The sun. [volume] (New York [N.Y.]) 1833-1916, 1894-11-04
MEN WHO THRIVE ON DEBT.
DISHONEST PRACTICES POSSIBLE
UNDER VIEW roRK,s LAW.
Mil Owners and wholesale Merchants
Oftcn ne the Mercy OF Their Debtors
nuties OF commercial Lawyers.

NNH lOhfh ~ bHV
.-
Viii Owners and wholesale Merchants
Oftcn ut the Mercy OF Their Debtors
Dates OF Commercial Lawyers.
A famous and successful financler in the West
once remarked that the secret Of acquiring
wealth lay in a mans ability TO walk as close as
possible to the edge Of the penitentiary wall
without falling on the inside. Many men In
New York have tried this plan and have found
plenty of time at Sing Sing to regret It. A lew,
perhaps, have succeeded. IL Is certain NEVER
theless, that the laws of this state af-
ford as much protection to a certain class
Of dishonest men rs they could desire.
The best illustration of this is found in laws
which permit n fraudulent debtor to smile At
and defy a creditor with impunity. d
The attention of commercial lawyers is ale
ways drawn to this subject, but Of late there
has been on outbreak OF Indignation among VIC
Tins which may lead to a general movement to
remedy these legal abuses. This has been caused
In a large degree by the hard times, which have
| tempted men TO resort to dishonest measures to
save a little from a business wreck. In the last
month a method of defraudlng creditors has
been carried on over on the east side to an extent
alarming to lawyers and large manufacturing
houses. Small dealers in dry goods. clothing,
and notions are the swindlers.
Suppose that one of these men desires to 20
into business. He has a few hundred, OF per,
q - tiibu1Httu ohhNA AhV NV |" Sbotp NhA
invests his small capital in q stock of goods,
Having this equipment he can easily secure
credit for sixty OF ninety days. II he wishes to
go in the dry goods business he generally starts
at q time when he can secure from one of the
big mills a good supply of cloths that have res
mained unsold. Mill owners and large manu-
fscturers Of ready made clothing are obliged to
take chances with such goods. After he has
got the goods on credit the course of the swim
ding merchant is very simple, though his suo-
cess is more or less dependent upon his nerve
and ability to hustle. The secret Of the bust.
ness is his ability not so much to get the
store stocked as to get rid of the goods
before the time limit OF credit has expired. To
do this he must sell his goods below cost and
resort to every trick OF the trade to bring people
into his place and make them buy. He pockets
the money as fast as it comes in and does not
buy any more goods. At the end Of sixty or
ninety days the agent or the manufacturer or Of
the wholesale house comes TO the store to collect
his bills and finds practically nothing there.
judgment, but Il is Of little value because the
debtor has no property. The debtor stuffs tho
town or another part of the same town TO work
the game over again. unfortunately the com
black list of these fellows.
But by far the greatest evil to be contended
is that part OF. the law which makes It in
cumbent upon the creditor 70 prove fraud in
worked v%S this law F0f for ali ,iiii'nGi L is us worts
during the period OF financial distress.
make an assignment. In order to save so sTe"
thing he transfers his property by bill of sale to
The Fl T deSto or IS r not Obliged s 20 rsao4d tho b taifin %;
ssle; The Creditor, weary Of his unsuccessful
sherif a appears pears on n the scene. Judgment ana inc
here @M nc.i bss; yon h from sny ss, "I l RSs Z E Judgment
Mr., Doe replies" Here is IS a biIl' OF sale % s' my
SnS s Si I'll ny @3 Snr9ps1sy That IN + y 6s flashes asn.s " paper
do The sheriff reports TO the creditor and the
lets a Judgment, go by default, 1t is almost GER
tain that there has been a bill OF sale or some
s st4sr means to an St eeff fn snpp ies s1sdi,o proi II he
ings,, he has not only the best of The situation.
standstiii. In order to o Sier the ef iii Of s aos
or transfer. they must show beyond question
fraud; he IS not required irsr1 to W show iat snyt 10 as.
The burden Of proof rests wholly with the plain
swears that the transfer " wss made .eh FOR s a rdny
sideration of 80 much money lent Ly his wife or
Where was the money used p" he is asked.
oh. in the business"
For anything, else ~
He viii add that he has kept no exact record
the transfer was honest; 1t is for the creditor to
show that 1t was dishonest. and was made with
that in forty -nino out OF fifty suits Of this char.
acter the creditor is forced TO quit.
mand for clever lawyers who max q Specially
OF commercial law, and In no city In the country
Is TINS demand so great as In New York. Law
yerS who are thoroughly successful in this
branch Ct OF the lazy are not only capable Of taking
the best value; but they must be as diplomatic
and as clear students OF humanity as 'the best
trial lawyers. The duties OF such n lawyer ara
illustrated at a meeting of creditors. The firm has
turned over its affairs TO the assignees. who are
usually lawyers. IL not, the lawyers for the as
signees are there. The creditors are tearing mad,
and they want nothing but 100 per cent. OF their
promise with the creditors. smooth their ruffied
feelings. and induce them to cooperate In the
work of getting the firm back on its feet is an
srtlst. He begins, perhaps, by throwing out a
when their anger is turned into serious atten-
tion, he piles up more legal terms, and finally
Works them into such an ENHANCEMENT Of
phrases as TO cause them to accept any sugges-
THIS work can always he done more success
fully when the debts are divided among many
A creditor with a comparatively
small debt will not think IL worth while 10 con.
suit a lawyer, particularly when the chances arc
recovered.
One OF the most brilliant turns ever made by
2 Commercial lawyer occurred in connection
own. it was q bad failure, too, and IL looked
as II all the legal knowledge in town could
not adjust matters with any satisfaction to the
hrm, consisting Of stocks, and waited. Finally
he sold when the market was right, and he nor
1nly paid every dollar OF the firms indebted
ness but had a large capital left for the re-
OF business, The lawyers fees in the
'aee amounted TO more than $500. 900. and in
he received a service OF silver thai was
sOrth several thousand dollars. In this case
here was no suggestion OF dishonest practices