The sun. [volume] (New York [N.Y.]) 1833-1916, 1879-06-17
BEGINNING THE DEFENCE.
COMMISSIONER HAYT AND MESsRS.
KdRR AND EIELD SWORM
The Advice that Mr.. Hayt says Chancellor
Zabriskte Gave-Mhy Judge Gnrretson
Refuses to Direct nm Acquittni in the Case.

The Advice that Mr.. Hayt says Chancellor
Zabriskte Gave-Nhy Judge Gnrretson
Refuses 10 Direct an Acquittai in the Case.
Public Prosecutor McGill Of Jersey City
cndcayored to show yesterday morning why
Judge Garretson should not direct the jury to
acquit President Hdy Secretary Knrr. and
Director Field. OF the International Trust Com
pauy without putting them on their defence.
He said that the advertisement that the COM
pany hal 100000 paid up capital for the So
curity OF dcpostors was circulated in tho face
Of the fact that largo amount Of this alleged
capital was in the shape Of stockhulders' notes.
made PAYABLE only after thirty days notice.
with interest. That the company did not re-
gard these notes as paid-up capital was shown
by resolutions passed by the Board Of Directors
authorizing tho replacing of the notes with
wcll-securcd bonds and mortgages. and also
calling on tho stockholders to pay the notes.
The defendants know tat there was constant
| ly increasing deficiency. In addition to the
shrinkagc " real estate valuCG. Tl.!s de-
/ n'iency was shown on tho books or the
company Notwithstanding die values OF
| tho real estate were carried on from
| year to year by the bookkcepcr in tho same ~
urcs. There was also a great shrinkage in the
value OF their real estate. On the books 1t was
/ valued at sl7f0O0. and. according 20 the esti-
mate OF witness Washington b. Williams 1t was
only about ,7j 0O0. The real cause Of the def
cheney alluded to was the putting money into
| this speculative real estate and continuing TO
/ pay six per cont 10 depositors in order % keep
| up the rcul estate speculation. While they
| were fully aware Of the condition OF the bank.
! they circulated their advertisement of u paid
/ ~ capital Ct s2lpo0p. although in fact the cap
! ual had all been sunk. II this advertisement,
printed on Tho back Of 10000 tape measures.
! meant anything. II meant mat therc was s2ol.-
| OuO between the dcpositors aud danger. In
| point of fact there was not dollar between the
knew it. Mr.. McGil added that the scoking in
| this way 90 obtain tho money " d"positors I'm
| order to bolster up thcir wildcat real estate
! spc ulations was fraudulent and ought to be-
| punished. II might b. that in some legal rcla.
tons the Stockholders notes might be regarded
rs paid-up capital. but Mr. McGill was sure
! they ought not tn b. so regarded MS between the
| bank and It's depositors.
| ments OF some Of the soundest corporations the
words cash capital" were used. yet nobody
actual cash. All that 80 cash capital" meant was
| paid-up capital. Could any depusitOr OF the In
ternnuonal Trust Company be supposed To
| think that on every day he might curry tape
measure away from tho bank. the s2OOOD cap
| itnl remained IN precisely the SAN" shape
! The fact WIS that tho capital did lie between
| the drpositors and danger. and when tho hush
ness of the bank was voluntarily suspended, no
| director had any thought that the d"positors
| would lose u cont. although all knew that a part
| Of the s2uuo had been lost
Judge CfHrretson refused o. direct the struck
| Jury to acqult, ON the grounds that such curse
! WIS unusual In criminal gasos. In which u was
| peculiarly the Part OF the Jury a. judge ~ the
| in'is. and QtwthetauiiuE tho argument OF x.
Gov. Bedle. De believed there were coutrovcrted
facts IN the cgse. The Judge then announced
thar he would lay down tho following opinions
when he came 90 charge tho Jury; That the adj
| Nrrtlsrment on the Nre came under The statu-
! tory eArf,ssinn, Nrttch statement or ac-
| count that tue word property. IN IN" stat
| utory clause. with intent to induce any per
son To inrust or advance any property to such
! CORPORATION included depostor's money;
| that the occurrence Of the act charged q year
and eight months before the date named in the
! Indictment lid not constitute n legal variance; .
| that the meaning OF the words on the taue must
OF stock mol lers were not cnpitRl provided tho
| Jury should Interpret the words on the tape 10
| mean capital paid in cash. us the Public Prose
| cutor holds
Exceptions to tho decision and to each Of the
| rulings ~ announced were granted 10 eN-Goy.
| Bedle, who then moved for the discharge Of the
been proved that he knew anything about tho
tape; This motion WIS denied. The opening
| for the defence was made by Mr.. Flavel McCiee
| Gov. Bodies partner. The points mnde by
| him had. in the main. been incidentally raised
| In previous arguments.
pany at its orsnnlfaiion IN lsSs and sinGe 1877
| PENDANTS and tho others Interested that u"
giving n s5o.oo00l the shane ~ notes would in
law constitute a GO9d payment, - capital.
Secretary Frank u. knrr ~ Elizabeth. ono %
| tho defendants testnedthat he wrote the words
| ior the printer tQ put on the back OF thc tape
STATE with 4 pa,l-up capital ~ s2oO006 for tho
| absolute security ~ depositors.' he said he
meant that Il WIS the only bank IN the
State with a capital NJ goo 900 for The security
| % depositors. ana that the capital was ruid va.
| H. honestly believed that us capital was
| legally paid up when he wrote ont the advcr-
| tisrment and bee believed ro vet When the
| business was suspended o." hnd $50 on deposit
for himself aul family consisting u "a wfe aud
| seven children. n b salary was ~ 500
| Then President Fra A. Hayt was called To-
| the witness chair His cluutennuce IL grave
| and his dcm"anor digni0od. Tho top ot n,
head is bald. ana he wears gray side whiskcr.
| continuous with his gray mousiache \ pair q
on his nose. H. deposited n palm leaf fan
! on table IN front Of him, and then slowly aud
! distinctly, hut in a low voice, gave his testi-
| mony. He lives IN Patterson. Putnam County.
| y. Y AMI Il Sc years OF uge. He Is Commits.
sioucr Of Indian AfTairs-that is to say. the head
of the Indian bureau. which has under It's
| SUPERVISION about $50 uOu Indians. He has
held that position nearly two years lie said
hr never saw the Advertisement about the
5000 600 paid-up capital, NJ It was written outb
the Secretary. He first saw tho tape measures
they were printed. and subsequent 70 that
time he had seen very little Of them. When he
read the words on the tap. he understood they
meant L. eNpr'ss that tho company had capt
tai Of 5000 900. and thar II was paid M. He be-
lleved that that was true. IL he had had any
doubt OF It's truth ho most assuredly would have
stopped tho circulation OF the tapes. Ho had
never conceived that the words meant that
there WAS so much capital on hand intact, He
was advised that the notes of the stoo hholders
constituted 50 murh pail-up capita, both by
Dir. Delayan and 10y the late Chancellor Laurs-
kio. The question had been raised by the late
Bakeley Wilson. one Of the directors. and the
opinions Of these two eminent lawyers had sat
isned him. Chancellor Zabrskic had told him
that the notes would constitute good and val ld
payment Of capital IN law and in fact. The only
time he ever saw the tapes after they were first
printed in 1873. was when he saw the nnitor
carrying lot Of them ont Of the bank in n
basket. probably for circulation. but be had
never had anything to do with them. The rea-
son why he mad never noticed them lying onthe
tab, in the bank was. he presumed, that be had
usually visited the bank IN the evening. When.
in 1871 IL WIS resolved 10 suspend business.
the only question with him aud the other di-
re- tors was as to how much the stockholders
would lose. None OF them supposed that the
d,rusitors would lose anything.
The rest of the day WAS devoted to expert tes-
timony on the part OF the defence.
National EneamPmcut Of the q. a. Il.