The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-05-02
TIE GROCERY FAILURE.

TIE GROCERY FAILURE.
Trial Of J. X. Place ON the Charge OF OBJ
tanning 100000 Under False Pretences-
Proceedings I'm the Court Yesterday.
In November last commercial circles of this city
were startled by the sudden failure Of the frm Of
James X Place Co., OF New York, doing business
at 132 Front street, with branch al Rio Janeiro,
Brazil in the grocery and importing line. This
one Of the well known firms of the city. which was
engaged In a large business and stood, up to the
time OF the failure in the confidence Of the public.
1t seems from subsequent developments in the
courts that the Old firm Of j. X. e.
B. Place and the new firm Of ]. X.
Place Co. were largely engaged in the
importing business, and that to successfully
carry on the trade in which they were engaged they
erected certain arrangements with the firm Of Brown
Brothers Co., OF No. SO Wall street, for advances
in the form OF letters Of credit.
AS stated above, the iirm failed in November last,
but no proceedings seem to have been taken until
caused the arrest OF James X. Place. on the charge
OF obtaining Slo0,O00 from his firm under false pre-
tenGes MI pace was arrested on warrant Issued
Court, when preliminary examination was had,
during which It was shown that of $500 900 borrowed
by said Place from the firm of Brown Brothers h Co.
$400, 900 had been paid by the defendant towards
satisfying the claim. At subsequent examination
some further facts were elected The gentlemen
composing the firm, who claim that they have been
swindled out OF 100000, are James M. Brown,
Steward Brown, Steward Henry Brown, John Crow
ley BrOWn Clarence 5. Brown, Charles ID. Dlckey,
Howard Potter, Mark w. Outlet, Francis A. Hamilton
and Herman Hasker.
hrm to Place Co., in 1885, consisting OF q letter
Of credit for 100000, drawn in favor Of Phpps Il
coffee were purchased and shipped to Brown
Brothers n Co., New York, who, on their arrival in
this CITY, handed over the bills OF ladng TO Place
Co., an agreement having been signed by the latter
firm authorizing Brown, Brothers 4 Co. to revoke
the letters of credit If at any time the responsibility
OF their creditors should become doubtful. As the
credit OF the firm was good the bankers continued
making loans in large sums. In the month OF April,
1866, another letter OF credit covering eco was
drawn in favor Of Towlie, Richmond 4 Co., Of Co
loinbo, Ceylon with which 6442 bags of coffee were
purchased and shipped as before; on April 10
Co., Of Shanghai, China, was drawn for
f25,000 with which cargo Of tea was pur-
were to be paid to Brown, Bros. d Co. In specie.
On October l. a fourth letter Of credit was given
IN favor OF Towlie, Richmond Co.. Of Colombo,
purchased, and the proceeds on being received In
New York, were paid to Brown Brothers 4 Co. in
fifth letter Of credit In favor Of Benin, Mayer Co.,
OF Singapore, for $4,000, was given and expended
three separate vesses one Of which mi has only just
reached this port. Brown Brothers Il Co. received
the proceeds of sale OF the two first cargoes Another
letter OF credit was given IN December, 1856, for
100000, with which coffee was purchased, and
fl7,5 paid back in coffee. Another letter of credit
OF the cargo about half the loan was cancelled by
Place h Co.
In August of last year Brown Brothers 4 Co. first
heard unfavorable rumors as to the status of the
firm OF Place Co., when James K. Place was sent
for and an interview took place between the heads Of
the respective firms. Mr.. Brown in his testimony,
gives the conversation at that interview. He re-
marked to Place that he had heard unfavorabe
rumOrs as to the condition of his firm, when Mr..
Place remarked that his firm was good for 500 900.
They had met with large losses during the year, but
not in excess OF their prOntS-abOve 100000. Mr..
aia cafe hat no hl9 oil
in Fifth avenue. In the following month another
interview was held, when the same statements were
made by Mr.. Place. short time after the firm col
lapsed.
il is further charged that these representations
cheat the complanants out of their just Dues which
are placed ut 100000 that the books OF defendant
Hsp o he ossss o Se y % eng
in 1866 they were over 500 O0O also that the repre-
sensations made as to the possession OF house on
the name OF defendants wife.
The hearing OF the case was resumed yesterday at
the Jefferson market Police Court j. H. Anthem ap-
pearing for the prosecution and Ira Shaier for Mr..
Place
member Of the firm OF Brown Bros. Co.; there was
an interview between Place and myself at the time
credit was opened; the substance, which l trans
cribed at once, IL as foilows:-
~. X. Il F.. b. Place say that on June last they
had about $500, 900 in their business TO which they
have added since about $4,000 In gold-7th July,
1907
L
credit this of 100000; subsequently the 10Th OF
October, 1866, had conversation with J. X. Place
Il Co.; 1t is as follows:-
"Mr. place says that their profits last year were
5000 which made their capital the LIST Of Janu
airy last g. 100000; that notwithstanding the retire.
ment his brother II their profits this year eQualed
that Of last year, which he thinks is probable they
Will have about capital ON January l. 1857.
Dated Goth OF October, 1861"
These are the only conversations have recorded.
These conversations were with me personally, and
recolect the details mentioned on this paper. We
are in the habit OF making memorandum. First
learned Of the failure OH 10th November, 1867.
CrOss-examned.-The first letter Of credit was
one letter OF credit to ]. K. Z. b. Place, which
have mentioned; the same agreement accompanied
this letter OF credit rs those to Place Co.; with
this letter four thousand bags Of coffee were pur
nasad, bills made out In name Of Brown, Shpley
Co.: the cargo was by the brig Emily Agnes agree
ment was entered into relative To this cargo
think, since the failure OF the firm; our firm
had possession Of that cargo except by bill OF
ladng, which was transferred TO J. x. Il. B. Place
by endorsement Of Brown, Shipley Co.; the firm
accounted TO VA for the avais OF the sale OF that
cargo Of coffee, believe but can't swear to 1t;
amount for which they sold it; the coffee was paid
for in Rio by drafts Of Pbips Co. and Browns ac-
ceptances; the firm were required TO keep those
avs separate and distinct to meet the acceptances
we required the firm to hand over in specie the
avas OF sale OF this coffee; we always regarded the
profits over the satisfaction OF the acceptances as
belonging to us; we never went into any specific
examination; we did not expect TO sustain losses
when they occurred on the sale of these cargoes
made these memoranda ut the time Of the CONVEX
sation.
Redrect-By 1.-The agreement accompanying the
letter Of credit claim the proceeds OF the cargo AZ
cover for the general Indebtedness OF firm to u.s.
John T. Johnson sworn-I reside In New York; I
hold power Of attorney from Brown, Brothers &
CO.; am in their employ, and have general super
vision Of the Office; was "A member Of the committee
to examine the books OF J. X. Place n Co.: my assO
GATES were Courtlandt Taylor and O. r. Randoph;
we were appointed 18th June, 1861.
A question having been put 10 which the defence
ole ted the further hearing deferred until Mon
dag, at half-past ten O'Clock.