The Wichita daily eagle. [volume] (Wichita, Kan.) 1890-1906, 1897-10-10


Stayed by q Raised Bid
Washington, Oct 9-Attorney General
McNcnna today issued an official state
ment announcing that the government:
had decided not 70 appeal the Union Pa
| cific foreclosure suit bur to allow the
road 70 be sold on November in con-
sideration of the Union Pacific re-organ-
iza1iOn committee raising liz guaranteed
bid from s45.745.O59 ID s50.0o0.e coo. The
road. ne stated, is 70 be sold 10 the high
est bidder, but with a minimum bid
guaranteed. as stated
The attorney generals statement IS
as follows:
There seems TO De Misrepresentation
Of the action OF the previous adminis,ra-
ton in regard 70 the Pacific railroads.
There was no agreemen. 10 sell the roads
or the sinking fund Of the Union Pacific.
In consideration o. the appearance OF
the United States in the foreclosure pro-
ceedings already commenced and the
prosecution OF its own mortgage, il was
guaranteed a bid of s45. 754 .059 al the
sale which should be ordered by the
court over and above the amount OF the
first mortgage. This amount included
the sinking fund and SIS, 500, 900 in addi-
tiCn.
There was no formal agreement i:
consisted Of letters between the reorgan-
izaii0n committee and special counsel
OF the government. and Attorney Gener-
al Harmon, all Of which were published
in Senate document, So. Fifty-fourtn con-
gress. second session.
The agreement, as I have said, goes
no further than 70 provide for the ap-
pearance OF the government in suits
brought for the foreclosure OF the fire:
mortgage bonds and bringing suit OF
foreclosure OF its own.
The sale Of the property was (and
necessarily mus; be- by the direction OF
the court. "a in other foreclosure suits
with the whole world for bidders
the appearance was made and the
suits instituted as agreed before the ad-
ven: OF the present administration.
These suits, therefore. ii had to- accept
and it has endeavored TO secure such de-
crees as it believed the government IN
der the laws Incorporating the railroads
was entitled 70.
1T may De disputa Die as 20 whether
the agreement TO 90 into court should
have been made. It is not disputable as
70 wha; the government, after il was In
court, could do. There, like any other
sutton, the government was subject 20
the orders Of the court. ! mean. OF
course, eubjec. to the orders Of the court
as creditor. The sovereign powers
could not be affected, and have not been,
by the DEGREES. We think, therefore,
that the action OF the government and
the situation are very plain. i; has not
sold its Interests. 1t has enabled all in
teres,s 10 be sold a public auction to
the reorganization committee or 10 any
committee or 10 anybody or 8sSocia ton
which, or VINO. may bid the highest.
IN what l have said l do not mean 70
imply criticism OF the previous admins
trstion. What K did, i, no doubt did on
mature reflection and in sincerest judg-
ment, and its action was recommended
by bo:h receivers VINO had been appoint
ell upon the application of the United
States and was also unanimously
by the five government,
directors.
Now as 20 the relation Of the gov
eminent 70 the DEGREES. They, as rend-
cred, were in many respects gratifying.
but in other respects We're not as the
government strenu0usly commended for.
For instance. the Omaha bridge mort
cages, amounting TO about 81 .200. 900,
n ha he
len OF the government on that part Of
the road between Omaha and Council
Bluffs and in addition the money and
assets in the hands Of the receivers ac-
,ruing from the opera lion Of the roads
we're ordered 10 be sold instead OF being
reserved 70 meet deficiency judgmen:
10 be obtained by The govern |
nent. This amounted 70 more than |
Z. 0o0. 900. This. Of course. would be- |
come important II the price bid at the |
'ale should not equal the governments |
len.
Dissatisfied with the DEGREES. there
ore. the government considered the pro-
,riety OF an appeal. TIE reorganization |
,onmitfee learning this. came forward 1
with an increased bid OF over 81 900 900 /
making the total Of their guaranteed I
ID $50. 900 900. instead OF s45, 754 .6Js, an
Increase OF $i.245.9H.
This increase removed the objections
0 the DEGREES 50 far as the money con-
sntions We're concerned. In all else ne
ecrees We're just and s.Bt5=faciOry. Tn
e- these circumstances an appeal did
-; seem justified.
Regarding higher bid. the prospect
Z II saeuls as great now as Il would 81
j Ter. These considerations determined
ne government I; must he remember
4 ;hat tie governments len = a sec
nd one-su5ject 10 a first mortgage o.
g. 900 0Go. The advantage l. has secur-
i. therefore. K. 20 repeat s3meTlat.
Ia. at The sale under tae DEGREES Of
o-eclosure there viii De bid for the
Dads OF fifty millions OF dollars over and
oOve the first mortgage AMI. besi tes.
le Denefi; OF absolute freedom o. com
ssi-i1n a. the sale. The g1veTnm-1;
lay. therefore, secure IL whole claim
7rougn a higher bid. I; e sure % $50
- 30 AMI ibis amount. II connection
-sta re payments already made. xii
az ne principal o. t1e de5: twice
yer"