New-York tribune., 1899-12-30

NORTH JERSEY DIRECTORS ENJoINED
AND ORDERED To SHOW CAUSE.
ACCUSED OF CoNsPIRTNG TO DIVERT THE
PROFITS or THE CONSOLIDATED
TRACTION COMPANY To THEIR
OwN BENEFIT

Tronton. Y J. Dec % tSpeclaD An order
vyaq made bv Judge Gray. In tho Federal court
to-day res,r,lning the directors n the North
Jersey Street Railway Company from. paying on
January I $4,000 ~ the stockholdefs - N"
Consolidated Traction Company The order was
made AZ the instance ~ J. Ovcrton Dickinson. ~
Trappe. Nd. and Samuel u Thomas. of Easton.
Md. executors of Samuel r Dickinson Of New
York the owner of one hundred shares ~ the
Consolidated company's stock.
Under a rule entered by the Court at the same
time the North Jersey company must show
cause on January II why n permanent injunc-
ton should not issue restraining IL from operat-
ing the street railways Of the Consolidated COM
pany and from paying $1,000 a year To Bcr-
nard VI. Stanley as the president ~ the first
named company. which. the bill Of complaint
AYERS. up 70 1895 possessed of only two
small lines Of street railwa" In Essex County
and few franchises OF small value. on April
2S Of that year its capital stock was increased
from $5OOOOO0 10 $15OO0OcO. The stock was
owned by the individuals who controlled the
Consolidated Traction Company
The bill OF complaint continues that in March,
1905 Edward f. c. Young. f. a. Il. Wdener,
A. j. Cassatt. jeremiah O'Rourke. Thomas +.
Ryan. william =. Elkins. Elisha p. Gadds.
Thomas Doan. c. a. Griscom and others. be-
ing In control Of the Consolidated Traction Com
pany. knowing the value of it's property and
franchises and realizing what an enormous in
come they were about 10 bring into the COM
pany's treasury and wishing to appropriate all
or much as they could with safety TO them
selves personally. and wishing TO divert the
profits accrued or about To accrue to the stock
holders at large. entered into "a conspiracy
among themselves and with Bernard VI. Shan
HalSey NJ Barrett James r. In
Henry VI. Doremus and others. directors Of the
North Jersey Street Railway Company and who
we're the agents Of the directors Individually
OF the Consolidated Traction Company. to trans
fer by means Of a lease the railway system Of
the Consolidated Traction Company To the North
Jersey Street Railway Company. whose entire
capital stock was their personal property"
The bin further charges that the principal and
interest on SlJ.WoOto per cent bonds. Issued
by the North Jersey company. Will they be-
come due be paid out OF the earnings OF the
Consolidated Traction Company. which money
would otherwise be devoted to the payment OF
dividends to the shareholders OF the Consolidated
company. II is alleged that this IL wrongful
diversion Of the earnings Of the Consolidated
company, and amounts virtually to n scheme
whereby the consideration Of the lease. instead
OF being paid for by the lessee. Will be paid by
the lessor. The cOmplainants as minority
stockholders of the Consolidated company al
lege that they have been defrauded out Of their
Just profits the price agreed upon In the lease
being wholly inadequate for the property.
They furthermore deny the constitutionality
OF the act OF March II. lS'3. under which the
lease was executed.
The lease Of the Consolidated Traction Com
pany to the North Jersey Street Railway Com
pany was for n term of 800 years. and provided
for a payment of 81 100000 upon the execution
Of the lease and yearly sums In semi-annual
payments. beginning with S3OO.OO0 and ncreas-
ing gradually until 1905 from which time the
amount should be S6OOOOO a year 1t also
provided that $1,000 year should he paid as
the presidents salary long the two com
panies had the same president. The bill charges
that this was gratuty to Stanley the presi-
dent of the two companies.