New-York tribune., 1896-01-29
THE BEST Is THE CHEAPEsT.
A n n THE 0aS,aaaaI
a. Qs u BEST U0luII6o oI
ALREADY STEAM COOKED.
STAMFORD CASE UP AGAIN.
ApCJ-NENT IN THE UNITED STATES SU
PREME COURT BEGUN.


sEpn II. CHoATE FOR THE STANFORD Es-
rATE-GREAr POPULAR INTEREST
IL THE SUIT AND VAST IN
TEREsTs AT STAKE
washine,on Ian. 2s-Argument was heard to-day
ny the Supreme Court of the United states In the
famous suit brought by the United states against
the estate Of the late Senator Stanford OF 'ah-
forna as a stockholder in the Central Pacific Rail-
road Company establish his liability Tor the
debts Of that corporation to the Government. The
Importance OF the suit with its far-reaching cohse-
quences II the contention OF the Government should
be sustained and the popular interest In the case
attracted a large attendance TO the court. Among
the auditors was Mrs. Stanford TO whom the de-
termination Of the litigation means so much. Shouid
II be adverse the result would beggar her and rem
der II impossible continue the work OF the Leland
Stanford Jr University Palo Alto. founded by the
Senator as a memorial to his son. who died just az
he was entering manhood, and which has already
become the leading educa tional institution on the
Pacific Coast The argument opened by AS
slstant Attorney General Dickinson. and will b.
cosed by Solicitor General Conrad. Mrs Stanford
was represented by Joseph H. Choate
The suit was originally begun in the Circuit Court
OF the United States for the Southern District Of
California the demand being for Sb.2a.oc0 Both in
that court and In the Circuit Court OF Appeals the
Government was defeated. and the case comes to
from the judgment OF the Court of Appeals against
the United States.
WHAT THE GOVERNMENT ASSERTS.
The Assistant Attorney General in his argument
said that the liability sought TO be enforced was
created by the law OF California which, 1t was in
sisted. bound stockholders OF corporations to an
swer personally for their debts In proportion to their
holdings Of the capital stock Mr.. Stanford was
stockholder in the central Pacific Railroad Com
pany and the Western Pacific Railroad Company
two California corporations, chartered In 1851 and
1852 respectively and consolidated by authority or
California In 1870 under the name Of the central
Pacific Railroad Company. II was alleged that
these companies became indebted TO the United
States for bonds Of the United States. which were
loaned TO these companies under the United states
statute OF July !. 1867, 10 aid them IN bulIns thelr
railroads. that these companies became bound to pay
TO the United States the amount Of iheee bonds AT
their maturity together with all the interest on the
same and that this was an existing indebtedness 10
the United State The bonds loaned to the Central
Pacific Railroad Company OF california amounted
10 S25 Sg3 l2O: those loaned 10 the Western RACINE
Railroad Company To N.S0oH All Were thirty
wear bonds BEARING interest at per cent Ihe h'st
four nstaments of the bonds loaned to the Central
Pacific Railroad Company q california. amounting TO
g. $1,000 have maturcd and have been paid by the
United states and all the interest when a'cturi
up TO the nllng OF the bill has likewise been pau
bv the United States and no part Of the prin'lpai
haS
the United states bound 70 pay. and would pay
slI OF said remaining bonds and interest At maturity;
that the Indebtedness TO the United states on hc-
count OF those loaned 10 the central racine H""'
road Company OF California would amount 10
go 90 90 and that on account Of those loaned 10
the Western Pacific Railroad Company to S'S''>'''
that the said railroads. were nsolven were coVeied
nv a paramount mortgage exceeding their value ana
that the United States hal no remedy cXcep' against
the stockholders OF said company
The contention OF the Government was that the
railroad company became indebted To ih' 'h''4
States in the amount Of the bonds Issued 10 'nen'
and was personally bound to pay the same win
interest that the Constitution OF the state OF 'a''-
fornia imposed on each stockholer an enforceabe
~ rsor al obligation FOR proportion or an dents anu
S1cton II OF the act OF 1861 under which the com
panes In question were INCORPORATED nNed u.iInts s
either OF lis departments OF government Was an IN
OF purpose manifested TO absoNs we oeh'naI a.
sumed by the companies. or from the liability m
posed on their stockholders; and that nothing can
be found in the course OF the dealing between the
United states and the Central Pacific COMPANY 10
support the Inference or justify the conclus0h har
waived the security afforded by the personal haoil-
iiy OF the stockholders.
MR. CHoATE's ARGUMENT
Mr. Choate in his argument in behalf OF the de-
fendan Mrs Stanford, executrix OF the Will OF her
husband referred the basis and magnitude OF the
suit saving that the magnitude OF the claim was
wholly unparalleled The bill demanded t5,0Uop
from the defendant and involved the claim OF
equal against each OF the three associates OF
the defendant testator amounting to a totai claim
of 100000 against four individuals. solely by rea
son OF their having held stock In the Central Pacific
Railroad Company and in its constituent companies.
The defence TO the suit based upon four prin-
cipal grounds. In support Of which it was argued:
/ The successive acts OF Congress relating to
the Union and Central Pacific railroads are to be
read together and. so read. they demonstrate that
Congress intended them to never control and regu-
late the entire relations of the Government to al OF
the companies with respect the subsidy bonds
without reference to the laws of any State that the
companies respectively created and adopted as
governmental Instruments for great National pur-
bose In the accomplishment OF which they were To
be subjec to the control OF the Federal Govern
ment that In respect that purpose the functions.
obligations and Liabilities OF al. the companies were
to be equal and identical; and that as TO both com
panIea the Government looked TO the companies
alone for the performance OF all that the acts I'm,
the personal liability Of the stockholders Of either
but. the contrary did Intend that IN respect I"
the subsidy bonds there should be no liability OF the
Decisions OF the Supreme Court Of the United states
In support OF his assertion were quoted at great
length.
2 In addition to the fact that no individual Ia
estate Of Senator Stanford was also certainly free
from any individual liability for the subsidy bonds
passage OF he act Of 1867 which prescribed the
terms on which the bonds b. issued, and
also the time Of the issue Of the bonds. from 1865
to 1868
g. But the qualified liability Of stockholders
for contracts of the corporate did not exist under
the Constitution and laws OF California at the time
Of the contract between the United States ana the
company, evidenced BY the act Of Congress of
July l. 1852 and the written acceptance OF Its con-
dltions by the railroad company At that time there
was no liability OF stockholders whatever. the
Supreme Court Of California has uniformly held.
As the rights OF the United States must and do de-
pend wholly that contract. and as no liability
OF stockholders 70 the Government under the con-
tract could be imposed by any subsequent egisla-
ton of California the bill sets forth OF
action whatever.
l. But IN fact. by the true construction Of the
acis OF Congress there was obligation the
part OF the Union and Central Pacific Company TO