The morning news. [volume] (Savannah, Ga.) 1887-1900, 1894-03-13
A new QUESTION CONES UP
The CentTal'S Reimbursement for EL-
pendituTGS on Other Properties.

The Matter Misunderstood Hereto
fore-The Issue of Second Series of
Certificates on the Tybee Road
Brings ONt the Question-The Propo-
sition Applicable to the Petition for
the 800, 900 Issue on the Savannah
and Western.
1t seems that the question of the right
of the Central railroad TO ask for REIN
bursement for moneys expended on the
other properties operated in connection
with its line has been somewhat misun-
derstood
The question has been considered in the
light that the Central was the owner of
the properties in question as of the Sa-
vanuah and Atlantic, in which the Cen
trail is the owner of all the stock. When
the order was granted for an issue of
certificates to rebuild the Tybee railroad
the right was reserved by the court on
request of counsel to grant further issue
of SIS, 900 in certificates on the road to re-
pay the receivers of the Central for
moneys expended in improvements on
the Tybee railroad and for money eX-
pended by reason of the loss from opera
tions. The case that has been presented
has been one of the Central asking the
court for money which it lost in operat-
ing its own property.
DIFFERENT MATTER.
The matter as presented to the court,
however, is an entirely different one,
according to prominent attorney who
| is engaged in the litigation The Cen
trail is an insolvent property and is in the
hands of its creditors, or what is practi-
cally the same thing, it is in the hands of
the court for its creditors. Each sepa-
rate property composing the Central
system is thus held for different set of
! bondholders and creditors. The Central
belongs to the holders of the tri-partite
and the floating debt. The Savannah Il
Atlantic belongs to the holders of the
mortgage on that property. The mort
cages on these properties it ismaintained,
and probably correctly, covers their
/ income as well as the properties them
selves. The question at issue then is
whether the income from one property
can be used in improving or operating an
other while they are in the hands of their
creditors, or can the creditors of one
property be Odeprived of a portion of its
/ income for the purpose of maintaining
| and operating another property.
THE RIGHT OF REIMBURSEMENT.
Where money from one property sub
ject TO a mortgage on it. has been ex-
pended on another under different mort
gage, the question arises, and properly so
| il is held, as to the right of reimburse
ment to the holders of the mortgage on
! the former, from the fund or from the
| property on the latter 1t is held that
| the bondholders of one property have no
right to receive the benefit from funds be-
! longing to another under these circum-
stances, when the properties are in the
! hands of their creditors, or the hands of
! the court for the creditors.
| This Is the proposition involved in the
! the question before the court. The same
proposition applies to the petition of the
receivers of the Central for an issue of
500, 600 certificates on the Savannah and
! Western, though this question is mere
complicated on account Of the more init
mate connections and traffic relations be-
tween the Central and Savannah and
! Western. This required the minute and
I detailed examination of the accounts be-
tween these two properties. In other re-
/ spects the question is very similar one
to that explained by the attorney.