The morning news. [volume] (Savannah, Ga.) 1887-1900, 1894-08-27
THEY WANT A RECEIVER.
4 Prayer for An Injunction AGAINST
the Electric Railway Company.

A General Insolvency of the Corpora
ton Alleged In the Petition-The
/ SIoss Iron and Steel Company, Nc
| Donough & Ballantyne and the
/ Palmer Hardware Company the
I Plaintiffs-An Alleged Combination
/ of Bondholders Who Win Not Ask
the Payment of Their Interest.
Bondholders and Creditors Expected
to Intervene To-day-The Hearing to
take Place Next Saturday.
a bin has been filed in the superior
court asking for an injunction and a re-
ceiver for the Electric Railway Company
Of Savannah.
The petitioners are the Sloss Iron and
Steel Company, the Palmer Hard ware
Company and McDoDough & Ballantyne
The total Indebtedness of the Electric
Railway Company to these three con
Germs amounts to 500.
The bill was filed Saturday night, and
though service has not yet been made on
the defendants, the fact that such a step
had been taken came out yesterday.
ALLEGES INSOLVENCY.
The petition alleges that claims to the
amount mentioned. held by these three
petitioners, have been presented and have
not been paid Under the Georgia law
three small creditors can, when the pay
ment Of their claims is not made when
due and demanded, go into court and ask
for a receivership.
The bill asks for an injunction and re-
ceiver on the ground that the company is
insolvent, and that if its affairs are con
tinued in the way they are going, the un-
secured creditors viii suffer loss
SAYS a POOL HAS BEEN FORMED.
II states that there is a bonded indebt-
edness on the property of the company
amounting to S250,0OO, which is secured
by first mortgage, and alleges that some
OF the DOndhOlders have agreed not TO de-
mand the payment of their interest, which
was due July of this year.
1t is said there is a clause in the mort
gage by which payment of this interest
can be deferred for two or three months,
but the bill alleges that pool or combina-
tIon of certain bondholders has been
formed, which has entered into an agree
ment that its component members will
not demand their interest for the present
The bill charges that this constitutes
fraud, as it tends to increase the indebt-
eduess of the company placing il in a
on interest. While the amount may be
small, 1t is urged that the unsecured
creditors ought not to be put to any fur
ther disadvantage.
RECEIyERsHIP ADVISABLE.
The bill is rather short one covering
only four or five pages of typewriter
matter. 1t alleges indica tions of insolv-
ency, and states that it is deemed advis-
able to have receiver appointed; that
-Ff, III, h., FOL. a.
gage fOreclosed, the property sold, reor-
gained and put on better basis.
The corporation being a large one, no
request was made for temporary receiver
and injunction. Judge Falligant issued a
rule to show cause before him next Satur-
day at 10 O'Clock as to why the injunction
should not be granted and receiver APP
pointed
The prayer for injunction asks that the
company be prevented from disposing of
us property in any way, or from changing
its condition by lien or otherwise until
the further order of the court.
A BONDHoLDER INTERVIEWS.
An intervention was also field by one of
the bondholders, Mr. Elton A. Smith.
who holds $1,000 of the bonds, and Judge
talligant signed an order making him a
party plaintiff to the suit. He adopts the
allegations in the bill praying that the
mortgage be foreclosed and the road sold,
meeting of some of the bondholders
who say they are not satisfied with the
way things are going, was held late Sat
urday afternoon, and it is said they will
also intervene this morning, and ask to be
made parties plaintiff 1t is understood
that some of them are connected with the
company officially.
There will probably be a number of in
tervenors, including unsecured creditors.
who will come in at once, now that the
initial step has been taken. The plain
tiffS claim they can make a formidable
showing on their side, so far as the bonded
Indebtedness is concerned, and that there
IS considerable dissatisfaction among some
of the bondholders with regard to the
more recent operations of the company
ana the course that has been pursued in
its management.
WILL PROBABLY BE FOUGHT.
There is no doubt that this petition will
be fought by those who are in charge of
the management Of the properly. 1t is
said the directors control large majority
of the bonds. The amount is put by some
at 30 per cent. This, of course. gives
them decided advantage, and it is be-
heved if there is to be a receiver ap-
pointed, they Will urge the name of
President j. 5. Collins for that position.
In fact 1t thas been talked that if a re-
ceivership were found necessary. and if
the initial step had been taken by the
company, that President Collins name
would be urged before the court as re-
celver for the corporation.
COUNSEL INTERESTED.
Messrs. Barrow & Osborne are asso-
ciated with Messrs. O'Connor a.
O'Byrne as attorneys for the plaintiffs in
this petition, and this fact calls to mind
| the report that was circulated some time
ago about the collection of some unpaid
coupons of the bonds of the Electric Kali
way Company for the purpose of institut-
ing such a suit. II could not be estab-
lshed whether this had anything to do
with the suit or not but it does not
seem that 1t has any connection, at least
with the present proceedings The ball
has been started rolling and il remains to
be seen what the next step will be.
Messrs. Charlton, Mackall and Ander-
son are the attorneys for the Electric
Railway Company, but they had not yes
terday been onicially informed of the suit.
A