Delaware state journal. [volume] (Wilmington, Del.) 1870-1883, 1880-12-02


companies properly kept; from my examina.
ton OF such books as they had was unable
to determine anything at all as 10 the condi
ton and circumstances of the company,
otherwise than as to their premium notes
founu no record Of assets upon any of the
BOOKS OF tie company some of their assets,
certain number of securities they had, stood
IN the name Of the company the largest
item was matter of bonds and mortgages
II remember rightly, about 1000 there
We're other mortgages the particulars OF
which do not now remember, bills recevs-
Bile, a deed for real estate, a certificate OF
stock in passenger railway company do moi
| recollect any other item in the way of Becuri
ties !; did not see any what are called nego
liable securities, except the bonds and
mortgages found no Government bonds nc
State bonds; there were no other securities
than those have stated | do not remember
that these bonds and mortgages stood in the
name OF the company there were assign
ments upon mortgages to the company the
assignments were on separate papers folded
in with the mortgages, not attached to the
mortgages l think most of them were moi
recorded there was no evidence of theil
having been recorded.
s'Is there any name by which securities
held in that way are commonly called in in
surance circles?' No answer.
Certified copies of mortgage shown
These are copies OF the mortgages referred to
and which constituted the bulk OF the assets
that were submitted.
As result Of my examination recommended
| that number of these items exhibited Ar
assets should not he allowed (referring to
memoranda made AT the time) there was an
item Of Empire Passenger Railway stock,
do not remember the number of shares,
recommended the commissioner to disallow
that Item for the reason that there seemed to
be no actual value to the stock at the time,
made inquiry and ascertained that.
The next item was deed of 40 acres of
land in Clinton county, Pa, the consideration
being $4,000; made inquiry into the value
oil This land ; as II result Of the investigation
l recommended that that item be stricken
| out.
Inc next Item was matter of bills receiv-
able, promlssory notes. | recommended that
they be not allowed, the notes were given BY
| individuals to the company, were without any
security and were all overdue the secretary
SAID they were given for stock in the com.
pany, think they amounted to something
III the neighbOrh0od of $4,000.
The next item WAS premium notes which
mad been taken for premiums ON mutna.
| policies, they were given to the company at
basis for assessment with which to nav
losses and understand that note of that
character would have no negotiable value
they cannot be collected except by assessment
the commissioner that they should not be
| regarded as cash assets.
| Gin explanation to the jury.) In mutual
INSURANCE, company the cash premium il a
nominal sum and the real consideration for
the Insurance Is premium note; in return for
the policy the assured gives II premium note
which stands simply rs security for
assessments upon which losses are to he met
The next item was office furniture we had
no means OF ascertaining the value of that
except by sale, and We did not think it should
be allowed in the cash assets.
The next item was accrued interest on
| premium notes, amounting to S305l. As; this
rejected, because 1t was an expected asset
and we had no means of asugrtaiuing what
the real value of that would be- and. under
THESE circumstances we did not consider it
| a cash asset.
| cash asset is an item which can be con-
verted into cash. Cash assets are necessary
as foundation for insurance business; it il n
cash business, because its losses are PAYABLE
IN CASH sound insurance companies invest
their surplus money, aH rule, i'll such securi-
tlcs-ilrSt, as are known to be sound, and
second, as can be quickly and readily CON
Nerted INTO cash; | iound none of that char
| acter among the assets of this company
Hound, think, about S3i0 cash on hand
inc last Item on this memorandum is
bonds and mortgages; | recommended the
commissioner to reject the mortgages on
land IN Dauphln county, PENNSYLVANIA three
mortgages Tor 57,5Ji each and one for
9-Aobli, making SjD,OOO III all; we employed
III attorney up III Dauphln county to make
IN investigation INTO tile value of this prop
ertyi the attorney submitted to Ills allidayits
Mr.. Have You got those ailidaylts?"
Mr.. Bates we have"
Mr.. Lore-"We don't want them"
The ailidavits were produced and identified
by Commissioner Melee who was called to
the witness stand for that purpose. They
were taken by MIR. Bowman, a member of the
Harrisburg bar. After identification, they
were offered i'll evidence, but excluded, after
argument.
Examination resumod-"As further
result OF examination, did you make any fur
ther recommendations to the commissioner Z"
II recommended him to take steps to close
the company up?"
Nv hat were yuur rcasOns?"
MY conclusion was, from all the evidence
saw Ut the examination, that the company
llau been founded upuna fictitious basis and
was unworthy of credit.
have adjusted loss of this company
That loss was unsettled at the time of my
examination | had some conversation with
Tue secretary, dnrlnS that examination with
retpecl 10 That loss we were going into the
matter of unpaid claims at the time and the
secretary Ina given III list IN which | did
Wa, my ~ tliit particular loss 1t was the
Az D'ui nuns III pennsylvania did not
,.,,,' ,ii'a itu'i inquired OF the secretary
time he stated that he had no knowledge of
IL thNt lie had not received the proofs |
llau sent the proofs to the company | know
' !, "e w '"Vo''Si oeTauae saw Them there
80, I'a'ine u"S 4 thlllh thtN were not
,',.,. VI tho pooks thv dtiehse made
~, ,Iu ui'' was th"t the premium had
it,I,nrt r",u w .uU culhpahy Inc agent was
rra,,aS @ W hiiHueipnh saw MI.
.It,,tt,r, 1,,a', w Wv nu"u VI an account AZ
',' 'iai'o, Agent, uh the books OF the
,S. ilans thu! refused 10 pay the policy on
5r",'''" 'ii''' tncS had not received tins
~,
The amount of as4et4 claimed hy th, o,,,,
| pAnN was, III my recollection over sl5u DDn
relerrlhs to II copy OF the official statemenp.
the amount Of assets finally allowed was
Fol,ooo'li inc liabilities, S4O,2jl.1 As luay-
ING AS net assets about II l. 900
NPullcy shown. and attention of Witness
called to the following clause 1T il hereby
declared and agreed to be Il condition. nf ms
Insurance. that III case of uIly loss or olnim
under this policy the insurora nre aud sb"iI
De liable Tor uuly twn-thrds of the same nut
exceeding the amount here insured, and that
puc-tiiIu Hhall De borne by the insured. - ~
nave never seen such condition IN INV fra
policy, stock or mutual.
Cross-eXamlned. lave never examined tbo
| policies IN Delaware companies have NOT
examined the policies OF any mutual fire iplI,r-
ance company for ma ,or,;',' iiie Ili1'r-
have no interest in the claim | nm adinsting
the policy was for II, 900 | do not remember
mat tley claimed that Crane was not their
agent | asked Myers if such a clain, Lad
come on one day and he showed it 10 m, the
next day am morally sufe il rns tb"ro ,t,,
day before; Myers SAID that II had come il, Il,