New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1880-07-10
A RECEIVER'S TROUBLES.


AFFAIRS OF THE CONTINENTAL LIFE.
CHARGES MADE AGAINST JAMES oNKLL-TFsTI-
MoxY OF r.. F. FARRELL BEFORE THE RrFErEE.
reference has been in progress before
Henry j. scudder OF No. 66 Walst since December lG.
TO- TO inquire into the accounts of James ONeil as
receiver Of the Continental Life Insurance Company
large amount of testimony has been taken before the
referee the receiver being represented by Wingate
Cullen the people by the Attorney General and policy
holders by Raphael j. Moses j. II. Work and other
counsel On June ~, 1850 r. +. Farrell, lawyer who
previously had been employed In the case appeared
representing several policy holders for small amounts
He had previously written a letter in which he SAID
that the referee being msled. aud that he could
show great Irregularities in tho receivershp account
On June % he his testimony before the referee
" on Information aud belief" He said:
II charge that the transfer of the purchase and sale Of
$500 900 worth Of will show neglect and fraud
the part receiver in this respect that more could
have been got for bonds when they sold The
broker believe to be one Amos Holban, formerly OF
Phi adephla-
81 charge that the son-in-law Of the said Receiver,
james McKenua with his knowledge and coGnzance,
bought certain property in the Exchange Rooms that
was knocked down TO him at tie suggestion OF his
principal clerk J. O. Tobias. for the small sum OF
81 800 and that the said McKenna did there and then
on that day make agreement to scll to resident Of
the vicinity for $500 and IN at the instrument
deed is now on hle in the County Clerks office. That
property is in Observation-Disclosures and was
sold on the day of May E. ID. Gale beng referee
The simple that the Harlem property sold to
persons in New-York City. friends OF the receiver for
third less than IL could be sold to other parties.
The witness made similar statement in regard to
property at Saratoga aud jersey CITY, and continued
.'The Jersey CITY property sold-by the state
ments of the receivers agent Jersey Cy-and there
was a good dizzy made out Of that"
"Madc at private sale r. the referee asked.
bo,so hoan teoda lrr
sponsbIe persons, but how true they may be- won't
vouch for them. BY the receivers agent mean Mr..
Tobias. who made the statement TO a responsible man.
well known In The City OF New-York. That completes
the facts. the statement OF the real estate and
bonds concerned. have nothing more now except
as TO the false statements IN the testimony. charge
that the compensation allowed by the receiver to his
chief clerk. j. o. Tobias, scandalous violation Of
his trus that said Tobias has been engaged
In business Of the character in his lfe and that for
years notorious fact that he only received from
the said O'Neill the OF SO week; but that he
(O'NeD allowed him 800 a week from the time he
sumed charge of the Continental Lite Insurance Com
pauy
charge that the receiver allowed c. d. Westbrook
salary Of $4,000 per annum for the month Of
June, 1877, without authority-when he was not re-
ceiver
81 charge that the said receiver paid John j. Mooney
the sum OF so-caled services, which he the
receiver repeatedly charged to be false and corrpt
that he paid them after certifying tnat he fMOOncy
was in the employ the receiver when the fact Is he
never there over two or three weeks during the
whole year"
Mr. Moses a.kcd the witness TO specify what he meant
by false statements In the testimony. He enumeT
ated numbcD OF incidental statements by Mr.. Tobias
which he said were not true huch s Tor instance tnat
Mr.. ONe:ll col eye grad ate. Nh Farrell then de
the agent OF Attorney General, and he desired 10
have him present TO assist him He said that the
charges depended upon the testimony OF witnesses whom
Mr. Cnlcn OF Winglte & Cullen when inquired of by
"a ALLEGATIONS Farrell,
grew very inpatient 1t the suggestion that there night
be any foundation for them. lie said that MIR Farrell
had made loud declarations OF the extraordinary things
he could prove but chat hc ha not proven 81 them
Al bis proofs" amounted 10 about what they did In
the case The NcwJerscy property. When Mr. Farrell
was questioned about tins he said that he had been told
that ms informant was told mat the property had been
sold irrcmlarly. OF course such testimony amounted
nothing, aud Mr. Farrell had brought no other tcst
support him. Mr.. Cullen was severe In dcnOunc
Ing what hc carcd the Interested motives of Mr.
faIIeli III t'hlts me t ~ tir
was the fact that neither Mr. Work Mr. Moses found
anything substantial in them. As the referee had not
yet given his dccisOnt was impossible OF COURSE to say
what he thought OF the charges.
MI. Work IS ont oftown. Raphael j. Moses said yes
terday that while he represent POLICY holders ana on
their nehilf he fe,t bound 10 get at the facts in regard
that there was nothing III the evidence 10 substan tate
the most Of them Taking up Mr. Farrel's charges Mr..
Moses discussed them ia their order.
As TO the sale OF the $500 600 Of bonds Mr. Farren
claimed that the brokers who NEGOTIATED TIE sale re
ceived too much. But Is eighth of per cent,
which the brokers testified their regular charge.
The Harlem property was sold 70 Mr.. Mchenna Tor
81 800 because there else at the sale, which
was a public who willing 10 pay 50 much Tor
II. Next. the $4,000 year paid TO Mr.. Tobias do
complain before the referee that his services were
not worth much that, for he Is skilfu account
ant But claim, and expect TO convince the ref
ere c. that services those Of MI Westbrook
should be paid for by the receiver himself !
1t Is true that the custom has grown up |
and has been sustained by tho Courts to |
allow compensation to he paid out of tue funds Of the
insOlvent company OF the services Of the referees
sstant But the receiver himself should be
BE Of doing these accountants duties Unfortunately
when You find a man skifu at such accountngs he IS
generally unable TO furnish sufficient bonds such as
100000 IN this But We think that the receiver
pay for This work. Then. too We claim that the
receiver, when such large sums involved should not
be paid full legal rate OF per commission, aud
we expect the referee Of tins sir. Farrell
Is right my opinion, claiming that Mr. Mooney
paid Excessive for the little clerical Work be dd
and we have given evidence 10 show that. his pay
ment was the fault Of the receiver and he always
protested against IL.
This is about what Mr.. FaFrels charges amount 10.
lie has promised to produce witnesses to suOstsntate
his bare allegations but although he has opportunity
do done In IKE this there
il danger OF leHkage5, aud here where more than
q 900 900 is yolved there have probably Deen leak
amounting to $4,000 by careless9ess or nadvtrt
ence. These we hope correct before the referee.
Already more than 5000 600 OF dividends have been
paid and the winding up Of the companys affairs has
probably been conducted with usual care and correct