The free lance. (Fredericksburg, Va.) 1885-1926, 1903-11-10
SHIfylBb SEtRE1'S
Nixon Admits Crescent Co. Was
Bankrupt When 1t Entered Trust.
NEUTRALITY-SUSPICIOUS. oNLAwYEr
Declared Sehwab's Attorney Tried 10
Place Him In Oiseredi,able Position
Regarding Sale CT His Plant - =
snrinkaae Of 100000.


Place Him In Diseredi,able Position
Regarding Sale CT His Plant A
shrinkaqe Of 100000.
New York. Nov. c.-The features Of
he session oi the hearing in the Unit
ed States Shipbuilding case were the
Bitter at-acE madc by Lewis Nixon
lpcu William d. Guthrie. counsel for
.ne defendants and representative oi
The interests Of Charles VI. Schwab
for his methods of crOss-eNaminntioa
leading questions by Mr. Untermyer,
counsel for the complanants, as ioI
he absence OF competition between
The Bethlehem Steel Company and the
Carnegie plant OF the United States
steel Corporation In government con.
tracts for armor plate. and the entire
change of front of Mir Guthrie. who
heretofore had aimed 10 bring oui the
fact that the value of the constituent
plants OF the United states Shipbiuld'
ine Company WAS not ovcrestimatcd.
Mr. Guthrie adopted line Of qurs-
tioning dcsigncd 10 show that the est
mates of value were made by tht pro
motcr. the vendors and other interest.
cd or ineypari op' n rs. and were
practically wittcw ,ht in deter
mining the ccact t-.el of iho plants
and tine as.ats.of The consolidation.
Mr. NiACu WAS ON the stand all
lay. Ilis denomination was Nm
ishod and the redirect eXaminaii p
partly completed. lie presented a per
soual protest. in which he declared
that Mr. Guthrie in consultation wi'h
MaN Pam had adopted line OF qucs-
uonne desirned TO place him in a
false and disccdliable position re-
earlirg the sale OF his plant To the
sEipbuiliiac consolidation. The pro-
rcs. was angry and bitter in tone. ard
mdnaicd that Mr. Guthrie had been
Unfair in asking him 10 answer from
mcmcrv questions about tho finances
OF his company without opportunity 10
look up thc details. while Guthrie had
the benefit O. q full investigation Of
The fcmes.
Mr. NiSon. continuing. said. - took
the Crescent yard when % could not
build a ship. while had It built 100
ships Think OF what 100 ships mean
II o. IS q discredit 10 have built up d
shipyari from nothing, I stand Dis
credited.
Mr. Nixon said he organized the
Crescent company, with capital OF
$1,000 00o. OF which si.1970o0 Of the
stock was issued ON the property. only
5000 being paid in cash.
do Won know that the books Of the
Crescent company. on July 81, 1902.
showed n surplus OF s2l5.2lG?' asked
Mir Guthrie.
THE record viii show: | don't re-
member now. replied tho witness.
DO Won not know that In fact the
books on that date should have shown
deficit Of over 500 0O0?"
Mr. Untcrmyc- here interrupted
"We are willing to admit that he
said
Mr. Nixon .aid he was willing to
answer.
Wait exclaimed Mr. Untermyer
we will admit that If the purpose Of
this examination is to show that the
United States shipbuIldins company
was houelessly insolvent when II was
started. We are willing TO admit
that and nus curtail the examination.
The insolvency OF the company IS one
Of our allegations
Mr.. Nixon said that the reports Of
Tho company were prepared by com
petent accountants He was asked II
II was not a fact that the Crescent
companv'- cash on hand" when 81
was turned over 10 the combine.
showed an amount OF sl2S.776. when,
as an actual fact. there was only
$3.50
Witness said he knew nothing more
than what the books showed.
DO you know that there was a
shrinkage Of 500 boo in cash assets
alone in the shipbuiiding company?
"Yes. ! was 20 informed by the &C
countants Of the compenv." Witness
said that be found that the main raa-
son for certain poculiaritics OF the ac-
counts was due to different methods OF
Bookkeeping.
Besides asking Nixon about the or
ganization OF the shipbuilding com
pany the valuations put upon the con-
stituent companies and the methods
bv which they were reached, Guthrie
took I'D the alleged Withholding OF diyi'
dends by the Bethlehem company. an
action which. according to the charges
OF Receiver Smith contemplated me
wreching Of the company
Guthrie placed in contrast NlNons
attitude in demanding by letter TO
President McIlvain. Of the Bethlehem
company. that the Bethlehem directors
declare a dividend to save the ship
buildlng company. and later, al two
subseouent meetings of the Bethlehem
directors. in acquiescing In resolutions
declaring u HSAprhlFHN ~ "NN'"'
such dividend. ne also brought out
that Nixon had voted for the resolu'
ton for the expenditures for better.
nents. This was the means. 50 Re
ceiver Smith charges, by which earn.
ings we're diverted from dividends to
needless improvements.
100 Traekmen, Threaten TO Strike.
shamokin. Pa, Nov. Ga commit
tee representing 400 trackmen on the
Shamokin branch OF the Philadelphia
and Reading Railroad between here
and WiTiamsport. notified the com.
pany that they would stop work next
Tuesday unless orders issued for
reduction Of ~ CENTS per hour be
revoked. This would make complete
the strike on the entire division from
Newberry 10 TamaGua-