The Birmingham age-herald., 1915-09-28
THE KATY RAILWAY SYSTEM GOES INTO
 RECEIVERS HANDS
Action Comes as Result of Arrangement With Cred itOrs-President Be-
 comes Receiver

St Louis. September 27.-The Katy" railway system, embracing the Missouri, Kansas and Texas railway, Kansas corporation, and the Missouri, Kansas and Texas railway of Texas, today went into the hands of re- cefxzr. s a--s s .s :. |.
 This change affecting system with an aggergate mileage of more than sS0o,, was. brought about by independ- ent orders filed in federal court at St Louis and at Dallas and was a result of friendly agreement be- tween. certain creditors and the man. agement of the two companies that comprise the system
 Charles E. Schaff, president of both roads, was named sole receiver of each.
 The receivership order signed here was issued on the petition of two cred itors--the Railway Steel Springs com pany of New Jersey and D. B. Hussey of St. Louis. who had a claim of $135, 900 for ties and equipment. The order petition of Mr. Hussey, acting for him. self and other creditors.
 The railway company filed an answer to the petitions here, consenting to the appointment of a receiver and admit ting the allegations of the petitions as to the inability of the road to meet obligations already matured.
 The receivership suit was filed by agreement with the directors of the railroad. The failure of holders of $y50.000 face value of $19,ooo,0O0 out standing two-year 5-per cent notes to consent to an extension for one year at per cent brought about the decision of the railway management to throw the road into the courts to prevent the filing of individual suits that might re- suit in a disintegration of the system
 Holders of $200.000 of the two-year notes recently filed an attachment suit against the railway in Boston. similar suits were threatened by western note holders, and this, 1t is thought. hasr- ened the receivership petition.
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 Railroad Combination
 St. Louis. September 27.--The Mis- souri, Kansas and Texas is com bination of several roads originally in dependent. St. Louis Is the head quarters of the system and through trains operate from here to the large cities of Texas. The roads northern terminus. Is Hannibal, Mo. It's western terminus is Junction City, Kan.
 The first part of the road to be pro- jected was the Junction City Chetopa, Kan. line, promoted in 1865, as the Union Pacific Railway company (southern branch). This road was built as far as Emporia, Kan. and then passed into the hands of the Missouri, Kansas and Texas Railway company, organized in 1870. The new company
 
 panies extending it's lines to Parsons, Kan, Sedalia, Mo- and Kansas City. The Missouri. Kansas and Texas was the first road to reach the Kansas Oklahoma line.
 It then pushed construction through the Indian country to 'Defison, Tex. Tho Missouri. Kansas and Texas rail- way of Texas was built separately and connected up with the Missouri, Kan sas and Texas at Denison. The road had no St. Louis line. and in 1888 the Missouri Pacific leased 1t. This lease continued a. few years and the Mis- souri, Kans&s and TexlB euhder the Gould management, acquited traic1ake rights into St. Louis.s Afxet;f ffh6 leaee was dissolved the 'Katye buiit sfts own limo into St. Louis. ~ }3f fS's1e
 In .18s6 Congress offered alternate sections of land to the sraAroad that first should build from the eastern ter minus of the Union Pacific to the Kan : sas- Missouri line to the SOuthern line of Indian Territory. The Katy won the race. <.ss 7 The land. under the act of Congress, was to be turned over to the winning road after the Indian titles were cleared. The land never was turned over to the railroad. however. as 1t never became part of the public do- main. The Missouri. Kansas and Texas then filed a claim for $40 an acre for of way through Oklahoma The total amount claimed was @et,0 ,000. 900. The autt went to the federal Bubreme court V kSf6h dismissed the, cabe.
 s Ah antitrust suit lzxcIving maxi- mum penalties cf -o1eo. eeo. .oeos was flied
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