, CALHOUNVW). sr. Louis "a s. tm. mz. co. , 11 ‘
and supplies and materials furnished, to the discharge of a portion
of the indebtedness due on the mortgages, or by the appropriation of a
part of those earnings to the betterment and permanent improvement
of the railway, thus adding to the security of the mortgagees; and
therefore, on that account, the amount being sufficient to meet the
A sum due on those various claims, they should be paid.
I shall, therefore, overrule all objections of that character which
have been made to the report of the master, and hold that these
claims should be paid, but I shall not allow interest on any of the
claims, notwithstanding the certificates may have declared that in-
terest was payable. Where claims have been transferred by the
original parties to whom they were due, and the assignees have pre-
sented them, I will allow as valid claims only what has been paid
for the claims thus transferred. The master was of the opinion that
the fair inference from the testimony was that these claims arose out
i of work done for, or supplies and materials furnished to, the railway _
in Illinois and Indiana, and I cannot say that in this case this is nec-
essarily erroneous. This was a contract made by the company after
the lien of the mortgages had operated on the road, and was, of
course, subject to the rights of the mortgagees, and, as has been fre-
quently held in a case like this, there must be some sacrifice made r
by all parties—the employes and the material men on tho one side, and
the mortgagees on the other. Notwithstanding the ability of the
arguments which have been made by the counsel for the mortgagees,
they do not affect the view which I have always taken of these claims,
nor are they able to withdraw this case from the principles which the _
supreme court has established, which are that the net earnings of the ··
road are to be applied primarily to the payment of the employes
of the company, and of the amounts due for supplies and materials
furnished, and that if, instead of making these payments, the earn-
ings are diverted either to the payment of what is due to the mort-
gagees, or for improvements or betterments placed upon the road,
that constitutes a valid claim against the corpus, the property in f
the hands ofthe court, which it is the duty of the court tosee en-
forced. , ‘
See Tumer v. I., B. rt W. Ry. Oo. 8 Biss. 527. _