Sacramento daily record-union. [volume] (Sacramento [Calif.]) 1875-1891, 1885-10-10
penditures claimed to have been made by Col

q IHIEt pOTIIUIl Jnt
time. during which these manifestations are al
legged to have occurred, Cotton was not the
trusted associate OF the defendants exccpt in
the management of the coal company. There
is no more reason to suppose that he would be
expected to use the funds of the company fol
purposes which could not safely be shown on
the books than any other employe.
ooLToNs GUILT OR INNOCENCE
1 am not going into the discussion of how
much il would help the reputation of Cotton ia
suppose that the otherwise unexplaiDable ap,
preparations can be explained by the suspicion
that they We're intended to be used improperly.
influencing the officers of the United States
Land Department, or in procuring testimony
which 1t would not do to have known Ger
tainly, If any agent has taken money of his
principal ne could not defend it on mere sus-
piclon that lac had expended il in bribing Off
GERS OF the Government or in sub0rnation of
witnesses in the interest of his employer. Since
this suit was commenced very thorough exam
nations have been made of the books by ex-
perts on both Sides and il is safe to say that in
formation has been sought from all sources
which there was the least reason to believe
could afford any light Some few items has
been shown 70 have been incorrectly charged
SO Wilson discovered, for he says his inyestiga-
tons generally, but not always met with an ad-
verse result. These very complete and thor
ough examinations may have discovered and
probably have some explanations as TO a few
matters, beyond what Wilson knew TAX
ing the whole thing, however / do not
see any advances whatever in regard
which Wilson occupied. Nor have / found
much argument beyond those suggested by Wiz
son and Ievis in regard TO the Improbable ma
ture of the charges and the charity with which
after his death his conduct should be Judged
or the difficult circumstances in which The de.
Tense S made 10y Colton's Representatives. We
are not now. for the purpose OF this case TO pass
an absolute Judgment upon the guilt or inno-
cence of Cotton. If the charge be discredited
the accuser Is not. therefore, condemned They
certainly have not been altogether disproved
n OIL o dc
was really charged TO have been a misappro-
priatiOn. The ulesdings ON both sides speak of
them as such, but on the face of the exhibit the
contrary plainly appears.
do not care, however, to enlarge upon the
matter. ! an prepared TO finish.
That the tull extent OF the representation was
that the statement contained result shown by
their books as reported TO them by Mr.. Gum :
and, further, that Wilson knew how the state
ment WIS made up, all the evidence for each
item OF the charge. That while the statement
was IN some respects inaccurate as Wilson well
knew, yet. IN the MAN, as a matter of account
ing, II was correct. That the defendant did not
cause 10 be prepared or made any charges ia
reference 70 Il Tor the purpose OF cOercing the
plalntlIi INTO an unjust or any settlement of her
relations with them, but the account was pre-
scented !n good faith and for the purpose Of col
lecting the amount claimed from the estate OF
cotton. IN lact, having found these apparent
discrepancies on the books l do not see how n
disclosure to the plaintiff could have been
avoided. There would not have been a full dis
closure OF an the facts had they suppressed this.
IMPROPER DIVIDEND OF W. D. co.
now come 10 Exhibit E, attached to the
compliant, or rather to the complaints made
with reference TO the matters contained in it
II IS averrcd IN effect that the defendants. 10
influence the action OF the plaintiff and induce
her - execute the Gssailed contract repre-
scented That ;lll the stocks and bonds received
by her from the estate OF her deceased husband
were insufficient TO pay the milion-dOllar note
cotton Indebtedness TO the Rocky Mountain
'r4 ~r.I all
OF the Indebtedness of the Western DeyeloD-
ment Company. and Colton's Indebtedness 10
themselves. That to sustain these representa-
tons they presented Il statement of the assets
and Liabilities of the Western DEVELOPMENT
Company. which IS Exhibit L. They also rem
resented that the Western Development Com
pany was lnsoivent and unable to pay its debts
ana lhal u would be necessary to return the
dividend improperly made by Cotton This
dividend composed a large portion OF the assets
oil Cotton estate. It is also ayerred that they
Represented and asserted that the valuations
contained in the statement were the true and
full values OF the assets of the corporation, and
they further represented that it was necessary
10, and they intended to- and would forthwith
cause 70 be levied an assessment of many mill
ions Of dollars upon the capital stock of the
corporation. Then follow allegations of reli-
ance upon the representations, and her subse-
quent discovery that they were false
IL appears that Wilson first called at the office
OF the defendants and desired to know the value
OF MIS- ColtonS interests there. He was mt once
MT Crocker had already informed Mrs Cotton
III response TO similar Inquiries that the bust
ness was so extensive and so ramified that it
was alihcult 10 give any correct opinion about
II. AS early as January Is, 1879 Wilson had
commenced making inquiries to find out what
Cotton had and what il was worth In a letter
OF that date to plaintiff he relates an interview
with Mr.. Croker. He was then told that the
western Development Company was largely in
debted, and it might be necessary to recall the
ulVidendi that the settlement of the business of
that company was necessary preliminary to
getting at her rights He sought for a statement
OF the assets and liabilities of the company; and
having in some way obtained rough statement
was informed by Mr.. Croker that he must not
rely upon 1t; that they were preparing a more
perfect statement, which he would furnish
The statement zen. E) was made out and pre-
sented 10 wilson as the more perfect statement
promised. The original statement was made ND
by Mr.. Douty, but without the valuations Viii
son also had this original statement made by Mr.
Dohty The statement was changed in some
respects by Mr.: Brown, and the value of each
item, or au estimate OF the value, added. These
values were made at the request of Governor
Stanford, and Wilson was Informed that the
values were the result OF the combined judg-
ment OF AL the defendants; and all through the
negotiations which followed they insisted that
they were the very highest values. These valu-
atoms became very important matter in the
negotiations, and were the subject of freol1pnt
controversy between Wilson and the defendants
There can be no doubt therefore that the state
ment was furnished to Mr. Wilson as a correct
and tll list OF the assets and liabilities of the
western Development Company they APP
peared upon their books and that the values
were in the negotiations represented and in
sisted upon as the highest Of such assets in the
opinion oi the defendants. 1t is important here
TO consider the circumstances under which this
statement was furnished, and. somewhat more
mlnutely, how il was regarded and treated by
the parties. 10 understand just the force of the
representations, the purpose for which they
were made, how they were received, and the
H.gree OF reliance which was placed upon hem
Which the plaintiff was entitled to place
on them.
EsFER TO PACIFIC IMPROVEMENT COMPANY.
Along with Exhibit E. and Exhibit Il. Doutv.
|hich last Is the original from which Exhibit
was made, there was also furnished an inven-
ny OF the property turned over by the Western
KeYeloplneut company to the Pacific Improve
yneht company v lison says that he regarded
his transfer rs absolutely void, and the inyen-
Ftorv only as a convenient mode of getting at the
assets OF the w. b. Co. DOuty was also directed
70 AID with such Information as he had and it
IS admitted that ne did so thoroughly and well
lie was the Pr sident OF the ". d. Co and its
bookkeepcr, and knew more OF its atiars-out-
SIDE OF crurSe, of questions Of policy which
were entirely controlled by the individual de-
IenQalhs-thau any other person. He was Col
TONS nephcw and had been his confidential
clerk. The inventory was made UP under his
personal supervision, and he was fully able to
explain the meaning of the terms used, and
how far il could be relied upon as a correct list
lnder the circumstances 1t is obvious that the
ueienoants could not be expected 10 know much
OF the 9fuirS OF the corporation in detail: and
no human beng knew or well could have an
accurate knowledge with reference TO all its
assets and liabilities. II must also be remem-
bereC that the parties did not deal with each
other under the influence of any relation Of
trust thcu known to them. She did not know
or understand that they owed her any duties.
nor dd they furnish these statements in dis
charge OF any such obligations. II she relied
upon them. 10 was not because of anv trust or
confidence in them or their obligations to in
form her- Ihey dealt as strangers, and at the
tlmc each party believed they had right so to
deal she now seeks to avoid the contract as
wei on the grounds that she contracted in ig-
norancc OF this relation, as on the ground Of
their failure to perform its obligations
Al the way through defendants assumed the
right to negotiate rs strangers; to cheaper what
she had 10 sell. Very early the question arose {:
Can me W -. Company pay its debts without
the return of the dividend? There was no con-
uoVeTsy about the liabilities: the whole matter
was reduced down to the question of values
the Nalle OF The assets of the W. d. Co.
vi course the value either way after realizing
the assets, If the dividend were returned. de-
pended upon the same question. lido NOT see thar
plaintiff or Mr. Wilson for her, ever demanded
or expressed any desire for these valuations
unless u was understood from the desire to
Know the value of Mr.. Colton's interest there
ihey seem 70 have been volunteered and |
tnlnk Il not unfair to presume that they were
oueIeu Us an argument or showing to support
thelr claim That the return of the dividend was
required to enable the corporation to nav its
debts The next inquiry naturally is whether
these values were statements of fact or were
mere expressions of opinion for which the per