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Court, of 1861, which established the validity of the lease in all respects, fixed the amount of rent that was then in arrear, and made a decree for its payment. Pending that litigation, the Chancellor had appointed the three trustees receivers, in order that they should hold the income of the road subject to the order of the Court until the cause ended; and when the cause was ended the Court directed that the property remain in the hands of the receivers, who were ordered to apply its income to the payment of the decree which the Court had made. For three years these trustees and receivers went on in pursuance of that decree, and discharged its provisions as well as they could.
Then various of these parties got together in 1864 and entered into an arrangement which is called the compromise decree. I suppose it was called so because it was not a decree and because there was nothing whatever to compromise. Because it will be borne in mind that at that time there was no dispute between these parties. There was no litigation. There was nothing to make any litigation out of. All the litigation there had been was terminated, and these gentlemen were in possession of the road to carry out the explicit decree of the Court, in respect to which no question ever arose.
They have been called by many names - trustees, managers, receivers, agents, officers. It is enough for my purpose that they were fiduciaries. That is a title which covers by its definition all it is necessary to include. They went on under that arrangement after the date of this so-called compromise decree for fifteen years, without proposing at any time to close this trust or to withdraw from it; on the contrary, resisting, and successfully resisting, every effort that anybody was sagacious enough to devise to turn them out or to interfere with them in any way.
Now they come into court in 1879 and say: “The result of our fifteen years' administration is this: since 1872, seven years ago, we have paid no man a dollar upon the old original securities which we were put in there to protect and provide for. But since 1864, when this second edition of our trust started out, we have put upon that property, or have incurred in its administration, a debt of about six millions of dollars, evidenced by all the variety and forms of credit that can be imposed upon human credulity Six millions of dollars' indebtedness is the result of our fifteen years' stewardship, in the last seven of which we have not paid a shilling to anybody that was interested in any of these securities. And now we ask that the Court put us finally and forever in possession of the entire property of our trust, and likewise the entire property of the Vermont and Canada Railroad Company, to be held until the administration, which in fifteen years has resulted only in the accumulation of six millions of debt, shall pay it off.”
That is the exact proposition which is now made before the Court. You are called upon, on such a report as that of the stewardship of these gentlemen, to say: "Well done, good and faithful servants, enter you into a perpetual inheritance; we present you with the entire property of the trust; it is yours. Go without day.”
And thereupon these fiduciaries, not only in spite of courts of justice, but by the aid of courts of justice, walk off, the proprietors of the entire trust-estate,
having thus extinguished and wiped out all the securities they were placed there to pay.
It is not necessary to employ adjectives to characterize such a proposition as that; the common law lays small stress upon adjectives, and there are none that could possibly heighten the color of this plain statement of facts. That is actually the attitude of these fiduciary agents, for whom the dictionary has been ransacked to hunt up names. Now, if the Court please, if there ever was a case in the world which so carries its own answer with it that a Court would be justified in declining to hear the party in his own behalf, it is such a one as is now made to the Court of Equity, a Court of whose jurisdiction one of the foundation - stones is the enforcement between fiduciary agents and their principals of the very utmost good faith and fair dealing.
Well, who is it that asks for it? Why, it is the same set of gentlemen that always appear on such occasions. It is these trustees who have now got themselves incorporated into the Central Vermont Railroad Company, a corporation formed for the purpose—a sort of wrecking company, chartered by the Legislature-but the same men as before. And when you look at this petition all the orators are made up from that class. There is hardly a name that is not perfectly familiar to the Court; the same old faces appear here, only growing older as time goes on. Every time this hydra-headed controversy lifts itself in a court of justice these ghosts of departed litigation appear to us.
Some of my esteemed friends appear here for equipment bondholders. Equipment bondholders! Does any man suppose if an advertisement was put out in Boston proposing that all the holders of equipment bonds should put up one per cent. of their security for the sake of prosecuting this case that any money would be raised? Why, it would be received with universal derision. The modern Athens does not contain any Bæotians who are fools enough for that. It is this same set of fiduciary agents, and their instruments and satellites, who are after this property, and to whom your honors are called upon to convey it.
The case of the unjust steward, which I presume will be relied on (as it is the only case I know of that makes in that direction), did not go so far. He was undoubtedly a receiver; but the case was decided in his favor on the ground of the moderation of his demands. He left something for his principal. When they came to the end he only demanded fifty per cent. of the entire trust that was committed to him. He was contented with half. But the authority of that decision does not go far enough to justify the taking of the whole. That case is distinguishable from this.
Well, what is there to show for all this? They say they have improved the property. But they propose to take it, improvements and all. Who gets any benefit of that? Knowing they were going to have it, they have taken care of it. This whole case reminds us of what was said by one of those whose words do not die as ours do, in respect to the condition of England after a certain long war. “What have we to show,” said he, “for the slaughter of thousands and the misery of millions? Nothing but the sudden glory of contractors and agents, whose palaces arise like exhalations and whose equipages dazzle like meteors.” Now, one word on the prospect of the future after this shall have been accomplished. What does anybody suppose would come to pass if your honors granted this petition and deeded this railroad in perpetuity to these people by the establishment of a perpetual receivership where there is no cause, no litigation, and nothing for a receiver to do except to keep what he gets, a receivership that should last till the curse of chancery is swallowed up in the final curse?
Does anybody suppose that after they got it these debts which are now paraded before the Court would ever be paid? How could they pay them? Their previous history has only been to make them. They would fund them, of course, because there is no form of obligation they have not at their fingers' ends. They would promise to pay the interest on them, and then they would go down to Boston and say, “See here, we have got rid of all the old securities; there is no longer a first mortgage, no longer a Vermont and Canada; there is nothing but this trust and this forever. This being so, it will bear another loan. If we could have another hundred thousand dollars to stop this gap, and a few hundred thousand more to develop the property, we should have a glorious future before us. And all the satellites would say, Amen. Well, if they were fortunate enough to find a new set of creditors, in due time those who sit where your honors sit now would be called upon to apply the same rule of law which you are asked to make; that is to say, that the agents, who went in for the purpose of paying off this present trust-debt, had ample power to charge all their trust-estate with whatever new debts they created, and therefore the property should be made over to pay those new debts, wiping out these present ones. And