Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1883-05-01
A BANK HISTORY.
FIsDIEGs OF JUDGE WILLIAMS IL THE
ODD PELLows' BANK CASES.
The story Of the Failure Peculiar Acts
Of The Directory The cou1t Finds
fraud and Collision

The following is a full abstract Of TIE
findings of fact and the conclusions OF law, By
the Superior Court CT Sacrament, Hon. GEO
E. Williams presiding, which have just beer
filed, in the case OF II. G. Smith, assignee,
va. The Odd Fellows Savings and Com
mercial Bank and others, and the decree il
which csse was published in tho RECORD
UNION yesterday morning. The Odd Fellows
Bark casez. as populsslY known. have beer
pending q number OF years, and have excited
a great deal OF interest throughout the State.
These findings present full history of the
cases in the view of the Court, under the
voluminous testimony taken. Il is under
stood that an appeal win BE- taken 80 the Su-
prone Court.
The Court finds that The Odd Fellows Saw
ings and Commercial Bank was legally incor
porated TO do general savings and com
mercial bank business since March l, 1875
September 81, 1875 the Directors met. excep;
Aldolph HeilbFon, there bsing one vacancy
beside. H. G.. Smith Was President. Nc
4 -
verbally; Hebron was not notified; Smith
presided. Welsy rnovsd TO Giscontiade the
! business Of the bsnk, snd assign 70 Smith the
assets. Smith resigned rs President, and
Edward Cadwalader was elected, and i'm
mediasely made an assignment to Smith.
| TIE Direetsrs, except Robin, were indebted
to tie bank for money borrowed and as cure.
| ties. Besides for balances due on subscription
! for stock, Csdwsiader owed 81. 84S. Chris.
4 ~ al.
| Heiibrcn IS 400, and ID. W. Weiry So, 400
The aggregate Indebtedness cf the Directors
| TO the bank was Sl72. 1873 20.
/ October 8, 1878, the Directors fled With
the Recorder gn Inventory of the bank prop
erty, assets and debit, but it did not con-
| tain any statement OF tie indebtedness 81
Greer, Bryte, or Heilhron, on account Of uu
paid steck. I5 showed the value Of the
assets to be S740,379 CO; the Liabilities
S644, 943 OF, Gnd s51. 24S SO was allowed f5I
shrinkage, leaving $44 SOS 05 of assets oven
liabilities.
October Is, 1878, Smith fled his bond as
assignee Among ths sureties were Mike
Bsgte. Chris Green and AiolDh HeilbreD,
AMI other debtors OF The bank. The seven
were su.e:ies for $4,000, and five Of than
Mike B,yte. Chris Green, Adolph Hebron,
! S. w. Butler aad Theodore LMaas-were
stockholders. TIE next day after the assign.
meuG was Sunday Monday, September 23d,
| she bank cid noS open, and gave notice OF
suspension. Saturday evening, September
| 2ls5. Sc the time Of assignment, there was in
the bank vault Sc, 1868 So, Of which S776 69
were cash tags of II. G. Smith; checks,
S1S7 40; eTeensaoks, $40; silver, s., o46 40
gold, IS, 3e3 %. Monday morning following
only 81, 283 10 remained, to wit: Gold,
Sl35 IS; silver, $1,920 IS; checks, $40;
| the greeubacks and Smiths tags 80 men,
toned before. Tbis difference was caused by
Smith paying his brother, II. II. Smith,
81. 299 20 save him from loss upon deposits,
end draft fled for Collection also by psy-
| ing the Board of Trade SS4 81, OF which
Smith was Treasurer. TIE Directors had
| ordered the bank salaries to be paid and the
current bills, ard money TO be sent TO New
York to protect drafts. The remainder OF
! the cash and equivalents were removed by
Smith from the bauk on September 23d. The
| inventory did not contain an account OF
j Smiths cash tags, and SCI out the sum OF
| s. 062 81 as all the money received by Smith
as assignee. September is, 1878, Smith, IS
President, gave orders to pay 20 deposition
| exceeding $50, aud if more was required, to
reg lister the denaud. He then owed the bank
| s., 796 46 on an unsecured note of SIC, GOO,
made BY Smith and Samuel Laveuson to the
! bank. This was exclusive of Indebtedness
before mentioned.
On that day, after the order was made,
Smith presented thre5 checks ia his own IS
vor, dawn by Ben. Billiard, his brother IT,
Isw, G.. W. Smith. his zen, and f. Smith,
another sop, all depositers. The checks were
| In blank. Snitn ascertsined the amount Cue
each, end filed in the checks accordingly.
| The total amount wss 81, 90l 80, and was
paid by applying 81. 796 DC of it TO the pay
ment of balsncs due on the Sic. COO note, aod
! the balance was received by Smith in cash.
On closing the bank September Dist there
was on hand SIS, 449 So. Ga Monday follow.
| Jog, after the amounts stated were taken cut,
the bookkesper changed the books by inter-
| lineatioas and erasures, TO make il appsar
that the check Of Frank Smith and tie other
amounts taken ont on Sunday and Monday
| were the transactions cf Saturday, the Dist.
| This was done to conceal the transactions of
Sunday and Monday.
One of the causes for the assignment
| of September 2Lst, was that on the 9Th,
| Wells, Fargo & Co., to whom the bank owed
| Sl00,2H Ii, on account of over drafts, ssked
the bsnk to reduce the account 10 $50 600.
| Wells, Fargo held colatersls for sizes coo.
Tbs account was reduced up to the 2lss only
about Sc, eco. A. the tins Of the demand
and before. AID TO tie 2lst, seven Of the
| Directors owed Che bank in aggregate over
| S171 COG, end OF which Smith, Byte, Green
aud Geilbrou, Owed $50 000, all past due.
| The fvs were solvent, and the bank had
colaserais FOX uest Of the debt. but found il
| inconvsnisns TO pay, although the teller fra
quently requested them 30 do SO. This in.
oehtelrsss was the principal motive for tire
assignment Bstwee1 the Ga sud the 2lst
the Direct, ri met cnce, and the only action
taken 10 raise money was 10 ask Poormso TO
ply the interest on his lean. The bank suf
| ,.a,,sal f,-a RIM n nm
usual demand Of the dep 7sitors, though With
| asawAls had been iist!e in txcees OF
| dep,sifs for time, but not for want OF public
| confidence in the bsnk.
| May %, 1879, tho Peoples Bank formally
organized with capital stock of $500, 00p,
shares 81 each, TO acquire ss much of the
claims of the creditors of Odd Fellows
! Bank IS possible. in return for shares Of the
new bank ut par value. BY June it had Sc
ouired about $3.50, 600 of the claims, and Up
to date Of this suit about $500 600. The
Peopls's Bark never had any other capital
stock. and more Of it was paid in any other
way than as mentioned. Smith favored and
encouraged the formation Of a new bank, and
promised the creditors to convey the assets Of
| the old bank to the new, telling them he had
on hand assets 1854 GOO From the time
OF assignment to the transfer of assets he
managed the property under the direction oi
| the Directors OF the Dad Fellows Bank. de
has neglected to collect large sums due hi;
assignor from its Directors and stockholders.
Green, Biyse, Heilbron. Butler and Mas
| were snreties on Smiths bond in the sum Of
| s47. 900. June 2, 1879, he sold to the PEP
pls's Bank nearly all the rest of assets in bis
| hands, including indebtedness dus from him
self AMI other Directors, to the sssigaor.
June 7. 1869, he executed contract to the
Peoples Bank reciting the transfer OF the
assets that the Peoples Bank held about
four-ffths of the liabilities of thu Odd Eel
lows Bank; that be had cut of the proceed.
OF the sales ef the trust funds in his hands
paid the Peoples Bank S2l9. 631-supposee
to be about the amount that would be award
ed as dividends to said bank on liabilities held
by it against the Odd Fellows Bark: that
Smith mad loaned the Peoples Bank $50 379
70 enable it to pay purchase money of III:
property sold by Smith TO the bapk; there
fore. in consideration of 81 aud the PROMISE
tbs Peoples Bank undertook to pay Srpitf
800. 0O0, on conditions as follows First
that il the dividends to the Peoples BAH
OF the liabilities held by it agaicss tbs ODD
Fellows Bark should exceed or equs
S2l9 e31; or il they did ret equal that. the
Peoples Bank should pay Smith tbs differ
euce: siso the bark should repay Smith tht
$780, $40 loaned it By him. in installment'
equal to the rate of percentage at which div
idends should be declared to the creditors q
the Oid Fellows Bank; siso ths People,
Bank should hold Smith harmless for suit
l. L - J Ill