The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1898-04-05

The application for the appointment
or a receiver for the Life Insurance
Clearing company, was, at the con
clrsion of the testimony and argument!
OK counsel, late. yesterday afternoon
denied by Judge Otis and the action t.
snow cause dismissed In summarizing
the case Judge Otis said:
Inc court should only interfere with a
company, IN case of this kind. when
nomylc aea, OF fraud or mismanagement Ut
rights and the breaking down of Contracts
unless It is clearly established that the
rights of those whom the court ahould
project, are endangered.
The methods Of this company. in the mast
are undoubtedly open to censure, but it
appears IN the testimony that an entire
ehange OF management has recently taken
company is upon a sound basis It APP
pears that the company is adopting a con.
ventional course of business and though
the new president is not an experienced
insurance authority. he is beyond doubt an
expert accountant qualified to look after
the interests of the company.
ra 1bt WIN ~ single exception there. Is
IN manner jeopardizing the interests Of
the policy holders. This particular is the
tha tnat the company is encouraging
II this be true It is injurious to the policy
holders. but fail to- find course Of mis-
mhaaaagement or fraud whereby the policy
dangered, therefore Ircannot find it neces-
sary for the Intervention of the state in the
interests of the policy holders.
am OF the opinion that the time has noe
come for the court to interfere in the affairs
affairs. -''
The company is perfectly solvent and has
ample resources ito meet every obligation
while its funds are on the increase.
After full consideration of all matters
brought to the attention Of the court am
OF the opinion that the application for a
receiver should be denied and the order
to show cause should be dismissed.
Judge Otis, during his remarks, com.
mended Insurance Commissioner
Dearth upon his vigilance concerning
the welfare Of those for whom the state
stood sponsor in regard to the insur.
ance companies.
The alternative Of an appeal remains
to the prosecution, but no stay for this
purpose was yesterday requested.
documentary evidence submitted
threw light upon the contention in the
case relative to the allegation Of the
prosecution that the company encour.
aged the lapse of policies.
counsel Edgerton produced letter
from an Eastern policy holder, showing
over $500 to have been paid in premi.
uns upon the policy, and a reply Of
the company stated that the policy
could be converted only in the amount
Of a small consideration.
Opposed to this letter Attorney Mum
introduced the preliminary correspon.
dence concerning the policy, containing
specific statement Of regret that the
holder was considering the advisability
Of allowing the policy to lapse and ex-
pressing the desire that he could con-
tinue possession Of the policy,
The witnesses examined yesterday
were Insurance Commission e. H
Dearth, M. W. Hill, a clerk in the in
surance. commissioners office: w. c.
Sergeant. present president of the com
pany5 and Gustave Willius.
Mr.. Dearth testified to the notification
Of the condition Of the company, which
he had received, and explained the
grounds upon which the proceedings
had been instituted. From the condi-
method Of business, Mr.. Dearth stated
that he deemed 1t expedient that the
application for a receiver should be
made.
The testimony of Mr.. Hill was rela-
tive to the methods Of the company g
business which had come under his OBJ
servation.
Mr.. Sergeant testified to the present
methods of business. He admitted that
practically twO-thtrds Of the outstand-
ing policies, issued under the former
management, would in time die a
natural death and secure little return
to the holders, but explained that this
kind Of policy had been discarded and
that under the system now in practice
no such eXigency could arise.
Mr.. Will1us testified to the sale Of 10(
shares Of the company's stock to Mr.
Scott.