St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1890-11-04
THIS ENDS THE SUGAR TRUST.
Judge Pratt Decides That Two
Receivers Are Necessary.

NEW YORK, Nov. 3.-Judge Pratt, Of
the supreme court, in Brooklyn. rem
dered his decision this morning in the
sugar trust litigation. 1t is volumi-
nous document, and recites the issues
at stake very fully. The cases involved
are known as tho suits of Cameron
against Havemeyer, and Havemeyea
againt the Brooklyn Sugar Refinery
company. The judge justifieS the orig
inal injunction restraining the plan of
reorganization, but says that it has been
superseded by the publication of the
plan under consent of both parties. 1t
as the plaintiffs say in their own bill,
the original trust agreement be void.
certainly they ought not to attempt to
perform the duties which its language
imposes upon them, because such acts
would constitute further OtfenSeS
against law which would subject the
corporations composing the trust to
furtetureS of their charters. Besides
they profess to be DESTROYS of being
relieved from the responsibilities of
their positions. At present his honor IS
disposed to view the trustees as merely
custodans of the property OF the trust.
He holds that the original stockholders
of the corporation having delivered
their certificates TO the trustees with au-
thuritv to issue trust certificates repre-
Senting undivided interests in the pool
the original stockholders are eStopped
from questioning the title Of the pur-
chasers and holders of the trust certiii-
Gates. The holders of certificates de-
rive title from the stockholders OF the
corporation, and not from the trustees,
who have merely executed author
ity derived from the stockholders. But
ie fn -
the legal title is, because the trustees
concede in their bill that they hold it
for the benefit of certificate holders. De-
PENDANTS are therefore in possession
of property belonging eqUitably to
others, which came into their
hands under an agreement vote to the
main purpose for which it was made,
and which they cannot legally use for
the purposes for which it was placed in
their hands; and they are utterly power
less to convey and give good title or
to distribute IL to its rightful owners.
As to the objection that Cameron'S
stock was not transferred when he sued,
his honor holds that it is unfounded;
besides that. no question is made about
Mr.. GieaSOn's title. 1t is not a case
where majority can cOerce minority
into any new scheme of reorganization,
as the holder of a small interest is en-
tilted to as much protection as the
holder of large interest. The object
of the trust having failed, each certif-
stakeholder has right to demand that
the affairs of the trust shall be wound
up, and that he have his share of the
joint property. His honor knows of no
may by which this can be accomplished,
except by unanimous consent of the
holders, or by application to
the courts. Meantime the disposition
of the property is the vital ques-
as to endanger the corporations
or be taken by the court and held intact
for all those interested in it? Shall this
vast amount of property be left in the
hands of board, acting without any
defined duties or restrictions, without
any legal authority and subject to only
the will or discretion OF a majority of its
members? 1t is conceded that at some
time the court must appoint some per-
son to dispose of the property and divide
the proceeds. Certificate holders ask
for Immediate settlement of the trust.
The trustees claim that the proper time
had not arrived to interfere. as there is
plan of reorganization. The answer
is that receiver Will not interfere with
proper plan of organization. The fact
| that there are 1,600 certificate holders
shows that no disposal OF the property
can be made without a receiver, or
equivalent officer. Indeed, in case any
legal and satisfactory scheme of reor-
ganization is proposed. his honor saw
no reason why these certificate hold
ers composing it may not have
their share or the bulk turned
over to them, always leaving
enough of the property in the hands of
the receiver to meet the demands of
creditors and certificate holders who
don't come into the new scheme. The
court then cites various authorities, CIV
ing his reasons for appointing a re-
ceiver, and then concludes by saying
that "both parties may submit nomina-
tionS for appointment of receivers, with
proposed orders or decree on Or before
Thursday next. the nominations to be
left with the clerk. The amount of
bonds will be fixed at the time OF NAM
ing the receivers"