The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1895-07-03

The application of the American
Loan and Trust company for a separ-
ate receiver for the Oregon Short Line
and Utah Northern Railway company
having been disposed of in a manner
not satisfactory to the plaintiffs, it
now appears to be tie intention OF the
Trust company to press for a fore
closure of the consolidated mortgages
on that property.
he original bill filed by the Trust
company included a prayer for fore
closure. but only the portion of the
bill relating to the separate receiver
ship was heard and the portion re-
lating to the foreclosure is still in
allegiance In anticipation of the
question Of foreclosure coming up,
Attorney r. V Hall, of Omaha,
through Hon. z. L. Williams, obtained
leave of the court to file a general an
swer to the bill on behalf of the Ore
gon Short Line and Utah Northern
Railway company and at once filed the
same.
in the answer the defendant reserves
TO itself ali ADVANTAGES which can be had
by reason of errors, uncertainties and
other imperfectionS in the complaint.
As to whether or not the lines of rail-
way are correctly described and as to
whether there has been any
default by which the plaintiff is en-
titled to the possession OF the road the
defendant leaves the complainant TO
its proof and specifically denies the
same
Defendant submits that as to
whether or not the bonds were duly
and legally made by it and duly anG
legally issued by the plaintiff, the COM
plainant should be compelled to state
and that the defendant should no5 be
required 10 make any specific allega-
lions in regard thereto. It is also set
up that the defendant has no knoWl-
edge on which TO predicate an an
swer as to the amount of the CONSOLE
dated bonds now outstanding.
The appointment Of receivers for
the Union Pacific system is referred
to and admitted, but it Is denied that
the terms of the same are fully and
aCcul aJely set out in the complaint.
Defendant admits that the amount
of its capital stock was 100000 shares
of the par value of 800 each, but al
leges that only 262, 44S.5S shares of that
amount have been issued or are now
outstanding. 1t is admitted that 15l,
167 shares of said shares belong to the
Union Pacific railway company, but il
is denied that the Union Pacific con-
trolls the management and business of
the defendant, other than in this that
it voted the said shares of stock as
other stockholders do.
! 1t is admitted that eight of the direc-
tors of the defendant company are also
directors of the Union Pacific railway
COMPANY, and also that the same per
sons are president, Vice-president,
comptroller, secretary and treasurer
% both companies, but it is denied
that by means OF the said 151, 167
shares the election of the officers, as
we'll as the management and business
of the defendant company are con-
JrOlled by the receivers, and, it is al
legged. that the 151,167 shares are held
by DreXel, Morgan & Company as
trustees under the indenture made by
the Union Pacific on September 4, 1891,
as security for the payment of the
Union Pacific cOmpany's collateral
trust per cent. notes and that said
shares of stock are controlled by
DreXel, Morgan and company and by
the committee named in the trust deed.
Defendant denies that the coupons
for the interest on the consolidated
bonds were presented on April l. 1894
and payment refused and denies that
the plaintiff is entitled to the possess
sion of the property of the defendant.
Defendant admits the making of the
AmeS and Dillon first mortgages for
S149S1. 900 and admits that bonds to
that amount are outstanding against
the Short Line. 1t also admits the
execution of the mortgage for $1,S31,-
600 against the Utah Northern, the
Ham mortgage against the Utah
Southern and the Utah Southern eX-
tension and also the obligation of the
Idaho Central Railway company and
its execution of the Idaho Central
bonds. The consolidation of the COM
panies is also admitted
The defendant alleges that the
Oregon Short Line has received its
due proportion of the gross receipts of
the Union Pacific system and admits
that the Union Pacific broke its agree
ment of December 6, 1889 to furnish
sufficient money in excess of the gross
receipts to enable the defendant to
yay its expenses and interest and that
by reason of such failure on the part
OF the Union Pacific the defendant is
insol vent and has failed to pay the
interest on the bonds.
Defendant admits that the receivers
failed to pay the interest on the
Oregon Short Line first mortgage
bonds due August l, 1894 and the in
terest on the Utah Northern general
consolidated bonds and on the Utah
Southern, Utah Southern extension
and on the Idaho Central bonds pay
able July /, 1894, and suffered all the
said interest to be in arrears and that
suits have been instituted for fore
closure of the same.
Finally it is set up that the defend
ant has surrendered all its property
franchises and everything. else to the
present receivers, appointed by the
court, and therefore cannot surrender
the same to any other persons.
Wherefore defendant humbly prays
to be hence dismissed with costs.
TO LEASE THE UTAH CENTRAL.