The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-10-14
z. NJ. johnson Appraised 1t and
Loaned $4,000. Having Loaned ON
Some Lot to Another Party.
MARION COUNTY TO LOSE S2,232
HIRAM MILLER GOT THE PROPERTY
ON SALE UNDER FIRST MORTGAGE.
johnson Admits Story in Yesterdays
journal Was True-And There
Are Others.

City Controller E. NJ. Johnson, Democratic
candidate for auditor. admitted in an inter-
view in the News yesterday afternoon that
the story of the Franklin Landers school
fund loss published yesterday morning in
the Journal was true. But he said: II feel
safe in saying that the county will not lose
on those loans" after admitting the land
foreclosed would not sell for enough to pay
of the delinquent loans. He denied that
there were any dummy borrowers. All
the parties had been identified to him, he
claimed. The colored man, Jordan Free
man, and John Larkin declared their names
had been used without their knowledge.
Mr.. Johnson may have been imposed upon
by some one impersonating these two. Mr..
Johnson was credited with saying that it
would be strange in handling large school
fund if there should not be one mistake"
But there was more than one. There is the
Victor NJ. Backus case here detailed. AS
the Journal remarked yesterday: And
there are others
Although the loss to the school fund in
volved is not so large in the Backus case,
the facts are as inexcusable as they were
in the Landers case, if not more so. V. M.
Backus a leading Democratic politician, as
shown by Mortgage Record 296, Page 39S.
borrowed $1,000 at per cent. Aug. q, 1895,
giving as security Lots Is and 10 and thirty
two and one-half feet off of the west side of
Lot II in Minturn's north addition to the
city. z. M. Johnson, who was then deputy
auditor, and L. d. Bryant, Mayor Tag
CARTS father-in-law, appraised the lots as
being worth 81 1000. Mr.. Bryant always has
and always will have courthouse job while
Taggart or Johnson are in office. At that
time Lot IS was assessed for taxation at 1915,
Lot 10 at $3.50 and part of Lot II at $2S5, or
$3.50 for all. 1t was appraised for the pur-
pose Of making a loan out of the sacred
school fund, set apart for the education of
the poor youth of Indiana, at $1,000. That
was not the worst of it.
FUND LOAN ALREADY ON 1T.
Jan. II, $685. Leona A. Minturn mortgaged
a number of lots to the school fund. One
of them was this same Lot 10. When Backus
bought it of her 1t was already incumbered.
Johnson had made the loan to Mrs. Min
turn. The Minturn loan became delinquent
and the lots, including No. 10, were sold
to Hiram w. Miller March %. 1897 AS
Johnson made the Minturn loan in Janu-
airy, 1893 he must have known that Lot 10
was already mortgaged to the school fund
when he and the mayors father-in-law APP
praised it for the purpose of the Backus
loan in August, 1895. There is some wonder
that Mr.. Johnson, who had the custody of
the fund, should have acted as appraiser of
the property.
There was never any interest paid on the
Backus loan, except for the first year. The
$40 in payment of the first years interest
was taken out of the loan in advance. After
Auditor Smith took charge of the Office the
deli ho off ha
property for sale at the courthouse door,
just as he had done in the Landers case
The attempt to sell was made March rs, of
this year. No one would bid enough 10
cover the face of the mortgage and the
accrued interest. 1t is now in the hands of
the county, and the loss on it to date is
22S2. IA. Mind you, the county has to show
for this sum only Lot IS and the part of H.
as Lot IS was sold to Miller when the Min
turn loan became delinquent and the lots
covered by it were disposed of. Auditor
Smith did not discover the mistake until
after the lots covered by the Baclkus mort
gage were offered for SALE Mr.. Miller saw
the advertisement Of the Backus sale and
noticed that one of his lots was included.
He went to the courthouse to make in
quiries. Then it was discovered that when
Backus bought the lot it was already mort
gagged.
Under the school-fund law it is not neces-
sary to foreclose a mortgage. When it be-
comes delinquent the auditor offers it for
sale, and if a purchaser is found he is given
a warranty deed TO the property. There is
no power of redemption. The property goes
to the new owner absolutely. This being the
case, MIR. Millers attorney told him that he
having bought the lot and received deed
for it, the mortgage placed on it by Backus
was cut off forever. The question has not
been fully decided yet. County Attorney
Brown has it under consideration. There
seems to be no question. however, that the
county has no claim on Lot - whatever,
and that all the security it has for the
payment of the loan is Lot Is and part of
Lot IL, assessed for taxation at $610. AS
the title to IL. is so badly tangled it will be
almost out of the question to find buyer
for any of them.
In the Landers transactions, detailed yes
terday, and the Backus transaction, here
detailed, the total losses to the county so
far are:
AdnuSrS .......... .............-......s So,IVoVO
B2ckuS ................ ................ z,zoz Ia
Iotal ......... $lV,o5o ~