The morning news. [volume] (Savannah, Ga.) 1887-1900, 1897-03-14
THE FIGHT OVER THE BONDS.
EATONTON BONDHOLDERS WANT
THEM HELD UP AS SECURITY.


Atlantic Begun Before Judge FaIIi-
Eant-Mr. Weed and Mr.. Myers Say
They Control $4,000 of the Eaton
ton bonds, and They object to the
Suit-EatOntOn BOndhOlders Claim
They Have Lost Their Security and
want the COurt to Restore 1t to
Them-Argument to he Concluded
Monday.
The arguments in the case OF L. J.
Guilmartin and others, bondholders Of the
Eatonton Branch Railroad Company,
against the Middle Georgia and Atlantic
Railroad Company and the Central OF
Georgia Railway Company were begun
before Judge Fanigant in the superior
court yesterday morning.
Mr.. Charles N. West appeared in behalf
of the plaintiffs, Col. William Garrard
for the Middle Georgia and Atlantic and
Capt Henry c. Cunningham for the Cen
trail. The first thing was the introduce
ton of witnesses concerned in the trans
action, who gave testimony pertinent 10
the issues.
Prior to this, however, several of the
to certain material facts. The affidavit
OF Messrs J. D. Weed and Herman Myers
stated that they control $4,000 Of the Ea-
tonton Branch railroad bonds, which as
more than a majority, that the improve
ment of the property had increased the
value of the security, that the suit of l..
J. Guilmarttn and others tends to injure
the bonds as a security and they protest
ed against it as being against the inter-
ests Of the bondholders Of the Eatonton
Branch railroad.
The affidavit Of Messrs. Herman Myers
and Edward Karow stated that they were
at the meeting of the Central committee of
the Middle Georgia and Atlantic at which
the deal was made, and that nothing was
said to lead Messrs. West and Gaudry, who
appeared for the Eatonton bondholders, to
believe that the Middle Georgia and At
lantic controlled or owned the bonds which
were issued on the property in 1892. The
affidavit of Col. VIM. Garrard was prac-
ticaly TO the same effect, except ne went
further and said that it was known that
the bonds were pledged by the Central
Savannah aggregating 100000 The only
statement made with regard to them was
that they were not scattered and could be
easily gotten at
The plaintiffs also presented some affi-
davits. Mai. G. A. Whitehead testified
that he was a director of the road at the
time the deal was made, and he never
heard any suggestion of the roads in
solvency at that time. 1t was a going
concern at the time, be said. and he never
heard any mention of liabilities in the
shape OF outstanding bonds, or Of dimin-
ished value of the guarantee.
Mr.. John J. Gaudry, who participated
in the transaction for the plaintiffs, made
practically the same statement He said
he never knew of any 1872, 900 of bonds
outstanding on the property. The state
mcnt that the suit was filed by the Eaton
ton bondholders for the purpose of get
ting more money for their security, he
said. was untrue. The guarantee, he said,
had been made worthless, and the bond
holders simply wanted it restored.
Mr.. Charles n. West made a similar afii-
davit saying that if Il had been known
that the whole Middle Georgia and At
lantic was mortgaged the Eatonton bond
holders would never have made the deal
with them they did. The invariable re-
ply to their questions, he said, was that
the bonds had never been issued, but
were in the control of the central COM
mitee, and their existence made no diff
ference with the security. He only
knew he said, that the road was worth
from $4,000 a mile up, and there was not
a time when the Eatonton bondhollers
did not rely on the guarantee of the Mid
die Georgia and Atlantic, which they con-
sidered going concern, worth at least
$5O0.009.
Mr. J. D. Weed. president of the Middle
Georgia and Atlantic Railroad Company.
was the first witness placed on the stand.
afldayit relating 60 the ownership of $4,000
worth of Eatonton bonds was
his. MIR. Weed said the Middle Georgia
and Atlantic had put more
than $4,000 of Improvements on the prop
erty. but he did not remember any agree
ment to that effect. He believed that the
value of the Eatonton bonds had been en-
HANGED by the sale of the property to the
Central, because he said where the Cen
trail is responsible for the interest they are
stronger than they ever were, because if
they do not pay the principal and interest
the Central would lose the road. President
Weed said he believed the Central had as
stunned the debt, as this was shown by it's
holding Sl6S.O 900 of the bonds in escro. He
said he heard the statement made by Mr.
Cunningham, who said the Central was re-
Eponsible because they kept these bonds
in escro. President Weed was satisfied that
the Central had assumed the debt and was
responsible for the bonds under the ar
rangement made. Mr.. Weeds reason for
making this statement was, as he said
that it would be to the Centrals interest
10 pay the interest and principal on these
bonds rather than let the road go to fore
closure.
While they were discussing this point
as to what the Central railroad would
do, Mr. Cunningham stated that what ne
said was that the Central would exchange
its bonds for the Eatonton bonds at par
When asked II he would accept the Cen
trails bonds for the Eatonton bonds
President Weed said he did not know what
the committee would think of that. The
$4,000 referred to, he said, were con,
trolled by the committee, though not all
owned by il. Mr. Weed said he did not
think he would exchange his Eatonton
bonds for the Centrals divisional bonds.
but he thought they We're a great deal
better now with the liability Of the Gem
trail than with that Of the Middle Geor-
gia and Atlantic The Middle Georgia
and Atlantic at the time of the deal with
the Eatonton Branch. he said, was not
tnsolyent, even though II had mortgage
on it Of $4,000 mile. The road never
earned the interest on its bonded debt