Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1894-06-09
mrs. srAxFoap's DEFENCE,
Aad She Will Not Less ST., 900, 900 wltAsus
Making 0as.

San Francisco, June 8.-The claim fol
SIS, O00, 900 filed against the Stanford estatt
BY Attorney General Olney, as prelimin
AIRY step to force the governments claim
against the original holders of the Contra
Pacific grant, has caused the greatest ex.
element. It il now learned that the gov.
ernment's claim was presented on May 26
but that an attempt was made to keep the
proceeding secret Il order that the financial
opefatione Of the estate need not be EN-.
barrassed.
The late Senator Stanford's estate wal
recently appraised at S17 100000. Since
the appraisement heavy obligations have
been made, and it il said now that the
enforcement of the government claim would
practically wipe out the estate, not only
leaving the widow penniless, but cutting off
all the beneficiaries under the late senator
will, including the endowment of $780,
600 to the Stanford university.
1t is said that the estate, after the liquid
alton Of ito ackno wledged debts, may not
equal the amount of the claim of the gov
eminent. In this event Senator Stanford's
deed Of trust, under which Stanford uni.
versity was founded, would not stand, in
case the decision of the court should be in
favor of the government, and the univer-
city would naturally be sacrificed to satisfy
the judgment.
Mrs. Stanford, in an interview, says that
the government claim will be resisted to the
fullest extent of her ability. She regards
the proceedings in the nature of . test case,
and was not surprised at the filing of the
claim. Further than these statements she
would not talk.
An idea of the probable defence was
given by Mr.. Wilson, Mrs. Stanford's attor-
ney. He said:
1.-THE opinion of the Encouragement of
the United States is entitled to great deal
of consideration, but he is proceeding on a
wrong assumption. I am free to say that /
do not think the government will ever be
able to collect anything from the estate of
the late Leland Stanford. The government
issued the bonds to aid in the construction
of the Central Pacific Railroad, but neither
Mr.. Stanford nor any one else ever agreed
to pay the government back. The bonds
operate as a second mortgage. It is not a
debt, and while the encouragement is right
IN holding that in California the members OF
a corporation are personally responsible for
the debts of the corporation, he is wrong in
assuming that the mortgage is q debt. The
government holds second mortgage on the
company's property of 500, 900, 900. The gov
eminent, by paying tine first mortgage of
$50, 900, 900, can foreclose the second mort
gage and get control of the road. But it is
not to be presumed that the United States
would care to expend $4,000, 900 to get
control of railroad that could be built for
one-third that amount"
Today is the last day under the law
which Mrs. Stanford has to accept or re-
ject the governments claim. 1t is believed
that she will simply ignore the claim, which
in law amounts to rejection. 1t will then
be in order for the government to institute
suit, either in the United States courts or
the superior court in San Francisco. At
torney- General Olney's claim was filed in
the probate court in San Francisco, before
Judge Coffee, where the Stanford estate is
now undergoing settlement.