Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1902-09-25

and the circumstances than that It was
done WITH intent
Did these bankripts contemplate bank
ruptcy? Expert Pratt testifles that they
were insolvent, practically. six months be-
fore they failed. They we're short of cot
ton all the time from the first day of Au-
gust. 1899. selling short in the market and
losing heavily. Tho loss on their short
sales began about the middle Of August.
1899, and their loss on January cotton
alone, sold short by them in the market,
was ,260, and this was customers money
put up for margins, and the speculations
were the bankrupts own and not for GUS
toners. The analysis shows that the bank
rupts were short of cotton all the time.
with their brokers. and many thousand
bales long with their customers, and the
cotton market going UP all the time. The
experience In the brokerage business, as
the evidence tends to show bankrupt
Knott had. told him what the inevitable
result would be. Knott testifes that he
don't remember lust the time when he be-
lieved the firm was bankrupt, but recog-
nized the fact a day. or two before tho
failure that the firm was bankrupt. Now
on the first day of January. 1900, when
bankrupt Knott transferred the house ard
lot previously described, to his wife, Anna
NJ, for the reason that he did not have
the money to make some repairs on the
house for rental, which amounted to -four
or i've hundred dollars, and the fact OF
cotton being on the rise all the time, and
knowing, ne must have known, that
the firm was many thousand bales Of cot
ton short for the customers of the firm
and that demand of sale and the profit
therefrom made by the customers, meant
what? financial ruin, that he then. and
before, contemplated bankruptcy Is an ir'
resistible conclusion of fact from all the
circumstances and testimony In the case
Now whether the book or memorandum
kept by Knott. showed the bankrupts lone
or short holding in the market or not. Une
evidence shows pretty clearly that it did
1t was destroyed or concealed from the
trustee in bankruptcy. So that the referee
finds the fact, from all the evidence In the
case. that these banlIrupts, with fraudu.
lent intent to conceal their true fnantia
condition and in contemplation of bank
ruptcy destroyed, concealed and failed tc
keep books of account or records from
which their true condition might be ascer'
tained. This general finding means that
the referee finds the fact, from all the evil
dence. that each and every count from t.
20. inclusive, is sustained.
Now did Knott & Closson conceal, while
bankrupt, from their trustee any of the
property belonging to the estate in bank
ruptcy? In January. 1900. these bankrupt.
were in a process Of Incorporation and they
issued a prospectus to the world offerni
$50 shares of stock for sale at par ant
stated III said prospectus that the net in
come of the firm for the year 1898 was $16
02637 and that the net income of the firm
for the year 1899 was Si2, 115.G4 and stated
that this income was arrived at by thor
ough examination of the books Of the firm
made by an expert accountant and thi:
accountant was Thomas +. Clay. thu
firms own bookkeeper. and these figure:
were sworn to by Mr.. Clay on the I'D day
of January, 1900, before o. p. Ray, ESQ.
notary public.
The cash analysis of the firms receipt!
and disbursements, made by Expert Pratt
shows that Bankrupt Knott drew out q
the business during the partnership ST.
iOo91 and that Bankrupt Closson drew on
| of the business 81, S96S0. 1t appears tina
when Bankrupt Knott went to New Yori
two or three days before the failure, III
received from Seymour, Johnson & Co.
$3.50, this item shows on the banllrupts
book of accounts that the firm received
| from Seymour, johnson & Co s62. 80 on thu
| nth day of February, 1900 Knott says h,
don't remember of receiving 1t an,
he wouldn't swear whether Bache 4
Co. paid him some cash when he was II
New York. A review of the record vii
show that the greater proportion o
| Knots answers are that he don't re
member, or he don't think So or he doe
think so. and it takes a good many o
| bis answers to make one good one.
1T appeared that bankrupt Knott re
ceiVed some iittle money from the sal
| Oh membership or social ciup IN Can
aoa since ms trustee was appointed Ii ap
l'ears mat Oh, Marcn = i'oV' several gay
after III" peti'ioi' IN palkruptcy was ,leu
tne concern received Soo ana charged OF
! the cashbook $3.50 paid for postage
/ The testimony shows that the bankrupt
were receiving large sums of money from
customers ana not executing the orders
No"' an the money that came INTO 'n
hahos OIL the trustee was MO w nat ma
become OF tnis money ne testmoh
SHOWS tnat hhott was buying real estat
ana paying ms wlte an ola dept OF man.
years stanoihg ana making her present
along buying Va'uaole personal propert.
ana making ms wiie present OF that' pay
| ing large amounts OF money 10 seV"ra
| or the nrm creditors Just prior TO IN