The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1908-01-12
SAY THEIR RIGHTS
HAVE BEEN ABUSED
Allegation That Many Whose
Claims Have Been Listed Are
Not Protected Creditors.
Claim That trustees
and Counsel Are
Ineligible.
Times Dispatch Bureau.
Munsey Building,
Washlngton. o. C.. Jan. /

second mortgage bondholders OF the
Jamestown Exposition Company had
determined to make hard fight for
control OF the litigation pending in the
foreclosure suit in the United States
Court at Norfolk. Counsel for these
bondholders have been proceeding very
quietly. 50 quietly. in fact, that 1t only
became known o-day that on the day
after Christmas Thomas Wall Shelton.
OF Norfolk. counsel for certain bond
holders particularly the William II.
Horstlnann Company. of Philadelphia,
appeared before Judge Waddll. In
Richmond, and filed petition for leave
to file a bill OF intervention this being
the proper procedure in order to al
low bondholders not parties to come
into suit OF this character.
Judge Waddill allowed the petition
10 be filed and set January 18th. at
Norfolk. as the date on which argu-
ment will be heard. 1t Is a foregone
conclusion that the exposition officials
Will make a bitter fight to retain con-
troll OF the litigation.
The bill OF intervention. filed with
the petition Is said by those who have
seen 1T to be an Interesting document.
aside from the legal fight. 1t sets out
the origin and history of the James
town Exposition. the manner OF elect.
Ing officers the duties attached to the
several Offices. and the manner In which
these duties were discharged. Expla-
nation is also made of the manner in
which the William n. Horstmann Com
pany became bondholders upon certain
representations by the officers of the
company.
Those Legally Secured.
This company. suing for itself and
sll other persons similarly situated.
which means all of the, second mort
gage bopdholders legally secured. al
leges that no person liz legally secured
under the second mortgage whose
debt had not been contracted prior to
June Is. 1907. which is the date OF the
mortgage; yet many persons have been
issued bonds that they might be used
as evidence for the purpose OF partic-
ipating IN the second mortgage, when
they were not so entitled
The bill further alleges that the
mortgage is lien upon all PERSONAL
property. including unpaid subscrip-
tions to stock and dues to exhibitors
for space; that the personal property
has been sold and not accounted for.
as provided by the mortgage, and that
ro funds arising from payments by
exhibitors have been deposited The
Till prays that all persons buying this
personal property be brought into
court.
The bill further charges that when
the second mortgage went to record
on June 18th the rights Of persons se-
cured Hereunder became fixed, and
that the exposition. after that time.
had no right to dispose of any Of the
assets for any purpose whatsoever:
that the bonds secured in the first
mortgage could not be used for any
other purpose than that named therein.
and particularly mot for the purpose
NJ creating a preference to other per-
sons secured under the second mort
gage, the company at the time being
irsolvent
What Court Must Construe.
1t appears from this that the court
will be required to construe the first
mortgage and, in addition, will have
tc pass upon the conduct of the OFF,
GERS of the exposition company re-
sarding this prior mortgage.
A very interesting point is that the
second mortgage transferred "al other
personal property of every sort. not
Included In the above description II
Is claimed that the unpaid subscrlp-
tions to the capital stock Is such "other
personal property not described" This
Is denied by the company, and 1t has
already transferred the unpaid sub.
scriptions to other persons to secure a
:
other fight.
The bill alleges that in order to in
duce persons to take bonds of the COM
pany, It sent out a signed statement
showing that the Indebtedness secured
by the mortgage would q not exceed
$35o0o0. 1t is alleged that there was
attached to this statement a letter
ed to eXamineSthe accounts OF the COM
pany, and which certified that they.
were correct. ,l.5l'sti
There will probably be some highly
interesting Developments regarding
this point. for the bill of intervention
alleges that ut was represented that
the amount Of notes Issued would not
exceed ss5o,ooo, Such being the fact
at his command, and necessarily and
easily ascertainable by the auditor Of
OF the Jamestown Exposition Company,
II he had the least grasp Of this
duties OF his Office, the company s.
estopped to deny3it particularly after
sending out what purported to be an
examination of the books, by a COM
mlttee certifying to the correctness
thereof ..ii3 II
Attncks Bonds First Issued
The bill attacks q great many Of the
bonds issued under the first mortgage.
claiming they were irreg gularly issued,
and that the second mortgage Is a first
lien on all personal property Of every
kind and class, including all debts
owing the Exposition Company, and
is a second mortgage on real estate of
the company after the bonds In the
first mortgage have been paid; that it
comes In ahead Of all Judgments and
mechanics liens, EXCEPT the particular
fled. s s. 55 "a III ff =
The bill claims that under thls4state
81 facts the second mortgage bondholt-i
,rs are really the most interested per-.
IONS In litigation. The bill alleges
The lltig~Sts are divided into slX5
slasses, as follows: Bondholders se-i
ID MI (Contlnued on Third Page,l