New-York tribune., 1905-08-23
ASK PREFERRED CLAIM
Borroacer from Merchants Trust
Gets Order to ShorU Cause.

To offset the Injunction which Justice Cochrane
in the Supreme Court, issued August Il pro-
hbiting the receivers OF the Merchants Trust
Company from paying $4,000 as O preferred claim
TO the Chittendon Power Company the J. G. White
Company yesterday served an order on J. I Moore
attorney for the depositors OF the trust company
who obtained the injunction TO show cause why
they should not receive $4,000 preferred claim
out OF the $4,000 deposit of the Chittendon Power
Company.
The Merchants Trust Company failed because Of
inaohity 10 realize on securities OF the Hudson
Valley Railroad Company and OF the Chittendon
Power Company. OF Rutland. The directors of the
trust company sank 81, 10000 IN the bonds Of the
railroad and ssOoOO in the bonds of the enterpri.es
conducted under the name Of the Chittendon
Power Company. Some Of the chief directors of
the trust company officials and directors OF the
Chttendon Power Company and OF the Hudson
Valley Railroad Company. In lending money TO
the two companies the directors, in some instances
were simply lending money to themselves
The attempt is obtain the balance OF
loan made by the Merchants Trust Company
Some time ago the Chittendon Power Company
borrowed s150Ooo from the trust company II drew
out $4,000 and deposited $4,000 On December q
1904 the power company asked the trust conuanv
10 permit the ]. G. White Company TO draw money
10 the amount OF slO3000
The request was signed by Edwin Langdon. presi-
oent OF the power company and r. K Brown as
sistant secretary OF the power company and a d.
rector Of the Chittenden DEVELOPMENT Coropanv
an institution that also got money from the trust
company. Both Langdon and Brown are directors
OF the trust company. On the same day the request
was granted by c. NJ Wicker vice-president of the
trust company and by F. P. Davis the secretary
wicker is director OF the Hudson Valley Rail
road company. Moore has not vet fully looked
up the records OF the thirteen other directors OF
me trust company, but far Is he has gone he
mas tnat their business interests doveTau To-
geIher as those OF Langdon, Brown and Wicker do
1hree justices OF the Supreme Court have SO far
peen called on 10 act since the trust COMPANY
passed INTO the hands OF the receivers Justice
Cochrane appointed the receivers after the direc-
Tors OF the company failed 10 get rid OF the Rut-
lano tChittenden Power and Hudson Valley Rail
road securities. Justice Howard empowered the
receivers 10 pay the Chittenden Power Company
SlZo.eo as preferred claim. Moore went to Jus
tlce Cochrane and obtained injunction restrain
ing the receivers, and another calling on the re-
certain bids for the assets OF the trust COMPANY
/ The Injunction and the order which Moore Oh
/ tained from Justice Cochrane are returnabie on
! saturday al Albany. Moore wants the receivers
10 accept s4l5.O0 for the Rutland securities for
which the trust company paid 00OO0 and 81 800 :
90 Tor the other assets. OF this latter sum 500
is onereo for the railroad securities for which the
trust company paid & 0o0 II the receivers ac-
! cept the bids, which the highest that have
been offered, the E215.000 in deposits can be paid
/ of and sl65.O00 will be left
Moore fears that attempt will be made to re-
/ organize the Hudson Valley Railroad and doe.
not want the money belonging the depositors
! OF the trust company TO pay the costs