Page:Federal Reporter, 1st Series, Volume 10.djvu/429

FLAGG V. MANHATTAN BY. CO. 417 �1881, the people of the state of New York brought a suit in the su- preme court of New York, against the Manhattan, the complaint iu which sets forth the fact of said leases, and the operation of the roads unciler them by the Manhattan; that by their terms it agreed to pay outatanding obligations of the other two companies amounting to very large sums, and, under them, is now liable for the payment of bonds of said companies, amounting in the aggregate to about $21,000,000, and the interest thereupon, and for the payment of all taxes on said roads, and to pay to said companies certain additional fixed charges created by said leases, and which aggregate more than $1,300,000 per annum; that the Manhattan is, and for a long time bas been, operating said railroads at a great loss, which loss for the year ending Seplember 30, 1880, was, according to the estimates, about $500,000; that the continued operation of said road by it will resuit in further loss to it ; that it owes, and for a long time past bas owed, a sum exceeding $900,000 for taxes unpaid, a large part of which has been due for more than one year; that it has no assets with which to meet its existing indebtedness, and the requirements of said leases, except the receipts which accrue to it, from time to time, from said roads, which fall short of its annnally-accruing obli- gations to the amount of at least $1,000,000 per annum; and that, on or about April 25, 1881, it addressed a communication in writing to the mayor, comptroller, and corporation counsel of the city of New York, whei'eby it declared itself to be unable to defray its obligations, especially its indebtedness for taxes, and in substance declared itself insolvent and showed it had been so for more than a year. The com- plaint prayed a dissolution of the incorporation of the Manhattan, and a forfeiture of its corporate rights, privileges, and franchises, and the appointment of a receiver of its property, and of a temporary receiver. On the twelfth of July, 1881, the Manhattan answeredthe complaint, denying its insolvency, admitting that during the year ending September 30, 1880, the said roads were operated by it at a loss, and that, on or about the twenty-fifth of April, 1881, it ad- dressed a communication in writing to the mayor, comptroller, and corporation counsel of the city of New York, and denying the other material allegations of the complaint. On the thirteenth of July, 1881, the supreme court, by Mr. Justice Westbrook, after a hearing of both parties, appointed John F. Dillon and Amos L. Hopkins to be temporary receivers of the Manhattan. On the twenty-third of July, 1881, the New York presented to the supreme court a petition v.l0,no.4— 27 ��� �