Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1890-03-21
LUCKY FIDELITY.
THE TRUST COMPANY WINS THE SHENANDOAH
RAILWAY SUIT.
Decision Of a Famous Case in the State Supreme
Capitalization Involving Millions Of
DOllars--The Trust Mortgage Bonds
Preferred Claims.

Special telegram 10 he Register
CHARLESTON, W. Va, March 90
The celebrated chancery case of the
Fidelity Insurance, Trust and Safe De-
posit Co. against the Shenandoah Val
ley Railroad Company, was decided tn
the Supreme Court to-day. The Fidel-
ity Company gains all it contended for,
and the Jefferson county Circuit Court
is reversed on every point The case is
a famous one. The shenandoah Valley
Railroad Co. is two hundred miles long,
extending from CharleStown, jefferson
county. 10 Roanoke, Va. The Fidelity
held a number OF mortgages against the
road. The Central Improvement Com
pany also held claims against the road,
and i'm 1S7S agreed To accept second
mortgage bonds and income bonds of
the road in the amount of their claim.
The mortgages of the Fidelity were
consolidated and first mortgage bonds
10 the amount of $4,000 Il mile issued
to that company. The second mortgage
bonds were never delivered TO the Cen
tral Improvement Company, and liti-
CATION was entered into 10 determine
the priority of claims against the road,
the Improvement Company claiming
that its claim was of prior standing To
part of the original mortgages of the
Fidelity Trust Company. The litiga-
tiOn practically involved the ownership
of the road, for it was recognized that
the road would hardly sell for more
than enough to pay the Fidelity bonds.
The suit came up in the Jefferson
County Court before Judge Duckwall,
and was argued by John c. Built. of
Philadelphia. and Caldwell Il Cald-
well, of Wheeling. for the Fidelity Com
pany; Hon. ID. B. Lucas. of Charleston,
and Mcdonald n Moore. of Virginia, for
the Central Improvement Co., and Hon.
W. II. TraverS. Of Charleston, for the
Shenandoah Railroad Co. \ decision
was rendered. preferring the Central
Improvement Co. : claim To the amount
of Sl25, 900. though the whole claim was
about 500, 900. Both parties took an
appeal. and the case was argued elabO-
ratcly before the Supreme Court last
winter.
The decision to-day is that the Cen
tral Improvement Co. is entitled To
equitable compensation for failure TO
deliver the second mortgage bonds, bnt
this compensation must be subject to the
first mortgage bonds held by the Fidelity
Company as trustee to the amount of
Sl5. 900 per mill at six per cent. per am
mum interest. The amount of cOmpcn-
Sation allowed the Central Improvement
Company is fixed by the face value Of
the bonds which We're TO be delivered to
il under said agreement aS follows;
$3.50. 600 with interest from the first day
of April 1874, subject To credit Of SILL
600: and and a further sim Of S379. 224
without interest The first sum rep
reScntS the second mortgage bonds
and the second sum of 1879, 22I
represents the income bonds. What is
known as the philadelphia record
and attachment" was held, no bar to
recovery by the Central Improvement
Company except rs an Offset to the in
tcrcSt Of the Sll.OOO mentioned above.
The prioriticS in the proceeds of sale
when the road is sold. is fixed rs fol-
lows:
First-Proper costs of plaintiffs in
these causes.
Second - Receivers certificates or
charges under the receiyerShip.
Thrd-The first mortgage bonds with
interest thereon at & per cent. per an
mum To the extent of $4,000 per mile.
Fourth-To Central Improvement
Company S25O.OOO with interest from
the first day Of April. 1879, with provi-
sion to meet the contingency of inSuilic-
icncy of proceeds as indicated in decree.
Fourth - To Central Improvement
Company the further sum of S379.22i
with interest from this date.
Fifth-One per cent. interest ON the
said first mortgage bonds of April lSt,
1850
Sixth-BondS secured by general
mortgage April 5th. 1883.
Seventh-lncome mortgage bonds OF
February l2th. 1883.
Eighth-Such receivers certificates as
cannot be paid under second class above
specified.