Shoshone journal. [volume] (Shoshone, Idaho) 1884-1931, 1897-01-29


closure of the mortgage on the Union
Pacific Railway company was yester-
day filed in the United States circuit
! court In this city.
! The plaintiff is the United States of
America, by Judson Harmon, attorney
general, acting in the premises by d.
rection of the president of the United
States, under authority of the tenth sec.
ton of the act of congress approved
May 7, 1878, and the defendants are the
Union Pacific Railway company. S. H.
H. Clark, Oliver W. Mink, E. Ellery
Anderson, Frederick R. Coudert and
John w. Doane, receivers, F. Gordon
Dexter and Oliver Ames as trustees,
Union Trust company of New York as
trustees, J. Pierpont Morgan and Ed
win F. Atkins, as trustees, and the
Central Trust company of New York,
as trustee.
The complaint Is a very voluminous
affair consisting of about 40 pages print
ed in pamphlet form in which It is set
Nut that by act of congress of July I,
YB62, the government undertook to aid
Nd assist in the building of railroad
and telegraph line from Omaha west
through Nebraska, part of Colorado,
Wyoming and part of Utah, to connect
with the Southern Pacific road at point
five miles west of Ogden, distance of
I,os2.o3 miles; that the government was
to have the first call on the company for
transportation of mails, troops, tele-
grams and so forth, and that the COM
pany building the road, now known as
the Union Pacific Railroad company,
should receive grant of right of way
for single track and 200 feet of land
on each side of the track. also every al
ternate section of land, $40 acres on each
side of the road for the entire distance.
The act empowered the government
and the government did advance. to the
company the sum of $4,000 per mile of
the road, except 900 miles in the Rocky
Mountain district, which was very ex-
pensi2k to build, and on $50 miles of
this Portion it advanced $4,000 per
mile and on the otter $50 miles $780,
900 per mile. The loan was made from
time to time as each 40 miles of the road
was completed and as security for the
money the government accepted per
cent mortgage bonds payable in 80 years
from the date of issuance which, ipso |
facto, constituted first mortgage on the |
Ill ~,
on. The interest was payable semi-an-
nually and it was stipulated that per |
cent per annum of the net earnings of
the road should be applied to the ex-
tinction of the debt until the whole was
paid.
On July 2, 1864, congress passed an
amendatory act providing that the
railroad company might issue first
mortage bonds to an amount not ex-
ceeding the amount advanced by the
government, such mortgage bonds to
rank as a lien on the property prior
and superior to the lien of the govern
ment. and such bonds were issued in
1865 and are now held by F. Gordon
Dexter and the Ames estate.
II is then recited that another amend
atory act was passed by congress on
May 7, 1873, providing that, as the COM
pany had defaulted In the payment of
the interest on the government loan,
one-half its net earnings should be aP-
piled to the payment of the interest.
Another act was passed allowing the
company to issue first mortgage bonds
on and for the construction of bridge
over the Missouri river between Omaha
and Council Bluffs. These bonds were
issued and are now held by J. Pier
pont Morgan and Edwin F. Atkins.
1t is then set out that the S4,32o.ooo
of the 3o-year 6 per cent bonds issued
to the government became due on FEB.
I, 1896; $3,s4o,ooo became due on an. l. {
1897; Srs.9I9,5I7 will became due on
ian. 1, 1898, and $5,1s7,ooo will become
due on Jan. I, 1899, the total issue being
Sa7,236,sI2.
The bonds which have already be-
come due have not been paid. and after
deducting the portion of the earnings
An account of interest there is due for
interest balance of SAG, oo4,6 5000, max
ing a total of principal and interest OF
$s69or,I78.3o.
1t is then alleged that the company
is insoivent and that the government
may redeem and clear of the nrst
mortgage bonds and demand decree