Nashville union and American. [volume] (Nashville, Tenn.) 1868-1875, 1874-02-15

The Receivers EssTd IN Its EtS-s LASs
From the Memphis Appeal
The following are the facts of the case
now pending in New y YOrk courts OF the
State Of Tennessee vs.. the stockholders Of
the National Bank of Metropolis of Wash
| ingtOn, d. G. In October, 1866, the Ma
tiOnal Bank of the Metropolis, Washington,
was indebted TO the Tennessee National
Bank, Memphis, for about fOrty-tive thOus-
and dollars. II was mutually agreed this
debt should not be pressed, provided SUI
ficient security was given. Notes, stocks
and other obligations to the amount OF
sixty-six thousand dollars were set aside,
and receipt therefore given, showing that
they were held as collateral. A small part
of this collateral was paid and properly ap-
piled. Two months after, December, 1866,
the Washington bank went into liquidation;
and three months later still, March,
1867, the Memphis bank failed. In
the meanwhile the officers Of the
Memphis bank very properly took
the coilateTals out Of the Washington
bank and had them in the hands Of Judge
Sherman, who was afteTward directed 10
give them back to the agent Of the Wash
ingtOn bank, with the express understand
ING that they were the property Of the bank
here until the original debt was cancelled.
The receiver repeatedly called attention TO
the balance, some thiTty-eisht thousand
dollars, still due when he took charge, urg-
ing payment either out Of e0llateTals or
otherwise. lie also visited New York and
Washington several times about this debt.
At one of these visits the agent offered
t. enty thousand dollars cash and five
thousand dollars in ship stOck-the latter
of no market value. On consulting his
solicitor and agent OF the State on his re-
turn, this offer was declined. Subsequent
" a peremptOry demand was made for the
cOllaterals or their avails. This demand
was refused on the ground
l. That the bank could not give cOllat-
erals in the face of liquidation or failure.
?. That when the affairs Of the bank
reached him these cOllateralS were net dis
tinrIishable from the other assets.
This claim was purchased by the State Of
Tennessee, September, 1869, and carried
with it the collateTals now in suit. The
State is plaintiff and the agent Ofthe Wash
ington bank, together with the directors
and stockhOlde 5, defendants, and who re-
side in New Ork.
Il is alleged that the Washington bank
being largely indebted to the government,
the COLLECTIONS I3id NcIc SpPiitu ~ this
object, and not 10 the debt due the Tennes-
see national. 1t is also alleged that this
diversion was known TO some 0fthe govern
msent officials in Washington, who took no
pains 10 correct it. The defense rested
chiefly on the grounds taken in tie above
reply TO the peremptOry demand Of the re-
ceiyer here. The plaintiff showed clearly
the securities reached the Washington
bank agent as such, specifically, and It was
also shown that he was the same person
who had previously made the offer of twen-
tv-five thousand dollars for the claim, TWEEN
ty thousand of which was in cash. Much
credit is due for the success Of this suit to
the able management Ofthe case by Messrs.
Brunei & Lathrop, the attorneys for the
State, who, notwithstanding the lapse Of
time and distance from evidence on their
side, presented the claim in clear and
forcible manner. They acknowledge them
selves indebted to the late receiver OF the
Memphis bank for the aid and evidence he
gave, without which they say they could
not have succeeded. l. o. U.
Missouri legislation costs seven dollars a