The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1885-10-03
FAILURE OF WIN. HEATH & co.
The Collapse Caused by Inability Of
Customers to Furnish Margins.
A Belief that the Suspension Is Due to Van
derbilts Efforts to Revenge Himself
for Henry N. Smiths Treachery.

NEW YORK, Oct. 2--There were rumors last
evening that prominent house was in inancia
difficulties. and the stories took definite shape
before the opening of the board this morning
The statement made that William Heath &
| Co. were likely to fail, and that meeting had
been held between Mr.. Gould and Mr.. Cammack
4 to consider the advisabi!ity of assisting them
over their present difficulty. AS Mr.. Heath ap
peared on the Stock Exchange at the opening,
| and no further developments were
made, the general conclusion was tina;
the rumors were false; but shortly
before midday the announcement came from the
rostrum of the Stock Exchange that the firm of
VIM. Heath & Co. was unable to meet its oblga-
tons The shock was not nearly as great as
many had anticipated 1t is impossible. at pres
ent. to learn anything definite as to the immedi-
ate causes of the failure, but rumor says that
the house as short over 100 900 shares of stock.
and the general impression of the street is that
the failure is due largely to the inability I'M
| willingness of a prominent speculator, who was
| recently reported in financial trouble to respond
| to the demand fer additional margins. 1t is
probable that the failure is due to the hardness
| of more than one customer, who was heavily
short of stocks through the suspended house.
| to meet the demands made upon them. There
| have been large number of transactions under
! the rule for cash in Lake Shore ST. Paul, Lack
| awanna, Northwestern, Western Union. Union
| Pacific. New York Central, Jersey Central
| stood to be on account of the suspended firm
| but the decline in prices, up
to 1 o'clock, was less than i per cent
the weakest stocks being Lake Shore, North
| western and New York Central. The firm of
| William Heath & Co. was composed of William
| Heath Charles E. Quincy and Theodore E.
| Davis Mr. Heath has been prominent per-
son on Wall street for about twenty years. and
| has been conspicuously identified with nearly all
the leading operations in the street during that
| time
Mr.. Henry N. Smith, about whom rumors of
financial trouble have been afoat for some time
past, and who has been a very heavy "bear"
operator at times FOR several years, says: 'The
failure of William Heath & Co. is mainly due to
my operations in the stock market. / supposed
| the firm was strong enough to carry me through,
and up to 10 o'clock this morning / had no idea
of their failure. l am now, unfortunately,
placed where l cannot pay what owe, for the
present. l have been short of the market. be-
lleving the advance to be unwarranted. l shall
make an assignment"
The firm is represented in London by the
third partner, Thomas e. Davis, and it is under
stood that the London house of William Heath
q 20. is one of the leading American houses
in that city. Mr.. Heath and Mr.. Quincy are
the representatives here
No shadow of suspicion that Heath g Co.
were not abundantly able to meet all their en-
gagements has existed in Wall street, and the
general impression has been that it among
the strongest and most prosperous houses on the
street The firm have just made assign
mept to A. r. McCauless the manager of their
Office, without preferences. 1t is stated at the
office of the firm that contracts for about 100 900
shares OF stock are outstanding on the Exchange.
principally in the Vanderbilts, Lackawanna and
the grangers
Mr.. Henry N. Smith has made an assign
ment to M Cunning, of the law firm of Van
derpoo Green q Cunning, with Preferences for
wages and salaries, but the amounn1s>not stated.
Mr. Smith has been a member of the Stock Elk
change since 1877.
A prominent broker says: 1.-THE effect of the
failure is likely to be quiet market after to-
day, until the street discusses the extent of the
losses"
of William Heath & Co., about ST. 600 000 and
that the firm owes its customers about the same
amount The differences to Wall-street houses
are not likely to amount to over $4,000 Heath
& Cos. two seats in the Stock Exchange are
good for SOC. 900, that Wall street houses will
lose very little by the failure 1t is more likely
to strengthen the hands of the bulls"
as Smiths operations have often prevented the
market from advancing. 1t is stated that Smith
is also responsible for the failure of Soutter &
opinion of number of people on the street that
Smiths failure was brought about by William
Ell. Vanderbilt who advanced the market in
order to break Smith, as punishment for Smiths
betrayal of William K Vanderbilt when they
were operating together. 1t is estimated that
Heath short from go 600 to 100, 900 shares of
stock for Smiths account. All the settlements,
as far as Wall street is concerned. will be COM
pleted before o'clock this afternoon by buying
in all the stock on which Heath g. Go. were
borrowing
| Alexander & Green, as counsel for Giovanni
| P. Morosini, to-day obtained from Judge Dono-
| hue, in the Supreme Court. an attachment
| against the property of VIM Heath q Co. Mr.
| Morosni says in the affidavit upon which the at
tachment was granted. that, for several years
past, he has had 1880 600 in cash on deposit with
| Heath e. Co., subject to his draft, and that the
only debit that could properly be made against
| that amount was for 2 $50 shares of the capital
stock of the Manhattan Railway Company. of
| the value of 1892, 000 and twenty-five second
mortgage bonds of the Metropolitan Elevated
Railway Company, of the value of So, 900, which
he had ordered the firm to purchase for
| him, making an aggregate of $2l5000 He
claims that the firm is in debit him for 1865 900
! in cash, and that it also holds these stocks and
bonds for him. Mr. Morosini declares that he
called at the Office of Heath & Co. yesterday for
| his money and securities. and was told in reply
that the company could not deliver them, as
the securities had been hypothetical or Sold
and the money had been otherwise disposed Of
| He AYERS that he never authorized Heath 81 Co
to make of his money and securities, and
charges that they have assigned and disposed of
their property with intent to defraud him and
their creditors generally. Charles e. Quincy,
one of the members of the firm, Mr.. M6rosini
states, has been in Europe for several months
| past. He believes he is not resident of this
State. but of some country in Europe unknown
| to him, and has also attached whatever property
| he may have in this State.
Failures for the Week.