The opinion of the court was delivered by: CASHIN
This is a class action by the plaintiff, Sylvan Lemaire, on behalf of himself and all other bondholders of the defendant, Kentucky And Indiana Terminal Railroad Company (hereafter K & I), similarly situated. Plaintiff seeks a declaratory judgment as to the amount of principal and interest payable on certain 'Coupon Gold Bonds' issued by the defendant K & I and guaranteed by the defendants, The Baltimore and Ohio Railroad Company, Chicago, Indianapolis & Louisville Railway Company and Southern Railway Company.
1. Sylvan Lemaire, a citizen of New York State, is the holder of the 174 First Mortgage 4 1/2% Coupon Gold Bonds, issued by the defendant K & I in 1911. Plaintiff, with full knowledge of defendants' position, has acquired all of these bonds since May 1953, and they are part of a class of 2,467 of the defendant K & I's bonds which remain outstanding of an original issue in that year for the face amount of
2. The defendants are all domestic companies, organized and existing in states other than New York.
3. The caption on the face of the bond appears in the following form:
Kentucky and Indiana Terminal Railroad Company
First Mortgage 4 1/2% Coupon Gold Bond. Payable January 1, 1961.
For value received * * *'
Superimposed over the text of the bond in the centre of its face, in letters over an inch high, is the word 'Gold'.
4. The interest coupon attached to the bond appears as follows (the plaintiff holds 542 of these coupons):
'On the 1st day of -- - Kentucky & Indiana Terminal Railroad Company will pay to bearer two pounds and five shillings, Sterling money of the United Kingdom of Great Britain and Ireland, at the agency of the Company in the City of London, England, free of all taxes as mentioned in the bond, -- being six months' interest on its First Mortgage Gold Bond No.
5. The operative language in the text of the bond reads:
Promises to pay to bearer * * * One hundred pounds, Sterling money of the United Kingdom of Great Britain and Ireland, at the office or agency of the Company in the City of London, England, on the 1st day of January 1961, with interest thereon at the rate of four and a half per cent. per annum from the 1st day of January, 1911, payable semi-annually, in like gold coin, at said agency'.
'This bond is one of an issue of coupon and registered bonds of the Company to an amount not exceeding in the aggregate the equivalent of Two Million pounds sterling, known as its First Mortgage 4 1/2% Gold Bonds, secured by its mortgage or deed of trust dated the 3rd day of January, 1911, executed by the Company to The Standard Trust Company of New York, Trustee, conveying all the property of the Company ...