The Helena independent. [volume] (Helena, Mont.) 1875-1943, 1891-01-10
SAID TO 81 INSOIyENT.'
-
Asking That a Receiver be Appoint-
ed for the Steam Motor
Company.
The Northwestern Guaranty Loan
Company the Prime Mover
In tho Action.
Judgment Day In the District C0urt-Min-
Ing I.0GatiOns-A YelIOwstOne COun-
W Irrigation Company.

been asked for. The Northwestern Guar
anty loan company, which holds bonds OF
tho motor company OF tho par value OF
100000, has a complaint In tho United
States circnit court alleging that the con-
corn is insoivent and In a failing condition
and has no money in it's treasury to pay the
current expenses Of running and operating
the road, and is from day to day falling
behind in it's accounts; end that the secur~
ity OF tho loan ~company's bonds is being
diminished and will utterly be destroyed
and become of no account in q short time
unless q receiver Is appointed. There IL
also said to be great danger OF the motor
franchise being forfeited to the city Of
Helena.
On.Oct. %, 1890. Gilchrist Bros. Il Edgar
commenced suit in the district court against
the Motor compana for debt and to procure
the appointment of a receiver to Il
charge Of the company affairs and to obtain
n judgment decreeing such judgment q lien
on the franchise and demanding the sale OF
the property to satisfy the judgment. 1t
was also asked that the. judgment be made
a lien prior and superior to any claim OF
the Farmers Loan and Trust company. Of
The case was not heard in the district court
but was transferred to the United States
circuit court last Wednesday.
On May Il, 1889, the Motor company
made $50 mortgage bonds of the par value
of $1,000 each, to the Farmers Loan and
Trust company. The bonds are to be paid in
New York on or before June !, 1904, with
Interest at six per sent. These we're secured
by a trust deed. by it's terms 100 of the
bends we're delivered to the Motor company
for safe, the Northwestern Guaranty Loan
company being the purchaser.
The loan company claims that the trust
deed provided that the motor company OBJ
bonds the principal and interest ms they be-
come due, and that it would also pay all
taxes, charges and liabilities incurred for
labor and other expenses in the ordinary
course of business. Under the terms of the
trust deed the trustee was given authority
to take possession OF the motor line II de-
fault should continue for six months in the
payment of interest on the bonds. In case
Of such default the holder of one fourth of
the amount of the bonds could demand that
the trustee enforce the right Of the holders.
Gilchrist Bros. d Edgar OH the LIST of last
May obtained a Judgment against the mo
tor compan for $378. 92 for coal furnished
together with other claims. The district
court decreed that the judgment was n lien
IN the property of the motor company.
This Judgment, with a number OF other
claims, for a period of six months remained
unpaid. The loan company then made q
written request upon the trustee and offered
security and indemnity to enforce the
rights Of the bondholders under the trust
deed. This, the loan company says, the
trustee refused to do. On June /, $4,000
was due the loan company on the bonds,
| payment of which WAS refused by the
| Farmers Loan and Trust company. None
of the 100 bonds held by the loan company
nave been paid and no interest has been
maid nm than aiDCa January 1. ISM.
The motor company delivered to Il. ID.
Edgerton, in November, 1889, sixteen of its
mortgage bonds as collateral and gave the
company's promissory notes for .Y7,OV to
the Second National Bank Of Helena and
$1,000 to Edgerton, payable in one year.
The loan company claims that the issue of the
sixteen bonds was illegal and in contraven-
ton of the terms of the deed.
Gilchrist Bros. d Edgar also obtained a
Judgment in the district court against the
motor company for $2.299.Sl for materials
furnished. The loan company. in its cross
bill, says that this judgment was for the
fraudulent purpose of constituting. the
judgment a lien upon the property Of the
motor company superior and senior to the
lien of the mortgage deed of trust of the
Farmers Loan and Trust company. The
Judgment, it IS also claimed. was a fraud
upon the rights of the loan company, mas
much as it decreed the amount was due for
III IA IA kuNl plsc-Vsct
Of the Judgment was for money due On a
bill of exchange. Gilchrist Bros. d Edgar
claim that their Judgment is q lien and su-
perior to the deed of trust. Other judg-
ments OF the parties to this suit are also set
ont at length in tho cross bill, which are
claimed to be frauds against the rights of
the loan company, as they are not for work
or labor or materials furnished prior to the
execution and recording of the trust deed.
The loan company asks that the collection
Of the judgments be postponed until its
own claims are satisfied, or until tho prop
erty covered by the mortgage or deed of
trust is fully exhausted in the payment
thereof.
Against William Muth, who is the owner
of the judgments, the loan company alleges
that at the time he purchased them he was
a large stakeholder in the motor company
and still is indebted to the motor company.
| 800 for each share of stock.
The loan company represents that there
is $4,000 due in the subscription to the
capital stock of the motor company. and
that the directors have failed to call in the
subscriptions; that if such fund were paid
in it would be ample i'll connection with
other assets and property TO fully pay all
| Indebtedness.
The court will be asked to appoint a mas
ter in chancery to fully investigate all
claims, judgments and other matters III
connection with the corporation and make
a report to the court.
No action has taken by the court in the
case yet.
MORE JUDGMENTS.