The morning call., 1893-10-27
FOR THE CONTROL.
The Fight in the Pacific
Bank.
BAGGETT AND WILEY TALK.
They Declare That Frank Stones
Mission to Los Angeles VIII
Fail of Success.

present solely in the hands OF ID. /. VIII
lev, temporarily appointed receiver by
Judge Rebb ard pending the hearing of the
complaint filed by Attorney General Hart
and the Bank Commissioners.
The hearing on the complaint has been
set for November 9. The document asked
that the Pacific Bank should be judicially
declared insolvenJ and unsafe for the
transaction of business; that ii be perpet-
ually enj0ined for conducting banking
business; that its affairs be wound up by
the Bank Commissioners, and that any un-
derlying charges of malfeasa sance against
individual directors be officially investi-
gated.
Pending the hearing of this complaint
Receiver Wiley is authorized TO only take
such action as is necessary to preserve the
assets of the bank and protect the inter
ests of depositors and other creditors. He
receives all payments due on bills receiva-
BILE. and in case note is in danger OF pass
ing beyond the statute OF limitation 1t Is
his duty to bring suit thereon.
A three-cornered fight is IN progress con-
cerning the administration of the banks
affairs. The Bank COmm ssioners MAIN
tain that in the present situation the
custody of the assets of the bank and the
administration of its affairs devolve upon
them, and so they uphold Willey's ap-
pointment. Sheriff McDade claims his
eX-officlo right to ke charge of the inter
ests of any insOlyent corporation. The
board of directors of the bank, otherwise
the McDOnalds, contend that in such an
emergency as the present the directors are
the proper parties to continue the bank
government, under the supervision of the
commlS 81 oneTs, not only because of their
own interests and those of the stockhod-
ers, but also on account Of their familiarity
with the details of the corporation assets.
Judge Hebbard has made an order"
said ". I. Baggett representing Receiver
Wiley, yesterday, requiring the board of
directors of the Pacific Bank to show cause
why the petition embodied in the COM
plant should not be granted. Tney must
file an answer within few days. They
probably will nos dare to deny the allega-
tion of the banks insolvency, which can
not be controverted.
Attorney Frank NJ. Stone has gone to
Los Angeles to interview Bank Commits
sioners GeTberding and DunSmOTe, pract-
cally in the interests of the McD0nalds.
That was the rock upon which Stone and |
split. ! maintained that it was not good
policy to allow the management of the
bank any further controLin its affairs, ana
l also cODtended that The law did not re-
quire that it should be consulted or given
any voice in its business at this junctuTe.
believe that its admitiance to the councils
of the receiver would entail more sacrifice
Of its interests than gain.
''R. II. Mcdonald Jr. and Frank Y.
Mcdonald DO not represent, as they assert,
a majority of the stock. In fact they
represent practically nothing. DR.. r. II.
Mcdonald is represented, not by his sons,
but by his attorneys, L. d. Sawyer and J.
NJ. Burnett. These attorneys have ap-
proved my course in the IL after and desire
General Wlley's retention as receiver. l
have refused to have anything to do with
the McDonalds. II they come into the
direction of the business | shall withdraw
and so will the receiver.
The McDODads say that they have the
und0ubted right to select the officers Of the
bank and the attorneys. They profess
their willingness to allow the TEMPORARY
receiver to make these appointments, sub
ject to the confirmation of the board of
directors. This. freely Interpreted, means
that the McDonalds want some one here
to protect their regulations and look after
their personal interests.
Now l hold that If the McDonalds have
made away with 100000 or 100000 no
effort should DO made to shield or protect
them. Mr.. Stones contention that they
should have the ratification Of appoint
ments and policy simply means their en-
dOwment with supreme control. II it be
necessary to summon TO our assistance in
unraveling the affairs of the bank from its
present tangle a board Of directors it
should not be the board which has caused
the existing conditions.
I'VE are simply waiting for the Bank
Commissioners to take absolute control of
the bank, and are trying to prepare for
such an order from the court. | have no
doubt that Stones mission to Los Angeles
will be failure so far as inducing the
Commissioners TO recognize the McD0n-
do vd cd i
Gerberding and Dunsmore an exact copy
of Attorney General Hart's instructions to
me prior to his departure for the East, and
] have asked them TO make no promises TO
Stone or any one else until they come
hlther and examine the status of the case
for themselves.
Receiver Fl. L Wiley stated that the
clerks selected for his assistants were busy
making an inventory, not only of the bills
receiVab bic, but of all the available assets
OF the Pacific Bank, including every foot
of its real estate and eyerv stick of its
furniture. He began an inventory during
his former brief administration as re-
celver. Then Sheriff McDade began an in
Ventory OF the stocks and bonds and SINH
lar assets. Now Wiley has made fresh
start. aud is preparing a detailed list of
all assets of whatever kind.
Il had to say to r. II. Mcdonald Jr.,"
Wiley added, that it would be better for
nlm 10 transact MS business elsewhere
than in the Office of the Pacific Bank.
We talked of changing the locks on the
doors. but finally we prevailed upon him
to surrender his kew, and be has not been
here for several days. All mail addressed
to him officially l take possession of, and
/ have retained all the bank papers The
documents in McDonald's desk were all
placed in box. sealed and deposited in
the vault without examination. They will
be retained and at the proper time exam
iDsd 10 ascertain what bearing they may
have on the acts of the directors, in view
OF possible personal proceedings against
them.
"CommIssioner Knight has been cog
infant of every move l have made, and as
approved each step. l have no doubt that
the other two Commissioners will take the
same position. We would not permit X.
II. Mcdonald Jr. to remove papers upon
any pretense, for fear some document
might be misplaced or removed which
would have bearing upon any subsequent
proceeding"