The Corvallis gazette. [volume] (Corvallis, Or.) 1862-1899, 1892-05-13
THE OREGON PACIFIC.
FULL TEXT OF THE DECISION.
Judge Deady Orders Both Parties to Enter
into a Stipulation.

| Is about at an end, and that the road Will
soon be put on solid financial footing
again, as in the United States circuit court
last Monday Judge Deadly rendered de-
cision in the case of Linnley Smyth ct al.
VS.. T. Edgenton Hogg ct al. on the motion
to issue an injunction to restrain defendants
from receiving or assigning a certificate of
the sale of the Oregon Pacific railroad and
it's property. The case was argued and sub
mitted week ago.
The following is the full text of Judge
| Deadys opinion and decision.
| OPINION.
JUDGE DEADF On February lG, 1892,
Lindley Smyth. George De B. Klein and Jo-
seph Warton, bondholders i'll the Oregon Pa
cifc railway company filed bill in this court
against T. Egentou Hogg, Zephin Job, and
| William Mackay to enjoin them from trans
! ferring certificate of sale of the road under
a decree of the Benton county circuit court.
| Zephin Job was the bidder; VIM. Mackay
was the sheriff. A restraining order was
| allowed, and order issued to show cause.
| Mackay the sheriff of the circuit court, and
| he was allowed to deliver the certificate if
| he saw proper to Zephin Job; but Job was
restrained from disposing of it, or transfer.
ring it i'll any way. A few days since the
| parties showed cause, and the matter was
| heard.
| The bill showed that the company was
| largely in debt, and on last October failed
| to pay its interest that the Farmers Loan
| & Trust Co. vino held the mortgage against
| it as trustee for the bondholders, brought
| a suit to enforce the lien of the mortgage,
| and decree was entered for the sale of the
| property, to be sold for not less than mil
| lion dollars The bill alleges that there
was an understanding between T. Egenton
Hogg, the president of the company, and
the bondholders represented by the COM
mittee of the bondholders, that the property
should be bid in for their joint and mutual
benefit, and that there should be new
company formed which should float the new
| bonds and retire the old ones and set the
concern on it's legs again. The material al
legations of this bill are contained in the
sixth clause, and are as follows:
Hogg answers the bill and files an afhda.
Wit denying utterly and absolutely having,
or ever having had any such purpose; and
there is nothing in the case from one end to
the other to show that lie had any such in
tention. There is an answer of Job to the
effect that he bid off this property for him
self, that he did not bid it off for the bond
holders. In further showing by Hogg and
assented to by Job, it appears that he bid it
off at the request of Hogg, Hogg being in
New York and telegraphing him to bid it
off and furnishing him the $4,000 with
which to make the first payment. There
was no particular explanation as to whom
he bid it off for and whom he did not bid it
off for; but really he bid it off for Hogg and
bid it off as the agent of Hogg, and what
ever purpose Hogg had in the matter ulti.
mately was his purpose. AS said, there Is
no evidence in the case to show that Hogg
ever threatened or had purpose to leave
these bondholders out in any reorganization
OF SGUtleIilGHL Ol HfdItSi, 10 phio
material allegation of this bill without it
there is no case. Hogg admits the arrange
ment made between the committee of the
| bondholders and himself as alleged in the
bill. and is willing to carry it ont. The
| vice in this arrangement was that they
made no provision for the payment of the
bid under this arrangement. The bondhold-
ers say that they understood that Hogg had
negotiations with foreign capitalists by
which he was to obtain the money to pay
this million dollars and other expenses in
| cident to the sale, through his own means,
| by himself. But he denies this, and there
is no proof of it; the proof is to the coH.
trary; but they made this arrangement,
went into this business, and made no pro-
vision for the payment of the bid. Tney
| admit that they made an arrangement to is
sue new bonds, to issue new mortgage, a
new company to be organized; but that
could not be done until the bid was paid
| that had to be done first, and it was over.
| looked altogether. 1t is not reasonable te
expect that Hogg was going to pay, this mil
| lion dollars himself cut of his own pocket
| for the benefit of these bondholders, and
there is no proof that he agreed to do it
the proof stands to the contrary. Logically
speaking, it ought to be dismissed. Hogg ii
not in fault any more than they are all il
fault they have made no provision for tn.
payment OF this bid, and the proceeding
come to stand.still unless Hogg viii
raise the money. or they will raise tn,
money. All the circumstances considered
think will do justice to these parties aut
facilitate settlement of this matter, which
I think is very desirable.
The following is the decree as finally set
tied by the judge.
In THE CIRCUIT COURT OF THE UEITEl
STATES, FOR THE DISTRICT OF OREGON.
Lindley Smyth, Georgel
d B. keim, Joseph
| Wharton, Plaintiffs,
1 vs.. r,
T. Egenton Hogg,
Zephin Job, William
4 Mackay, Defendants.
This case was heard upon the bill o
complaint and the answers thereto of th
defendants, T, Egeaton Hogg and zephil
job, and the affidaviss and exhibits tile'
! herein by the respective passies on th