The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1904-11-01
BILL THAT MAKES
GRAVE CHARGES
W. J. Edwards, Receiver,
Under Hot Fire.
HIS REMOVAL PRAYED
R. l.. Forrest in Suit VS.. Insolvent Saw
Mill Company Alleges Gross Neg
Leo, Fraud and Collision,
Too Free Issue of Certi.
ficates by Court.

flcateS by Court.
\ bill in equity filed in the Circuit
Court IF the United States for the
Eastern District of North Carolina, al
Wilmington, on behalf of Robert i.
Forrest against the Southern Say,
Mill and Lumber Company w. j. Ed
wards receiver and The Union Trust
Company and w. ]. Edwards. co.'s
tains sensational averments in regard
to the management of the property
by the receiver. the issue of Pc
ceivers certificates by Judge T. II.
Purnell. and as to collusive practices
on the part of Receiver Edwards ana
Supt. McNealy, of the Carolina Nor
thern Railroad Company-aiso in the
hands of w. J. Edwards. as receiver
to exploit the property and timber
holdings of the lumber company foi
their own personal ends and prollt.
and nrays the appointment of a re-
ceiver. the removal of Receiver &c
wards and an examination of his ac-
counts by d special master.
lit will be remembered that the
Southern Saw Mill and Lumber Cont
pany went into receivers hands on
Dec. 1, 1902, upon a bill filed by the
Carolina-Northern Railroad Conn
pany. which was likewise insolvent ut
that time. The complaint of the
railroad company was TO the effect
that the saw mill company was In
debted to it in the sum of $4,000 and
that, unless a receiver were appoint
ed. the interests of the road would
be damaged by the Intervention OF
other creditors who might bring suits.
levy judgments, ETC., against the saw
mill company.
Whereupon one Augustus Metlier
was appointed by the court as re-
ceiver and one Charles B. Skipper ar
Master to take charge of and state ac-
counts.
In Januar 1903, these narties were
removed and w. J. Edwards was made
both master and receiver of the prop
erty, he being also receiver of the Car
olina-NOrthern Railroad. the plaintiff
at whose instance the saw mill COM
panv had been placed in receivers
hands.
Now comes Robert L. Forrest. who
alleges in his bill that he is the
owner personally and as trustee
tee. of S40.500 of the bonds of the
company. which We're secured by Geed
of trust to the Union Trust COMPANY,
of Philadelphia. with the right to
foreclose; that the complainant in said
bill was a railroad corporation. of
which Augustus Meiller was the
president the same being con
trolled and directed by him. ana
that the said Southern Saw Mill
and Lumber Company was also col-
trolled. directed and operated at the
time by the said Augustus Mellier.
who was an officer and president OF
said corporation and thereafter. a.
per the said order. was appointed re
ceiver of both corporations in the sSid
suit: and that the Union Trust Com
pany. of Philadelphia. which as
trustee in the mortgge deed has the
legal title to the property was not
made a rarty to the said suit. which
was not brought in the interests of
creditors but of the complainant alone
and that all orders and DEGREES made
i'm the said proceeding or acts or DO
ings of the receivers are invalid u
against the trustee of the mortgage
deed and the bond holders hereunder;
that. although not known to the at
tDrneys therein concerned the suit in
sttuted by the Carolina-Northern
Railroad against the Saw Mill Com
pany was a collusive suit. each cor
noration being controlled l'v said Au-
rustus Mellier. who was in the frs.
instance an Ninted receiver. all orders
therein having been taken without no
tee to outside credit""s @ot parties
10 the suit. and without notice TO the
trustees of said bonds. although each
of said corporations, their officers
agents and attorneys. knew and NAG
reason to know by the record or tire
said deed of mortgage that the SAID
trustee was the mortPa~ee OF the si'i,'
P~onert-- and that these facts appear
cd prima facie in the pleadings.
Sensational Charges.
With reference to the operation OF
the company by Receiver Edwards
in la 1,Cp
that his mana cement has been reck-
less. extravagant and incompetent:
that he has caused the holdings of the
said saw mill to be greatly diminished
in value: that he has neglected 10
give attention to the affairs OF the
com~any and that he has been
party to the organization of other .uln-
Der companies which he has Eei-
mitted to take IN valuable options
upon timber originally held by the
said saw mill and lumber company. as
well as other timber in and arouhd
said mill and that he himself mas
utilized the property of the southern
Saw Mills and Lumber Company. MS
knowledge of it's bust ness resources
and correspondence, for the purpose
CT upbuilding his own interests IN a
certain lumber company and plant
which he organized and built in the
neighborhood of the said Southern
saw Mills md Lumber Company. TO
tie damape, detriment and dim'n y
ton of said trust and to his own al
vantage, as hereinafter more particu-
larry set forth and ALLEGED"
Lavish Issue OF Receivers Certificates.
The bill further ALLEGES that by an
order dated and entered December
9th. 1902. within six days after the
appointment of Augustus MeIlier as
receiver. and before any parties Or
creditors might have interviewed and
been heard, and without notice either
TO your orator or the trustee of the
said mortgage bonds. and by consent
only of the said Carolina Northern
Railroad COMPANY and the said South
ern Saw Mill and Lumber COMPANY
who were the sole parties to the pro-
ceeding. and unon application of the
said Augustus Mellier. receiver. ne
court authorized the issue of receive =
certificates in the sum of $15.958f5
for the payment of claims of creGi-
tors ~rior to the appointment of the
receivershiD. as will a~near by the ap-
plication of said Augustus Mellier.