Evening star. [volume] (Washington, D.C.) 1854-1972, 1904-12-03

Nor shall such Claims be counted
in computing either the number of creditors
or the amount of their cldims.'
Judicial Legislation.
such a readjustmentI of this section
would be nothing short 4f judicial legisla-
ton. It Is inconceivable that Congress could
have intended to provide in the one para
graph for majority to be computed solely
with reference to the votes cast, while in
cooperating in the other a provision which
Is absolutely meaningless, except in connec-
ton with the computation of a majority of
all creditors present who are qualified to
vote.
Majority Of Creditors Present.
Il am therefore Of opinion. that it is es-
sentiaI to the election of trustee that he
shall receive the votes of majority Of the
creditors present whose claims have been
allowed, and that these votes shall repre-
sent majority in amount of allowed
claims represented at such election.
TT necessarily follows that If creditor
whose claim has been allowed be present,
he must and does participate in every vote,
whether that participation be active or
passive, Tor, by his presence, having IN
creased the number OF creditors and the
amount of claims, his mere silence does
not and cannot reduce the number and
amount necessary to constitute majority.
such creditor may, by refusing to partfci-
pate actively in a vote, preserve right
which otherwise would be forfeited, the In
evitable effect of this silence is to cause
his vote to be counted in the negative on
an aye and nay vote, and as though cast
for an additional candidate in an election
for trustee.
For example, suppo e there were only
ten creditors present whose claims had
been allowed, and that their claims aggre-
gated the sum of $4,000 Six of these
creditors, whose claims aggregated more
than 5000. would be essential to ma
jority within the meaning of section 56.
If the claim of one of them amounted to
the sum Of $4,000, no majority could be Sc
cured without the vote of this creditor. II
he voted against the motion that motion
would be lost; if he remained silent or re-
fused to vote, the same result would neces-
sarily. follow; in other words, If he did not
vote, or did actually vote in opposition to
the others, his silence would be as
effectually antagonistic as his active oppo-
sition.
Another Query Answered.
what creditors are to be counted as
present?
TT has been decided that creditors whose
claims have been allowed are not present
at a meeting within the meaning Of section
56a when they are not permitted to par
ticipate in it's proceedings; and THAI only
those are to be counted whose represent
participate in the meeting.
The cOrollary of this proposition is:
creditor is present who, being quallhed TO
vote, participates in the proceedings either
sentative.
Former Rules Adopted.
In conformity with this opinion and with
that delivered the 18th day of November
last, the following rulings viii be adhered
to in the conduct Of this meeting:
1. No creditor who has filed letter OF
attorney in this cause shall participate In
this meeting in proper person.
2. No agent, attorney or proxy VINO mas
not filed with the referee a letter OF attor-
ney will be allowed to vote in represen-
tative capacity.
3. Those creditors will be counted present
who, being qualified to vote, participate In
any manner in these proceedings.
4. Creditors whose claims are secured or
are entitled to priority will not be permitted
to vote except for SO much of their claims
as may be in excess OF the securities neid
by them.
s. Creditors whose claims are founded
upon promissory notes which purport to be
secured upon the so-called List of notes
No. 1" will be permitted to vote for the full
amounts of such claims
g. The matters submitted to the creditors
shall be passed upon by them by viva voce
vote. r,r
T. 1t snail De essential 10 the success OF
any motion or the election of any person
to the office of trustee, that such motion or
person shall receive the votes of major
ity Of the creditors present whose claims
have been allowed, which votes shall repre-
sent majority in amount of allowed
claims represented at this meeting.
Mr.. Mattingly's Warning.
Attorney William F. Mattingly, at the
close of the reading. stated that If any
creditor whose claim is secured on list of
notes No. II votes for trustee at this meet
ing as an unsecured creditor, under the
ruling of the referee, he CMr. Mattingly)
will hold that the persons SO voting have
waived all security they may have held.
Attorney Sullivan noted exceptions to
any ruling the referee had made, or may
make as to the status of creditors, particu-
larly those whose claims purport to be Sc
cured on list of notes No. 1. This had spe-
that for the purpose of voting he would
hold that those represented on list No. 1
were unsecured creditors. Similar excep-
lions were noted by Attorneys c. c. Cole,-
Jackson Ralston, Arthur Peter and many
others.
The first matter to be submitted to the
meeting" said Referee Bradley, sis
whether there shall be one or three trus-
tees"
1T seems to me-" said Mrs Belva Lock-
wood, that there should be two or three
as in the case of one trustee he
might become sick or die"
The referee said as there had been other
claims against the Waggaman estate filed
since the last meeting of creditors he de-
sired to ascertain the wishes of all the
as to the one or the three
plans.
At the suggestion of an attorney the
referee invited all those who favored the
three trustee plan to arise and be counted
Just two attorneys arose.
Il shall hold" said Mr.. Bradley. that a
majority of the creditors favor the cleo
ton of one trustee"
The Voting Begins.
The election was then proceeded with. the
referee calling both the names of creditors
and the amounts of their claims. The
names Of the voters were recorded by
teller. while an expert accountant .click-
ed" the amounts on the adding machine
The first vote cast was that Of the Ameri-
can National Bank. the representative of
the corporation responding heartily:
1--WE vote for H. Rozier Dulany."
As the voting proceeded 1t soon became
evident that Mr.. H. Rozier Dulany would
receive vote equally as large, If not
larger. than that received by MI. George
Truesdell. Only once was the unanimity
of the Dulany vote broken and that was
when Attorney ]. s. MeDonough voted the
claim Of Sallie Nolan, amounting to $3.50,
for his law partner, Harry A. Hegarty. This
caused a ripple OF laughter, as Mr.. Nc
Donough had at the previous meeting voted