The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1895-06-11
THE SHORT LINE REcEIvERsHIP.

The case involving the appointment
of receivers for the Short Line has
been decided. 1t aroused the most in
tense interest in the community, as
was inevitable on a case of such great
Importance. There is some obscurity
ard misinformation as TO the status of
the case and the points involved, and
with the purpose of clearing this away
we offer a brief statement of its main
features
The Short Line, so-called, resulted
from the consolidation of a number of
separate lines operating in Idaho,
Montana, Wyoming and Utah. Before
the consolidation in 1889 several of
these lines were under mortgages still
unpaid and in force; since that time a
blanket mortgage has been issued,
covering the consolidated roads. OF
this the American Loan and Trust
Company, the plaintiff in the case just
decided, is the trustee for the bond
holders. The interest of the Union Pa
cific in the Short Line is due TO the
fact that it owns the control of its
stock; owns, either directly or through
its people, a large interest in the
first mortgage bonds on the separate
roads; owns a minor interest in the
consolidated mortgage bonds; and has
a. traffic arrangement of value with it.
BY consent the Short Line was in
Guided in the Union Pacific receiver
ship.
Upon default in interest both the
first and blanket mortgages brought
are now pending, but none are being
pushed except the latter. there being
q general acquiescence among the
first mortgages in the Union Pacific
receivership.
In its suit. the Trust Company asked
for a separate receiver. United States
Circuit Judges Gilbert, of Portland,
and Sanborn of st. Paul. granted the
separate receivership for such portions
of the Short Line as lay in their juris-
diction- being all not in Utah. Mr..
Egan was named by each as receiver,
aGd the appointment was conditional
on the payment of interest on the first
mortgage bonds, to provide for which
the court authorized the issuance of
receivers certificates constituting a
lien on the earnings of the road. The
jurisdiction OF the Utah court was in
voked Sc far as Utah mileage was con-
cerned. The court was asked TO APP
point Mr.. Egan as separate receiver,
10 permit him TO operate such COM
ponent parts of the line as he saw fit
and to issue receivers certificates con-
stituing a lien on the Utah lines. 1t is
this application that has just been
heard. All other interests were repre-
scented ana heard. There was a gem
eral protest against the request to
abandon the separation OF any part of
the line; and. owing TO the interest of
the Union Pacific either as bondholder
or stakeholder with the other parties,
there was a general demand that the
Line be left in the hands of the pres
ent receivers. In addition TO this was
the suggestion that if the court should
see fit to grant a separate Feceivership,
an additional receiver acceptable to
them be named.
The court has decided to grant a
separate receivership and has provided
that AL parts of the line in Utah must
be operated. Mr.. Egan was named as
a receiver as requested, hut the court
saw fit to listen to the protests and
requests of the ether parties and has
named a co-receiver in the person of
Mr.. w. II. Bancroft, now general SUI
perintendent of the Mountain Division
by appointment of the Union Pacific.
This was against the virtual protest of |
the plaintiff.
Resulting from this action. the plain !
> cfa arfa 5r1lxr
not accept the joint receivership and |
is doubtful of accepting the receiver |
ship in any part of the system, claim |
ing that the road has been brought to |
its present deplorable condition by the |
Union Pacific. and that the Vesting of /
2 veto power in Bancroft will result in |
a perpetuation OF that wrong and in |
Jury. 1t is of course difficult for those |
who are not in the inner circles to |
know Just what the various moving |
considerations may be. 1t may be that |
this distaste for joint receivership re- |
suits from a lack of confidence in Mr.. |
Bancroft. 1t may be that it results |
from a desire to carry out plans in /
which Mr.. Bancroft would be a dis |
cor6ant factor. 1t is certain that it /
Was OpSthy NboASNN nat -AAs A<ScA .
2 nnointment was urged en- motives not |
appearing or the surface and in the |
interest of other states and other lines
Should the suggestion OF the plain
tiff be realized, that this action of the
count means the perpetuating of |
Union Pacific control in the Short Line, !.
the Plaintiff would not be alone in its !
feeling of discomfort with the decision.
Among the people of Utah the conyic-
ton is well nigh universal that the
Union Pacific has persistently disre-
garded the permane.9 interests of its /
tributary country; that its owners hav-
ing il. mind the vast underlying mort
gage Of the government, which they
-.o.-ar. exnect to pay. nave controlled