The Portland daily press. [volume] (Portland, Me.) 1862-1921, 1893-12-11
INSOLVENCY PROCEEDINGS.
The Chapman Ranking Company Petition
Frank Fl. Emery Into Insolvency
Hearing Begun Before Judge Peabody
What the Petitioners Claim to be.Able
to Show.

Hearing Begun Before Judge Peabody
What the Petitioners Claim to be.Able
to Show.
The petition of the Chapman Banking
Company, of Portland, that Frank II.
Emery of Portland be declared insolvent
was. taken up before Judge Peabody
Saturday morning.
Symonds, Snow Cook are attorneys
for the Chapman Banking Company and
Seiders & Chase for Emery.
Mr.. Cook opened the case on the part
of the petitioners. He said that in view
of the fact that the truth OF the allega-
tions in the petition are contested, and
especially in view of the fact that Mr..
Emery contends that the transactions
with the Chapman Banking Company,
upon which this Indebtedness arises,
were fraudulent and illegal, and that
he has been an unwilling victim of a
stock gambling transaction, we desire
at this time to present to the court the
whole case-all the facts relating to the
entire transaction between Mr.. Emery
and the Chapman Banking Company.
The partnership known as the Chap
man Banking Company, which has been
in business in this city for number OF
years never intended as a part OF their
general business to act as stock brokers'
for the purchase and sale of stocks for
other parties; and as matter of fact they
never did act in that capacity I'D any
general way. In all their business they
never have acted in that capacity e1eepS
for four people all told Prior to June
30, 1881, when the first transaction oc-
CURED between Mr.. Emery and the Chap
man Banking company, they had never
bought stock but for one person, and
that in small way, and that transaction
was closed. Just prior to June ~, 1871.
this same person came to Mr.. Chapman
and requested him 70 buy some more
stock for him. Mr.. Chapman suggested
to him that it was impracticable to buy
and sell small quantities of stock at an
advantage, that the unit of trade in the
New York Stock Exchange was 100
shares: that % or SO shares was frac-
rional amount and 1t wasn't easy to
make sales or to purchase small quantl-
ties or at price SO advantageous as IN
100 share lots He suggested that if he
had any acquaintance who was buying
stocks, or who desired to buy stocks,
who would go in with him SO that they
could BUY 100 share lots at d time, 1T
would be more advantageous and better
results could be obtained. This person
suggested that Mr.. Emery of Gorham had
been talking about buying stocks and
possibly he. would pe willing to come In
with him and make some purchases.
Subsequently Mr.. Emery did come in and
1t was decided that they should buy
some small amounts of stock This was
June 60 1891, and they bought so shares
of ST. Paul and so shares of Atchinson.
From that time on the Chapman Bank
ing company through Cullen G. Chap
man, the senior mem Der. made various
oI,n rnlo IF OF VIZ nj ar
enumerated in the account between that
company and Mr.. Emery, which we shall
introduce, either upon the express orders
of Mr. Emery, which was the case in
most instances, or in few other instances
where the matter was left to the discre-
tion of Mr.. Chapman having in view
the hest interests of Mr.. Emery. But in
all cases Mr.. Emery was notified 1mme-
diately on the actual transaction which
had been entered into on his account.
The Chapman Banking company exc
cuted these orders through the firm of
Taintor & Holt, reputable bankers in
New York. embers of the Stock tx
change These orders were executed by
Taintor & Holt on the Stock Exchange
by actual purchase and Sale of the stocks
enumerated in the account. The stocks
were actually bought and came into the
hands Of Taintor & Holt, and were paid
fer by them, and held subject to the or
der OF Mr. Emery through Mr.. Chapman.
Every one of these transactions was as
actual and bona fide as would be the
purchase of horse for which part pay
ment was made, with the understanding
that the horse should remain in the
possession of the seller as security for
the balance OF the purchase money. In
every one of these instances the stock
held by Taintor & Holt was the stock of
Mr.. Emery. Between Taintor & Holt
and the Chapman Banking company it
was understood that Taintor & Eo t
were liable at any time to deliver that
STOCK upon payment of the purchase
price; and not only that, but they had
the right to demand at any time that
the Chapanms Banking company should
take the stock and pay them the p'1r-
chase price, and the discretion was exer-
cised by Tintor & Holt in July, 1873,
when they demanded of the Chapman
and pay Tor all the low priced stock they
held for Mr.. Emery. The Chapman
Banking company were obliged at. all
times to advance to Taintor.S Holt, either
in cash or securities, an amount equal to
20 per cent of the stock they desired to
be purchased, to protect Taintor & Holt
against any loss by depreciation.
July 10, 1893. the Chapman Banking
company notified Mr.. Emery that they
had been called on by Taintor & Holt to
pay for this s1ock and take deliver of
1t and he, Mr.. Emo cry, must furnish
them with the necessary funds to doalt.
Mr.. Emery knew what his liability was
in relation to it,; he knew the difference
between buying stocks, actual buying
and selling shares of stock and the tran
sactions of IA bucket shop In his reply
to this letter from the Chapman Bank
ing company there was not one word
that he did not consider himself liable
to pay for that stock or that he didn't
understand the true character of the
transaction. There is not lisp from
Mr.. Emery in the whole correspondence,
which we shall introduce into the case,
against the validity,sof these transactions,
until the 18th OF last month. Novem Der
Is, 1893, was the first time that he ever
notified the Chapman Banking company
that he did not consider these transac-
tions valid and legal; that was after he
had been pressed for the payment of the
purchase price of the stocks and after he
had consulted counsel, and then he
makes b is first claim that the transac-
tions between him and the Chapman
Banking company were illegal and
fraudul emit
Mr.. Cook then cited and read from
several cases in the United States SUI
hn ol, nh