The Detroit times. [volume] (Detroit, Mich.) 1903-1920, 1915-05-11
Road Files Suit to Pre-
vent Operation of
Statute
CLAIMS MEASURE
is NOT VALID
Plan Is Brewing for
the Reorganization
of Railway


Grant Fellows and the members OF
tle Michigan railroad commission
from enforcement OF the two-cent
fare Law on The ground that Il Is
constitutional ard conascatory.
vas sled Monday, BY Z =. eros
Eeuor, OF New York. a member Ot
- hrm Of Cadwallader. Wicker
SHAW & Taft and former assistant
United States attorney general. on
behalf Of the consolidated mortgage
holders o! the Pere Marquette rail.
4 Fl-s-!-
The sgit viii. IN az PROBABILITY. De
referred 20 the United States cir
cult co--i ~ Appeals. which VII sit
.G a similar suit sled BY the Ann AT.
,cr railroad in Grand Rapids. May
10
The case aled. Monday. is the d.
( rect outgrowth OF the refusal OF the
Michigan legislature 10 pass the
. TAYLOR. Henry bin. which provided
10, a general increase IN railroad
fares throughout the state. The dec
larstion Is based upon the points set
no In ne suit OF the Norfolk a
Western railroad against the state
q West Virginia and which was up
held by the supreme court OF the
United States 10 which II was car.
RED on appeal
The specific parties TO the suit
( are Beekman winthrop. former as
slstant secretary o, The navy, Fred
ferick winthrop, Charles W. Cor.
I William J wilson and the Farmers
Lean & Trust company OF New
York
Monday was an eventtuI day In
the annals OF the Pere Marquette
Ia addition 20 the fling OF the suit
~ the voidsncs OF the two-cent fare
law decision whereby a plan OF re
+ organization vtll be presented 70
I aited states District Judge Arthur
J. Tgtt.e within two weeks vas
reached after e lengthy conference
in the Judges chambers between az.
I torneys representing underlying
/ bontholters and consolidated mort
\ gaEeholders OF the system
/ Hal H smith. OF Detroit, and John
Lothrop Motley. Of Boston. vita as
soclate counsel representing the IN
DERIVING bondholders. we're prepar.
I'd 20 argue their motions for an i'm.
mediate sale Of the road. for author
. i'y 10 bring foreclosure proceedings
Ia ease the nrst petition was denied.
and for the cessation OF payments
en- both Canadian bonds and on
equipment obligations.
Rather than submit the case 20 ar
zument Attorneys Grosvenor and
Hilton z Spalding. % Detroit. repre-
sentlng the consolidated mortgage
holders. agreed 20 submit a work.
able plan FOR the reorganization OF
,he system within two weeks IL the
5ondholders would agree 20 post
pOne their suits for that length OF
time.
In tho general discussion Judge
futile declared (, his belief that the
present time was The proper one for
FORMULATION and his opinion vas
backed up by Receiver Paul King.
vho insisted tha, New York hnan-
Cd him tha. the work should be
done now, a.. on the close OF the
European var. there would be go
many other financial matters requir-
ing immediate attention that the
Tere Marquette would, In all proDa-
1lliry, Do lost sight o.
Judge Tuttle agreed 20 the post.
roremeut. declaring. however. that
be believed the mortgage-holders
% have considerable equity in the
road over and above the claims OF
NE hondholders. and that he wished
TO conserve their interests In every
way. Re insisted, also. that the ob-
legations Incurred under the man
aRement % the court be taken care
Of In any REORGANIZATION plan pre-
pared
~ the conclusion o. TIE confer
erco In The Judges chambers. Sew
ard I Merriam. counsel for the re
cciveTs. fled his answer 10 the ale
cations set up b. the underlying
+ bcndholders In their petition for the
sale 81 The road The answer did
not oppose the sale proposition. but
. corrected several statements in the
petition and outlined a mode OF pro
cedure which would be acceptable tc
the receivers 81 the court saw az tc
grant the request.
Objection 20 the demand for ces
lsation OF payments on Canadian
bonds vas Offset by the answer thai
the Canadian lines were self-sus
taining. and. In view Of this fact
mus; pay interest on bonds. Cessa
ton ~ payments on equipment on
, legations made such materials liable
IN acfzure whlrh would hfpfor snr