The Honolulu republican. [volume] (Honolulu, T.H.) 1900-1902, 1900-10-23
PROMOTERS TOOK FEES
NOT LEGALLY Theirs
So Holds Judge Hum
phreys in Kamalo
Case.
ORAL OPINION FROM THE BENCH
IT WILL BE FOLLOWED BY
WRITTEN FINDINGS
LATER
Declares Tha. Defendants are Liable
for the Fees Taken Together
With Interest on
the Same.

| The charges of fraud set up By the
| plaintiffs in the suit OF H. L. Hitchcock.
ct al, vs.. Frank Hustaee. J. ]. Esan.
Frank Foster aud the kamalo Sugar
| Company are sustained by the court
This was set forth by Circuit Judge
| Humphreys yesterday. when in an oral
| opinion he said that he would practically
sustain the plaintiffs in every count OF
the complaint against the promoters OF
the company.
| The suit was brought some months
| ago by Hitchcock and several stock
holders acting on behalf of other stock
| holders to compel Egan. Hustaee and
| Foster 10 pay hack $4,000 which il was
| alleged they took from the funds of the
| corporation and remunerated them
| selves for the promotion of the concern
The judge promised complete judg
mcnt after hearing argument on a point
| that he is not yet decided comes within
| the scope OF the petition for general re-
lief. In the meantime he stated findings
already concluded TO the following eff
feet:
I'm an opinion which | will hand down
within the course OF a few days" SAID
Judge Humphreys. Il will hold that the
defendants rs trustees are liable for the
$4,000 with interest at i per cent from
the time that they received the money.
the records showing this date. con
slider that these defendants. Foster. Hus-
tace and Eagan. entered into q fraudu
lent conspiracy, and such conspiracy
could not have been more clearly estab-
lished. shown and demonstrated except
by plea of guilty. Frank Hustace dos
tored the books of the institution and
Eagan perjured himself continually in
his testimony in this court
Il desire to hear further arguments
over the disposition of this $4,000
worth of stock which these defendants
converted to themselves. This matter
will come under the prayer for general
relief. In the matter o. the 200 shares
of stock. | am not certain as to whe-
Their the defendants can be held res
ponsible for all of this. One thousand
shares were paid for the land but | will
however hear arguments upon this issue
also. This suit has been brought by
holders of the company and it will not
be fair for the plaintiffs to bear all of
the expense and the others TO obtain
the full benefit without bearing any of
the expense. / will order that the plain
tiffs who have incurred EXPENSES in
bringing this suit be paid. | will hear
the statements of attorneys regarding
the value of their services The argu-
ments on the other issue will be heard
Thursday morning at 10 O'Clock.
The kamalo company was organized |
by Egan, Hustace and Foster and lands !
bought in Molokai. The promoters
turned in to the company the tract of
land known as the McCorriston proper |
ty for 100000. 1t seems that they had
paid for this tract only $4,000. To |
make their profit of $4,000 appear |
straight, they entered it on the books
of the company as money due as pro
moters' fees.
L. II. Dee, chairman of the finance |
committee, says: I'VE found evil
dence of crookedness in August. 1899. |
A close examination of the books re
vealed the juggling that hal been done
by the promoters wi the McCorriston |
property. We then brought suit against |
the promoters in September. year ago. |
The kamalo Sugar COMPANY mas been
put back just one year by these trans
actions. but nevertheless has an excel |
lent future. The company has 135 acres |
of land in fee simple and COCO i-.res
under lease for term of f)rty Yeas.
1t has live stock TO the value of $4,000. |
There has already been expended in i'm
provements $50 600. The estimated ex-
pense for the next three yeas is 1892. |
600. and for the same perioi the planta- |
ton viii produce. according to careful
estimates. $4,000