The Sun.
London, England, 1869-10-14 00:00:00

THE EUROPEAN IN CHANUTE

Vice-Chancellor James was engaged yesterday in hearing
the two petitions for the winding up of the European
Assurance Company
Mr. Serjeant Sargood, Mr._ Dickenson, Q.C., Mr.
Higgins, and Mr. Kekewich appeared for the petitioners ;
and Mr. Glasse, Q.C., Mr. Fry, Q.C., Mr. Amphlett, Q.C.,
Mr. Millar, Mr. Whitchorn, and others for the other
parties.

Mr. Dickenson at the commencement of the proceedings
called his Honour's attention to the fact that a motion
had been made to commit The Times for publishing certain
matters sub iudice. The Observer had since that published
a letter cf Mr. Lake's,which was quite as much a contem:4
of court as the article in the Times.

The Vice-Chancellor said that he had certain matters
before him to decide, and Mr. Dickenson must give notice

of his motion

Scrjeant Sargood then opened the petition of Mr.
Cowpc, a sharPholder of the company, who asked that the
company might be wound up, on the ground that the com-
pany was insolvent, and upon another ground—that it was
prudent that it should be wound up. In reference to the
first allegation, the learned serjeant explained that by
insolvent he did not mean that the company could not pay
any particular debt* but whether it could ray all its debts
and viewing the peculiarities of insurance and assurance
business, was the company in a solvent condition?
The Vice-Chancellor: The Act of Parliament says "able

to pay its debts."
Scrjeaut Sargood then went on to say that the amount
of policies was acknowledged to be ever £8,000,000, and
that .£200,000 had been paid for amalgamation with the
other companies. This sum was treated as an asset,
whereas the learned counsel contended that such could not
he done. As a proof that the company was not a1.:13 to pay
its debts, the petitioner•in his atlidavit mentioned the
fact that a shci t. time since a call of 1.75. per share had
to be made. Dlr. Cowpc a1z.,0 alleged that the company
ought at all events to have 42,000,000 in hand, whereas
they had not £500,000. Notwithstanding that, the company
was insolvent, the directors had been receiving fees, and
dividends had been paid. Mr. Sargcod here laid down that
the company was insolvent, not because it could not pay
the obligations of the hour, but because it could not pay It 3
general obligations on a fair estimate of its general liabi-

litics. Of course the retitioners were Acting sumo:v.ll:A in
ignorance, a 3 they had not the bools before them.

The Vice-Chancellor

And yet you mr.l:e such whole

denunciation;

Serjeant E'argood meant that the information had only
bean obtained from the c:m2any's own lalan?,e-sheet. Of
course in that sheet aggregate sums were rut down, and
the petitioners had no opportunity of seeing if they were
right or not. There was originally another petiticnc r with
Mr. Crawford, but he had withdrawn. In his affidavit he
stated that he had been a member of the guarantee com-
mittee. In 1566 and 1367 he did not believe the company
was in a position to pay a dividend, and when
the -cheque for the amount of his dividend was
sent to him he refrained from having it cashed.
There was an affidavit by Mr. Martin, en actuary, who was
of opinion • that the price put down for amalgamations
could.be stated as assets ; but he (the learned counsel)
would show several affidavits from well-known actuaries,
who held a contrary opinion. Then there were affidavits
from ten directors, but they merely said that they believed
the company was solvent.
Mr. Higgins then read affidavits from general actuaries
of very high standing, who bore out the petitioner's view
of the company's affairs. Mr. Bayley stated that the

average life insured in the European was 42 years. Ho
thought that 40 per cent. of the liabilities ought to be
accuinulated, and paying 4 per cent. Mr. Tucker (Pelican
Office), Mr. Pattison (Commercial Assurance Company),
Mr. Charles Ingell (Mutual Life Company), Mr. Charles
Ansell (the Atlas), and others, by affidavits, expressed
pretty much the same opinions. Mr. Higgins next read
some of the cress-examinations of Mr. Lake and others
connected with the company, and which had been taken
before one of the masters. Mr. Lake then stated that ho
received £5OO per annum, and 1 per cent. on all premiums.
In 1366 and 1367 his income was between £3,000 and
£4,000 per annum. The late manager, when he lift the
company was paid a compensation of £12,000 or £13,000.
Mr. Lake believed an amount had been paid to Mr.
Sheridan, M.P. for services rendered as a negotiator. Did
not know whether that amount was £20,000; but believed
it to be under £lO,OOO.

The Vice-Chancellor said the object of such a cross-exa-
mination had evidently not touched the main ground of the
inquiry, but had been done to create a prejudice.

Serjeant Sargood and Mr. Dickenson endeavoured to
spew his Honour that such was not the case ; but the Vice-
Chancellor, after hearing them, intimated that his opinion
remained unchanged.
Mr. Higgins, after referring to the reluctance with
which the witnesses had answered the questions and their
refusal to produce books, though they gave evidence
alleged to have been taken from those books, went on to
read the examination and cross-examination of Mr. Walker,
+lie actuary.

Mr. Kekcwich then read portions of the eraraination of
Mr. Palmiston. He said that several sums of money had
been invested this year, and policies surrendered. The
company had received £50,000 on account of calls. In
1563 there was a loss of ever £5,000 in the Kent Depart-
ment. The expenses had been £70,000 per annum;
but under a new amendment that would be
reduced to £50,000. Younger, who was the head of a
departmcut, made an affidavit stating that the bonds which
had fallen in on September 25, and cf which the society
had notice, was £101,831, but only £50,014 was " proved."
It was argued that the society did not attempt to say they
could pay the first-named amount, but that the second
was the only sum that had been "proved." Consequently
the company did not say they could pay these debts, but
that they could " stave them off."
Serjeant Sargood then proceeded at some length to con-
tend that the company had no right to trade on the
society when the latter had not the wherewith to carry
cut its contract. By refusing to interfere, the Vice-
Chancellor would say that the company was a staple one,
and could pay its debts, and that would be indirect
contradiction to skilled actuaries, who said that the
company could not pay its debts. They were told that a
society ought to put away 40 per cent. of its premiums,
-and the European had not done so. They did not say this
meney-bught to be in bands paying no interest, in bor-
rower:3'hands that could not pay, but somewhere where it
could earn 4 per cent. He thought it an idle mockery to
ask shareholders "for money out of their pockets, and
then to say the company was solvent, as the money so
received was only to make up a deficit.
The case was adjourned till Friday.

"Biddy," said a lady to her servant, "I wish you
would step over and see how old Mrs. Jones is this morn-
ing." In a few minutes Biddy returned with the inform=
tion that Mrs. Jones was just omcnty-tnyoue, govvi
149Athaimmiliabinoll :