Evening star., 1895-01-14
THE MOTION REFUSED
Stockholders Cannot Continue the Fidelity
Company Longer.
Judge Cox Refuses a Request and Re
ccivers Will Continue Their Work
The Courts Reasons.

Judge Cox this afternoon refused to
grant the petition of certain stockholders
of the Fidelity Building, Loan and Invest
ment Association for the discharge of Re
celvers Williamson and Poole, and perlnis-
sion to continue the business of the asso-
citation under a new directory, under the
direction of the court.
The effect of the decision is to direct the
receivers to proceed in their settlement of
the affairs of the association and the clos
ing up of its business
The decision of the court was a very
brief one, Judge Cox explaining that he
had been in a maze in getting at the true
inwardness of the association. having had
to depend upon it's undated constitutions,
certificates and the report of the receivers.
The questions for the court to decide were
whether 1t had the power to discharge the
recelI ers and, II it had, whether 1t would
be right to do So
Discussing the scheme of the association
Judge Cox said that the monthly plan
seemed to be much like the ordinary build
was much different
The latter plan was explained to be for
persons Of limited means, who, said Judge
Cox, appeared to be not we'll informed
1t appeared that these stockholders agreed
to allow the general manager to represent
them at the meetings Of the association,
ticipat ton in it's affairs.
These stockholders were, scattered over
several states, and the home office being
here, the result was that the management
oS the association was left in the hands Of
it's officials.
Payments on stock, said Judge Cox, were
payable at the home office to agents,
and that, it seemed to him, was imprac-
ticable. Then, too, seidi Judge Cox, the
constitution in the matter OF forfettures,
had been departed from. the constitution
requiring a delinquency of six months be-
fore forfeiture of stock could operate,
while the managers had period CT but six
weeks.
Ninety Per Cent Lnpsed.
1t had been stated, said Judge Cox, that
80 per cent of the weekly stockholders be-
came delinquent, and when all the facts
were considered it did not seem strange
that such should he the case. The scheme
of the association produced such deiin-
quency, said the court, and it was to the
interest of the managers of the affair that
such delinquency should follow.
For instance, said Judge Cox, 1t was to
the interest of the managers to have their
collectors fail to make collections. The
business of the association was, therefore,
not one which the court should allow to
continue.
Referring further to the scheme of the
association, Judge Cox said that the asso-
citation promised to Quadruple amounts
-
That scheme, he remarked, seemed pre-
posterous on its face. No allowance was
made for certain unfoI eSeen contingencies
likely to always happen, and the success OF
the scheme was to him iL iLConceivable. The
association was now inSolvent, remarked
Judge Cox, and that fact, he thought.
demonstrated that the scheme of the man
ayers of the association was either falla-
cicus, or the association has been mis-
managed. In either event, said Judge Cox.
it would be unjust to the stockholders to
allow a continuance of the business Of the
association.
Motion Denied.
Another reason, said Judge Cox, why
the association should not be permitted to
continue business was the fact that there
had been a breach of contract in the mat
ter of the expenditure for expenses. The
constitution allowed but so per cent for
such a purpose but remarked the court,
the report of the receivers showed that
So per cent of the amount collected had
been expended for expenses.
That was plain breach OF contract, sald
Judge Cox, and a thing not to be allowed
to continue. The request for the discharge
of the receivers would, therefore, be de-
MED, and the receivers would be directed
to continue, as directed by the court.
Mr.. F. L. Siddons called attention to the
fact the receivers had reported the mana
gers of the association as having ex-
: ceeded the expense fund. and he asked that
the court direct them to hold the managers
and directors of the association liable for
such excess and institute suits against
them for it's recovery. -.se-r... .-.,-.. -.
Judge Cox gave Mr.. Siddons leave to so
move, and continued the case. ,--. .