The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-03-12
American Loan and Trust
Company Protecting Its
Interests.
COUNSEL sT0RY's STATEMENT
He Says the Present Receivers Have
Enough Money to Pay De-
faulted Interest.

was Degun IN the united States Circuit
Court to-day before Judge Gilbert on an
application for an independent receiver for
the Oregon Short Line and Utah Northern
Railway
This hearing is on the application of the
American Loan and Trust Company for
the appointment of a receiver independent
of Union Pacific interests. The Union
Pacific receivers are at present also re-
ceivers of the Oregon Short Line and Utah
Northern, having been appointed separate
receivers OF that line in proceedings brought
by John T. Dillon, trustee of the first mort
gage on the old Oregon Short Line, which
is the line from Huntington to Granger
and the branch to Ketchum.
The American Loan and Trust Company
is trustee of the consolidated mortgage on
the Oregon Short Line and Utah Northern
system, which was executed about the
time of the consolidation of the several
roads into one system, and which covers
all the lines subject to the first-mortgage
liens, and on some of them subject to
second-mortgage liens.
1t was on this consolidated mortgage
that the foreclosure proceedings were be-
gun in Judge Gilbert's court by the Ameri-
can Loan and Trust Company This COM
pany is also trustee of the collateral trust
bond securities of the consolidated system,
and also of the first mortgage on the Idaho
Central, minor branch of the system.
The consolidated mortgage is for SIC,
600. The collateral trust mortgage is for
$14, 100000. The first mortgage on the
Idaho Central is for $145,00O The total
amount OF the mortgages on different parts
of the Short Line system, which are prior
liens to the consolidated mortgage, is $27,-
$40. OF this amount John f. Dillon is
trustee of the first mortgage on the old
Oregon Short line for $14, 931, 900, and of the
first mortgage on the Salt Lake and West
ern for 81, 0S0, 900, total of SIC, oil 900.
Joseph Richardso is trustee of the first
| mortgage on the Utah and Northern for
| 1885, 900. James NJ. Ham is trustee of
| the first mortgage on the Utah Southern
for 81 ,52S 900 and of the first mortgage on
the Utah Southern extension for 81, $50 900,
or total of So, AIS, 900.
| Dillon, Richardson and Ham are trus-
tees for mortgages on different parts of the
system aggregating $24 $4,000. All of the
trustees oppose the granting of the appli-
cation for an independent receiver and
favor the continuance of Union Pacific con-
troll of the Short Line system. Their
mortgages are all first liens. These latter
| aggregate $25, 040 900.
| Morstield Story and Dolph, Mallory
Simon and Strahan are the attorneys oil
record for the American Loan and Trust
Company, and Senator Thurston, Winslow
S. Pierce and Snow g. McCammant will
appear for the defendants and urge the
| continuance of Union Pacific control.
| Winslow s. Pierce. counsel for the first
mortgage bondholders on the Oregon Short
Line, moved a dismissal OF the case. Story
counsel for the American Loan and Trust
Company, suggested that he be heard in
his statement of the compliments case
before Pierce's motion was argued. His
suggestion was adopted. and he began his
statement OF the American Loan and Trust
Company's complaint for a separate re
ceiver. He explained the organization o.
the different companies which were
merged into the Short Line system, and
of their consolidation into the Oregon
Short Line and Utah Northern Railway
Company,
After stating the default of interest or
the bonds he said there was no question
that a receiver should be put in possession
of the property. The only question wa:
who was to be chosen, and this was the
point at issue in the suit. He then read
from the traffic agreement between the
Oregon Short Line and Utah Northern and
the Union Pacific, showing that the two
companies roads were to be worked as one
line. He said at the time of this traffic
contract the laws of the United States pro.
hibited the leasing of one railroad to an
other except by express legislative author.
lty, and this traffic contract was intended
and did practically take the place of lease
He compared the two sides of the Union
Pacific system On one side he placed the
corporate officers of the Union Pacific
Company, who had controlled eighty sub
sidiary companies for the benefit of and in
the interest of the Union Pacific Company
On the other hand he said there are mum.
bers of people having their money invested
in the stock and securities of the sub
sidiary companies controlled by the Union
Pacific Company.
He referred to the Ames bill and sale
Mr.. Clark Mr.. Mink, Mr.. Atkins and the
executors of the Ames estate secretly ar
ranged to place the Union Pacific Com
pany and its eighty subsidiary companies
in the hands of Mr.. Clark, with Mr.. Mini
and Mr.. Anderson as receivers, and il
furtherance of this plan they brought the
Ames bill in the United States court a
Omaha.
Mr. Story gave way to Mr.. Pierce t.
argue his motion for dismissal or that tn
case be remanded to the district of Wy
oming as the court of primary jurisdiction
He said the first-mortgage bonds on tn
Oregon Short Line outstanding amount t.
$14, 931 900; the tirst-mortgage bonds on tn
Utah and Northern amount to 50, 495 900
the Utah Southern Railway Company ha
outstanding 81 $780, 900. All of these mort
cages are prior to the consolidated mort
gage, The bonds secured by these prio
mortgages are in amount more than doubl
the consolidated mortgage.
Mr.. Pierce also said that if the innio
) mortgage (the American Loan and Trus
Company would pay the interest ON tn
prior mortgages and furnish adequate S,
curity for future payments he stood read
as representative of all the irst-mortgae
holders to accept it and withdraw from tn
Mr. Sfnru int tod rs !,