New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-05-05
"GETTHE NEEDED DUMMIES"
LIGHT ON NORTHERN PACIFIC.
DAVID S. WEGG'S INSTRUCTIONS ON THE
CHICAGO TERMINALS.


WILLARD AND oTHERs-How THE CON-
BINATIoN WAS MADE-FRIENDs
OF CHARLES l.. COLBY ON
HIS DEPARTURE.
The Master in Chancery appointed by the WIS
consin Court to take testimony in the Northern
Pacific Railroad litigation Is expected to begin
hearings in this city next Wednesday There is
a prospect of sensational testimony, unless there
is deartn Of witnesses resulting from the alb
sence Of men who were formerly connected with
the Willard regime, either as directors or counsel
of the Northern Pacific. Enough documentary
evidence has been unearthed by the present
officers of the company to encourage them in
the hope that they can achieve success In pro-
ceedings for restitution OF alleged Illegally d.
verted funds. The absence of Charles l.. Colby,
Henry Willard and David s. Wegg is regretted
by the plaintiffs in the proceedings. but there
is said to be enough material on hand in the
expected testimony of other witnesses and in
documents that have been discovered to make
the proceeding one OF the most interesting ever
instituted in the history OF railroad con-
troversy.
The progress of the proceedings begun by the
present management of the Northern Pacific for
a review Of the acts OF the past management
has been attended by significant movements
among the Chicago and Northern Pacific stock
holders. The annual meeting Of this company
is held on March l. according to the regulations
OF the company The meeting this year was
adjourned to April l. No meeting was held on
that date. but soon afterward Judge Jenkins OF
the Wisconsin Court which has the Northern
Pacific under its Jurisdiction. granted the
authority for the taking Of testimony In the
proceedings for the removal of Thomas f. Oakes
as receiver-proceedings intended to reach Henry
Willard. Charles L. Colby. Edwin II. Abbot Col
gate Hoyf and others concerned in the North
ern Pacific management After Judge Jenkins
had allowed the Master in Chancery to begin
his investigation, meeting Of the Chicago and
Northern stockholders held on April IS. and
Mr.. Wegg retired as president and Henry s.
Boutell as secretary. Mr.. Wegg sailed for
Europe last Saturday and Mr.. Boutell while
still in the country, could not be found when the
plaintiffs tried to serve subpoeras short time
ago. These changes in the management of the
Chicago and Northern Pacific were followed by
the necessity of one of the receivers of the road
appealing TO the Wisconsin Court in order to
secure access to books papers and documents
which they alleged were withheld by William
Nelson Cromwell. counsel of the receivers Of
the Northern Pacific.
REORGANIZATION HELD IN CHECK.
The reorganization Of the Northern Pacific
Railroad has been held in check by the develop
ments which followed the overthrow OF the Viii
lard management last October. The stockholders
took possession of the property after the company
had been placed in the hands OF receivers in
August, and they have been struggling ever since
to obtain some voice in the management as d.
tbn oryarG
can win their suits against the former directors
they will be able to recover property worth
millions Of dollars. This restitution may make
a great difference In the company's cash neces-
stiles and change materially the terms of treat
ment in any reorganization plan. Of the different
classes of securities and the stock. The present
managers who are seeking a restoration Of
funds alleged 10 be improperly diverted. have
offered no plan Of reconstruction and will not do
so until they know whether the courts Will con-
firm the past record Of the Willard interests.
The Northern Pacific people have just put in
evidence before the Master in Chancery, who is
now taking testimony in the pending proceed
ings. a letter which reads like a page OF
romance To understand its tenor the follow
ing facts must be recited: In 1885, 1t Is alleged,
Colgate Hoyt Edwin II. Abbot and Charles l..
Colby began buying up property In Chicago,
with a view TO the organization of a big terminal
company. In 1889. after Henry Willard had re-
turned to this country with fresh foreign capt.
tai to invest in Northern Pacific. there was hot
controversy among the company's managers over
the proposition to lease the Chicago and North
ern Pacific, which had absorbed the property
gathered by the Hoyt-Abbot-Coby combination.
The lease opposed by Frederick Billings,
Robert Harris. John u. Brookman and Brayton
Ives all of whom omitted from the
board Of directors by the Willard party in the
following October election The board had in
May, 1882 agreed to a traffic arrangement with
the Chicago and Northern Pacific that did not
impose any penalty upon the Northern Pacific.
LEASE OF CHICAGO AND NORTHERN PACIFIC.
In April. 1890. after the objecting directors
had been expelled from the Northern Pacific a
lease was made Of the Chicago and Northern
Pacific property which, according to the report
of the receivers OF the Northern Pacific, has cost
the last-named road s2,500O0O for its operation.
This lease is declared to have been saddled upon
the Northern Pacific property at a profit to the
Hoyt- yt-Coby-Abbot-Villard syndicate Of millions
of dollars The Chicago terminals. which went
with the lease acquired through a con-
solldation OF the Chicago and Great Western.
the Bridgeport and South Chicago. and the Chi
cago, Harlem and Batavia Railroad companies.
In the following letter the names Of these COM
panes are abbreviated to initials This letter
is one sent by David S. Wegg, counsel of the
Northern Pacific from New-York, to Henry s.
| Boutell. in Chicago. and ii tells a story OF the
| preparations made month before the lease OF
| the Chicago and Northern Pacific to the North
| ern Pacific. Following Is the letter in full:
New-York March 3, 1890.
! Henry s. Boutell esq. Room 49, First National
Bank Building Chicago. Ill
My Dear Boutell: Please have the Chicago anc
Northern Pacific Railroad Company organized I'm
| mediatey upon receipt OF this letter; have the
stock subscribed one share each. by the necessarS
| by dummy who will hold It really for the beneh
| az the company and after subscribing and receiving
the stock deliver 1t into the treasury or the com
pany in the manner talked Of BY M High your yourSet
YOU can. none Of whom shall be directors OF ths