The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1897-01-28

The governments bill for foreclosure
of the mortgage on the Union Pacific
Railway company was yesterday 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 di-
rection of the president of the United
States under authority of the tenth
section of the act of congress approved
May Z, 1S7S 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. Cor
don Dexter and Oliver AmeS as truS
tees, Union Trust company of New
York as trustees, j. Pierpont Morgan
ana Edwin 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
printed in pamphlet form in which it
/ is set out that by act of congress of
July 1, 1862, the government undertook
to aid and assist in the building of a,
railroad and telegraph line from
Omaha west through Nebraska, part
u
Utah, to connect with the Southern Pa
cific road at a point five miles west of
Ogden, a distance of 1,042.93 miles; that
| the government was to have the first
call on the company for transportation
of mails, troops, kilograms and so
forth, and that the company building
the road, now known as the Union
Pacific railroad company, snould re-
ceivS a grant of right of way for a
single track and 200 feet of land on each
side of the track, also every alternate
section of land, $40 acres on each side
of the road for the entire distance.
GOVERNMENT LOAN TO THE COM
PANY
The act empowered the government
and the government did advance to the
company the sum of $4,000 per mile
of the road, except 300 miles in the
Rocky Mountain district, which was
very expensive to build, and on $50
miles of this portion it advanced $4,000
per mile and on the other $50 miles /
$50, 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 ac- /
cepted per cent mortgage bonds pay /
able in 80 years from the date of is |
suance which, ipso factO, constituted a
first mortgage on the railroad and all .
Tic IOlilIS SlUCE lllCIEOIl lie INTEREST
was payable semi-annually and it was
stipulated that 5 per cent per annum
of the net earnings of the road should
be applied to the extinction of the debt
until the whole was paid.
PRIOR LIENS.
On July ., 1864, congress passed an
amendatory act providing that the
railroad company might issue first
mortgage bonds to an amount not eX-
ceeding the amount advanced by the
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.
1t is then recited that another amend
atory act was passed by congress on
May Z, 1878, providing that, as the COM
pany had defaulted in the payment of
the interest on the government loan,
One-half it's net earnings should be ap- .
piled to the payment of the interest.
Another act was passed allowing the
company to issue first mortgage bonds
1r and for the construction of a bridge
over the Missouri river between Omaha
and Council Bluffs. These bonds were
ssued and are now held by j. Pier
oont Morgan and Edwin F. Atkins.
INTEREST ON PRINCIPAL $56, 9O1,- !
u.s.
1t is then set out that the $4,320, 900 =
If the 30-year 6 per cent bonds issued
o the government became due on Feb.
, 1896; S3.S40,000 became due on Jan. l, 5
S97; S15,919.512 will become due on Jan
1885, and So. ISL, 900 will become due
N Jan. 1, 1899, the total issue being
81 236, 512.
The bonds which have already be-
ONE due have not been paid, and after
educting the portion OF the earnings 7
n account of interest there is due for :
nterest a balance of 500 664, 666.39. MAX I
ig a total of principal and interest of f
Sc, 901, 1883. +
COMPANY INSOLVENT. /
1t is then alleged that the company .
; insolvent and that the government
lay redeem and clear off the first
lortgage bonds and demand q decree
foreclosure on the property.
Plaintiff then prays that the court a
nter judgment for the amount q
aimed, and that if the same be not G
aid that the property be sold. q.
A S9,2S1 Foreclosure.
Judge Marshall yesterday delivered
ldgment of decree and foreclosure -