Wheeling register. [volume] (Wheeling, W. Va.) 1878-1935, 1898-03-10
RED HOT ALLEGATIONS
Made in a Bill Filed Yesterday BY
Assignee S. G. Smith

assignee ). U. oIlltH
Against the North Penn Oh Conl-
pany and Others-Charges OF the
Most Serious Nature Specifically
Stated, and Alleged to Show the
Internal Workings Of the Local
Company Operating in Marshall
County.
Yesterday there was filed in the Of
Office OF the Circuit Clerk the bill OF ;.
u. Smith, assignee, V. the North Penn
Oil and Gas Company, a local cor
poration, and others The document
is rather a red hot one, and states
specifically a number of things which
Will make interesting reading for
many, and especially for those taking
an interest in oil and gas matters.
The counsel for Assignee smith are
Hubbard & Hubbard.
The bill recites that on the 10th day
OF January, 1898, the Company as
signed to S. G. Smith, and
that prior to such assignment,
Working Committee Of the Board OF
Directors was appointed 10 conduct the
business OF the Company, sand COM
mlttee being composed OF Messrs John
T.. Gator, w. ii. Haller and ii. l..
Mckown. Proceeding, the bill states
that IN turning the anars OF the
Company over 10 the Working Com
mittee, the Company relied upon the
committee to exercise It's best Judg-
ment for the advantage of the Com
pany III any contract 1t might make,
but as the assignee is informed, the
committee proceeded to contract with
one Williams and one Jones, upon
terms which were made for the indi-
vidual benefit OF members Of the COM
mittee and to the loss and disadyan-
tage of the Company, and for the
purpose of defrauding the Company
out of large sums of money, 10 which
it was entitled" The fact that such
an arrangement had been made was
unknown to the Company until short
ly before the assignment was made.
The terms of the agreement between
Jones and Williams, on the one part,
and Clator, Halter and McKOwn, on
the other part, are alleged to be as
follows: "Clator, Halter and Mckown
were to receive from Williams out OF
the One-siXteenth OF any production
upon the territory covered by SAID
leases, one-half of the amount so be-
longing TO said Williams, or one-thlr-
ty-second part of said production; and
they were also to receive like share,
that is to say, one-half Of the interest
held by the said Dennis Williams, in
the Woodruff lease, but the assignee
is not informed what share of the pro-
duction upon that lease was to be-
long to Williams, but believes it to
have been one-siXteenth.
The five leases were transferred to
the Company in pursuance OF the ar
rangement thus made in fraud OF its
rights by the said Clator, Halter and
McKown, and, as required by the
terms of the transfer, and the Company
proceeded to develop the territory, or
a part of it. Of the five leases the
Company, in June. 1896, surrendered
the Riggs lease, never having drilled
a well upon it; surrendered the
Samuel Grow lease of 1870 acres to the
lessor on the list of January 1898, after
having. at the instance of ClatCr, PAID
the three quarterly rentals aggregatlng
$3.50. after it had been shown as mat
ter of fact that that tract was worth
less for oil purposes, and in october,
1896. the Company sold the Griffith
lease. The Company never drilled
any wells on the William Crow lease,
hut retained it and the R0gerson lease
ND to the time of the assignment.
The Company drilled in all ten
wells on the five leases. eight OF these
wells being upon the William Roger
son 1O0-acre tract and two on the
George S. Griffith lease. The wells
drilled uDon the Griffith lease turned
ont to be valuable, and in OCTOBER,
/ 8e6 were sold by the Company DR.
eum between $4,000 and SIT 1000 OF
tho eight wells drilled on the Roger
son lease. one was dry, one was q gas
we'll and the other six were producing
wells. Some producing wells were also
drilled on the Woodruff lease, and
c;nce the sale of the Griffith lease by
the Company a number OF wells, pro-
dilcing and valuable, were drilled.
The assignee AYERS, upon informa-
tion and belief, that of all the pro
duction of the Rogerson lease, the
Grifith lease and the Woodruff lease,
the said Clator, Halter and Mchown
have received that share and amount
which was contemplated and PROVIDED
for in their agreement with Wllllams'
that is to say, nethirty-second part
The amounts so received by Clator,
ualler and McKown the assignee IS
unable to state accurately, re mas
been informed and believes that out
of the first six months production
unon the RogersOn and Griffith leases
thew received the sum OF about S499'2o.
They received other large amounts
as their share of the production from
the Rogerson, Woodruff and Griffith
leases. and the assignee further AYERS
that they are still receiving large
sums as their share of the production
from the Woodruff and Griffith leases,
of which neither the Company nor the
assignee now has any control. Inc as
signee believes that the amount re-
ceiyed by the said Clator. Halter and
McKown exceeds $1,000. in trust for
the said Company. and in equity they
should be compelled to account for
and pay the same to the assignee as
the eouitable owner thereof.
While operations Of the Company
were under the control Of Clator. Hal
ler and McKown, it was their duty to