The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1893-12-29
AN ATTACK ON CAKES.
Mp. Directors Ask for Removal
Of the Receivers.
LONG CATALOGUE or MisDEEDs.


enc kAIfJ3a ADm pB1y. W sass W. Sssfss
Of Phiia6eiphia. iss general counsel. today
filed before Judge Jenkins. OF the United
States court, petition for the removal OF
the present receivers OF the road, Thomas
r. Cakes. Henry c. Payne and Henry G.
Rouse.
The bill covers the same general ground
rs the Ives committee report Of about .
year ago, and declares that Cakes. - presi-
dent Of the company. appointed 4. o,
Eaiston. president Of the Farmers' Loan
and Trust Company, OF Scw York, chair
man OF the finance COMMITTEES OF the road.
At this time, IL IL asserted, the line as In
good financial condition and had 81 90. 600
cash in the treasury. The oskes-Raiston
board managed TO increase the interest
charges for branch lines from so, COG. 600 70
$50 coo. 600 inside of one year for the ac-
QUESTION OF properties which, with one
small exception, have never paid the cost
Of operation.
The petition further charges that the
officers and directors were themselves in-
tsrested In selling properties to the North
ern Pacific company at an exorbitant
profit TO themselves. The petition names
in detail the railroads thus acquired by
the Northern Pacific and which thus COM
pieted its ruin within one year OF
the oakes-Raiston board getting into
power. IL siieges that in the construction
OF the United Railroads of Washington
the msmbers Of the board derived profit
of si.7500o0, while iss operation cost the
company In the year ending June 30. 1859.
SIS, 600. IL 10 charged that q syndicate. Of
which Henry Willard was president and
which included many members Of the
Northern Pacific board of directors,
divided among themselves s. oo0. 90 in
trnst certificates of tho Rocky Fork 4
Cook City road. OF which 5000, 600 repre-
sented coal lands worth only 500. :
o0 and the other 100000 the Rocky
Fork road. which cost about $500 900.
This road the directors caused the North
ern Pacific 10 buy from themselves for
81 $00. 90. BY similar met hods the direc-
tors are charged with making profit Of
$4,000. 000 out of the Northern Pacific &
Manitoba deal, this line having been oper-
ated at q loss of $500 900 annually to the
company. Also the directors guaranteed
interest on SIS. 0oo. 600 additional bonds of
railroads as branches TO its system, and In
no single instance have the earnings been
equivalent to the interest so guaranteed.
Charges of = simiiar nature ara made in
connection with tho construction and
operation Of the Seattle, Lake Shore &
Eastern. Matters pertaining to the Chi
cage a Northern Pacific are treated st
great length. II is claimed that the price
paid for this lire and depot at Chicago was
so. 600, 600 In excess OF the cost of the
property conveyed. and that the profit
from this deaf was divided among many
Northern Pacific directors. The bill con-
tains many minor allegations OF extrava-
CANT and reckless management by the men
whom the court 10 now asked to remove
o. receivers.
The petition shows that in consequences
OF this reckless waste of the company's as
sets and addition to It's obligations tho
credit OF the company rapidly deprecated,
so that tho floating debt could not be
taken care OF, and that by collision of
oakes and Raiston a bill was flied TO- the
appointment of receiver and Cakes recon-
mended as such. which bin was flied with
out tho knowledge of many of the directors
OF the compony, who we're kept in ignor-
ancc that any application for receiver had
been prepared or was necessary. The Pc
tition shows that receivers were obtained
for fifteen branch lines, the expenses OF on
GRAFTON being thereby largely increased;
that in all twenty-three different sets of re.
ceivers were appointed by, aud subject to.
the jurisdiction of six different courts,
adding enormously TO the expense of op-
Grafton, besides receivers fees, lawyers
fees and court expenses. The petition
AYERS That the stockholders. represented by
the board of directors. have cause of action
against the late directors, including Cakes
aud Kalston. for the various transactions
set forth; that IL Is necessary for the new
board to have free access TO tho books and
accounts. that. inasmuci as actions for
restitution must he brought in the natnes
OF the receivers and IL is not competent for
Cakes TO sue himself. therefore il is ahso-
iusely necessary that ha be removed and
snotner receiver appointed in his place
that it is necessary that reorganization
should be had whereby the property can
be put upon solvent basis, aud this cam
not he done and tie large sums OF money
raised which will Re necessary TO bring il
about so long as the company is managed
by receivers appointed at the instance of
and in sympathy with the board of iirec-
tors whose fraud and incompetence have
wrecked the company; and that the re-
eeivers should be- removed aud new re.
ceiyers appointed IN whose management
the stockholders and the public have con-
hdcnce. so tina, they can formulate and
carry out a plan OF reorganization whereby
the eomrany's debts can he paid and ID
can be restored to a solvent basis.
MILWAUKEE, Dec. -. 49, Receiver Henry
q. Payne. of the Northern Pacific. .sid
with regard To the petition of stock holders
Of the rood seeking the appointment
nt new receivers, that he and
his colleagues have faithfully and
diligently undertaken 60 aa,ninis,sr
the trust placed in their charge, having
in view only the preservation aud man.
agemeai in such way IA will In the
quickest time place the company on is
iset The old management has not in the
least degree tried 20 influence the action
at the receivers. He cited the stand
taken concerning the Wisconsin Cen.
trail lease a. an illustration. The
ansinuation that the receivers are incor,.
reient needs. be said. no answer in their
own communities. He asserted tina.
Cakes IS cue og the ahles. rail-
road men Ia the county, while Rouse
IS quite "a we'll known, being al
present chairman of the executive board
- the Missouri. Kansas & Texas railroad
Payne looked upoa the movement as an
ellogt 10 transfer 10 the court.
Vail street feud which has ioaS
existed between TWO opposing fac
sioas OF tho road. lie personally dna.
vowed any snleation to 10 anything Tor
ctaeE taaa the hes; interests Of tAe coga
paay, and Characterised charges and coan.
ieT-ehaFges in tAe Wall street controversy