The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1898-10-13
IMMENSE SUIT.
Cy Leland and Ex-GOv. Morrill,
Bring Suit
Against John r. Mulvane For
$125, 900 Damages.
MAKE THE CLAIM
That in Securing Control of the
Capital Plant
Mr.. Mulvane Defrauded the
Capital Stockholders.

Suit for s125,oOO damages has been
filed in the district court by Cy Leland
and Ex-Governor E. N. Morrill, against
John R. Mulvane and the Topeka Cap
ital company. The petition alleges that
in securing control of the Capital plant
Mulvane defrauded the stockholders of
the Topeka Capital company. Leland
and Morrill, are both stockholders in
the Capital company, and the amount
of damages is asked in favor of the
company The amount is what the
Capital plant and good will Of the pa
per are held to be worth.
The petition filed in the case recites
the financial woes of an Improbable
political newspaper from the time the
plant passed out of the hands of Major
J. K. Hudson into the control of the To-
peka Capital company in 1890 up to the
time of the foreclosure of it's indebted
ness in November, 1896.
The plaintiffs state that when the
plant was turned over to the company
in 1890 there were mortgages against
it amounting to 1000, and the 495
shares of stock issued Major Hudson
in payment for the franchises and good
will of the paper were by him deposited
in the Bank of Topeka as security for
the payment of the Indebtedness. After
that, from time to time with the con-
sent of the officers of the company and
the bank, Hudson was allowed to with
draw stock until in 1895, only 26O shares
remained.
In that year, the petition goes on to
state, John r. Mulvane purchased all
the mortgages still outstanding against
Hudson at such discounts that the cost
did not exceed SIS, 600, and on October
23, 1895, obtained a mortgage from the
Topeka Capital company to secure So
600 alleged to be due him. In the follow
ing month, November, of the same
year, the petition states, Mulvane in
duced the Topeka Capital company to
turn over to him the newspaper plant
under a promise and agreement that
he would faithfully manage the same in
such a manner as to advance it's inter
ests and protect its property from the
liability of the Hudson debts.
In 1886, the plaintiffs go on to say,
while in possession and controlling the
260 shares of capital stock of the COM
pany, MulVane foreclosed all mortgages
in a suit in the United States circuit
court in which J. E. Baker was COM
plainant and John r. Mulvane, The
Bank of Topeka and the Topeka Capt
tai company defendants, and obtained
judgment for 52,300, which exceeded
the cost of them to the amount of $19,-
coo. I'm order to obtain said judg-
ments," the petition states, f'fOreclosing
said mortgages for more than was due
him and for the purpose of defrauding
the stockholders said Mulvane falsely
and frauduIently represented to the of
fcers of the company that he was act
ing in the interest of the company and
to defeat an attempt of said Baker to
subject the company to the debts of
Hudson, and that if allowed to manage
the defense would faithfully guard the
interests of the company and prevent
the diversion of all moneys to other
than the payment of it's debts"
In November. 1896, the plaintiffs con-
tinue. MulVane caused the Capital plant
to be sold at auction and it was bid in
at the sale for $50, 600, which sum was
received by Mulvane as the proceeds of
the sale. They state that all of this
amount he converted to his own use
and never accounted to the company
for one dollar; also on the books turned
over to him by the company, there was
$4,000 collected, and no accounting was
made of that. They further state that
the Remington Paper company, which
has since secured a judgment of $S, $50
against the stockholders of the Topeka
Capital company, desired to make their
account an intervening petition in the
suit in the United States circuit court
and was induced not to by Mulvane
The petition then goes on to state
that said Mulvane wilfully, WrongfuIly |
and for the purpose of injuring and de-
frauding the Topeka Capital company
caused the Bank of Topeka to fail to
sell the 260 shares of capital stock to
raise money to extinguiSh mOrtgag geS
and satisfy judgments until rendered |
valueless by the judicial sale" At the
time of the sale, it is stated, the pro-
perty and good will of the Topeka Capt. |
tai was worth S125.000, and that by Null |
vane's action all the property and good
will was lost to the Topeka Capital
company and it damaged to the amount
of $125 600
The petition ends by asking that Null
vane be adjudged to be in possession of
$29, 900 as trustee of and for the To-
peka Capital company for the payment
of the debts of the company, and that
he be ordered to place it in the hands of
the clerk of the district court
Mulvane's answer will not be filed for
several days. The case can not come to
trial until the next term of the district
court.
The suit is the result of the freezing
OUT of all the stockholders of the To-
peka Capital company by Mulvane.