Abilene weekly reflector. [volume] (Abilene, Kan.) 1888-1935, 1889-11-07
THE ROCK ISLAND MORTGAGE
The Facts Relative to the Recent
Foreclosure Suit Instituted in the
United States Circuit Court.


United States Circuit Court.
TOPEKA, Kas Ger. 2S.-[Special
correspondence On the 11th day of
October meeting was held in Topeka,
composed Of the county attorneys of
the various counties through which the
Chicago, KaI sas & Nebraska (Rock
lsiand) railroad runs, for the purpose
Of discussing the recent foreclosure
proceedings instituted III the United
States circuit court against said rail
road company. This meeting was
called by r. W. Griggs, county attorney
of Meade county, and in his call TO
other county attorneys set forth, among
other things, that ''tbe counties
through which the said road passes in
Kansas, have in round numbers over
| 81 ,0GG, 600 invested in the stock of said
road. This will all be swept away if
we do not make common cause To
thwart the ail-to0-evident purpose of
the trustee, in conclusive cooperation
with the Chicago. Kansas e Nebraska
and tie Chicago, Rock Island & Pacific
railways" That your readers might
have the truth, in view Of the fact that
the c. X. & y. and C. r. l. & p. rail-
roads have been charged with an at
tempt to defraud the people living
along the line of the G.. K. & n. out of
81, 900, 0OQ, your correspondent felt
called upon to furnish your readers
with the facts in the case.
find that on the 4th day of July,
1884, the Chicago Rock Island & Pacific
Railway company executed first mort
gage on all its property, called an ex-
tension and collateral mortgage. In
this mortgage it was provided that all
bonds executed under its provisions
should be secured either by a direct
lien of this mortgage, as first mort
gage Of one or more railroads and APP
purtenant property owned by said rail-
way company, or by deposit of col
lateral bonds, secured by a first mort
gage of one or more railways and rail
way property, which by lease or traffic
arrangement, shall have been made at
he time part of the railway system
of the Rock Island company for the
transportation of through traffic. The
money with which the Chicago, Kansas
& Nebraska railway was built was pro-
vided by the Rock Island company from
sale of its bonds issued under this
mortgage, and secured by the bonds of
the Chicago, Kansas s. Nebraska Rail-
way company as collateral. The Rock
Island mortgage further provides that
if the obligors in any of such collateral
bonds shall fail to make payment of
either principal or interest thereof, it
shall be the duty of the trustee to cause
proceedings to be instituted to fOreclose
the mortgage by which such collateral
bonds shall be secured. The Chicago,
Kansas & Nebraska railway is operated
by the Chicago; Rock Island & Pacific
Railway company under lease which
requires the Rock Island company
to pay thirty per cent. of the
gross earnings of the railway of the
Chicago, Kansas & Nebraska Rail-
way company. As matter of
fact the net earnings of the Chicago,
Kansas & Nebraska railway do not
amount to thirty per cent. of the gross
earnings by very large sum. The
Rock Island company is, therefore, COM
PEELED to pay not only the difference
between thirty per cent. of the gross
earnings of the Chicago. Kansas s. Ne
braska bonds, but, also, to make up