The Portland daily press., 1883-11-03
The shaws' Offer.
Total Surplus,


On the 2Sth of July the firm failed, and
in August at meeting Of their creditors
submitted statement in which they showed
that on the daysof failure their direct llabil
tiles were $4,612, O74. -, and their contingent
liabilities $780,, 235.27, total ;of $780,
309.39 In this same statement they esti-
mated their assets at Sc, 1852, 1872. Between
January and July therefore, surplus of
over $5,000,000 had disappeared, and the
firm was in debt over $2,00O,000 above their
assets. This was their August statement of
the condition of the firm on July IS, the day
Of the failure. On November LIST the firm,
through their counsel, made proposition to
their creditors for settlement If their Az
gust statement was correct, their assets
amounted to almost five-sevenths of their
liabilities, and a fair offer based on that
statement would have exceeded so cents on
the dollar. But they offered only SO 1-3.
Now, how did they justify that offer? In
this very suspicious manner. They said
that in making their August statement they
overestmated the value of their assets
more than 100000. Instead of the assets
being $5,262, 1912, as they reported them,
they were. actually but $2,664,SO9, and ex-
penses which had accrued since would cut
them down to So, 154 ,494.
1t will prove instructive to examine some
what in detail the August and the Novem-
Der statements and note the items in which
the principal differences occur. In August
tha Che x,s oef;,,otad tbot tho no 1,1o Of tba;r
lands was on the 28th of July, 81, 900; in
November they alleged that their August
estimate was too high by 100000 and that
their value on the 28th of July was only
1000; in August they estimated that the
value of their tannery property on the 2Sth of
July was 5000, 900; in November they had
concluded that tEeir August estimate was
over 5000, too high, and that their tannery
property on July 18th was only worth $780,
900; in August they estimated that the val
ue of their bark on the 2Sth day of July
was $o00,0 900; in November they confessed
to mistake of nearly 100000 and alleged
that its value on July % was only 1914, 800
Such gigantic laundering as this is unpar-
Alleled In the three items of land, bark and
tannery property the Shaws confess to a
mistake in estimate of over one million
and quarter of dollars. Bear in mind that
the August and November estimates
are estimates of the value of the
same property on the same day, made by the
same parties. There is no chance to ex-
plain their difference by shrinkage because
thAv hofh ofo of+ e Az
property on July 2S.
Not one word of explanation accompanied
this statement tending to show in what man
ner these huge mistakes were made The
members of the firm did not submit it in
person, but through counsel, and the latter
took pains to shift all responsibility for it
from his shoulders by asserting that it had
been made up by the Shaws. In view of all
the circumstances is it to be wondered al
that oue>of the creditors pronounced it the
most astounding statement he had ever lis
tened to, and that another intimated that it
was not honest? Is it strange that the
creditors unanimously rejected the offer of
335 cents which was based upon it? Is it
singular that they preferred to rely upon the
statement of their own committee rather
than upon statement which could only be
true on the assumption that previous state
ment, concerning precisely the same matter
made by the same men, was grossly false?
When the Shaws failed their creditors
and the general public were disposed to be
lenient and look upon them as the victims of
misfortune. If creditors and public have
changed their opinions since it is because
they have been constrained to do SO by facts
which have been developed in the progress
of the investigation.