The morning news. [volume] (Savannah, Ga.) 1887-1900, 1896-12-23
SENSATIONAL RAILROAD SUIT.
ATLANTA AND WEST POINT MAY GO
INTO A RECEIVERsHIP.

Renewal of Its Charter-SeaboarI
Air Line May Be Behind the Fight
Or the suit May Be a Movement to
Bear the Roads Stock by Parties
Fighting to Secure Control.
Atlanta, Ga, Dec. 22.-A suit, which may
be the entering wedge in the railroad sit
uation in Georgia, and cause the disrup-
tion of some of the consultations of the
Southern system, was filed in the superior
court here to-day. The suit is a bill for
a receiver for the Atlanta and West Point
Railroad Company, based upon the alleged
llegality of the new charter recently
granted to the company by the legislature
of the state.
L. p. Nelson, a local capitalist of this
city, the owner of $500 of the Atlanta and
West Point stock and $500 in debentures
of the company is the plaintiff. He is
represented by Attorneys King and Spalo-
ing, which is regarded as significant, on
account of the fact that this firm repre-
sents the Seaboard Air Line, and has had
much to do with the conduct Of the fight
waged by that line on the Southern.
1t is regarded as significant that this
suit is filed at time when the Louisville
and Nashville Railroad Company and the
Seaboard Air Line are reputed to have
sought to buy the controlling interest in
the West Point.
The effect of the suit, which asks for a
dismemberment of the corporation, may
be to bear it's stock and make it an easy
purchase for the roads which wish to
control.
Judge Lumpkin granted a restraining
order to prevent the West Point from
changing it's present charter status or
doing any thing else to alter its condition,
and set the case for hearing on Dec. 81.
The petition is so framed as to bring into
court for adjudication the whole question
of railroad combination, alleging that a
majority of the stock of the Atlanta and
West Point railroad is owned by the Cen
trail of Georgia Railway Company and the
Georgia Railroad and Banking Company,
further that these two corporations are
themselves owned or controlled by, the
Southern Railway Company, through Its
interests in the Centrals lease of the
The petition alleges that the Central is
a competing line to Columbus, and that
the acquisition and control of the West
Point road by a competing railroad COM
pany has the effect of defeating or lessen
ing competition, and is in violation of the
constitution of Georgia.
The basis of the action is, as stated, the
iature ia extending the charter
of the Atlanta and West Point railroad for
fifty years, from Dec. 20, 1885, and at the
same time amending the charter so as to
relieve stockholders of the special liabll-
lty heretofore existing under the act or
1866 The new charter is also alleged to
be illegal because there is a general law for
the chartering of railroads or extending
their expiring charters through the secre-
tary of state, and that the usual method,
which would have continued the special al
ability clause of the old charter, was evad-
ed by this act, which illegally exempts
stockholders. The petition asserts that the
charter expired at midnight on Dec. 20
and seeks to restrain George c. Smith, the
president, and other officers Of the road
from further control and management. AS
the charter has expired the bill recites that
the property is now trust of the court to
be disbursed to the creditors and stock
holders, and this is asked to be done.
The Central railroad and the Georgia
railroad are also made parties defendant
as collateral owners of the road.
Ihe serious nature of the suit and its
ominous purport are fully manifest in
those paragraphs, which set forth the facts
IN connection with the holding
OF stock by the Central of Georgia rail-
road and Georgia Railroad and Banking
company. This is fully brought into the
case and the Southern railway is referred
10 as foreign corporation owning a con-
trolling interest in the stock of the Central
and by that means controlling a half in
terest in the Georgia and the Central of
georgia railroad holdings in the Atlanta
and West Point
The bill recites fully that the Central of
georgia Railway Company is a corporation
whose capital stock is owned either direct
~ on indirectly by the Southern Railway
company, a foreign corporation and in
turn the Central of Georgia Railway Com
pdhy claims TO own and control half in
terest in certain lease which the defend
ant, the Georgia Railroad and Banking
company made to William M. Wadley, and
tHrough said lease to control the interest
or one-half of the shares of stock owned
Dy the Georgia Railroad and Banking Com
PdHy. The other half of said lease is
SIalmed to be owned by the Louisville and
nashville Railway Company, another for
eisn railway corporation, and the presi-
Go1 GGent Of the Central of Georgia Railway
Of said combination, and had been
LOT considerable time before that
went, one Of the directors of the Atlanta
ana West Point Railroad Company.
It is alleged that the Southern railway
Vontrols a competing line leading from
A,Htlanta to New Orleans but that despite
tlls the Atlanta and West Point Railroad
CCompany gave the Southern Railway
company alone the right to forward from
11.iahta through sleepers bound for New
OrIeans and points beyond its terminus,
and declined to do so with other lines
CItIhinpeetltive with said Southern railway
Vne Seaboard).
The Central is mentioned as competing
with the Atlanta and West Point in its
une to Columbus, and the petition says
we we voting of stock by other corporations
without and personal liability could create
Ip9hds and mortgages on the Atlanta and
West Point road, and under the many
manipulations which have characterized
ggalroad management of late years, create
LOT their own purposes a volume of in
ueDtedness on the road which would i'm
pair and finally destroy the value of the
STOCK, and cause the minority stockhold-
ers TO lose the value Of their holdings. In
other words, II is charged that the South
ern could wreck the road in order to freeze
out the minority stockholders.
Is recited that now a COM
paratiVely small minority of the
stock is owned by individuals
ho.dlng It for their own benefit, and
mat the policy of the Atlanta and West
Foint Railroad Company and the manage
ment Is dominated and controlled by other
Ialroad corporations and Influences.
Inc petition charges that while the At
iahta and West Point was so dominated
oy other corporations the company deeln-
Sa 70 compete In many instances with the
central OF Georgia railway for
business which IL fairly compet-
luye business between the two
roads aud that the Atlanta ana West
foint railway on the demand OF the Cen
tal refused 70 put In any side tracks or
compete for business between Atlanta and
East Point, and IN many ways was lnjur-
ga ana damaged by the domination ana
control or the Central
fNfa tH.aI