The evening world., 1894-06-21
HAD A BIC LOAN IN SIGHT,.
Why st. Nicholas Bolstered the
Madison Square.
Ex-Cashicr Gardner Tells Moro of
the Famous Collapse.

- = - ~ ~
Bank. was resumed before Referee VIII
lam q. Choa,e his morning.
William j. Gardner. eN-cashicr OF the
St. Nicholas Bank, spoken OF yesterday
by the plaintiffs counsel as an adverse
witness. was recalled 10 the chair, aud
his rigid cross-examination by Lawyer
Untormeycr was continued.
Witness declared that Notwithstanding
the fact that he had sent out u notice
to all the clearinghouse banks to the
effect that the ST. Nicholas Bank would
discontinue to clear for the Madison
Square Bank on and after Aug. .. 1893,
he had no idea that the Madison Square
Bank would close its doors on that
date. He admitted that the affairs of
the two banks had been the subject of
discussion at board meetings, the last
time no later than six days before the
suspension Of the Madison Square Bank.
No action was taken by the directors
or the st. Nicholas with regard to ter
minating the contract between the TWO
banks until the ISSUANCE of the Clearing
House notice.
The officers Of the Madison Square
Bank were, meanwhile asking for time
Win which TO pay off their loans.
We'll. yes. replied the witness.
They were also looking around for
another, Clearinghouse agent"
The deposit of the Madison Square
Bank ran below the $4,000 mark early
IN the month preceding the banks fail
ure. Witness said that the Madison
about this. and Director Mcdonald sub
sequently told witness that the bank
WAS negotiating, for a loan of 100000 TO
when the Madison Square Bank would
pay up its Indebtedness to the st. Mich
Clas.
witness saw President Graves, Of the
ST. Nicholas. and Director MrDnnalb
of the Madison Square. leave the st.
Nicholas Bank on the morning of Aug.
going, before the Loan Committee of
the clearinghouse. Did not learn that
day OF the result of that meeting.
Witness admitted that he had read of
the morning OF Aug. 3, 1893. This was
not recall having talked with President
bank messengers left for the Clearing
House.
Il had talked with a director of the
the failure" said the witness. and was
assured of the banks solvency."
Who gave you this assurance?'
Mr.. Mcdonald"
"Humph! thought so," said Lawyer
Untermeyer.
when you sent out the Clearing
House notices you knew the Madison
| Square officials had failed to secure
loans from the Clearinghouse and from
Ladenburg. ThaIman a Co.. didn't your
when did you prepare those notices."
o Saturday, Aug. g."
Then they were in course OF prepare
ton three days before they were sent
out and four days before the bank
Il guess that's right
What time on the afternoon Of Aug.
.. 1893, was 1t that the first instalment
of these notices went outf'
"About 4 o'clock in the afternoon"
Don't you know that President Can
fed to having received your notice before
Bank"
II heard him testify to that effect"
with whom did you talk at the ban
concerning the affairs of the Madison
Square Bank on the morning of Aug. 3,
Il recall having talked with Hill. He
asked me If we had sent out the notices."
who is HIP"
He was our receiving teller. He's up
Witness recollected that the clearance
arrangements between the two banks
had been made by Messrs. dryden and
Presiden. Graves and himself for the
St. Nicholas. The date was Jan. 3, 1891.
Beyond this he said he could recall lit
tie, but he thought he met President
afterwards.
Here the referee ordered the witness
to produce the minutes of the 81. Nicho-
las Bank bearing on the question or the
clearance negotiations.
Pending the arrival of the minute
book Witness Gardner recalled that Mr..
tions regarding the rules OF the Clear
ing-House. He also recalled having
answered some of Mr.. Blaut's ques-
lions and ha ving- handed to him a
lutions.
He asked particularly about the time
allowed for clearances." added the wit
ness, and ! explained the twenty-four-
The minute book of the St. Nicholas
Bank being produced LAWYER Inter,
directors meeting of Jan. 7. 1891. at
which the question of becoming the
Madison Square Banks Clearing-House
utes of the meeting OF Jan. Ii. a week
later, were also read.
The minutes OF this meeting estab-
, the sum of 100000 in bills receivable,
and that the last-named ank would
then act as the Madison Square Banks
Then Lawyer Untermeyer read from
the minutes OF the Madison Square
Bank, under date of Feb. 3, 1891, in
effect that the negotiations between the
two banks had been confirmed, and that
a record TO that effect be spread p
the minutes.
j MS tIIitu MI bdIu1ltI = ttOSS-thdlIl-
nation, and the redirect examination
was then taken up by Lawyer Smith. who
got the witness to testify that the Madi-
son Square Bank had made "A deposit
of $3l S36 at 8 j.. NJ, Aug. 8, 1893, but
same was credited TO the following day
the evcntful Aug. ..
Replying TO Lawyer Buffers queS-
ton, witness declared that SO far as he
was aware. the agreement between the
two banks had never been altered.
Upon redirect examination by Lawyer
Tntermyer, Mr.. Gardner stated that
only A few days before the failure OF the
Madison Square Bank. President Blaut
had told him that the bank had two or
three dollars for every one claimed
against it.
Tho accounts collected by the ST.
Nicholas Bank for the Madison square
| Bank were S27l. l76 81. III interest on
that amount is $40. JG7.l6
But when Mr.. Blaut told you his
bank had plenty Of none to meet its
liabilities. you knew from their last
oun"t"rly report this was untrue, didn't
you?"
well, I rather did think so"
After some unimportant testimony,
Mr.. Butler declared the case for the de-
PENDANTS closed. So did counsel for the
plaintiffs, who said they had hoped to
have Simon thlmann az n witness, but
they heard that he was in Boston.
Lawyer Butler then moved TO dismiss
the complaint, on the ground that 1t
was made against n temporary receiver,
who was not amenahle to the law In