The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1903-11-27
MAY BE WITHOUT WATER
LAPORTE MUCH CONCERNED OVER
SUPREME COURT DECISION.
Illegality of Contract with Water
Company May Cause BondhoIders
to Begin Action to Foreclose.
Special to the indianapolis Journal.

Special to the Indianapolis Journal
LAPORTE, Ind, Nov. 26.-The City Coun-
Gil finds itself in a quandary over the re-
cent decision of the Indiana Supreme Court
reversing the judgment of Special Judge
Capron, of the Laporte Circuit Court, in
the water works case of E. H. Scott ct al.
VS.. the city of Laporte. On Dec. 1 the in
terest ON the bonds issued by the Laporte
Water Supply Company will become due
and IL it is not met there is possibility
of the bondholders beginning foreclosure
proceedings and throwing the plant into
the hands of a receiver. The company has
no money in it's treasury, but it has con-
siderable due 1t from the city. but members
of the Council question the right of the
Council to appropriate money to the COM
pany in view of the Supreme Courts
tween the city and the company was IL
legal and void.
Several years ago the city found its water
supply, which came from the lakes sur
rounding Laporte, was diminishing, and
after much discussion and many investi-
cations by experts it was deemed advisa-
BILE to obtain a new water supply from
wells driven at the Kankakee river, the
majority voting to construct supplement
tary pumping station for the purpose Of
carrying the water to the city from the
| river. a distance OF five miles. The city
was then in debt, almost to the constitu-
tional limitation, and scheme was devised
by Mayor Darrow and members of the
Council whereby a company, to be known
as the Laporte Water Supply Company.
| was organized, the city taking $780, 900 worth
of stock in the company. A plant costing
more than 100000 was built the company
issuing bonds to the amount of SIS, 900,
pany. Chicago bond lawyers pronounced
the scheme within the scope Of the law.
A., A number Of prominent Lsporteans. in
County Treasurer s. 8. Bosserman and ex-
| Alderman w. ID. Paxton, opposed the plan
| very bitterly, finally bringing proceedings
| junction was secured. but on the hearing
| of the case the Injunction was dissolved,
| Special Judge Capron finding for the city.
| Scott ct al. appealed. The city had a con-
| tract with the Water Supply Company
| whereby IL was to furnish the city not less
than 100000 gallons of water day, for
which it was to receive 3 cents per thou
! sand. or $500 month. Gradually the city
| came into possession of all the stock with
| the exception of two shares which are held
by outsiders. in order to continue the COM
| pany. Whenever the company needed
money for running expenses or to pay
| bonds and interest the city would make an
allowance, the city usually being several
| months behind on its payments. The
| plaintiffs in the action contended that the
| whole proceedings were unconstitutional,
but the Supreme Court did not pass on the
| constitutionality of the case, although it
| declared the contract between the company
| and the city illegal.
At the session of the Council following
| the higher courts decision, a new contract,
| which Ii was considered was In keeping
/ with the law, was entered into. Now the
| company needs money to pay the interest
| on its bonds. but the Council fears that IL
| might get into contempt of the Supreme
Court il ii makes an allowance to the COM
| pany. while on the other hand there is a
| possibility that the bondholders, of whom
| there are more than fifty, might stop the
| plant and leave Laporte without a water
| supply should 1t fail to give the company
| money enough to pay the interest. The at
| torneys for the city are preparing motions
| and briefs praying for a rehearing of the
/ case in the Supreme Court. instead of hay-
| ing the case sent back TO the Lapote Cir,
| cult Court for retrial. In the minds OF
/ many persons the situation here is consid-
| cred alarming enough for the calling of a
public meeting to consider the matter