The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1903-11-13

Water Company Title Is Being
Made Ready.
Suit in Federal Court to Adjust
Mortgages.
PART OF SALE PLAN.
Plant Must Be Turned Over to
City Clear.
Indications That Company Is
Making Ready for Transfer.
ART OF SALE PLAN.

A suit on the part of the METROPOLITAN
Trust company of New York against
the Topeka Water company and ]. W.
O'NeilI. receiver. has been commenced
in the United States circuit court to
euiet the title to the Topeka Water
company. The purpose Of the suit is
to determine the standing of the va
rious bond issues of the Topeka Water
company and appears to be a declara-
ton of the disposition of the bond
holders to conclude the negotiations
with the city for the purchase of the
water plant. 1t also appears to indi-
cate that the directors of the water
company believe that decision will
be handed down by the Kansas su-
prene court concerning the validity
of the recent issue of $500 600 of bonds
for the purchase OF the water plant
In its effort to clear up the muddle
resulting from the issues of watered
bonds to the extent of hundreds of
thousands Of dollars more than the
water plant is worth. the Metropolitan
Trust company, which holds the three
mortpa ges upon the water plant, asks
that the court designate a trustee for
the third mortgage, it having lapsed
fror-7 the non-Oayrnent of interest on
bonds issued under it. 1t is probable
Iidt d lOTI1dI safe OF the water plant
VIII be ordered by the court and the
various claims consolidated. The suit
is friendly one. Rossington, Smith &,
A1sted. who have been attorneys for
the water company. representing the
Metropolitan company All three mem
bers of the firm are out of the city
TODAY.
The financial affairs of the Topeka
Water company have been involved al
most past comprehension by the success
SiVp hOnd icGnGS Tn q,
the property was given the Atlantic
Trust company for the purpose of Sc
curing bond issue of $3.50. 900. This
mortgage was foreeiosed in 1895 and at
that time reorgdnfza ton of the COM
pany took place. In 1895 q mortgage
for 100000 was executed in favor of the
Atlantic company under which 1910. 900
in bonds were issued, the proceeds of
their sale going for improvements on
the property Later on a second mort
gage for $550,000 was executed and
bonds to the full amount issued. But
since September, 1902, no interest on
these bonds has been paid and under
the provisions of the mortgage that in
strument is now liable to foreclOse.
However. upon the proceeds of the sale
of the plant the two previous mortgages
are previous liens.
AS stated, in 1895, the Topeka water
plant was sold under foreclosure pro-
ceedingS to satisfy the mortgage of the
Atlantic Trust company. Charles F.
Street bought it in and sold it back to
the Topeka Water company. of which
he became a principal stockholder.
There is however, another judgment un-
der that first mortgage. Tt is that of
William B. Strong who held bonds of
the water company to the amount of
$123,47S and who secured a judgment for
that amount in the federal court in 1897.
This claim he afterwards transferred to
the Atlantic Trust company. During
last January the Atlantic Trust COM
! pany merged its affairs with the Metro
politan company which now assumes all
its rights and privileges
The Metropolitan company claims the
equality of this claim with that of the
$270, 900 bond issue under the first mort
gage, the two taking precedent of the
$3.50, 900 second mortgage. 1t asks that
the property of the Topeka Water COM
pany be sold under the second mort
gage and that the relative standing of
the different claims be determined.