Daily Kennebec journal., 1904-05-07
ON THE STAND.
Former Cotton King SuIIy Tells
Of the Transactions.
Proceedings in Court Of Bankruptcy
at New York.
Deals Where Many Millions Were Won
and Lost.

ana company. bankruptcy proceedings,
today. Daniel j. Sully, described the
membership of the firm of Sully and Co.
The capital OF 100000, all paid in was
contributed by him, Jan. 1. 1904. The
partnership existed in 1903 without any
formal papers being signed. The wit
ness was asked by his counsel. Elihu
Root, to tell about the rider he received
to make purchases and sales for what
had been called the Joint three ac-
count"
1T was an arrangement between Mr.
Hawley Mr.. Ray ana myself TO buy
cotton, 'said Mr.. Sully. Il think | had
instructions verbally on every occa-
sion" He said the matter was talked
about for several days and finally it
was decided to buy May and July cot
ton.
Mr. IIawlcy thought it would be ad-
visable to have Mr.. Gates in the pool.
Il thought the three OF us sufficient
to carry ii through. From 10000 TO
190, 600 bales were considered. IIawlcy
and Ray had asked my opinion about
the amount
Now start at the beginning, and tell
us the story
Il was about to go on 4 vacation but
they thought thA market strong and Il
good time to make the purchase. 1t
was talked over Ivy us at the Waldorf
and elsewhere for several days and hn-
ally We decided to do it."
Were your orders on your agreement
to purchase for your respective selves
separately or collectively"
1T was for the Joint account
The witness then told how he SAID
to Hawley he would have to have
money on March IS and Hawley said
he would give his share. THAT was the
particular reason you thought you
would need money the next day
Il had put up s700.000 in margins and
thought it was time Hawley and Ray
did something"
Were you at the end Of your re-
sources"
No sir. I had about 100000 in cash
and a note from customers. l thought
it was time Hawley and Ray shared
with ME the burden. | was carrying
about 100000 bales of cotton.
Sully said that or March II. when he
had the talk with Hawley and Ray. the
market was going down. He told them.
however. that it would be wise to buy
on a falling market. No amount was
mentioned, but they intimated they
would pay what was needed.
Later" said Sully, Il showed them
statement including Il statement of
my funds. Ray and Hawley both saw
it,
when l saw Ray the following day"
said Sully. he said a drop of cent
meant $1.250.000 to margin it: another
cent meant another S1.250. 900. He said.
we cannot stand it. Somebody has got
to be sacrificed. 1t might as well be
you They told me they would close
the margin account at l o'clock the
next day. They wanted me to take
over their share of the account at 1925
for May and 1886 for July
Continuing he s1id: "On March Il. I
did not know. but since I have learned
/ was liable for s425,000 in margins at
10 O'Clock on March 1S. ! did not know
that the calls had been made"
"On the morning of the 18th. did
Hawley say anything about carrying
you over?"
mo. only as have stated. Hawley
said they would stay in until o'clock.
They had agreed to furnish money on
my collaterals and to furnish what
other funds were needed to carry me
over l o'clock"
THAT was one Of the conditions to
your assuming the Joint three ac-
count
Yes SIR
Did they do it?''
mo sir
Sully said that when Ray left him on
tho morning of March Is he had an opin
ion rs to what was about to happen II
thought he was going to sell the market
out on me- he said.
where did the heavy selling orders
come FROM"
Some from the Waldorf by telephone"
WAS that where Mr.. Ray went after
leaving You and Hawley in the carriage"
II don't know: he got out at the Wal
dorf.'
The witness said he kept Hawley posted
during the morning and told him he did
not fear the market If he could meet the
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