New-York tribune., 1908-01-04
RECEIVERS TO EXPLAIN
JUDGE GRANTS ORDI
Must Shoe Cause Why Third 4Ue-
nue Shouldn't Be IN Other Hands.

J,6re Iaconbe in the United States C1rcui'
Court. signed order yesterday directing the re-
cesve-s of the New York City Railway Company to
chow cause why separate receivers should not be
appointed for the Third Avenue Railroad Inc
order which Is returnahe on Monday. was granted
on the application Of John NJ Bowers. Of Bowers
& Sands. counsel for the Central Trust COMPANY
which has been substituted for the Morton Trust
Cornpany as the trustee Of the Third Avenues out
standing bond issue Of sS7-56e0oa
The fact that the Morton Trust Company had
resigned the trusteeship on December q was ho'
generally known prior TO the appearance of Mr.
Bowers in the application Of the Central Irusl
Companv Mr. Bower also filed a bill of fore
closure against the Third Avenue Railroad Com
pany.
Argument had previously been heard by Judge
I.acon,be on the question as to whether or not he
should order the receivers Of the New York CITY
Railway IN nav the rentals and interest on the
bonds OF the Third Avenue Company. Judge
Iaconlbe ordered counsel to submit papers In the
latter application this morning He intimated ne
would appoint a special master to take testimony
in the case
The amount due TO the Third Avenue company
and its bondholders is s2s0o in rentals defaulted
on October Is, and the senli-annual interest oue
on the outstanding bonds on January J. amount
ine to s751eoo. Arthur H Masten. counsel for the
receivers said that in his answer. TO be hied this
morning he would deny specifically that the Third
Avenue was able to earn enough money 10 pay the
fixed charges
The complaint of the Central Trust company
after telling OF the organization of the Third
Avenue company and defining its properties, re
cited the steps by which il leased TO the
Metropolitan company, which later was turned
over 10 the New York City Railway Company
after stating that the Third Avenue is an impor-
tsnt part of the New York City system, the peti-
tiou asks the federal award TO the CentraI
Trust Company judgment for the full amount or
The bends due under the mortgage of May 10. l%o'
with interest and rentals TO date unless the same
should be paid within short tine by the receivers
OF the New York City Railway Company The
petition then asks for separate recelNeTShp TOT
the Third Avenue
II is lust possible that prior 10 the return OF the
order 10 show cause why the separate receivership
sho,,d NOT be granted counsel for both sides will
sfipulate that the determination of the question
be postponed pending a decision Of the United
States Supreme Court the appeal from the orig
fnaI aopointment of receivers by Judge Lacombe
Edward NJ Shepard. representing committee OF
hordholders Of the Third Avenue Railroad opened
the argument the application for an order
directing the pavent Of the rentals and interest on
bonds He said he thought the payments might be
met by using the daily cash receipts for that pur-
pose and by the issuance Of receivers cerflhcates
for the general purposes of operation. Nr Shepard
said he took little stock in the reports of account
ants that the road being operated at a loss.
because they showed only bookkeeping figures and
did not represent the real facts
Mr. Shepard sure. he said, that if the ac-
counts of the Third Avenue could be separated
from those Of the New York City it could be shown
that the former earning enough to pay its
fixed charges. He said that in the original appli-
cation for a receivership for the New York City
nothing was said about possible segregation OF
the Third Avenue property On the other hand
one Of the reasons given for the receivershfp was
that the entire system should be kept together \
separation this time he argued. would result IN
serious loss re the Ihlrd Avenue ana 10 llS StoCh
and bond holders.
Arthur H Masten on behalf of the receivers.
denied that the Third Avenue earning enough
70 nav fixed charges; and as for receivers GER
ti6cates he secuted the idea that money could be
raised in that way the present condition Of the
.none market
Henry wcIlncan who is seeking to have separate
receivers for the Metropolitan and the New York
City said he could not understand how the Third
Avenue could be earning less now than before
millions Of dollars were spent on it.
Mr. Kirlin. who appeared on behalf Of the Met
ropolitan company, was asked as TO Wnetler ms
client opposed the payment of the rentals ana
interest on the Third Avenue He replied that he
NJ. ,,natle 10 answer that question at this time.
Mr. sbenard wanted several days for the prepara-
tion of briefs. bit Judge Lacombe said II was I'M
rortaut that there should be no further delay ana
that he intended TO pass on The question to-day
If II could be shown that il the wisest course
IN keen the Third Avenue part OF the entire
s,ste-n the payment Of the rentals and interest
might te arranged before the expiration OF the SIX
-no,ths allowed for the default He seemed much
favor OF aIlriilt4llB d 7tSNi0 -
n,sDs-iyelv into the question whose report he
might finally determine the future OF the Third
Avenue company.
William a Read & Co. are offering to purchase
le+ their face value the coupons for the interest
rs,,e on January on the first mortgage per cent
fft- year gold bonds Of the Third Avenue Rail
road Company. the interest of which has been de-
faulted by the receivers of the New York City
Railway Cornpany The offer expires February /
v. M. c. A. COURSE IN BOAT BUILDING.
W b. Stephens. the boat builder of Bayonne,
X I opened the second term of the Motor Boac
School al West Side Young Mems Christian
Association building No 3ls West 57th street. last
night with lecture Experiences in Motor
Boat Building Owing the number of motor
boat enthusiasts who wanted take this course
last year and could not so Of