New-York tribune., 1902-06-26
ARGUES FOR CONVERSION.
APPEAL OF UNITED STATES STEEL COR
PORATION FROM 1NJUNC-
TI0N HEARD.

Trenton y. J., June 25.-The Court of Errors aho
Appeals to-day heard the opening arguments OF
counsel in the appeal of the United states stee
Corporation from the injunction granted by VICE
Chancellor Emery. restraining the proposed re-
trenent of S2a9 e000 0a9 of preferred stock ana the
issuing in its stead of 2OO0000O of per cent bonds
The injunction granted in the case OF Miriam
Berger, a similar being refused in suit De
gun by Charles l. Raymond The first suit was on
behalf of holder of preferred stock, and the lat
that of a holder of common stock. Both
were appealed to the Court of Errors and APP
peals and court suggested to-day that they be
argued together. Robert H, McCarter represent
ing the complainant in the Berger case refused to
accede to this request the ground that it would
curtail the time to which he entitled for ar
gument.
The decided to adhere strictly to the new
rule barring Newly lawyers from appearing be
fore it. and declined to even accept briefs until
the names OF William d. Guthrie and Victor Mora
wetz had been stricken therefrom and New-Jersey
counSellors substituted. Both Mir. Guthrie and Mr..
NoraWetz were in the courtroom. but under the
new ruling had to content themselves with being
After he opinion of yice-Charcellor Emery had
been been read by N: McC4rter r. " I.indabqry opened
foLIaSo9h ana the plan q the CONVERSION 81 q 9" pre-
by the supporting attidavits, and therefore. III.
9Ry debatape question was whether IN adoPthHia Phia
the scope OF its chartered powers. Neither was
ISSUE m the pFopo5ed @ Of bon4s for CASH
1 ne claim, and the whole claim. SAID 1ff
Linda bury. is that the scheme of issuing bonds
and using them for the retirement of the preferred
stock Is contrary to the law il existed at the
time the corporation was formed and that the act
OF 1852 is unconstitutional and void, first in that It
1nt@FfereS with the obligation of the Stockholders
contract with the corporation. and. second, IN mat
II grants special privileges TO certain corporations
which withheld from others | deny this claim
in whole and in detail
Mr.. Lndabury then submitted that the conversion
plan was within the purview OF the corpora tlon
act. as it revised in 1896 and was therefore
permitted by the very contract with stockholderS
which the complainant sought to invoke He based
this argument the powers conferred by three
sections OF the revision and the charter OF the
corporation. Section the General Corpora tions
act provides that every corporation may decrease
its capital stock if twO-Jhirds in interest OF eaca
class having voting powers shall vote in favor OF
such change. Section is provides that every cor
poration organized under the act shall nave the
right issue preferred stock and that the power
vided in the shall apply TO all or any classes
OF the Section 90 provides that the decrease
of capital stock may be effected by retiring or
reduCing any class of the stock or by drawing
the necessary number of shares by lot for retire.
meRt by the surrender by every shareholder OF
certain shares for retirement, by retiring shares
owned by the corporation or by reducing the par
value of shares
These sections. in conjunction with the express
provisions the charter. Mr.. 1indaBury GoHteT@e'
give ample power for the conversion, eliminating
authority for carrying of the plan. He next
argued that the act of last winter was consttu-
tional and for that reason also the INJUNCTION
should have been denied by the Nice-Chanceiior
Mr.. McCarter made brief opening. ana VIII
continue his argument tomorrow.