The record-union., 1898-12-15


Loan Commissioners since April, 1S03.
and had been allowed by the old board
to assist building and loan associations
to straighten out and make their re-
ports when requested by them and at
such times he gave the association the
benefit Of all he found out or verified.
In answer to Grove L. Johnson he
said that he took the books as he found
them and could not question the justice
Of any entry, unless it was irregular in
some respects. He made his report in
accordance with what he found in the
books. In the report of 1896 there Is
no estimate Of real estate or its values.
In the list Of assets there is an item of
SIUb,U94.31, for real estate which he
took from the books Of the association.
He questioned Mr.. Alsip very closely as
to the values of the items of real es-
tate and was told that that was their
value. In the report of 1895 the real
estate assets are put down at $102,-
963.55. The difference for the two
years, with the exception of the Wal
ton property, which was taken in on
mortgage for 50 ,00O was due to the
increased cost to the association. Neith
the report of 1896 made out by him,
before he returned to San Francisco.
The report of 1895 came to the office
Of the Building and Loan Commission
ers and was returned to the associa-
ton as incorrect, one Of the items hay
ing no debt He made the corrections
on 1t and took it to San Francisco. He
left copy of it with the association.
He asked Mr.. Alsip as to the value Of
the real estate assets and had access
TO the assessments and other records
He did not recollect that access to any
information was refused to him, and he
had no information that would lead
him to think the property had depre-
ciated. He believed the statements in
the books were based on the cost of the
real estate.
Mr.. Johnson offered in evidence the
articles of reincorpOration of the Union
Building and Loan Association, filed in
the County Clerks office in 1891; also
the minutes Of the annual meeting Of
the Union Building and Loan Associa-
ton and the minutes of the meeting at
which the organization was effected
Objections were made on several
grounds, but were overruled.
The bylaws were also offered in evil
dence, but were vigorously objected to
on the ground of irregularity of adop-
ton. Clinton L. White argued that if
the stockholders of the old corporation
were absorbed into the new one, there
were 2,S5S shares of stock, of which
only 1903 were present or represented
at the annual meeting and therefore
the bylaws were not properly ratified.
If the stockholders of the old corpora
ton were not included in the new one,
then there was no sixth series of stock
and the case of the prosecution falls to
| the ground. There is no signature
showing that the minutes of the annual
meeting were adopted and approved.
There is nothing, then, to show how
| many stockholders of the association
there were on February Is, 1891, when
| the bylaws were adopted.
Mr.. Seymour quoted a decision of the
Supreme Court to show that articles of
incorporation are not competent to
prove the stockholders of a corporation.
Mr.. Johnson said that an attorney
could not put in all his evidence at
once and this is only a step in proving
the adoption of the bylaws by ma
jorfty of the stockholders, which he
thought he could show were adopted
legally The fact that the Secretary
had neglected his duty would not VIII
ate the legality Of the proceedings, so
long as a substantial compliance with
the law is had.
He argued from that standpoint to
show that the bylaws were legal. All
q ctn Of ola
new corporations, he said, had signed
the bylaws and are bound by them.
The objection was overruled and the
bylaws allowed in evidence
The trial will be resumed this morn
inc