New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1884-05-09
1'ur GRANT & WARD FAILURE.
THEIR LIABILITIES IN THE MILLIONS.

GENERAL GRANTS Sons.
The facts which are gradually leaking ont regard
ne the operations and business methods OF the sus-
nendcd firm Of Grant & Ward whose collapse
was concident with the suspension OF the
Marine National Bank on Tuesday. exhibit
the condition Of the house IN even worse
light than has been generally imagined. NOT
only are they known TO have rehypotheeated the
securities lodged with them on loans by seNeii ran
road companies. but they have obtained larger au'
Sances on some OF these colaerals than the amounts
they haa advanced The best information now puts
their gross liabilities in every shape at not iar from
$4,000 600 No estimate can he made OF ther as
sets exclusive of the loans they made on the eecu,
tics they have replcdgcd No statement is yet OBJ
talnable respecting the condition OF the Mariho
Bank. and the prospect of the final payment to de-
positors will be a mere matter of gueSswork u'h
the bank examiner finishes his report.
The assignments made by the firm and those con-
nectod with its operations were known early yef-
torlav The assignee ~ Grant 81 Wards Julian l.
Davies. of tho law firm Of Davies, Work
NcNamee. and the individual assignment oi James
ID Fish, president of the Marine Bank, Is To Johh
III. Morris who is close friend OF Mr. FISH, anu
has been connected with many OF his real estate
operations Frederick d. Grant and Jesse X. Grant
the sons Of the ex-Presdcnt, made their assignment
70 James McNamce; the former giving preferences
of about S2lO.OOO aud the latter OF $4,000. Inc
preference given by Mr.. Fish. after that to the
Marine Bank 70 the obligations OF Grant ~ Nhru'
for which he became personal gnarantoI' Sohiii"i'
the belief that he was interested IN the tIhlsac-
tions of the firm either through Ferdinand Nhru or
the other members The several assignees TOOK
formal possession Of the assets OF the assighors o
MIR. Davies was served with an injunction obtained
by the "Nickel Plate Railroad from Justice
Donohne prohibiting him from disturbing them IN
adjustment oil tho claim OF the
company ON the securities which Grant q Ward
have r,hypothecated.
EXTENT on THE INTERPRETATIONS.
The transaction involving the Nickel Plate bonds
has a worse look than any other case OF rehypothe-
cation so far developed. The company gave TWO
notes IA April the first for 100000 and the second
for . 900 OO0. secured by the pledge OF @l'4oo'ouo
OF Its second mortgage bonds. Nh. Ward maze
oilers Of the loan 10 yeral institutions aud ;orpor-
atoms before It was finally taken by the NIcK'l
Plate Company The Now-York Central is under
stood to have declined % make thc loan, although
/. WAS offered at the low rate OF per cent per an
nun The Nickel Plate bonds received by Giant N
Ward were pledged for various loans ranging from
60 20 - per cent of the principal. An uptown
bank we'll dout.hoi with the Vanderbilt family vi
vancCd a. much IS pei cent ON a lot estimated
at over $4,000. II ia estimated by person well
Informed a. 70 the tact, that while tn advance of
tue Niiu 20 li' thilpiuA M"N 'ii'f VI" " ''''''f' 40
per cent the bonds were IehypothDcated at an
average Of G2la per cent II il generally believed 10y
Lauker. who nave had occasion 10 examine the law
that where the second persons who received the
bond, GA loans 20 the firm were Ignorant oil tue
character of the firms Transaction, the company
cannot recover It's securities without tax ne up the
loans ii this be held by tle courts 90 Ice the law
The Nickel Plate Company will b' called on 20 pay
out from 100000 to $4,000 over the amount
sdyan.rl bg Grant X Ward to 1t IA ORDER 10 s'l
back thr coliaicrals.
The amount of the general mortgage bonds of the
Buffalo. Ncw-York and Philadelphia Railroad
pledged with the Grm is now said to be upward ol
100000. II IA not known 20 what extent these
have ID en- rehypothccaed. but from tho features
of the other transactions of the firm 10 is supposed
that all oi thc-e have been usel. John D1u@heriy'
treasurer of the company, said that he dl NOT De
hcy, that these bonds were roplodgcd on a meh'r
margin thau that allowed to the company and he
wa prepared 70 take up the loan of Grant Ward
whenever they were ready 10 demand it The loan
of this company will mature in the autumn
Tho number of the first preferred shares of the 81
Louis aud san Francisco road which Grant
Ward held as collateral, il was learned yesterday,
was -. 100 a larg r amount than was reported on
"Wednesday The company has arranged TO take mp
part of this lot. which was sold under the rules of
the stock Exchange when the firm announced its
suspension.
II is asserted on good authority that rehypothe-
cations have been made of securities placed with
the Rrm by the West Virginia Central and Pittsburg
Company. which operates a small road in West
Virg MIA and is also owner OF coal and iron-orc
lands there.
A disratch from the West announced that jerome
b. Chanee, of Colorado. had left Adrian, Michigan,
where he has been visiting. for New-lork. prob
ably to come To the assistance of his son-in-law
IT, $ Grant jr. MI Chaiiee is proved to be victim
Of the failure by the fact that he is one Of the pre-
ferrcd creditors of Grant Il Ward. Ii is understood
that Mr.. Chafee had deposited with the firm
$500 600 in Government bonds, aud little doubt is
expressed that these will be found to have been
involved ia the firms rehypoth ecations.
The means employed by the firm TO raise money
extended beyond stock transactions. They were
large borrowers of sterling exchange, securing the
loans on pledges Of securities many of which II IS
not doubted did not come from them rs first
holders Within n week preceding the failure they
sre rcpnted 70 have secured a loan of 100000 n
sterling balls.
OPERATIONS OF THE FIRM,
An enormous amount of unsecured liabilities OF
the Gtm exists comprising notes aud simple receipts
for money received for speculation. The story told
regarding the operations Of the firm by those who
are i'm a position to be acquainted with the facts Is
as follows: The firm started with the prestige OF
General Grants name TO aid the members IN secur-
ing capital and in inspiring confidence IN Their abu-
ity and position. Actual money was raised on
notes that the ex-Presidcnt and James ID. tish !
Endorsed 10 what extent the responsibility of the
conduct of affairs rests upon Mr.. Fish aud upon Mr.
Warl entirely cannot be learned. II Is not be- |
lieyed that General Grant L. s. Grant, ir., paid |
clos attention to the details The copartnershp !
agreement provided that each member could with |
draw %. 900 month, il is said, the profits above !
that sum being retained capital Neither Of the |
Grants is believed TO have paid closer attention TO
details than the regular drawing of his allowance