The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-12-30
RECEIVERS FOR GULF LINE.
Road Is Mixed Up I'm Affairs OF Mobile.
jackson and Kansas City.

jackson and Kansas city.
MOBILE, Ala, Dec. 2s.-Chairman W. d.
Stratton Of the board Of directors OF the
Mobile. jackson and Kansas City Railroad
arrived here last night from New York
on a special train and held a conference
with the attorneys of the old directors.
He would not discuss the reoeivership.
h Chicago and Gulf line between Pom
totock, Miss, and Middleton, Tenn, was
thrown into the hands of receivers yester-
day afternoon. The papers we're filed at
New Albany, Miss, and F. f. Dewey and
j. l.. Dantzler were named as receivers.
F. z. Dewey is a vice-president OF the Wis
consin Central, which position he will resign.
T. l.. Chadbourne, Jr., a New York
lawyer representing the receivers OF TIN
Mobile, jackson and Kansa City Railroad,
has filed an affidavit alleging that he was
a stakeholder in the road and a large
owner Of stock in the Alabama Securities
Company and was an active factor in the
affairs OF the concerns; that the securities
company purchased the entire stock OF
the Chicago and Gulf company for the sum
of s27O 900; that Alexander Mcdonald,
W. ID. Stratton and f.. X. Shallow own or
control a majority of the stock Of the
securities company; that they have made
charges against the Mobile, jackson and
Kansas City company in favor OF the
securities company for alleged extra SER
vices and expenditures a~ggregating 81 ,l83,-
SoI .63; that bv virtue of their control OF
the railroad company and the securities
company they nave had the former admit
liability by contract with the securities
company TO The extent of $500 900 on
= QnNdNYIAnN and Is- "
Chadbourne further alleges that they
caused the securities company to be credited
with 1884 ,6Jl 81 on claims equally I'M
warranted and fraudulent.
The Affidavit alleges that the Securities
Company has no assets in the State OF Ala
bama that can be reached by process of
law and that the Mobile, jackson and Kansas
CITY and the Chicago and Gulf railway
companies are nov both hopelessly and
l~rretrlevably insolvent and utterly unable
TO pay their debts or meet their obligations.
He alleges that there can be only one reason
for either OF the said companies authorizing
the issue OF the second mortgage bonds
except that Stratton, Mcdonald and Stallo
and the Securities Company may be enabled
by the use of the bonds to crystallize and
make permanent the alleged indebtedness Of
the two railroad companies to the Securities
Company by placing said issue, when made.
in the hands OF inner purchasers against
whom there would Ne no defense.
stewart lor several years auditor OF the
Mobile, jackson and Kansas City Railroad.
and who resigned a short time ago, makes
affidavit TO the effect that under instrlc-
tions from the president Of the road at the
time hat he was auditor he was ordered
TO max fictitious entries to the credit of
permanent Improvement with a counter
charge against operating expenses so az TO
make the earnings Of the road apparently
exceed its operating expense and fxed
charges, when az a matter of fact the earn
ings we're not sufficient TO cover operating
expenses and fixed charges. and that these
fictitious entries caused the books Of the
company TO show net earnings instead OF a
deficit.