Bellows Falls times. [volume] (Bellows Falls, Vt.) 1856-1965, 1896-03-25
CENTRAL VERMONT IN RECEIVERS HANDS


drand Trunk Brings Suit In Equity to Settle
Difference in Traffic Balance Partic.
ulars Of the Situation.
The fact became public Monday night
that the United States circuit court had ap-
pointed E. c. Smith, president of the Cen
tral Vermont Railroad company and
Charles M. Hays, general manager of the
Grand Trunk Railway company, receivers
for the Central Vermont company.
They were appointed in the equity suit
brought by the Grand Trunk railway
against the Central Vermont to settle
difference in traffic balances. Bonds were
fixed at $4,000. e
i The amount claimed by the Grand Trunk
railway for traffic balances is $4l5,712.
Judge Lacombe OF the United States cir
cult court for the southern district of New
York, has ordered that this court take
auxiliary jurisdiction with the United States
circuit court for the district of Vermont in
the suit of the Grand Trunk Railway COM
pany Of Canada against the Central Ver-
mont Railroad company and has confirmed
the appointment of Charles NJ. Hays and
E. C. Smith as receivers of the defendant
company.
Judge Lacombe's order dictates that no
property of the defendant railroad now
within this jurisdiction, of which the re-
ceivers may take possession under this
order nor proceeds thereof if sold, shall be
removed by said receivers out OF this juris-
diction except by order of this court. This
clause, however, is not to apply to rolling
stock in actual use.
Action in this case grows out of the fling
,,yof complaint in the United States circuit
| court of the district of Vermont, in which
the plaintiff seeks forfeiture Of equitable
lien upon the gross earnings Of the defend
ant company. In its answer the defendant
company admits the validity of the lien but
| asks that the plaintiff be required to furnish
proof as to the amount due.
The receivers were appointed upon the
petition of the Grand Trunk Railway COM
pany to the United States circuit court for
! the district of Vermont. That company
! is large holder of the securities of the
| Central Vermont Co. and also creditor.
/ The application was made entirely without
the knowledge of the Central Vermont and
was complete surprise to its officers
| The motive of the Grand Trunk company
in this move is not entirely well defined,
but from the fact that E. c. Smith, presi-
dent Of the Central Vermont, was at its re-
quest associated with Charles M. Hays,
general manager of the Grand Trunk com
pany, on the receivership, it may be safely
assumed that it had only the best interests
Of the property in view, and that there will
/ be no interruption in the operation Of the
property so far as concerns the personnel
E5f the staff or in its arrangements with its
railroad connections or in the friendly rela.
tions between the Central Vermont and
Grand Trunk roads.
| The floating indebtedness consists of bills
payable and notes. The latter are secured
largely by collateral and the former mostly
protected by the order Of the court, which
provides for the payment Of all outstanding
Indebtedness for labor and supplies accrued
within the past six months.
HOW 1T AFFECTS THE RUTLAND DIVISION,
| The Rutland railroad, sometimes called
the Rutland division of the Central Yer.
mont, is owned by the Delaware and Hud.
son Canal company. P. w. Clement,
president Of the Rutland railroad, has
given out the following:
i 'sThe gross receipts of the Rutland road
as they accrue from day to day at the
different stations on its line, are paid to 6
:, trustee and do not go into the Central Yer
mont treasury, nor are they under its con
troll. At the end of each month, after
paying to the Rutland road its rental due
the trustee pays to the Central Vernon
the balance, SO that there is at all times s
large amount of money due the Centra
Vermont from this source. The renta
amounts to $3.50, 900 year, and the gross
receipts OF the road are from $SOO,OoO t.
81 ,0OO,O year. The receivership doe
not affect the Rutland road; but tht
receivers may continue to run trains ovel
it provided they first get the consent o
the Rutland railroad company as provided
in the lease"