The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1886-09-15
The Great Niokel-Plate Lawsuit.

CLEVELAND, o., Sept l4-The trial OF the
great three-cornered Nickel-plate foreclosure
suit was begun in the Common Pleas
Court here to-day. Millions of dollars
are involved in the case. The validity
OF frst~mortgage bonds, amounting to
600, represented by the Central Trust
Company of New York, is attacked by various
defendant creditors of the road, on the ground
that the Nickel plate railroad, which claims to
be consolidated corporation composed of five
separate corportions. never became properly or
lawfully consolidated into such corporations that
the facts and condition of things existing did
not authorize it; that no law authorized
the consolidation of company in this State
with companies not adjoining, and that the al
legged corporation therefore had no power to
make the mortgage. 1t is claimed by contest
ants that the mortgage was fraudulent, and that
large amount of the bonds secured thereby
were issued to members of the syndicate who
formed pool to construct the road without con.
| sheraton. and that the road never received
one-third in value of the amount of the bonds,
stock and preferred stock issued to the mem
bers of said syndicate All the charges are con-
troverted on behalf of the bondholders.
A defense very similar to the above is also set
up as to the million-dollar mortgage repre-
sented by the Union Trust Company of New
York. There Is also involved in the case con-
troversy amounting to several millions of dollars,
on the claim of Shether e. McGourkey, that they,
as trustees, the owners of all equipments Sin
use on the road. Their claims that the sale of
all these things to the road was merely a condi-
| tional sale and never paid for, and that they
entitled to take them and have large
compensation for their use, are all more
or less consroverted by other parties.
is claimed under the mortgage by the trustee on
behalf of the various bondholders. In addition
to these there are numerous other issues The
Lake Shore Railroad Company is claiming on
i'll AAe l~tR III
Hollins & Co. for about two million more and
both claim that the entire property should be
| sold and the proceeds equally divided among all
the creditors of the road, regardless of the ques
ton of mortgages. which they seek to have de-
clared null and void. The various interests in
the suit represented by prominent attorneys
of New York, Cincinnati, Detroit and this city.
To-day was taken up by the reading of deposit
tional testimony as to the issue of the bonds.
The Right TO Buy or BniId Railways.
Topeka, Kan, Sept 14-In the United States
Court the opinion of Judge Brewer was filed this
morning in case of great Importance. involving
the powers Of the Atchison, Topeka & Santa Fe
Railroad Company to extend its line into other
States and Territories outside of Kansas. The
| suit was brought by Clarence Fl. Venner, of Bos.
ton, to restrain the Atchison company from &C.
| curing the Gulf Colorado e. Santa Fe rail way
| in Texas, and from building through the Indian
| Territory to connect with that road. Venuer
who was a stakeholder. claimed it was viola.
| ton of the charter of the Atchson company to
| purchase other roads, and that the laws of Kan
| sas did not authorize such purchases. The case
was argued in July, and, on account of its i'm
portance, was taken under advisement by Judge
| Brewer. The Judge sustains the power of the
| Atchison company to acquire the Gulf, Colorado
| 81 Santa Fe, both by virtue of its charter and of
subsequent statutes of the State of Kansas
| The opinion is very lengthy, and is an exhaust
i've discussion of the powers of railroad corpora
| tions, and especially of the Atchson. The court
decides that this company was originally incor
| porated with the distinct purpose of extending
| its line enthusiastically to Santa Fe and south
wardly to the Gulf of Mexico and that acquisi-
ton OF other lines beyond the limits of the State
| of Kansas was but carrying out the original
| plan of its projectors. In addition to this the
| decision holds that the general laws of Kansas
| permit railroad companies to extend their lines
| beyond the borders of the State. The contract
| between the Atchson and Gulf companies, which
was made last winter, provided for an exchange
| of the stock Of two of the companies, and Judge
| Brewer holds this to be lawful and proper ex-
ercise of power of the companies. aud that Ven
| ner cannot be permitted to buy the stock of the
| Atchison company and then come in and attack
| its validity or the validity of its contracts.