New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1882-09-17
RECEIVER BES1'S RECORD


At the Office of Senator Russell, vestord,o
the state senate Committee Insurance resumed it, -
vestigation Of the cment of the National Trns,
Company by Receiver william Best Only tho ott.
man, Senator Herman. and senator, Russell and Koch
were present The object OF theT days examination e.,
20 endeavOr to develop the fact that AZ the time m, Va
tionGl Trust Company declared Dsolyent 10 hal a.
sets sufficient TO pay all The creditors with the s,.,
ance OF slight assessment upon the stockholders 7,
also sought 10 be shown that Mr. Bee. nenlle..lv
sacrificed securities held BY the company which lavo
since largely appreciated in market yalue. Eys.na,o
Ecclesine. who l. employed private counsel by Chair,
man Herman, conducted the main part ~ the examine,
ton.
Receiver Best brought mass Of prpers and pile a,
books embraced IN bis receyership accounts IN,
among them detailed account showing the cos,
Of his administration. he requested 70 supolv
that deficiency and hs examination then was beeri,
He testified that from December. 1877 20 June o. 1874
he received receiver from the sale o. real estate seen
rites etc. u 1852 ~ For the same perol he va,
allowed for his services under order % Judge bono
hue Sj2,O39 27. This paid after reference n
John :. Lawrence. He did not know upon what ba..
this sum WIS cOmpu ed. hut he allowed by law 2
per cent Of all receipts IL paid -. go counsel Zoe,
during that period. H. next received S3G77G FOR ba
services from June 20 1873, to August 1879 plyngto
counsel during that time Sls,4iO fees Regarding Nh,
examination bank examiner Of the compDny'- affair,
prior to hs appointment rs receiver, IN December 1871
Mr. Best testified hat he found tine liabilities % bo
81 6j3GGl 75 excluding the capital stock liability N,
assets being Sl.s7633G Of.
Nj Eccesiue-WOuld you call that insolvency or only
an impairment OF the company's capitali
M Best prefer TO say nothing on that point.
The witness examined a some Length in regard
10 the sale Of securities held ny the company after hi,
appoin He testified that be made tho
sales to satisfy the camOr OF people who wanted 10
paid their money The securities sold at much e,s
than their face value securities realizing oay %
per cent There had been public meeting u credi
tors to demand what was due then. The clamor no
referred to was from individual creditors who called
his office and urged him 10 pay their claims.
Odd you pay dividend Of 30 per cent earlyin
1878 A.-les, sir.
Q-And yOu parted with the securities IN the springer
the early summers A.-Yes, with most Of them.
Mr. Ecclesne-Then al this clanor the part Of
creditors who mad received half Of what due themi
Mr. Eecle3ine then went the rec,iver- list II a,
sets Of the company with the witness; getting him
confirm the correctness Of the several items Having
all these United states bonds, which are always market
able Origge- Ola real Stale ana real estate besides the
cash, your duties receiver did not requr work
beyond the eSercise Of all necessary wsIon aud dis
cltuOn III rraiZhg upon lhe as'elr NJ ASKED
No, SIR" replied the witness. with some hesitation.
Mr. Ecclcsine-IAe exercise Of a wise discretion was
all that was necessary
Mr Best-Ihat all
Mr. Ecclesluc-DO you think that yOu exercised ucha
wise discretion IN selling the securities held by you IN
March, 1873, after having paid 30 per cent dividend
IN the January preceding
Mr. Best do.
Mr. Ecclesine-And this work-the exercise Of hscre-
tion-wls worth what you were paid a. receiver
Mr. Best hat Is question which am not compe'
The witness testified that he had sold some OF the 81.
Curtps al private SALE hut most Of them at public -ae
He could not recall the names Of The pure the
books ne had brought with him nd 40; show Them bGs
he would prepare for the committee complete .0ld
Of the sales aud Of those TO whom the sales made,
whether they were public o. private lie further sat
That there had been no pressure 81 any Kind brought 10
induce him 10 make the sales He hal u-y h-c1 asked
i,t-t IN
lie had never refused any intormaton 20 trustees WAO
applied for n. Continuing, ir said thar when lie took
charge OF the cOiap3ny's Affairs receiver he found
about ten or fifteen clerks In IN" Office lie mad re-
tained some OF the old clerks ana had replaced II
them With No trustee had requested the re-
tentiOn If le Old clerks Mr. Eccl,sue thcn questioned
the witness his report tie Banking Deparmeus
and also to the particular sales of some OF the -enr
ties. Prior TO making he report ne Uhe witness nal
called ull meeting Of the Board of Directors Of TO
company ana informed them Of the depreciation IN mo
securities The market value OF $4,000 which he Lad
affixed 70 $4,000 Missouri Paehe Carondeei BfancA.
first bonds he had obtained from estimates "
what they would bring made by members o. the stock
Exchange Inc witness adn Tea thal MISUNDERSTANDING
the depreciation IN the company securities there 10
Htl u, .ii',Dl' ,i, ~ ~, ~
holders and suggested that they make up the impair
mont OF the company capiia because II was uOt nrce
snry thy fully understood q situation: Wien asked
order of court staying the compan! from DOM any
business would MOI have been sufficient 10 protect ne
depostofs without the apPohlmeht 81 a tt.rNet .u9
witness admitted mat II the Banking Department hid
the right to take such action 1t would have been sum
O. As the company had asset, equal is genera Ia.
pointed receiver were wrong ~ surprising 'htI
pauy could pay its debts in ful 4 Tue posters
could not be pad within ten days,-no nor within sixty
Mr Best testified that he had issued cucuar priorto
his sale of the Waikiki Valley Railroad bonds Let D., thc
company, exhibiting the road a. proeprrDU- ana prom
Using, in order to get high price for tn bonds NJ
AT public auction tle h Shet Did was 90 ana le D'ush;
In he bonds 80 for the COMPANY and al'c."ntd -l
them higher price In August. l77,. he had -ol 80
at a private sale for S29,O62 30 The stock tLen ~aS
worth Whatever the lItteg would give for D.; he mo
a In h.ar tho fNHV
was 5000 900 in Missouri Pacific third mortgage bonds
sold in March at an average price Of 63 Tue wines
destroyed the emorandums of the purchases of the ~
ferent securities after recording The names In his report
Mr. Best was here excused md Charles +. Orsis. rho
bank examiner AT the time 0l Receiver Bests appoint
neut. was sworn He testified that be- examined AL 10
trust companies the state exc p the National ltust
TIlPtr3 T I M ' i,.v SxaIi,prI only the Union
Dime Sayings Bank Numbers ~ drec ora IN the ,ier
were directors IN tn. National Trust tompany. lGo
witness knew of no req, IA why ne ,r0aV no. my "t
lees SUPERINTENDENT Lamb wanted 20 iaNor 5r Be-.
In $50 the report on the company ~ Bank Examiner
George " Reed and H. l.. Lamb who theu was deputy
Examiner, showed surplus OF o39O62 \ year H,el-
cheney on its crpital sock Of SGls3i6 This i,rcuce
the Wltucs, SAIL, resulted from Nj Best ui tiNa!du@
the securities held by tine company IN ISL ihc CON.
p3ny in 1876 reported Liabilities OF S2,637939 and !.
had S46O.791 IN cash, Sf37lO4 IN Government boi"'
and 81 O-7 900 IN call loan, secured by good collateral
THIS made about - 800 900 assets exclusive " ao"
= 800 900 In other securities than Government bonus
II rare 10 mud an Institution thar could pay ls ue
pOsitorS promptly the National Trust could iheio
might have been a slight impairment OF the compih}s
capt. A. 1ut that WAS all The Wtues said EN- haualF
that he hal no doubt that the company mad Ottn
wrecked by The examiner. who aiierwaId was made rs
receiver. lie also thought that Nj Bc,tS charges l
examining the National Trust Company were very
large hc thc witness would have made the e1anih@'
ton nj "a cost OF 500. -
d. K. iInngam, president o. the COMPANY IN -,
testified that thrce shares OF the compy- stock Weie
sofa nj auction, without previous notice. IN December
1871 Tor 20 per cent He supposed ths sale Wa Nd'
first attracted the attention Of the state Banking De-
parfmnut to the company and caused Mr. he,te ar
ponImcnt to examine III afars lie nrst knew ol 'us
aDuoln mpnt Best receiver on The morning az
ter it had been made. The committee Of the cOmpanys
directory selected 10 consult with Mr.. Lamb and w.
Btst after the lattcT's report bank-eXiulucr a. 70
the Of arranging the cOmpany's affairs. never
reported back the board The OF their app0nf-
m tent they concluded the bargain" by which MIR Bes5
was made receiver ana became petitioners Tor The