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BEALS V. ILLINOIS, MISSOURI & TEXAS R. CO., 133 U. S. 290 (1890)

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U.S. Supreme Court

Beals v. Illinois, Missouri & Texas R. Co., 133 U.S. 290 (1890)

Beals v. Illinois, Missouri and Texas Railroad Company

No. 111

Argued January 16-17, 1890

Decided February 3, 1890

133 U.S. 290

APPEAL FROM THE CIRCUIT COURT OF THE UNITED

STATES FOR THE EASTERN DISTRICT OF MISSOURI

Syllabus

A decree in equity canceling bonds of one railroad corporation and a mortgage by a second railroad corporation of its property to secure their payment, upon a bill filed by the latter against the former and the trustee under the mortgage, binds all the bondholders, unless obtained by fraud. And a bill afterwards filed by bondholders not personally made parties to that suit against those two corporations and a third railroad corporation alleged to claim a right in the property, by purchase or otherwise, prior to the lien of the bondholders, charging fraud and collusion in obtaining that decree, cannot be maintained without proof of the charges if the second and third corporations, by pleas and answers under oath, fully and explicitly deny them and aver that the third corporation had since purchased the property in good faith and without knowledge or notice of any fraud or irregularity in obtaining the decree.

This was a suit in equity by Beals, a citizen of New York, against the Illinois, Missouri and Texas Railway Company, the Cape Girardeau and State Line Railroad, and the Cape Girardeau Southwestern Railway Company, all three corporations of Missouri, and Thilenius and Blow, trustees of the Cape Girardeau and State Line Railroad, and Fletcher, all three citizens of Missouri.





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