The Cape Girardeau Democrat. (Cape Girardeau, Mo.) 1876-1909, 1896-11-21
THE vANOALIA SYSTEM,

Roads in the Country, to Go Into the
Hands of a Receiver Against the Protest
of Interested PARTIES, Who Claim tina;
the Suit is a CoIlusive One and Intended
as u freezeout.
INDIANAPOLIS, Ind, Nov. ~14.-Judge
Woods of the United States circuit
court last evening appointed a re-
ceiver for the Terre Haute & Indian
apolis Railway Co., naming as receiver
Volney j. Malott, president of the In
dianapoiis national bank. The re-
ceiver vas appointed upon the suit OF
Mark L. Cox, James A. Blair and
James W. Paul, Jr., against the COM
pany, and the ground for the receiv-
ership was the admission of the COM
pany in cour that it is iusolvent.
The Vandalia has been known as one
of the most prosperous roads in the
country, and until Il year ago, when it
passed into the control OF the Penn
~syIvania company, which purchased Il
majority of its stock, it met its diri-
bends and all charges with the utmost
promptness.
During the hearing yesterday Judge
Woods remarked in court upon the Pc
culiar TACT that all the attorneys
seemed to desire u receiver and he did
not make up his mind to appoint n
until last evening. Some of the par
ties interested in securities of the sys-
tenn who were not made parties in In
terest are declaring that the suit is a
~collusive one for the purpose of freez
inpr fharn ont md saline tho SvStArr
to the Pennsylvania at a low igure.
The plaintiffs in the suit were repre-.
sented by john q. Williams, formerly
general manager of the Nandalia sys
tenn; George Wickersham, of New
York; Samuel Dickinson, OF New York
and Mr.. Golden, of St. Louis. The
defendant company was represented
by ). Y. Pickens, VINO is also attorney
for the Pennsylvania Co.
The bill sets forth that in 1870 the
defendant company acquired posses
sion Of the St. Louis, Naudalia 4
Terre Haute railroad, and nat i'll 1899
it took charge of the Terre Haute X
Peoria railroad, entering into a con.
tract with it for 80 years. Prior tc
this latter consolidation-in lsST-the
Terre Haute IL Peoria had. by deed OF
trust. conveyed all its property to the
Union Trust Co. of New York, &c
secure first mortgage gold coupon
bonds to the amount of 81, $780, 200, due
March !, 1927, with interest at i've per
cent.
In 1892, while the negotiations for
consolidation with the Terre Haute Il
Indianapolis were pending, the Terre
uauIe u Peoria authorized the issue
of bonds to the amount of s., 500, 900,
payable to the Union Trust Co. for
the purpose of improving the road and
for retiring the first issue of bonds.
The consolidation was affected in Oc-
tober, 1892, and the bonds were is
sued.
BY the terms OF the contract entered
into between the defendant company
and the bondholders it was agreed
that 80 per cent. of h gross earn.
ings of the Terre Haute & Peoria rail
road should be devoted to the pay
ment of the interest on the Terre
Haute & Peoria bonds, taxes and
rentals, the remainder of the 80 per
cent, if there be any, should first be
paid to the Terre Haute & Peoria rail
road. The compliments aver That the
interest has not been paid, though the
30 per cent. of the gross earnings
would nave been sufficient to have
paid it. The gross earnings since the
defendant company took possession Of
the Terre Laute Il Peoria have been
as follows:
For the 13 months ending October
81, 1893, $40, 52O.33; for the year end.
ing October n, 1891, Si03, OH. 90; for the
year ending October 81, 1895, S445, 4S3;
October 1895. up to September l, 1S9e
(estimated), $40, 600; all of which
money, it is alleged, has been appro-
priated by the defendant.
According to the complaint. the to
tal amount due on the interest cou.
pons September /, 1856, and which still
remains unpaid, is So, $50, and, cot
tlnues the complaint, your orators
are the owners of SIS, 200 of said bonds.
secured by the deed of trust of March
], 1857, and of 81, 40, 900 of said bonds.
secured by the Iced of trust OF Sep
TENDER l, 1892, and, as such, there is
due them the principal sum of S3a,375,
together with interest from Septem-
Der, 1896.
The bill recites that the defendant
company is operating the Terre Haute
81 Logansport railroad, and has agreed
to pay the interest and principal on
Sl,50O. 900 of its bonds, that it is opera.
ting the Terre Haute Sc indianapolis
railroad, and has agreed to pay the in
terest and principal on an issue of
first mortgage bonds to the amount of
$3.50, 900. 1t is then shown that the
Pennsylvania company owns about
half of the stock of the Vandalia. 1t
is set forth that interest to the amount
of sol, 900 on bonds of the St. Louis,
Vaudalia & Terre Haute will fall due
November l, and that it Is the belief of
the compliments that it will not
be paid. The compliments also aver
that the principal and interest Or the
first mortgage bonds due January l,
1897. will not be paid when due; that
upon this contingency the obligations
OF the Terre Haute 81 indianapolis
and of the Pittsburgh, Cincinnati &
ST. Louis will become enforcible; that
in that case the Terre Haute & Indian
apolIs will be unable to comply, and a