Delaware state journal. [volume] (Wilmington, Del.) 1870-1883, 1880-12-09

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witnesses III their dispositions, we must
treat the mortgage OH that land held by the
company as worth very little indeed. We
will now turn to other matters presented by
the defendant to sustain his pleas,
The examination of the affairs of this COM
pany by u committee of insurance men of the
different insurance offices of Wilmington, and
their report against it, is presented as
prominent fact in support of the defense
This investigation WAS made by committee
OF competent persons, aided by experienced
counsel, and embodies statement honestly
made. beyond u fair doubt, of the condition
of this company, tax ng the report of Com
missioner Hines of Maryland, us its basis
but the committee do not, from the state
ment of Its members. appear to have
examined any documents or records whatever
to justify the conclusion against the company
which they arrived at much less did they
investigate the value of any of the mortgage
securities by inspecting the mortgaged land,
or having it done by an agent. Whether
such report. and the evidence of those who
made it, sustains the defense of the defend
ant Is IL matter for Won to determine.
Again, the defendant produces before Won
the report of our own Commissioner of Insur-
ance John Il. AIcFee, Esq about the affairs
of the company, and that is relied upon as
proof that the defendants charges were true.
Mr. hlcFee rejected all other mortgages from
the item of cash assets, as he had not only
the right, but the duty upon him, to do. for
they were not Immediately available AS cash
nor as securities presently convertible into
cash, and found u sum remaining, however,
which, according to the testimony of
William A. LaMutte with respect to the rela-
ton of cash assets to liabilities of the
Farmers Fire Insurance Company, of which
he Is secretary and treasurer. Ii greater than
that OF his company, the proportion of cash
assets oil that company to its liabilities being
about two per cent, whereas those of the
plaihtllf to its liabilities, according to the re-
port Of Commissioner Melee, are about four
per cent. by calculation of percentage by
William n. reynolds, competent authority
in matters of arithmetic. This, however.
applies only to the mutual BUSINESS and not
to the stock business, which i'll the true sub
lect OF examination.
Further, the defendant. for the purpose of
affecting the question of damages, offers
proof of the condition of this company
according to common report. That proof is
the testimony of officers of other insurance
companies doing business in Wilmington. 1t
does appear by their evidence that this com
pahy had bad name i'll the business--that
IL, among the other conpanies-and one OF
the WITNESSES states that he had heardit spoken
OF discreditably outside of insurance circles
1t would seem, however, that this reputation
was founded upon the Maryland Commits
stoners report, and the examination of the
mortgage records by the COUNSEL en-
ployed by them, and went no farther. Now,
the rule with respect to impeachment OF
character (where that is i'll issueJ is this-that
the evidence shall be of the general character
of the party, in his neighburhood not what
A, Is or c think of him, but what the people
generally say about him which is his repute
generally among his neighbors those best
acquainted with him. We do not mean that
the business standing of one ia not best
m pf no11f
but that that alone should not be relied upon
to prove party unworthy Of credit for all
Obvious reason, not necessary to be given, as
the jury can well understand IT, 1t is.but
reasonable that there should be something
more When, as appears i'll this case, the bad
reputation alleged appears to be because of
an investigation, which certainly was not
thorough, but, apparently, the contrary. 1t
appears from the testimony of the defendants
witness, William latnall, upon his cross
examination. that the impression left on his
mind is that DIR. Tantum asked him to inves-
tlSate the affairs of the company, but that no
investigation was made, the reason therefor
given by hun, being. that he understood him
To propose 1t as Il private individual. and he
felt dellcacy about acting upon such re-
quest. MIR. 1Htnall knew that Dr. 1antum
was vice president of the company he SAYS
so distinctly. II this company WIS in bad re-
pute, and Its financial condition Of uilsound
IL,
states. and he would have been willing to ex-
ANIME it if the officers had requested 1t ltor
he states he would have BEEN 1t is to be re-
GREETED very much that he did not seek to
know from Taiitum whether the company
would consent to his examination. But tins
has not much to do with the questions before
YOU except as it may affect the value to be
placed upon the testimony. The question f. or
YOU thei Is thlS-ouSht you to conclude that
this company was fraud, upon reputation
which is shown to have had no other fullnda-
ton than report of other insurance men
VINO mate no examination of Its affairs be
You'd taking the statement of the Maryland
commissioners, i'll evidence before you. and the
searches of counsel of the mortgage fecords2
lhat Is Tor you to decide. Ii you think that
tile truth of the defendants charge that the
company lis fraud is established by reputa-
tiou based upon such facts. it is in your
power to do SO, and 1t is your right to do so
for. whether the company was a fraud or not,
Is not for the Court but for the Jury, to de-
eide. All we have to do with the testimony
is to rehearse it, where we attempt to do 50,
fairly and impartialiy, and to point ont 10 yon
the Ordinary rules for testing Its value.
The defendant has gone still farther. and
has produced before yuu witnesses to prove
that they Withdrew Their insurance from the
company. by reason of its bad reputation.
and their apprehension of danger; but 1t
drawal by policy holders until after the pub
location of the articles against it i'll the EVERY
Evening ; and he also proved in the outset of
his defense by some of those who
were originally officers of the company, that
they dissolved their connecuon with 1t be
callse they We're not satisfied with the conduct
of its business, and did not choose any longer
to be connected with it, But the second Pres
ident, hlr. James u. Henry, did not withdraw
for auv such reason, nor at or about the time
the Others did, but held on until his time ex-
pirea i'll january, lS7s-giving two reasons for
withdrawal, not necessary to repeat. as they
are no doubt remembered by YOU. neither OF
which, however, had anything to do with the
standing of the company ; and in answer to
the direct question put to him, upon cross
examination, by the plaintiffs counsel.
whether he considered the company Il fraud
lie answered, us had another of the defand-
ant 5 witnesses, George b. Money on hiscruss-
examination. that he did not. And it will
also he remembered by you that upon the
cross-cXamlnatlou OF another of tie defcnd-
ant : witnesses, Commissioner McFce, to the
same question. lie made like answer IN fact,
the Commissioner could not answer other
wise +; for, if he had believed the company to
be fraud Il supplement to the law which his
office was created, made it his duty TO stop its
operations when they appeared to be fraudu-
lent But You are not to he controlled in your
Judgment upon the truth OF the charges
against the company by the action of Money
Ash and the other original directors on the
one hand, nor the declarations of the farmer
Henry, and the Com missioner ON tue other
but are to take all the evidence on both sides.
that OF Joseph L.. Carpenter and
Others VINO examined the affairs of the COM
pany, and his confidence in its integrity By
withdrawing from other companies aud iusllr-
ing in it and this since the charges and
from your Judgment upon it.
In this connection, it is my duty to call
yOnr attention to the testimony of the expert
whom Mr. Melee employed to assist him in
his investigation OF the affairs of the COM
pany. Mr. William Muir. of Philadelphia. IL
gentleman OF large eXperenceiu estisating
the affairs OF Insurance companies. As IL
result of Mr., MUIR examination, the com
pany was, in his opinion, not doing business
upon safe basis, and he advised MIR. Melee
to wind it up; but then he excluded from its
assets the mortgages which have passed iii
review, and the notes of Bright and Others
held, or lii Possession of the company. and
looked to nothing as assets hut money, or
something imn ,diately convertible into it.
Upon this showing the company had not a
SQUAD basis, according to his notion of sound
ness but whether 1t was therefore dis
honest concern, fraud it is for YOU to
decide. Under the old State banking system
1t was not considered safe to circulate
greater proportion of paper than three dollars
for one of coin to redeem II with, and bank
that did 1t was not considered as doing a
sound banking business according to financial
theories CT banking. But it was nevertheless
true that most banks did keep out larger
circulation of notes than three for one, and
proved in the end to be very honest banks
This concern may have
been guilty OF gross imprudence in conducting
its business, and not been fraudulent In so
doing after all. And it is to be con .idered