The Birmingham age-herald., 1904-05-07
SULLY GOES ON
 WITNESS STAND Says HaWey and Ray Failed Him at Critical Time HAWLEY WAS SILENT PARTNER MT. sully Tells of Ills Connection With the corner-uses No Notes
 to Refresh His Mem
 ory.
HAWLEY WAS SILENT PARTNER

New York, May 6.--The examination of the D. J. Sully & Co., bankruptcy pro- ceedings was continued today before Uni- ted States Commissioner Alexander, sit ting as special examiner. Daniel J. Sully, the head of the firm, was called to the stand. J. D. F. Duncan of Phil adelphia, one of the latters counsel, ex- pressed the wish that the examination of MT. Sully be restricted to the acts. con duct and profits of his business, and its dealings with Edwin Hawley, Frank H. Ray and others.
 Mir. Sully described the membership of the firm of Sully & Co. The capital was $500 900, all paid in and was contributed by him January l. 1904. The partnerships existed in 1903 without any formal pa- pers being signed.
 The witness was asked by his counsel, Elihu Root to tell about the orders he received to make purchases and sales for what had been called the joint three account"
 Tt was a mutual arrangement between MT. Haw,ey. MT. Ray and myself to buy cotton," said MT. Sully.
 Gan you recall it in words?"
 T think I had instructions verbally on every occasion. The mutual agreement about the last joint account was made while we three were riding in an auto mobile about March l."
 Mir. Sully said the matter was talked about for several days and finally at that date 1t was decided to buy May and July cotton NIT. Hawley thought 1t would be advisable to have MT. Gates In the pool said the witness. "I thought three of us sufficient to carry it through. From 150,- 900 to 190,000 bales were considered. flaw ley and Ray asked my opinion about the same amount
 Now start at the beginning of the conversations tell US the story"
 Good Linz to Purchase.
 T was about to go on a vacation. but they thought the market strong and a good time to make purchases. It was talked over by us at the Waldorf for several days and finally we decided to do 1t ''
 ''i- i'd they ask you to buy 1t for them IS indivduals?"
 ''No sir"
 <Nhy tiiHS Sdlu dDOul StpdTaIe ana 1n- c.v'dual accounts?'
 Nc sir"
 Were your orders on your agreement to purchase for your respective selves sep arately or collectively"
 Tt was for the joint account D
 MT Sully said he had discussed his af- fairs with Hawley on March IT. Witness then told how he said to Mr Hawley that he N uld have to have money on March Is, ana Hawley said he would give his share.
 What was the particular reason you thought you would need money the next day?"
 ''. had i Ut up s70O000 in margins and thought 1t was time Hawley and Ray did something'
 Were you at the end of your re- sources?"
 ''No sir; had about $9Oo,oO0 in cash and securities and s400,000 due from customers. l thought 1t was time Hawley and Ray shared with me the burden. I was car rying about 33o,000 bales of cotton"
 Market Going Down. Sully said that on March r when he had the talk with HawIey and Ray the market was going down. He told them, however, that 1t would be wise to buy on a falling market. No amount was
 
 pay what was needed. Later" said MT. Sully. "I showed them a statement in- cluding a statement of my funds. Ray and Hawley both saw it. How much was the join three &C., count carrying?" About 111.000 or 117,000 bales" Did you know how much money you wanted, and when?" Yes"
 When was 1t needed?'
 "At 1 o'clock the next day. "When I saw Ray the following day." said Sully, The said a drop of a cent meant $1 ,250.000 to margin It. another cent meant another $1,250.000. He said: We cannot stand it. Somebody has got to be sacrificed. It might as well be you They told me they would close the mar gin account at 1 o'clock the next day. They wanted me to take over their share of the account at 1925 for May and l5.36 for July" Continuing he said; "On March II did not know put since l have learned I was liable for s495,ooO In mar gins at 10 O clock on March IS. l did not know that the calls had been made.
 "On the morning of the 18th did flaw ley say anything about carrying you over?"
 "No, only as I have stated flaw ley said they would stay until l o'clock They had good time to furnish money on my collaterals and furnish what other funds were needed to carry me over o'clock"
 That was one of the conditions Of your assuming the joint thre' account
 Yes, sir
 Did they do it?"
 No sir"