Lawrence v. Southern Pac. Co.

Decision Date04 March 1910
Citation177 F. 547
PartiesLAWRENCE v. SOUTHERN PAC. CO. et al.
CourtU.S. District Court — Eastern District of New York

Dittenhoefer Gerber & James (A. J. Dittenhoefer, H. Snowden Marshall, and David Gerber, of counsel), for complainant.

Joline Larkin & Rathbone (Arthur H. Van Brunt and Henry V. Poor, of counsel), for defendants Central Trust Company of New York Southern Pacific Company, and Houston & Texas Central Railroad Company.

CHATFIELD District Judge.

The complainant, stating that he sues on behalf of himself and other stockholders of the Houston & Texas Central Railway Company who may be similarly situated and who may come in has brought an action in equity in the Supreme Court of Queens county, since removed into the Circuit Court for this district, against the Southern Pacific Company, the Central, the Metropolitan, and Farmers' Loan & Trust Companies, the Houston & Texas Central Railroad Company, and the Houston & Texas Central Railway Company, and also one Frederic P. Olcott, who happened at the time of certain transactions to be president of the Central Trust Company, and to have bid in the property of the Houston & Texas Central Railway Company at a sale held under the decree of the United States Circuit Court for the Eastern District of Texas, in which suit the claims of the Southern Pacific Company and certain mortgagees, consolidated in the one action, were left undetermined and a reorganization effected between the Southern Pacific Company, certain trust companies, and many of the bondholders. Upon May 4, 1888, a decree in the consolidated action was entered ordering a sale of the entire property upon the defaults on the various mortgages recited in the decree. All possible defenses were withdrawn, the decree was entered substantially by consent, and at the sale held in pursuance of this decree the property was bid in, according to the terms of the reorganization agreement, by Mr. Olcott. The new or reorganized corporation was called the Houston & Texas Central Railroad Company, and the property bought in by Mr. Olcott was transferred to that company, except certain lands which had been pledged as security for the bonds of the old company and these lands were conveyed by Mr. Olcott as security to three trust companies, one of which was the Central, who advanced money or made loans under the terms of the reorganization agreement. The bondholders of the old company accepted the bonds of the new company, but, according to the complaint in this action, the minority stockholders of the old company refused to pay the assessments which were demanded, and ultimately all of the stock of the new company was taken over by the Southern Pacific Company, which now holds the same; certain guaranties having been made by the Southern Pacific Company at the time of so doing.

The complainant alleges unequal treatment, so far as the minority stockholders are concerned, on the part of the Southern Pacific Company, and the existence of a trust upon the stock of the reorganized railroad in the hands of the Southern Pacific Company. The complaint also alleges that the defendant trust companies have no beneficial interest in the lands purchased by Mr. Olcott and conveyed for trust purposes to each of these trust companies, and that the complainant has requested the directors of the old company to commence an action for an accounting against the Southern Pacific Company, Mr. Olcott, or any of those named as defendants in this action, and that these directors have refused so to do.

It is further alleged that these directors have taken the position that neither the Southern Pacific Company nor Mr. Olcott should be called upon to account or afford any relief to the minority stockholders who are said to be some one hundred in number; and the relief prayed for is that the Southern Pacific Company be held to have acquired and to hold the capital stock of the reorganized Texas Company and the profits and earnings received therefrom as trustee for the minority stockholders, as their rights may appear; that an accounting be had from the Southern Pacific Company; that it be adjudged that neither of the three defendant trust companies nor Mr. Olcott had a beneficial interest in the lands; that after the carrying out of the trust agreements by the trust companies the surplus of the lands, which would then revert to Mr. Olcott, be transferred, assigned, and delivered to the old railway company, and an injunction and the appointment of a receiver to carry the decree into effect (in which injunction the prayer asks that Mr. Olcott be also included) is demanded.

The action thus instituted was removed into the United States court by the Southern Pacific Company, Frederic P. Olcott and the Houston & Texas Central Railroad Company, appearing...

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8 cases
  • Bogert v. Southern Pac. Co.
    • United States
    • U.S. District Court — Eastern District of New York
    • 13 Julio 1914
    ...stockholder for leave to intervene denied for laches. Lawrence v. Southern Pacific Co. (C.C.) 165 F. 241 (1908); Id. (C.C.) 177 F. 547 (1910); Id. (C.C.) 180 F. 822 (1910); action stockholder for accounting and other relief; motions to remand denied and suit dismissed. Bogart v. Southern Pa......
  • Iovino v. Waterson
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 1 Diciembre 1959
    ...Neff, 1878, 95 U.S. 714, 733, 24 L.Ed. 565. The Federal courts in New York had earlier reached the same result, Lawrence v. Southern Pacific Co., C.C.E.D.N.Y. 1910, 177 F. 547; Stromeyer Co. v. Aldrich, D.C.E.D.N.Y.1915, 227 F. 960. Indeed, Judge Learned Hand's opinion in Thorburn v. Gates,......
  • Plimpton v. Mattakeunk Cabin Colony
    • United States
    • U.S. District Court — District of Connecticut
    • 17 Febrero 1934
    ...revival of actions against administrators and executors. The effect of this amendment is disclosed in the two cases of Lawrence v. Southern Pacific Co. (C. C.) 177 F. 547 (decided in the second circuit before the amendment), and Randall v. Proceeds of The Scranton (D. C.) 23 F.(2d) 843, 845......
  • Lawrence v. Southern Pac. Co.
    • United States
    • U.S. District Court — Eastern District of New York
    • 28 Julio 1910
    ...present motion are matters of record and are sufficiently set forth in the opinions upon the motions previously decided in 165 F. 241, and 177 F. 547. earlier of these motions was an application to remand to the state court from which the action had been removed, the plaintiff alleging that......
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