The morning news. [volume] (Savannah, Ga.) 1887-1900, 1893-11-16
SEIZED FOR The STATE.
The Governor Takes Charge Of the
Northeastern Road.

atty OF the 1nOOrSeLnehL OA bAS 4 II : !
Mortgage Bonds in Order to Protect
the Second Mortgage President
of the Road Appointed Manager for
the State.
Atlanta, Ga, Nov 1.-THE
state of Georgia is again an active
magnate in the railroad world. To-day
Gov. Northen issued the following proc
lamation upon the seizure of the North
eastern railroad which reverts to the
state through a forfeiture of interest on
the bonds which the state indorsed during
Gov. Colquitt's administration:
State Of Georgia Executive Department
Atlanta. Nov -, 1S93.-A proclamation by
William j. Northern. Governor Of the state
OF Georgia.
Whereas, have this day been informed by
the Southern Mutual Insurance Company. OF
Athens Ca, by and through its president
Young l.. Harris that said company is the
owner OF certain bonds OF the Northeastern
Railroad Com pany- Endorsed BY the state Of
Georgia, under the provisions Of an act entt-
tied An act to open and construct railroad
from Athens, Ca. TO Clayton, Ca. via
Gainesville. in Habersham county, or some
other point on the Blue Ridge railroad near
Clayton by the most practicable route, ap-
proved Oct, p, 1870, In and to the amount Of
&24 600; and
Whereas. Ihave been further informed by
SAID president, that II mas pre-
sented the coupons for the
semi annual interest on the said
bonds due on Nov. l, 1898, to said Northeast
ern Railroad Company for payment and thal
payment thereof has been refused; and,
Whereas, 1t Is provided in the 10th sec
ton Of the aforesaid act that: In the event
any bond or bonds Endorsed by the state as
provided in the 9TH section OF this act. or the
interest that may accrue and become due
thereon, shall not be paid by the said
81 WAah nm "a rFHf VVFE
due it shall be the duty of the
governor on information of such default
by any holder Of SAID bond or bonds to seize
and take possession OF all the property OF said
railroad company and apply the earnings of
said railroad TO the extinguishmenG of said
unpaid bond or bonds or coupons, and he may
at is discretion, upon continued default in
such payments by said company for period
of SIX months, sell the said road and its
equipments and other property belonging to
said company, or any portion thereof, in such
manner and al such time as in his Judgment
shall best subserve the interest of all con
Cerned, provided that said road shall never di-
rectly or indirectly be controlled or man
aged or worked by the Central railroad,
which. if it occurs. shall forfeit the charter"
Therefore, 1, William J. Northen, governor
OF said state, do issue this, my proclamation
making known that l have this day seized
and taken possession Of all the property OF
said Northeastern Railroad Company, to the
end that the same with all the earnings Of
said railroad, may be held, disposed of and
of said act, and that Rufus X. Reaves has
been appointed the agent OF the state to re
ceive, take possession Of, manage and control,
subject TO orders from this department, all Of
the property OF said railroad company, seized
as aforesaid.
Given under my hand and the great seal Of
the state, at the capitol IN Atlanta, the 18th
day Of November in the year of our Lord
1898 and Of the independence Of the United
States the llsth.
w J. NoRTHEN, Governor.
By the Governor
PHILIP COOK, Sec'y of State.
LETTER TO THE AGENT.
In appointing Mr. Reaves the states
agent to run the road, Gov. Northen ad-
dressed him the following letter Of in
struction:
State Of Georgia, Executive Department,
Atlanta, Ca, Nov. ID, iS93.-To r. K. Reaves,
State Agent. etc, Athens, Ca: Dear Sir
In accordance with the proclamation issued
this day you are instructed TO take charge OF
all the property of the Northeastern Com
pany, OF the state and to hold the same as
the agent of the state, subject to such orders
as you may from time to time
receive from the department 1t is
your duty Immediately on taking
possession OF the company, to make
or cause TO be made, and return to this office
fun and comDlete inventory of the same
together with statement as to the general
physical condition OF the road You will also
send up statement Of the number and names
of the employees absolutely necessary for the
operation OF the road. designating as far as
may he practicable the special business and
duties OF each.
desire to impress upon you in this CON
nectlon, as have already done in personal
interview the very great Importance of an
economical administration OF your office and
OF the interests OF the road. Whenever you
are at any loss as 10 the management of the
property under your control you will
promptly apply to this ONCE for instructions
and until further orders you will on or be-
fore, the 10th day of each month make an
itemlzed statement Of the receipts ana ex-
pendltures OF the road for the preceding
month very truly, etc.
W. J. NoRTHEN,
Governor Of Georgia,
THE MAN NAMED AS MANAGER.
Mr.. Reavcs, whom the governor APP
pointed to take charge of the road, is
president of the Northeastern Railroad
Company. His salary is 10 be 81 500 per
year, and he is to be allowed to assist
him only enc man, an auditor, who will
draw about SIS per month.
The governor is going to run the bust
ness on an economic scale.
Ihere We're dozen other applicants for
the appointment given to Mr. Reaves,
among them Col. j. w. Robertson, rail
road commissioner, Col. Allen Candl er,
Judge Bailey Thomas, Hon. Pope Bar
row, ii. Ii. Carlton, and others.
THE DANvILLE's HAND.
AS mas Oeen puOllShed, the state is in
dorser on the first mortgage bonds of the
Northeastern to the amount of $3.50, 600
The road runs from Athens to Lula June.
ton, forty miles, and has been operated
by the Richmond and Danville, under q
lease. 1t has not been a paying venture,
and the Richmond and Danyille, which
guaranteed the interest on the bonds
forfeited it. Just here a sensational re
port comes in. The Richmond and Dan,
Vile holds $2l5,000 of the Northeastern
second mortgage bonds and, it lis
reported, will attack the legality of the
states Endorsement, though when the
executive office closed this afternoon
there was no definite information on this
point yet received. According to the re
port, the Richmond and DanviIle claims
that the Endorsement of the bonds was
unconstitutional. and therefore the seconC
mortgage bOndholders have the right O.
foreclosure.
WHERE THE POINT COMES IN.
The contract between the state and tn,
Northeastern Railroad Company was
made before the meeting of the constitu
tlonal convention of 1877, which pro
hlblJed the state from giving its aid OF
guarantee TO railroads, but the actual in
Gorsement did not occur until yeal
after the new constitution was adopted
and this is the point upon which tn,
Richmond and Danyille's attack, if it /.
made, will be based.
The seizure Of the road by the state ha!