exposed the owners of stock and the
coal company to the suspicion of intend
ing TO benefit the company at the expense
of the Wabash company"
All Differences AmieabIy Settled.
CHICAGO, Dec. "A Daily News special
from Indianapolis says: A conference of
the arbirrators representing the operators
and miners OF Illinois, Pennsylvania and
Ohio, was held here to-day. After a
secret session of scversi hours a ami
cable adjustment of all the differences
was reached, except on the question re-
garding the price for mining soal when
vein Is not of the usual thickness. The
action on this point was deferred till the
annual meeting in February.
The certain reaction came and all ia