The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1898-10-31

timacy of HIS Connection with
the Bankrupt Concern which
svindIed Innocent Investors
Clear Across COntinent-How
Dare He Still Deny Itr
William Henry Eustis takes a terrific
| blow at the philosophy of Puddnhead:
| Wilson.
Mr.. Eustis' lies have more lives than
any cat that ever skedaddled acrosS
the field of Pudd' 'nhead or any other
philosopher, and the most absolutely
unt1ring lie that Mr.. Eustis is work.
ing is his consistent denial that he ever
was director in the Guaranty Loan
company.
The G 10 and other papers of the
state have already given dates and
votes which show beyond peradventure,
that he was a director, but the suprem4
court reports of this state further show,
that he was sued as a stockhoIder and
that the judgment was given by tha>
court against the defendants in thar
action as stockholders.
However, lest Mr.. Eustis sanctimoni-
Gus and oft reiterated denial that he
had any real connection with the Guar
anty Loan swindle should gull some
unsuspeoting person into the belief
that this blatant exponent of a notori-
GUS policy of law notification is telling
the truth, The G o b presents the
following facts once again:
HE WAS HELD NEGLIGENT.
AS director Of the Northwestern +,
Guaranty Loan, W. H. Eustfs, the Re-
publican nominee for governor, has,
twice been defendant in the lower and9
also the supreme court against the suits
of creditors Of that corporation. In4
both cases the supreme court held that
the defendant directors, of whom Eus-l
tbs was one, were liable for the corr
porate debts Of that fraudulent cons
Germ.
Eustis, as director, was defendant in
the suit brought by. the National New
| Haven bank and also by the First Ma
tional Bank of Merrin. The supreme
court found in both cases that the d.
| rectors were liable by reason of their
| official negligence in permitting frauds
| on the part of inferior officers of the
| corporation. The court found the d.
| rectors liable under the statute for VII
| olation and neglect Of official duty and
| for allowing the investing public to be
| inveigled into its tolls three years after
| the concern became insolvent.
Those Republican organs and orators
who confidently assert that w. H.
| EUstis was not a director IF the North
| western Guaranty Loan company and
| was not responsible for its frauds and
| losses are respectfully referred to vol$
umne 81, Minnesota Reports. pages 376
| to 1885, inclusive, where that subject IS
given about twenty pages of attention
| by the state supreme bench. The report
| Of this case by the supreme bench and
! published officially by that body gives
| In epitOme q history Of the financial Op-
| erations and frauds of that concern and
| also states concisely the responsibility
| of the directors. It makes q stronger
| campaign document than any which an
| ardent campaign editor could devise.
The title and material portions of the
| syllabus and the courts summary and
| opinion appear verbatim below. Any
reader may verify by taking down VOL
ume 81 Of the Minnesota Reports, page
| 375, and examining the case for hirfffS
| self. 1t is sufficient to say that after
the supreme court got through with
Eustls, Menage, Streeter and the other
Guaranty Loan defendants, they man.
aged to settle with the plaintiffs with
out further litigation.
The material portions Of the cc:2rS
| record follow:
| WHAT THE COURT SAID.
| National New Haven Bank vs.. Northwest
ern Guaranty Loan Company and Others.
First National Bank of Merrill vs. S. H.
Harper and Others. June 20, 1885. Nos.
1852, 9152 (6O 59).
orporation-Liability OF Officers and
Members under G.. S. 1894 Sec. 2600 Subd. g.
| 'Unfaithfulness.' G. s. 1894 Sec. 1900,
| Subd 8. provides that any officer, director or
| member OF a corporation is liable for corpo-
rate debts when he is guilty of any fraud,
| unfaithfulnes or dishonesty in the discharge
| Of any official duty 'Unfaithfulness,' as
| here used, held to mean any violation or
neglect Of official duty.
"Same-Contributing Fraud OF Inferior Of
| hcer Under this statute person who is
| induced to become creditor of an nsolvent
corporation by reason of the negligence or
other unfaithfulnes OF officer thereof, and
is injured thereby, may maintain action
against such officer for the amount of his
debt. And when the creditor Of such insol-
vent corporation is induced to become such
by reason Of the fraud of an inferior officer
and the negligence of a superior officer, and
is injured thereby he may maintain ac-
superior officer.
EUSTIS WAS ONE OF THEM
1.-TWO actions in the district court for Hen
nepin county.
1.-The defendants in the first named action
were Northwestern Guaranty Loan company,
William S. Streeter, G. H. Petit. Loren
Fletcher, w. D. Washburn, Thomas Lowry,
George A Pillsbury, Charles Robinson, WILL
LIAM H. EUSTIS and Louis F. Menage. IN
the other action the defendants were s. II.
Harper, w. G. Crocker Frank J. Percival
and all the defendants in the former action
"Canty, j.: The appeal in each of these
actions is from an order sustaining de-
murrer to the complaint. The demurrer is on
several grounds but the only grounds now
urged are that there Is q defect Of parties
plaintiff and defect of parties defendant
THE complaint in the National New Haven
bank case alleges the Northwestern Guaranty
Loan company is corporation organized un-
der G. S. 1884, Oh. "a, Tit 2.Sec. 2794-2912: that
the general nature of its business, as stated
in its articles of Incorporation, is ''the dis
counting and selling OF commercial paper, the
buying and selling of stocks, bonds, mort