New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1893-11-01
no ASK FOR A RECEIVER.
~ ,r1Oy TO DISSOLVE THE AMERICAN
STEAM BOILER INSURANCE co.

now THE ORGANIZATION WAS NANA'N'-
nrvtrss STOCKS PURCHAsED-A DEFICIT
ov ALMOST HALE MILLION
IN THE ASSETS.
roro will be a hearing before Simon W.
,.sordale the Attorney-General, on No'e''o''
% ask him to bring an action Tor 'he "'
so,,tion of the American steam boher i''
ance Company, to have receiver appo'"''. ~
~.,r. IN the affairs of this company, ana 10
nov the stockholders what If anything is eA
49, ,ber, The American Steam Boiler IN
surance Company was the basis Tor 'he y "
,otion NJ the American Casualty Company %
T1,.,r,,oro which was nearly wrecked by the
actions of its managers. Beecher' oche"IN
~ owing 20 the disastrous kind OF pusiie''
d.r,sken by the members OF inns III
William X Lothrop was nominally 'he P''''
aart ~ the company, but according W Wv
omdav,ts filed with the Attorney-Geheia' "e
had comparatively little to do WIN ''' mo-"
apement William r. Midgley, VINO was ','0
vice-president. and Vincent Il. ocnen'A -
was the secretary. are credited WIN peii,s "'o''o
,esponsibic for the manner in WHO" NV
Germ was conducted The apphca'oii i ~
dissolution of the company IS pious"' :" w
,ot,,ion of William H. Grafflin and Robertson
Taylor of Baltimore. and Hannah D. oa"'.''
who are stockholders. The story Is 'o'o III ''ie
ioint affidavit of Messrs GrafIhh anu lay ioi'
and 1t is in part as follows
The undersigned stockholders OF the Aiherioa'
Steam Boiler Insurance Company eo'po'".
Incorporated and organized uhuei 'he "" % Wv
state of New-York request that you (the Attorney
on ,, a., action pursuant to the statutes
81 this State for the dissolution OF that corpora
,on and the distribution Of its assets among ,ose
entitled thereto. in the order ana propor"ons pio
vided bv law and for the appointment OIL re-
celver of its property and eHec's' ana ioi a." III
iunct,on restraining its trustees. directors mana
s ord other officers from collecting or Seceiv-
inc anv debt or demand, and from paying out
or IN any way transferring or delivering TO any
person any money, property or eHec's oi t eme ro,
rnoration or from exercising any or us corporate
iiiebts nriyeges or franchises during the pendency
Of the action on the grond ,na' M ~ hdS S psrod of
more than one year, and the trustees ofcers anu am
01relS rnnsrv " invested misappropraed. wasted and
otherwise culpably lost its assets funds ana prop
erty And in support of TINS request we state
PURPOSES OF THE COMPANY.
First-The American Steam Boiler Insurance Com
many was incorporated in this State on or about
November s. 1888. for the purpose of making IN
surance upon steam boilers against explosion and
against loss or damage to life or property result
ing therefrom. 1t continued in business untii the
year $780, and had established agencies ana ud
business in practically the entire territory OF the
United States. Up to the year 1886, the company
Capitalization remained at 100000. but It's pusi-
ness was so managed that its capital was almost
constantly impaired. in 1886, to remedy such lhl,
pairment. the capital was increased to sS',VoV n ana
q bonus of 10000 contributed Dy tne STOCK
holders. With that bonus u Sso@H the , 3mlcers rs
OF the sO M S ed Of the year The next year
1887 in order to avoid another heavy impairment
another bonus of $4,000 paid into the com
pany's treasury. With that the company could only
show surplus of ASVv AT lne emu 1l .e ,oS 80; .
~, the end of SsS and 10 some 1886 S13 by the end
of 1889 These facts are given both on the au- ,
superintendent Of the Insurance Department IN
which & of as sm e sna Rf With he
pany and acquainted with the facts The @ prln,
had had been from beginning William k. IothroP pres
ident William Z. Mideley. vice president; vincent
really controlled and ita affairs and business man.
aged and conducted by Mdgley and Schenck
INCORPORATED JN MARYLAND.
During the year 1899 Midgey and schenck and
others caused company, the American Casu-
atty Insurance and Security Company. of Baltimore
City. be incorporated under the laws of the
State of Maryland. with its nominal principal offices
at Baltimore, in that State but its president and
managers and real business office in this State to
do, with other business. the kind OF business
that had been done by the American Steam Boiler
Insurance Company. Mldgley became president Of
the new company and Schenck became one OF It's lts
general managers. and they practically controlled
new company in the year $780, they reinsuredc6r ,S
replaced In this new company me most OF ,,ne tne
Company That company, however, retained its
officers and legal organization. and kept control OF
ness or issue policies. 1t may have taken a few
risks and kept up its business in states from which
the American Casualty Insurance and Security Com
pany OF Baltimore city. was still excluded IN order
70 hold the business Ia such States until The latter
therein. hit nothing more man tnat The American
States from which it was !lr,; excluded including
New-York anc 5he New England states. and as
early at least .ss 'nter>d upoa its business in
thoss States, taking over te oil'ces & ssences and
Company, and thus wholly succeeding 10 the l., 81
ness Of the latter company II was was aila ted TO
the 18th day of MAY, 1871 and in II the State o, Of
Sssr 5 ths oqnsry s and 'S of
The Am has een
tically wholly suspended.
HOW THE LOSS is ACCOUNTED FOR
Second-In addition to this suspension Of its or
dinary and lawful business. there have been an
enormous and unexplained disappearance loss and
misappropraton of the company's assets. which,
appears from the last annual statement of the
company. is still going on. such disappearance
and loss from the year 1888 TO the close of the
year 1892 appear by the annual statement of the
company to the Superintendent of Insurance to
amount to si5S.0oO, at the least calculation
after giving the company credit for than
$4,000 alleged balances in the hands of the agents
which are not admitted assets by the lnsur-
ance Department and which probably worth
less. The deficit. or shortage, thus stated Is not
In the nature OF business loss. but d deficit In
assets. IL has been arrived at by charging 10 the
company all the cash paid into its treasury and by
crediting 1t with all the cash paid out Of It's
treasury as reported by its officers to the lnsur-
ance Department al Albany each year by sworn
reports; and the sum Of over siSs0O so arrived
at is the actual amount which Saving pos
sible losses its investments). according
TO statements ,hc officers should
now hold and above the amount which they
DO hold claim to hold by their statements of
December 81 1892. 50 far as has been ascertaned
from the reports, this shortage Is defacation
Tor which the directors and officers Of the com
pany may rehtfuy be he!d accountable.
The affidavit then declares that $4,000 more
should be added TO the amount of the alleged
defalcation in consequence of the apparent
purchase by the officers of the company OF
STOCK OF the North River Bank, which went in
70 the hands Of a receiver in November. 1890
Inc stock OF this bank does not appear among
the assets Of the company for 1890, it must
nave been purchased" after the receiver had
oeen appointed. The stock Is practically worth
hapn mai