The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1893-10-11
CONSPIRACY CHARGED
Ex-Judge Howe Makes Serious Al
legations i'm Iron Hall Case,
Which Cause Painful Sensation i'm the
Court RoOm-Receiver Failey
on the Witness Stand.

IN court was limited Principally 10 the at
torneys who have been connected with the
Iron Hall at various stages. Court
was called to order at 10 o'clock, and
Judge Howe began a statement Of his OBJ
jections to the report. He said that one
of the exceptions was founded upon the
principle that it is the duty of one having
charge of trust to make it productive,
neglecting which he is chargeable with the
interest he ought to have got. Another
principle laid down was that it was a
breach of trust for trustee to use
fund for his own advantage, and in such
case. the profits may be charged to the
trustee. Going more in detail into this
feature of the case, Judge Howe said:
"A number of banks have large sums on
deposit, and interest is matter or agree
ment between them and their customers
We Shall be able to show that this is the
custom of the Merchants National Bank,
OF which this receiver is stockholder and
director. This money of the Iron Hall is a
large sum, amounting to nearly S6OO,Ot0,
and, as appears from this report, he never
collected cent Of interest on 1t until June
of this year. His last collection was on
Aug. IA, and the total Of interest collected
amounts to $3,59908.
Another exception proceeds from the
theory that he has not simply neglected to
put the money out at interest, but that he
has used 1t in his own business that he
put 1T into bank of which he was a stock
anu ana tndL III was USED
by the bank for it's benefit. When the re-
ceiver was appointed over $4,000 was in
the Meridian National Bank, $4,000 in the
Capital National Bank and about $l50000
in Fletchers Bank He must have col
lected a large amount from assessments.
We, shall show that Mr.. Failey is a stock
Merchants National Bank and that his
wife holds 5000. We shall show that he
and eight OF his bondsmen own over two
thirds OF the capital stock of that bank.
we do not have to show just what use of
mat money was made by the Merchants
National Bank any more than if an ad-
ministrator should be charged with using
money in a grocery business carried on bv
him. We shall have TO show simply that
ne used 1T in his business 1t is tolerably
pam TO be seen by the reports of this
bank how this money was used. The last
financial statement of the Merchants Ma
tlonal Bank prior to the appointment of
this receiver was made July ~ 1892. 1t
shows the resources then were 81, $780, 67
It's resources on Dec. 9. 1892. after this Iron
difference of $577, 532.S 81. The cash assets sub
Ject to check on July II, 1892, were $685.
$685. showing that the cssh w s9biec 1910 to
check had only been increased some $40 000
When you come TO loans and discounts
that will show where this money went. The
loans and discounts on July r. 1892 were
500, 94.21 and on Dec. 9, 1882, were I,172-
1882, showing difference of si6S, O99 Il in
crease IN its loans and discounts. The re-
port of Oct. 8, 1893, shows that the bank had
increased its government bonds 100000. The
same report SHOWS an increase OF city and
county bonds from s330000 to SOL, 600. With
out the Iron Hall money it could never had
this much in United States bonds nor in
State and county bonds. There are good
many other interesting features In these
financial reports which 1 do not care to
dwell upon now. We shall hold that this
upon the trust fund which has been used by
the bank of which he is a stakeholder
Judge Howe charged that there was
conspiracy to keep the money in the Mer-
chants National Bank as long as possible
the effort becoming more bold and
INSCRIPTIONS as the times grew
harder. There were rumors that
the original plaintiffs were talking of
dismissing the suit Had that been Gore
there would have been end of the re-
ownership, and an end Of the money in
the bank. Then DR.. Cain, of Huntsville.
was sent for. He did not come voluntarily.
lie was sent for by this receiver or his
attorneys to come and be an additional
plalntlff. lie was made so for no other
purpose except to guard against the con-
tingency Of the original plaintiff dismiss
Ing the suit.
SOME EFFECTIVE POINTS.
AT this point Judge Winters interrupted
Judge Howe with the remark that there
was nothing about this in the exceptions.
Judge Howe replied that he should keep
inside of the record. He charged that the
| criminal proceedings instituted were for
| the purpose of keeping Somerby and the
other Iron Hall officers out of Indiana,
thus enhancing the prospects of prolong-
| ing the receivership. At that time said
Judge Howe, a proposition was made to
! Somerby by the attorneys for the receiver
| of which the following were the terms:
Dismissal of the appeal; trial of the re-
ceivership case before Judge Taylor, TO be
submitted on evidence already heard !;
| Somerby to execute. in Supreme Sitting,
power or attorney to such persons as
| appear and represent the Supreme Sitting
| in all cases In the several States in order
| that the funds in these States should come
| into the hands of the receiver here; and
| for this all criminal proceedings in Marion
county were TO be dismissed.
Il know that from that time on Somerby
and his co-supremers In the East seemed
| to become ardenuy imbued with the idea
| that this order was at an end, and that it
tributed by this receiver and that Som
| erby has since been publishing kilograms
that he has received from Mr.. Failey
| We did not get Somerby back here, and
| by and by the Supreme Court decided this
| case, and when the decision came out
| Imagine that it was not what it had been
| expected 1t would be. 1t was proper to
| appoint receiver temporarily, but the
| court did say that it was the duty of this
new officers, to demand the funds be
| turned back to this order. The new Su-
preme e., Sit TIN +5 met on I'll, the Sd Of august
| tried. 1t had not even been set down for
| final hearing"
At this point Mr. Harris ventured the re-
mark that the court did not wish to listen
| to a diatribe that had nothing TO do with
some severity that he trusted counsel would
confine himself to the exceptions and not
argue the case You have" said he, "a
right to state what you expect to prove
| but not TO argue it,"
Continuing, Judge Howe stated that he
| expected to show that it was supposed that
| there were only two men who could make
| an affidavit for a change of venue. These
| two men were Davis and Walker The
| proposition was made to Davis that If he
| would pledge himself not to file an affidavit
for change of venue and Would use his
| influence with Walker, and If Wind should
| pull out of this there would not be any
prosecution.
| This declaration caused a sensation. and
the court room In an uproar When
order was restored Mr.. Harris demanded
proposition.
| Mr. Howe replied that he made the
| charge against Mr.. Harold Taylor.
After brief interval of dead silence Mr..
| Harris said there was no charge In the ex-
ceptions against counsel; neither was
| there any charge of conspiracy. II con-
| spiracy could be proved. Judge Howe was
| welcome to prove It, but counsel would
| have TO keep within the limits. Mr.. Rar-
| ris insisted that covert attacks upon coun-
| sci in this case, where there is no charge
in the papers. would not be tolerated.
TAYLOR SEEKS TO REPLY.
Mr. Taylor, with considerable show of
] agitation arose TO make n statement and
| Mr. Harris told him to sit down. Judge
NVintarS also stated that IL was lnnacec