National Republican., 1876-02-03
FACTS OF THE CASE.
The eedman's Bank and the Y. u. C. A

TIE Young Mems Christian Association Of this
city having been subject to much severe criticism
through the press in different sections of the
country for resisting the payment of an alleged
loan to It of s33,0CO, by the Freedman's bank, we
have taken the trouble to ascertain the facts in
the case, which are as follows:
There are two separate and distinct CORPORA.
tions-the joint stock company of the Y. NJ q. A.
and the Young Mems Christian Association.
The joint stock company was Incorporated By
Congress in 1867 as stated in its charter expressly
for the purpose Of "erecting suitable building
for the meetings OF the association, with a hall,
free reading roems and library for the employees
Of the public Departments and the citizens of the
District Of Columbia" The building and grounds
are declared by this &C. OF Congress to be forever
exempt from taxation.
To enable this company to accomplish the OBJ
Jeet OF It's creation was authorized to issue
STOCK 10 the amount of -. 0,CO0. The surplus
revenues iron the rental of the building were to
be paid over to the y. II. Z. a, which had been
previously incorporated by Congress in 1864.
With tie money thus received the Y. NJ. q. A.
was to purchase the capital stock issued by the
Joint stock company, and when the entire capital
stock Should have thus been purchased the prop.
eTty is to be conveyed by the joint stock company
to the ether corporation, the y. n. G. 4.
Tie board of directors Of the Joint stock COM
papy, without the consent OF its stockholders,
and also without the consent Of the y. NJ. &. A,
who, as will be seen from the above provisions OF
the act Of Congress, were deeply interested in
the IreseTTat!On OF the property Tor the purposes
for which Congress had designed it, borrowed
from the Freedman 5 Bank So, ,QCO, for which they
executed Iotc secured by deed Of trust upon
tie property 1t the curner OF Ninth and ID streets
in this city, with power Of sale in the trustee To
sell the property at Iublic auction in case of de-
fault n payment Of the note.
This note became due and the Joint stock cam.
pany was unable 10 pay il, the commissioner
OF the bank urging payment of the money, as OIL
course they were justified in doing, the Joint
STOCK company had made arrangements to Dor.
IN cRr rTrft NJ . hn
property to pay this debt, when upon an exami
nation OF the title the attorney making it ex
pressed the opinion that the company had nc
power under its charter 10 borrow money and Sc
cure its payment by mortgage or deed of truS,
upon the property. The directors of the company
Informed tho commissioners OF the bank Of this
opinion and their consequent inability to raise
the money. and offered to apply the rents re-
ceiVed from the building to the liquidation ol
the DEBT. This tn few years would have paid
the bank in full. The commissioners OF the bank
old not see proper to accept this Offer and filed q
bill in equity TO have the property sold for the
payment of the debt. Having thus appealed Ia
company having done all in its power had nc
other recourse but to let the bank stand by the
law. II Will thus be seen that the Young Mems
Christian Association had nothing whatever tC
90 with this loan; had 10 part in obtaining IL
Fever reesiTed dollar ofthe money, aud is moi
even party to the suit now pending.
Our reader will appreciate the fact that 1t is
10 say theileast, q very serious Question whether
property thus designed by Congress for a specific
purpose. in which large portion Of the people
Of this district are interested, can be sold under
deed Of trust 10 third parties, be applied to
totally different uses, be held forever exempt
from taxation and the very object for which the
corporation was created be thus destroyed.
The mistake seems to have been made by tbs
baIE IN lending its money On such security with
iull knowledge OF the law.