The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1897-04-03

1ndge Charles Fl. Simonton, OF the
United Staes Cciriut Court, sIttlng ~
Charleston. S. c., on Wednesday, mana
ed down his opinion IN the foreclosure
proceedings of the Farmers Lpan and
Ernst Company. of New York,( VS.. the
Cape Fear and Yadkin Valley Railroad
Company, and issued his decree inF TIC
sale of the road.
JUDGE SIMONTONS OPINION.
Judge Simontons opinion and the De-
cree of sale were filed yesterday WIN
Mr.. w. H. Shaw, clerk OF the uIiIs.'
States District Court for Eastern NoftA
Carolina. The opinion is as 1olloWs;
United States of America, Eastern Dls-
trict of North Carolina, IN the Clrcult
Court. Fourth District, IN EQUITY.
The Farmers Loan and Trust Com
nanny Trustee. vs. The Cape Fear and
Yadkin Valley Railroad Company and
Others.
At a hearins, of this case in Asheyllle
n reference To special master was
ordered before entering a final decree.
The questions which call for solution
were. how should this railroad property
he sold? In divisions, or as an entirety
And If sold as an entirety, how shall
the proceeds of sale be apportioned
among the several classes OF bonds
proved in the cause, in case SUM be
not realized sufficient in amount TO pay
all expenses and the entire sum secured
by liens? To aid the court in reaching a
conclusion. the special master was in
structed to take testiKaOny and report
facts proved before him
1. What has been the .aalative earning
capacity of these separate divisions for
a period of FIVE years; Slat is to say,
what is the value of the aggregate OF
freight going over such division between
its terminal and the value of its passenger
traffic, and what are the necessary OPP
Grating expenses?
9. What is the cost of repair of its
roadbed and track:
g. What is the comparative estimate
of the value of the respective divisions
by disinterested persons who have had
experience in railroads, furnishing such
estimate under oath under cross-esam-
nation and giving ahe grounds for the
estimate.
4. Any other facts bearing on tins
question of actual and relative value.
Let the report contain onlythe facts
given III evidence. so that the court
can reach its own conclusions.
Il lie IidSttE Has Iteiu ils itlti
ences. and aided by the ability and in
dustry Of counsel, has made a very full
and elaborate report The views of the
parties who represent the bonds upon the
divisions A, B and G, have been fully
heard and reported with the testimony
of experts. The accounts of the railroad
for live years have been produced, eriti-
cised and corrected The various esti-
mates OF yalne have been laid before the
court. To this investigation, the hold
ers Of the first consolidated mortgage here
added their aid. Every means of attain
ing result, if result can be had III
this way, have been exhausted.
The situation is this: The Cape Fear
and Yadkin Valley Railroad, made up
of other smaller roads consolidated with
each other. has been constructed in three
trunk divisions. The whole trunk line
is covered by a mortgage executed LIST
June, 1896. At the date of this mortga ge
line of road was in full and successful
operation between Greensboro, through
Fayetteville, n. c., to the South Carolina
line. This was known as the A division.
Another part of the road was in process
of construction from Greensboro to Mt.
Airy, toward the Virginia line, not yet
completed This was known as division
B. Yet another division was in contem-
platiop, but not under construction, from
Fayetteville to Wilmington, known as
division G. The mortgage covered the
entire road, described as follows:
THAT certain railroad extending from
the city of Greensboro to Fayetteville,
and from Fayetteville to the boundary
line between the States of North Caro-
lima and South Carolina, where it in
,t.arsects the same and also that certain
line Of railroad extending from Fay
etteyille aforesaid to Wilmington, when
the same shall be constructed, and also
that certain line of railroad now being
constructed, extending from Greensboro
aforesaid to the boundary line between
the State OF North Carolina and the
State OF Virginia, at a point near Mt.
Airy, together with the right of way for
said railroad. and also all depots and
station grounds and buildings thereon,
and also all shops, engine houses, turn
tables. water stations, warehouses and
lots. gravel pits, store granaries, and
other real estate used in operating said
/. road. or in connection Herewith"
The bonds secured by this mortgage
were divided into series. A, 3 and G,
each series being the first lien on the
division bearing its letter, and shar-
ing the second lien on each of the other
two divisions. with the series of bonds
not bearing the first lien thereon. Be
sides these, certain branches were con-
Quoted as feeders to the main lines,
known as the Factory branch, the Mad
ison branch, and the Granite and Fur
mace branches. None of these are COW
cred by the lien of the mortgage of 1886,
but by the consolidated mortgage of De-
tober j, 1889, as a first lien thereon.
Besides these, the Cape Fear and Yad-
kin Valley Railroad Company acquired
lease for ninety-nine years of the
South Carolina Pacific Railroad Com
pany, short line of road, but a valua-
BILE feeder This is part of the security
of the mortgage Of 1886, and is shared
by all the divisions. The problems are,
how shall all this property, bound in this
complicated way. by different liens, be
sold. and when sold, how shall the pro-
-ceeds be divided?
haWaVQr nufprluw infn This