The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1902-06-28
INVESTMENT
O|SAPPROVED
Humphreys Rules
As to Trust
Funds.
SAYS EVA BONDS
ARE GILT EDGED
Injunction Granted to Prevent 5.
c. Allen From Selling Mort
gagged Property.

Judge Humphreys yesterday disap
proved the investments made by tn
guardians OF the Richardson minors
The investment OF 5000 in n note o
the Union Feed Co. was not approves
for the reason that F. w. Macfarlane
one OF the guardians. has an interes
/ I'm the firm. the court not questioning
his integrity in any way. The invest
ment In one Eva plantation bond u
passed for the reason that an appea
Is now pending In the matter o. th'
Parker estate in which similar ques-
tons are involved. The investment In
inter-Isiand stock Is approved because
Il was made by n prior guardian. the
1890 being simply the amount which a
re-aIlotment OF stock cost.
Mr.. Macfarlane appeared in court
| yesterday morning when the report of
| Master Watson disappearing these va
rious Investments was submitted He
stated that he purchased the note for
5000 OF the Union Feed CO. because he
thought IL a good investment. stating
/
Guilty In placing that amount Of money.
AZ the Bank OF Hawaii. which held the
notes. was extremely reluctant TO give
them up. He considered the invest
ment a sound and wise one. but said
n. would not have made It. had he
known that the law did not permit H..
He said he was entirely willing To- take
I'D the note as funds could be easily
procured for the purpose. and would
| try 10 reilvest the money belonging TO
| the ward.
Judge Humphreys In passing upon the
matter said that the guardians were
interested both In the corporation In
which the money had been Invested.
! and In the proper disposition OF the
money OF the estate. Consequently
there was likely to arise at some time
a situation where the corporation and
wards interest might conflict. and as
the first duty OF the guardian was to
his ward. he did not wish TO see a
guardian placed in such position
where his action might be questioned
II was the duty OF the court TO pro-
tect the ward and this could not be
done by allowing the investment OF
trust funds by a guardian in property
I'm which he was interested. In disal-
lowing the investment Judge Humph-
reys stated that IL was the first time
he had disapproved an investment
made by Mr.. Macfarlane and that the
case in question had never before been
called TO his attention. or similar ac-
ton would have been taken year ago
Referring to- the Eva bond. the court
aid that IL was considered gilt edged
Investment By the business community
here. but from a legal point OF view
the investment was not one which
could be made with trust funds. Care
ful men in the community considered
Eva bonds as safe and wise invest
ment. but the judgment of a court
could not be controlled by public opin-
ion. The trust deed showed that a
foreclosure OF the property could only
be had upon a majority vote OF the
bond holders. and as the guardian did
not own controlling interest. the
wards rights were therefore delegated
n n third party not having any inter-
est IN the protection Of her rights. ana
c,.er whom the court had no control.
The. investment. the court said. would
be- disapprovcd. ia ruling was desired
1t this time. but as similar question
Is now pending In Supreme Court the
matter was passed. Judge Humphreys
stated that II the Supreme Court re-
vcrScd his ruling In the Parker matter
h. would approve the investment. and
III ne was sustained the investmert
would be disapprOved when the next
annual accounting u made. Regarding
the Investment of $500 in Inter-1sland
stock. the court approved IL. IL appear
ing by the statement OF Mr.. Macfar-
lane that ne had obtained the stock at
par By a pro rata distribution upon an
Increase OF capital. the estate already
holding stock IN the company. The
catt a Z
Sf.s and the court held that this could
not be treated as an original invest
rient By him
:. q. ALLEN Is ENJoINED.
s. c. Allen has been made defendant
in a suit brought in the Circuit Court
by RooIau Kaikainahaole. admins
tratrix Of the estate OF John w. Kali
ks.faanao'e. In which she seeks to eS-
tabiish the fact that the defendant,
who has taken possession of certain
property belonging TO her at Kawaia-
hao. In lieu OF the payment OF a prom
isSory note secured by mortgage on
the property. has no right TO do so.
being barred by the statute OF limi-
tatlons. II seems that her husband ex-
ecuted a note for $500 to Mr.. Allen in
1885. and gave a mortgage on his prop
erty 10 secure the same None OF the
principal or interest has ever been paid.
In 1897 the husband died interstate. and
the widow was appointed administra-
s-lx. She says that she published the
usual notice to creditors In the Kuokoa.
IN which she appraised creditors TO pre-
sent To her within six months from the /
date Of publication their claims against
said estate. whether such claims were
secured BY mortgage or otherwise. and
she Informed them that claims not 50
presented would be forever barred. She
alleges that the defendant did not pre-
sent his claim. and that the note ma