The morning call. [volume] (San Francisco [Calif.]) 1878-1895, 1893-12-30
WHAT TWO AFFIDAVITS SAY
Deeds That Were Made After
the Bank Closed.
PEOPLES BANK is UNSECURED.
No Receiver Is Necessary to Collect
the Rents-There Must Be
Pro Rata Distribution.

Two afidavits were filed with the County
Clerk yesterday in the matter of the suit
brought by the Peoples Home Savings
Bank against the Pacific Bank to foreclose
a mortgage on the latter banks premises
and to appoint receiver to collect the
rents derived from the building.
The parties interested in the suit assem-
bled yesterday morning in Judge Sander
sons chambers, bu. it was decided to con-
tinue matters for one week. Shortly after
ward Attorney P. F. Dunno appeared with
an affidavit on behalf of the bank direc-
tors in reply to the allegations contained
In the com plant, but finding that proceed
ings In the court were over for the day
Dunno proceeded TO the office of the County
Clerk, where the document was filed.
The affidavit is subscribed and sworn to
by S. F. Long. the present vice. president
of the Pacific Bank, and acting president
in the absence of DIR. Mcdonald, and con.
talnS facts and circums tances to show why
the request of the Peoples Home Savings
Bank should not be granted. In the first
place il is claimed that the transaction
Of mortgage. on which the Peoples Bank
bases its claim, is ultra wires and void, on
the ground that the mortgage was executed
after the 23d day of June. 1898, on which
MIR. Long asserts that there were two
certificates of deposit in return for which
the banks property was mortgaged. These
notes were for 100000 each. One is
matured, while the other has not yet ar
rived at maturity. And these notes stood
and up TO June %, 1898. The next day
the bank stopped, and at that time no
mortgage had been executed.
Then came the action taken by Attorney
General Hart in the name of the people of
the State of California to declare the Pa
clfic Bank insoivent and to dissolve the
concern. On this taking place all that
could be done by way of paying off any uu-
secured liabilities would be by pro rata
distribution. And 80 as the mortgage or
transfer of the banks premises TO the
Peoples Bank was made after June % it
was null and void and was evidently made
by directors of the Pacific Bank with
view of granting a preference TO the
Peoples Bank and thereby prejudicing
the Interests Of the other creditors. 1t
was not made at any organized meeting of
the board Of directors.
The affidavit states that the board OF
directors has been changed since that &C.
currence, aud it is the object of the new
board TO see that each creditor gets his pro
rata share of the assets, while matters are
not entirely settled with regard to the rela-
tive jurisdiction Of the bank directors and
Bank Commissioners in the matter of SO
distributing the assets. 1t is represented
that there are but few tenants in the
Pacific Bank building and that the ap-
pointment of a receiver Is quite an unneces-
sary expense. The bank premises are
stated as beng worth about S170, 600 and
so quite valuable enough to satisfy any
claim.
Later on in the day Attorney w. T.
Baggett filed the lODg-expected affidavit of
Bank Commissioner A. Gerberding, In
which il was expected that sensational
charges would be made against the old
board Of directors OF the Pacific Bank.
But the document turned out to be ex-
tremely simple and in its nature zorro Dor
alive of the statements in the affidavit of
Vice-Pres dent Long
Mr. GerbeTding states that he finds from
the books that when the Pacific Bank
failed it owed some S1,S6S. 900 TO various
persons and corporations and 81, 500, 600 to
stockholders. The whole amount of its
indebtedness to the Peoples Home Saw
ings Bank was S1417. With regard to the
alleged mortgage, that was null and void,
as 1t was unlawfuly made by the bank
directors after June o. 1893. and was not
authorized by. any organized meeting of
the board of directors. The affidavit con-
cludes with a repetition of Mr.. Longs
statements with regard to the value of the
banks property, and the appointment of a
receiver is considered an unnecessary ex-
DeDse.