The Birmingham age-herald., 1903-10-25
On Account of Alleged Decep- tion Criminal PrOceed-
 ings Will Result
VARIOUS CONCERNS CLAIM
 ID HAVE LEASED PROPERTY
Receipts Issued By Warehouses and Car Company Pledged Them as Collateral Security for Money
 Borrowed From Banks.

Chattanooga, october 24-A petition was fled in the United States court toody os Thomas C. Bush, Thomas A. Gillespie aho n I, Hurlburt, trustees in bankruptcy of fne Southern Car and Foundry con- pany against the Export Storage com many. Security Warehousing company National Security company and long hst of hanks doing business in all parts or the United States making sensational allesa- lions under oath. It is given out that criminal proceedings will result
 In the petition 1t is alleged that the Southern Car and Foundry company through it's officers on June lS' lsoi' entered into a contract with the Export Storage company, leasing the plants of the company al I.enoir and Memphis, Tenn, and at Gadsden and Anniston. Ala, and s'so an agreement by which the storage cor.pany claimed to have leased to it personal prop erty and to issue for it warehouse re- reipts.
 Various Receipts Issued.
 1t is alleged that at the same time the car company made an agreement with the Security warehousing company, whereby the latter company agreed to teceive In storage personal property and te issue receipts therefor. It is further stated that since that time various receipts have been issued by the warehousing company. and that the car company has pledged these rece.pts as collateral security for money borrowed from banks all over the United States and later the National Security ermpany made contract by which it agreed to guarantee to the holders of the receipts that all the obligations should be kept.
 The trustees allege that the property kept in alleged storage were not in any way separated from the property of the ear company; that no signs were put up to indicate the claims of the warehousing companies; that the latter never took pos session and that the car company had free access to all materials. and that the alleged custodians of the warehouse com panies were paid by the car company.
 Did Not Regard Receipts.
 It is claimed that after these contracts were entered into the car company con-
  fore, and that the company dealt with the material on the premises without re- gard to whether warehouse receipts were issued for them or not. 1t is claimed that the only requirement was that the total quantities of the materials of the various classes on hand and in manufac- ture should equal the aggregate amount of receipts outstanding.
 It is claimed that since the company went into the hands of receivers the warehousing company has placed tags on matter at the various plants and that at the Anniston and Memphis plants these aggregate 90 per cent. of the stock and that the warehouse receipts outstanding exceed one million dollars.
 The petitioners allege the whole purpose of making the agreements with the warehouse companies was to obtain for matter on hand and in process of manu- facture, the receipts of the said ware housing companies, so as to allow the car company to obtain loans on materials and that the purpose of this was known to the warehousing company and that the carrying on of business in this man. ner was with the knowledge and con- sent of the warehousing company.
 Tags Placed on Piles.
 While the record entries were made of sale receipts and of the property therein described by the so-called custodian and Some times tags were indiscrimnately -placed on various piles of material in possession of the Southern Car and Foun- dry company this constituted practically athe whole transaction, so that at the time the receipts held by the defendants were issued, the said warehousing sysl tenn was in effect, nothing more than device of bookkeeping to which the op ating department of the Southern Car Foundry company paid no attention ever.
 After charging that the state ] Alabama and Tennessee were II, ed in registering the charters
 warehousing companies the
 charged that all of the recei'
 the defendants were issuef
 Southern Car and Foundry
 insovent, most of them
 months preceding the ba-
 t'that said attempted transfe.
 cumbrances were in fact and in fraud on the creditors of the car pany."
 A previous order had been issued by Judge Clark placing the receivers in pos session of all this property, and on the petition filed today an njuction was issued to prevent the sale or disposal of the property.