The Washington times., 1901-10-03
NO DEFENCE BY RAILWAY.
Judgments Against the City and
Suburban for S225,000.
UudcrstnndinE That the washing
ston Traction Reorganization Com
mittee VIII Next File n Bill in
Equity for the Sale of the Line.


Judgments have been entered against
the City and Suburban Railway in the
suits filed against the company two weeks
ago for sums aggregating nearly S225. .000
Tor moneys loaned by other companies
controlled by the Washington Traction
and Electric Company. The suits were
not defonaed and judgment was given on
default. this having been the plan of the
Washington Traction manage ment for Sc
curing legal recognition of the claims. 1t
Is understood that this step is a prelim-
mary one to the plan of reorganization
of the Washington Traction Company
recently published by the committee of
the bondholders in New York
The judgments entered were in the fol-
lowing cases: The United States Electric
Lighting Company. for $4,000; the United
States Mortgage and Trust Company. for
Sl2'405-56; the Anacostia and Potomac
River Railroad Company, $4,000, and the
Columbia Railway Company, for $50. .O0o.
All OF these suits We're against the City
ana Suburban, and the iast was also
against the Washington Traction Com
pany- The total Of the judgments is, in
exact figures, S22i, ,s05.56 this being the full
amount of the suits. The money loaned TO
the City and Suburban is supposed TO rep-
resent the amount that the company has
ialen behind since the syndicate com
pany obtained control of it According to
the statements filed in the suits, the
moneys were loaned to the company on
demand notes.
The effect Of this judgment is to place
This claim first against the company after
its bonds in case it should be sold out at
auction by receiver The claims of the
holders of la
would come last should such foreclosure
sale take place.
1t is understood that the committee for
the bonGholders of the Washington Trac-
ton Company, now in the hands of a re-
ceiver, proposes next to file a judgment
creditors bill in equity against the City
and Suburban, on the judgments obtained
yesterday. This bill Will be for the sale
OF the property at auction. The plan of
the bondholders committee as far as it is
known, is TO buy in the property at such
sale for the reorganizcd system. No
action can be taken by the bondholders'
committee until October IL as that is the
earliest day that the receivership case
against the Washington Traction Com
pany can come up in the Virginia courts
As stated heretofore in The Times, an
application has been made for a receiver
for the City and Suburban by three of the
largest of the minority stockholders of the
company. This application has not yet
been acted on by the courts. The minor
ityr stockholders have taken further steps
to protect their interests by making an
agreement to act together through a COM
mittee, in any steps that may be taken
toward a settlement with the re6rganiza-
!on people, or toward the further pushing
of the suit for receiver. IL Is under
stood Vi he eli nod
almost unanimously. II provides that the
stock held by the signers, amounting to I
about 1900 shares shall be deposited with /
a trust company or other depository. and !
that the committee appointed shall have |
full power to act, either in selling out to |
the Washington Traction Company at |
any price decided on, or in pushing the |
suit for a receiver.
II Is thought to be probable that the |
Reorganization Committee of the Wash 1
inGton Traction Company will be willing 1
TO purchase this minority stock of the 4
City and Suburban, to avoid a conflict of !
interests and litigation The plan of the /
Reorganization Committee, published in /
The Times a few days ago, provides that !
bonds of the new company amounting to /
about $4,000 shall be devoted to the pur- |
Chase of outstanding securities and for /
other purposes. The only stocks Of the !
constituent companies outstanding at the I
present time are the minority stock of 1
the City and Suburban, 400 shares, par /
value. 500. .Ogj; the minority stock of the
shares, of a par value of Sj9GJ1, and few [
shares of the Metropolitan. 1t will be /
seen that all of these securities could be /
purchased at a much less figure than the
$4,000 mentioned by the Reorganization
Committee. 1t is understood that the
minority stockholders of the City and Su-
burban. who have combined their inter-
ests, would prefer selling out to the Re-
Committee to entering into
further litigation.
The only other parties directly interested
IN the City and Suburban Company are
the holders of the City and Suburban
bonds, which are a first lien on the COM
pany. The position of these bonds IS not
Affected by the judgments rendered yes
-erday, except in that judgment credi-
tors bill may be based it. as stated !
above. If such a bill were entered and !
he road were ordered sold by the courts, |
the purchase money would 90, first to
he bondholders to the extent of s., $50. .0eO
the amount of the bonds. While IL is I
said to be probable that the Reorganiza-
ion Committee will be the onl,' bidder for
-he road, il is also understood that the |
holders Of these bonds prepared to I
protect themselves fully by bidding the |
lalue of their bonds, If necessary.
The bonds are held almost entirely in !
Baltimore. The statement is made by an |
that the holders of the entire
ssue have Joined hands and agreed to !
I'D los on the bonds for the road. or 81 $780, ]
%. This viii mean. apparently, that the
Reorga anization Committee will have to |
lid at least this sum TO secure the line
or the new system.