The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1897-06-15
CORPORATION ATTORNEY FINALLY
BEGINS ACTION AGAINST DE-
FUNCT BANKS BONDsMEN.
PAPERS SERVED YESTERDAY
TO RECOVER THE AMOUNT OF CITY
MONEY IN THREE INSTI-
TUTIONS.
TWO ARE STILL HANGING FIRE.
Sudden Move of the City's Legal De-
partment, 1t Is Intimated, Is to
Spoil Grand Jury Thunder.


The corporation attorneys office has
awakened to the fact that there is
something like $260,000 Of the city's
funds tied up in suspended banks.
Something over five months ago the
nVe banks IN which the city had on de-
post the amount Of funds mentioned
closed their doors. Resolutions were
passed by the council requesting the
corporation attorney to take steps to
secure the return of the money either
ny the commencement of suits against
the sureties on the bonds given by the
banks or otherwise.
Nothing, however, was done in the
matter, but yesterday it was learned
mat action had been commenced
against the bOndsmen Of three of the
hVe suspended banks. This sudden ac-
CVlty on the part Of the legal DEPART
ment has been laid to several causes.
1t is suspected that the forthcoming
report Of the grand jury. now nearly
completed, has a few words to say on
THIS important question and that an
has reached the present administration
ofhcers. For this reason, it is init
mated, the city officials and more espe-
clally the legal department desired to
mead Off the thunder Of the grand Jury,
or at any rate take the edge off the
forthcoming report in this particular,
whether this is the strength of the
present move remains to be seen, but
yesterday deputy sheriffs We're hustling
around with copies of summons and
complaints in actions brought by the
city on account Of funds deposited in
the Allemannia, Minnesota Savings and
West Side banks. 1t is the intention
OF the corporation attorneys office to
proceed against the sureties on the
bonds given by the Bank of Mime
sofa and Germania bank but the &C
lions will not be commenced immedi-
ately against the bonds given by these
two institutions. In the case of the
Bank of Minnesota the city had on de-
posit when the doors closed $40. 1872. 10,
of which amount $22, 4S0.S1 was what is
known as coupon interest account The
point was raised by the comptroller
that this last mentioned amount was a
special trust fund and as the bond
given by the bank did not cover this
account, it was the duty of the re-.
ceivers of the bank to hand over to
the city the 22,4So81 without any ar
gument. The receivers, however,
couldn't hear Mr. McCardy, even
though his proposition was backed up
by decision in Missouri case, which
it was claimed was identical with that
of the present one The corporation
attorney thought so we'll of the point
raised by the comptroller that he went
into court with the case, and as yet
the judge has not filed decision. This
leaves the corporation attorney in
doubt as to how much the city should
ask the bondsmen for, and consequent
ly no action has been commenced
against the sureties on the Bank of
Minnesota bonds given to the city.
When the Germania bank closed the
city had $51 ,S7459 on deposit. The bank
however, being on the road to a reor-
ganization, the legal department of the
city has decided it would be bad policy
to commence action on the bond given
by the Germania to the city, and will
delay the suit for short time in view
of the anticipated reorganization Of the
institution
The suit brought by the city against
the Sureties on the bond given by the
West Side bank has not been filed as
yet in the district court, but the bond
given by the institution and approved
by the council and mayor Dec f. 1896.
is in the sum Of $4,000, and the sure
ties are E. Vanish, G. F. Staples, Eu-
gen Villaume, H. L. Moss, Thomas
Tunis Smith and D. S. Sperry. The ac-
ton against the sureties on the bond
is to recover the S24 954 90 and interest
at per cent per annum since the bank
closed.
The suit against the sureties on the
bond given by the Minnesota Savings
bank has not been filed with the clerk
of the district court either The bond.
however, given by the bank in Deem
Der last, dated Oct. IS, and approved
by the council and mayor Dec. 4, 1896.
is in the sum of $4,000, and the sure
ties are Herman L. Schade, George J.
Mitsch, Lawrence J. Casserly, Charles
E. Chapel, L. D. Barnard, Frederick
G. Stevens and Thomas F. Conroy The
action is to recover $4,000 and interest
at per cent per annum since the bank
closed.
The suit against the sureties on the
bond given by the Allemannia bank
develops rather peculiar state of af-
fairs. On Nov. a resolution was
passed by the council and approved
by the mayor designating, among other
institutions. the Allemannia bank as a
depository for city funds. After nam
ing the several banks and stating the
rate of interest to be paid on monthly
balances, the resolution reads as fol-
lows:
That each of said banks execute and de-
liver to the city of st. Paul a bond with such
conditions as shall be approved by the corpor-
alton attorney and with such security as shall
be approved by the common council before any
funds are deposited in any of said banks pur-
suant to the terms of this resolution.
No such bond was, however ap-
proved by the council. and when on
Jan. 4, 1897. the Allemannia bank closed
its doors there was 1920, 95423 of city
funds deposited in the bank The ONLY
bond which the city can sue on is one
given by the Commercial bank, which
was afterward merged into the Allie
MAMMA bank. This bond, dated June
25. 1895, is in the sum Of $3.50, 000 with
the following sureties: Henry Anne
mann, William Hamm Haskell q
Fischbein, Russ c. Munger, Arthur p
Whitney, F. R. Well. e. Vanish. Moses
Z. Clapp, Henry A Castle. Timothy
nd