THE ALASKA PROSPECTOR
Vol. 7 Valdez, Araska, May 28, 1908. NO 20
CREDITORS REFUSE
SETTLEMENT OFFER
Negotiations Toward Adjusting Reynolds Company
Difficulties Are Off and Bankruptcy Pro
ceedings Have Been Resumed.
Negotiations toward effecting a set
tlement between the creditors of the
Reynolds Alaska Development Com
pany and 13. T. Teter, who represents
the stockholders have been declared
off and proceedings to throw the con
cern into bankruptcy have been insti
tuted. This means that for a long
time at least the affairs of the con
cern will remain as they are and that
a hard fought legal contest will ensue
beforo the creditors get any part of
the money due them, or the stock
holders can take any action to reim
burse themselves for the money in
vested by Reynolds.
The abandonment of attemps to set
tle came Monday afternoon when
T. E. Donohoe of the law firm of
Ostrander & Donohoe declined to
accept the terms offered by Mr. Teter.
Mr. Donohoe at once telegraphed
John A. Goodwin of Fairbanks to
apply to Judge Reid for the appoint
ment of a master in chancery and to
have testimony taken to be sub
mitted to Judge Reid when tho lat
ter returns from a prospective trip to
the states, which it is expeeted will
bo in August. After he hears this
testimony Judge Reid will be asked
to declare the concern bankrupt and
to appoint trustees.
There are two reasons, according to
Mr. Donohoe, why he declined to ac
cept the terms offered by Mr. Toter,
one of them being the fact that Mr.
Teter's proposal provided that the
Alaska Home Railroad be eliminated
entirely from tho proposition. Mr.
Donohoe represents creditors of the
railroad and he says that he has had
no power to dismiss their claim. It is
the contention of the railroad's cred
itors that the railroad is a part of the
Reynold's Alaska Development Com
pany in spite of tho fact that the
stockholders of tho development com
pany deny any responsibility for the
debts of the railroad.
The other reason for refusing to
make a settlement is that the devel
opment company creditors repre
sented by Ostrander & Donohoe are
not satisfied with the terms offered by
Mr. Teter. According to Mr. Donohoe
his clients believe that the plans of
Mr. Teter will fail of their purpose
and rather than take any chances by
complying with his terms they prefer
to have the concern declared bank
rupt and abido by the results of this
course.
All told, Ostrander & Donohoe, and
Attorney Fred Brown represent cred
itors to the amount of $30,000 or $35
000. Only a small per cent, of this
amount represents claims against the
x'ailroad. The total claims against
the railroad and the development
company amount to nearly $500,000
about equally divided between the
two companies.
The terms submitted by Mr. Teter
provide for settlement, of the claims
against the development company by
the payment of 25 cents in eash on
tho dollar and 75 cents on the dollar
in gold bonds to run twenty years,
at G per cent interest, interest
payable semi-annually. Tho plan
was to issue bonds in the sum of
$500,000.
The terms, however, provided that
the cash payment should not be made
until all claims had boon certified, an
order of the court issued ^dismissing
the bankruptcy proceedings, remov
ing the receiver and returning the
property to the stockholder's manage
ment.
"Negotiations are off, and it. means
a court contest of at least five years
in my judgement", said Mr. Teter in
discussing the matter this morning.
"Tho clients of Mr. Donohoe see fit
to reject my proposal and now I
mean to fight to the last extreme for
what I firmly believe to be the rights
of those whom I represent".
TETER OBJECTS
TO BANKRUPTCY
Representative of Reynolds
Company Stockholders
Takes Action.
The Reynolds litigation remains in
statu quo and seems likely to remain
there for at leant a few weeks, after
the filing of several papers by oppos
ing attorneys in the past two days.
Mr. Tetor, vice president of the Rey
nolds-Alaska Development Company,
as attorney fur O. 8. Paget of Boston,
sotting up a elaitn of $10,480, has Hied
a demurrer to the jurisdiction of the
court, alleging that the bankruptcy
proceedings do not properly lie in
Alaska, that a proper foundation was
not laid to give tho court jurisdiction,
that the court had no powor to con
solidate tho two oases and that the
various Reynolds con)panics cannot
bo properly included in a single pro
ceeding.
After tho failure of the effort to set
tle on tho 25 per cent cash and 75 per
cent bonds basis, T. J. Donohoe, rep
resenting tho creditors who instituted
tho bankruptcy cases, wired to Fair
banks asking his fellow counsel thoro
to apply to Judge Roid In tho district
court for t he appointment of a master
in chancery to tako testimony In the
bankruptcy proceeding. This resulted
in nothing because Judge Roid was
already on his way outaldo on a Yu
kon river boat. lie declined by wire
to tako up any part of tho Reynolds
troubles while traveling. Ho will bo
In Valdez again about August 1.
Meanwhile Kdmund Hmith, who
has boon attorney for Reynolds and
the Reynolds companion under a
special retainer given hy Mr. Rey
nolds juat before leaving Valdez last
August, and also for nunierouH
Reynolds creditors, has filed a motion
in the bankruptcy case asking leave
to withdraw as attorney for Reynolds
and his companies beoauso it has be
come apparent that those interests
conflict with the int erests of the cred
itors he represents.
Mr. Tetor will sail 011 the Portland
and go direct to New York and Hos
ton. lie expects to return before tin
fall term of the district court.
DEMOCRATS NOMINATE
RONAN FOR DELEGATE
The democratic territorial conven
tion at Juneau noinnaited John
Ronan of Fairbanks for delegate to
congress by a unanimous vote. He
is a leading Tanaua mining operator,
president of tho mine owners'associa
tion, and during tho past winter was
in Seattle in cliargo of the task of
gotting minors for the Tanana to take
the place of the strikers.
The df,legates to tho democractio
national convention at Denver were
instructed for Bryan for tho presiden
tial nominaton. Following are the
delegates—lyouis Williams and John
Duckworth of the First division, K.
E. Hill and Ed. R. Dunn of the Hec
ond, John Ross and J. Y. Ostrander
of tho Third.
The convention adopted a home
rulo plank In tho platform.
Hteamship Hanta Clara sailed for
Heattlo early this morning, among
her passengers being Mont. Eastman,
from Fort IJscum, and John Noon.
Hhe also had threo second class for
Heattlo and Deputy Marshal Dooley
and flvo steerage for Oordova,
(lust. Honrlekson, Walter Naek,
Ham Gregg, H. Hmlth, II. Hallowoll
and L. Palmer, wero passongers from
Howard to Nome on tho steamship
Corwln which left Howard May 17.—
Gateway.
GALE DECIDES TO
MAKE CAMPAIGN
Congressional Delegate Is
sues Formal Announce
ment of His Candidacy.
CONSTITUENTS URGE ACTION
Present Incumbent Will Soon
Come to Alaska to Enter
Lists With John Corson.
Washington, May 23—(Special to
the Prospector)—Thomas Cale, pre
sent delegate to congress from Alas
ka announced today that he will be a
candidate for re-election. Delegate
Cale was nominated by the anti Hog
gatt faction of the republican territo
rial convention held in Ketchikan
May 12 in the face of the fact that he
had previously announced that he
would not be a candidate on a parti
san ticket but so urgent have been
the requests of friends both in Alas
and in Washington that he rescind
this determination that he has tlnally
decided to run again.
Delegate t'ale will, in a short time,
depart for Alaska and will make a
thorough canvass of the territory.
Delegate (Jale was elected to cong
ress two years ago as the miner's
candidate. Several months ago he
came out with a statement that he
was tired of oflicial life and that he
would retire at the expiration of his
term. This determination was re
iterated on occasions and then Dele
gate ('ale modified his decision by say
ing that if it was the unanii nous sense
of the people of the territory that he
be returned to ofllce he would consthrtf
to become a candidate for re-election.
The convention at which Cale
was nominated was one of the most
exciting in the history of the terri
tory, the dissention finally resulting
in a split, Governor lloggatt being
the source of trouble. The anti llog
gatt, faction nominated Cale and the
lloggatt faction nominated John
Corson of Nome. Corson is at pre
sent in the southeastern part of Alas
ka beginning his campaign.
OPPOSITION 10
GOAL UNO BILL
Guggenheims and Alaska
Central Object to Consol
idation Limitation.
Washington, May 27—Opj>oyitlon to
the coal land bill that passed the sen
ate and is now bofore the house has
sprung up and it 1m from the Ouggen
helms and the Alaska Central Hall
road t hat thin opposition comes. The
contention of those who at the last,
minute threaten to block further ac
tion on the measure is that the pro
visio limiting to '2,M0 acres the con
solidation of claims makes It. Impossi
ble to oporate with profit.
This opposition has created surprise
inasmuch an the previous opposition
to the bill has been that it Is in the
Interest* of the monopolists as it does
not provide for opening the land to
entry, and gives to thoso who en
tered before the lands were with
drawn, control of the eoal Industry
In Alaska.
DEPUTY CLERK BEEKS
TO TAKE A VACATION
Deputy District. (!lerk W. T. Heeks
Is to go out On the Portland for a
two months vacation, the greater
part of which will be spent in his
former home In Oklahoma. During
tfie absence of Mr. Heeks, Dr. Bur
ton, at present in Fairhanko, will act
as deputy.
Dr. Hurton Is now on tho way to
Valdez and during the Interval' be
tween the departure of Mr. Heeks ami
the arrival of the former K. If. Mack
will aet as deputy.
MINERS PROVOKED
AT GOV. HOGGATT
John Corson Is Also Con
demned by Delegates to
Convention in Seattle.
FAILURE TO ATTEND IS CAl'SE
Alaskans Generally Are Condemned
for Not Showing Interest in
Own Well fa re.
Scuttle, May 28—Coventor lloggatt
and John Corson in particular, and
Alaskans generally were roundly
scored at this morning's session of
the national mining congress now in
convention in this city. The criti
cism of the governor and of the can
didate for territorial delegate canto
because neither of them has seen tit
to keep their implied obligation and
address the convention. The mem
bers of the congress also took excep
tion to the fact that very few Alask
ans have seen lit to be present at the
session.
J. W. Ivey led the attack on the
Alaskans, declaring that while they
are always complaining of the burden
under which the existing mining laws
of the territory place thein, they
have not seen tit to attend the meet
ing of the very body vitally interest
ed in divising some method of reme
dying undesirable conditions. The
congress is representative of the most
prominent mining men, both opera
tors and engineers, in the country
and its recommendations with regard
to mining laws receive great consid
eration from the federal government.
» Mr. Ivey explained that tlie princi
'pa» reason for holding the national
congress in Seattle was in order to
be close to Alaska and thus give
Alaskan miners opportunity to pre
sent their grievances, to explain the
objections to the present conditions
and advance suggestions upon which
the congress might act in behalf ol
Alaska. " Despite what wo have
done,"said the speaker,"!lie Alaskans
present can be counted on one hand."
Continuing Mr. Ivey said:
"Alaskans have been eternally com
plaining that they are so hampered
by the mining laws of the territory
that the progress of the country is
greatly retarded. It would be ex
pected that the governor of the terri
tory, and that the man, himself a
mining man, who desires to represent
the territory in congress would make
it a point to come before this body
and shed a little light on the condi
tions in Alaska. This body is potent
with influence where influence counts
the most, but the governor and can
didate have seen lit. to ignore the in
vitation to address this congress, and
the men for the benefit of whom the
majority of you delegates have travel
ed so far have not deigned to come
before us and toll us in what respect
we can be of assistance to them."
The remarks of the speaker were
applauded and the generally express
ed opinion of the delegates is to the
effect that the mining men of Alaska
have no right, to expect, relief while
they sit. supinely by and content
themselves with whining.
HOUSE FAVORS A
FOURTH DIVISION
WaHhington, May 27 -Tho Iiouho to
day panned tho l>i 11 providing for fcho
oroctlon of a Fourth Judicial dlstrlot
of Alanka but It In doubtful if it pan
hoh tlio Honate thin hohhIoii.
Tho first time tho hill wan up It wan
amothored to death In the Iiouho but
now there Hoema to ho no great op
position in cither branch of oou^roBM.
Karthquakc at Katalla
Two earthquako ahooka occurring
In quick HueeoHHion tho night of May
14 Hot ovory building i" Katalla rook*
ing, moved furniture about rooms,
knockcd dlahoa fron aholvea and
eauHcd many portiona part of whom
had retired, to take to theatroota.
ALASKA CEMTRAL IN
HANDS OF RECEIVER
Judge Reid Acts at.Request of John Ballaine and
Big Fight for Control of Railroad Is New
On in Full Force.
The Alaska Central Railroad, the
terminal point of which is at Soward,
is now in the hands of a receiver, and
the first step in the battle to he
waged between John E. Ballaine, pro
moter of the road, and the Frost in
terests is on. Judge Iieid, acting at
the request of Ballaine's'attorney ap
pointed the receiver, naming .John A.
Goodwin, of Fairbanks. It will he
impossible for Mr. Goodwin to reach
Seward for some time and former
Deputy Marshal James Lathrop, of
Valdez, has been named as receiver's
agent. Mr. Lathrop departed for
Seward this morning on the Portland.
For more than a year Ballaine and
the Frost interests have been at log
gerheads concerning the manner in
which the afi irs ,n the road have
been conducted. Ballaine has al
leged that Frost has squandered
money and that his management has
been utterly incompetent. A few
months ago the men met in Frost's
ofllee in ('hieago ami nearly came to
blows. At that time Hallaine declared
that he would throw the road into the
hands of a receiver, and endeavor to
settle for all time the question of
| control.
Frost, too, has thrown the gage of
battle and has declared that lie would
I put Hallaine out of the running before
| the end of this year. Hallaine, in an
1 interview with the Seattle correspon
dent of the Prospector today declared
that he is in position to resume word
I on the road and that it will be eon
! structed to Fairbanks as fast as men
! can do the work. Construction work,
according to Hallaine, will be begun
I immediately.
The Alaska Cent ral has rails down
to mile fifty-three and the right-of
way is completed, with the exception
of thi' bridges, about seventeen miles
beyond that point.
HUNDREDS WATCH
FOURTEEN PERISH
Refugees On an Island Swept
to Their Death by Flood
in Red River.
Oklahoma City, May 28—Frantic- I
ally imploring aid from those who
helpless to act watched, fourteen per-'
sons were today swept from an island j
i>n which they sought refuge from
the flooded waters of Red river. The ;
tragedy occurred near Colbert.
For several days the Red river lias :
been rising and the residents of Col-1
bert have felt perturbation in conse
quence. Up the river there are low- j
lands and it was from this locality
where they formed a small settlement ,
t hat those drowned were swept away '
by the Hood, still clinging to the
wrecks of their houses or on rude
rafts. The current of the river washed
them against tho island and they
abandoned the wreckage on which
they had drifted and took to the
land.
It was early this morning that the
presence of the refugees was discov
ered and the residents of Colbert
were at once summoned to, if possible
effect a rescue. The river full of
debris was rising rapidly and repeated
attempts to get a small boat to
the Island failed, the boat at last
being destroyed.
The loss of tho boat ended all hope
of those on the mainland being able
to extend any further assistance and
helplessly they watched while the
riyer rapidly encroached on the Island
until It was completely submerged.
Then it was only a few minutes before
the Hood's victims were swept to
their doom. The names of those lost
have not been learned but there were
three women and four children
among them.
CASTAWAY JAPANESE
TAKEN TO SEATTLE
Hoattlo, May 1W— Immigration In
spector Maskeviccus of Hkagway I
arrived here today with four Japanese
who allege that they were abandoned
on an island near tho Alaska town by
the captain of a Healing schooner on
which they had shipped. It Is the
belief of the immigration authorities
that the men are boldly attempting to
enter this country In contradiction to
the purpose of tho coolie immigration
agreement.
One of the men is highly educated
and has documents showing him to be
a college graduate. All four inou
were famished when they were taken
froin the islands.
SAILORS REIGN
IN QUEEN CITY
Fleet Arrives Off Seattle
and the Town Is Delirious
With Excitement.
Seattle, May 2:t—At 2 o'clock this
afternoon the sixteen war vessels of
the Atlantic licet arrived off this
city, steamed majestically to their
respective stations and dn^ped an
chor. The arrival the floatiiyf?
fighting machines was witnessed by
at least .%0,000 persons who lined the
hlniTs bordering on Flliott hay, jam
med the waterfront and thronged
every available craft on the sound.
Mayor John Miller heading the re
ception committee was aboard the
steamship ('matilia and met the flag
ship down the sound, presenting the
golden key to the city to Admiral
Sperry. The reception lleet also
carried several organizations of the
city, the Arctic Hub being aboard
the steamship Victoria, tendered for
the occasion.
Never in its history has the eity
been so expensively decorated, and
never has it been so crowded. For
the past three days every train ha^
been landing every person it cotiifl
carry and the train service had to
increased in order to handle
tralllc Kvery hotel is full and hi^|
reds of private houses have been
verted into rooming houses. INII
The sailors of the fleet have orga
nized patrols to assist the police in
maintaining order. One of these pat
rols will be assigned for duty every
day <>t the fleets stay here.
From now on everv day will see
something doing in the way of enter
tainment for men and officers and
Tuesday has been declared a holiday.
Fleet Departs From Seattle
Seattle, May 27—Seattle is resting
today in an effort, to recover from
the effects of the dissipation of the
past three days, The fleet departed
this morning for Tacoma and within
a day or so the affairs of this munici
pality are expected to resume their
wonted course. It was an experience
that will never be forgotten by those
who participated in the pleasures con
sequent upon Ilie visit, of the fighting
ships.
SECRETARY OF WAR TO
INVESTIGATE RAILROAD
Washington, May SB The hmtfl
today ordered the secretary of wat^f
investigate and then report on
feasibility of all the railroad proJeH
contemplated in Alaska.