Show TOM WARDEL The sdferemeCourt Sits Daws ea Him aad His ILls Salt Washington 11In the Supreme Court today a decision was made in the asia of Thomas Wardell appellant 13 te the Union Pacific Bailioad Company et aL an appeal from the circuit court of the United States for the district of Nebraska On the 16Lh of July 1868 Oliver Ames president of tbe Union Pacific Kailroad Company acting by direction of tho executive committee the board of directors entered into a contract con-tract with Wardell and othervby which the latter wtw empowered to occupy and work upon extremely favorable tjms the coal lands belonging to the company along tbe whole line of the lallers road charily thereafter a stick company under tbe name of the Wyoming Wyom-ing Coal and Mining Company was organized with Wardsll and a number of directors of the Union Pacific Company Com-pany as its leading stockholders To this corporation Wardell transferred his cantract without consideration On tbe 13th of March 1874 the offices and agents of the railroad company oy order alent United States directors seized tbe mines bond and penoaal mine papers pnonl property prop-erty of the mining company and have held and used them ever since Wardell sues under his contract for damages resulting from such seizure and from the attempted abrogation of the contract The railroad alleges as iU main defense that the contract was void on account of fraud that i was executed for the company com-pany by the executive committee of its board of directors the majority of whom by previous agreement were to be equally Interested in i that for tbat reason its terms were made so favorable to the contractors and so unfavorable to the railroad company as to enable the con tractors to make very large gains at the railroad companys expense and that the organization of the Wyoming Coal ana liming Company was a mere device to enable those directors direc-tors t participate in tbe profits of the contract which as agents of railroad company they had executed and which a contractors they proposed to make money out of The court holds as utterly illegal and indefensible the character of this contract It was a scheme to enable tho directors who authorized au-thorized it to divide among themselves and the contractors a large sum of moneywhich should have been saved to the railroad All arrangements by the directors of railroad companies by which a new company is formed RS auxiliary to the original one with the understanding that tbe directors of the original company or some them shall take stock in it and then that valuable contracts should bed given it in the profits of which the directors as stockholders stock-holders of the new company shall share are so many unlawful ecbemes to enrich their promoters at the expense of the stockholders and creditors of the original company and they will be condemned whenever they are biought before courts for consideration Complainant Wardell can derive no benefit from a contract tainted as this with fraud or sustain claim against tbe railroad company for its repudiation The decreo of the court below i affirmed with coats |