The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-08-26
BACKS up MAYER.
Continued from First Page.


to take over tho debts Of said agents to the
defendant society may have been guilty
OF grave errors Of judgment resulting in
great loss to this defendant by reason OF
unoollectable advances. e well a. by reason
Of excessive payments OF interest. 49,.
The answer goes on to say that IN the
opinion of many mon Of great experience
In the business Of lie insurance, the system
OF making advances to agents is necessary
and proper within reasonable limits. The
whole subject V now under examination
by the present management OF the Equi-
table with the design Of ma king such changes
as will substantially prevent further losses
from unbelievable advances, and from the
differences between the rates OF interest
charged by the trust companies for their
loans to the society and the rate allowed
by such companies to the society upon its
deposits . 49,. .o..,,.,,.
thus answered, also alleges that In order
to avoid the law various trust companies
Of agents debts as loans. 1t further alleges
that among the trust. companies which
carried such accounts Of agents. the Equit.
able Trust Company, which was supposed
to have on deposit 81, $50, oSt.A2. IN. reality
1 psa Bs ss OF that
1t also says that certain directors Of the
Equitable Society were directors Of the
Equitable Trust Company. and wore there
fore injuring the society and profiting
themselves. Similar allegations are made
with regard to the Commercial Trust Com
The sixth paragraph OF the answer takes
up the consolidation Of the Western Ma.
tonal Bank with the National Bank OF
the United ststes ,parsgrhsph .h Is stoc Of
OF the banks was owned by certain Equitable
directors, who sold their holdings to the
society at an exorbitant figure.
The allegations In this thirteenth section
with all sorts Of technical qualifications.
First, the admission Is restricted to those
individual defendants who directly par
ticipatel in the transaction. Further the
answer denies any knowledge or informa-
tion sufficient to form a Judgment as to
the Western National Bank. could have
obtained 500 share for its holdings therein
IL the accused directors had accepted the
second Of the alternative offers contained
In the circular dated Dec. u. 1902 instead
Of the first Of these alternative offers.
In the seventh paragraph Of the answer
the society admits that the table Of salaries
set forth In paragraph II Of the complaint
was correct prior TO the recent change In
the control and management. Since then,
have been made. The paragraph further
admits that; the society WIS permitted to
pay to many Of its officers and directors
and others certain sums as expenses al
which were paid without sufficient vouchers
or audit.
Such payments are now under inveetiga-
ton, and the society has not at present
precise information as to-. whether
such sums were large and IN all cases UNI
directors were particularly responsible for
the payments.
Paragraph 8 Of the answer admits
that some illegal and excessive pensions
the society: 1t alleges that many Of the
individual defendants were ignorant of the
facts which were Of q character not neces-
sarily known to all the members of the
directorate.
It points out that the present president
vestigation Of the pensions paid and that
some which were excessive have been re-
duced and others which were improper
have been discontinued.
In. paragraph 0 the answer denies any
knowledge in respect to the allegations
in paragraph is OF the complaint that
various officers Of the Equitable were paid
salaries for duties which they either did
not perform or that when the duties were
performed the salaries were excessive.
eating $4,000 received by James H. Hyde
from the Equitable, Mercantile and Com
mercial Trust companies. Paragraph 10
also charges that excessive salaries were
paid to attorneys and oounselors at law.
Paragraph ~ OF the answer y all about
the SsS5 900 loan to the Equitable by the
Mercantile Trust Company. It traverses
the matter In Section IL Of the complaint
which charges James w. Alexander and
/ Thomas d. Jordan, as trustees, with having
carried on certain transactions through
the trust company and BY means Of the loan
benefiting certain individuals unknown
as yet to the plaintiff.
The complaint further charges that no
recordss Of these loans or advances appear
Paragraph ten. In dealing With these alIega-
tions, says that they are true, except that
the society itself did not procure or permit
the transactions referred TO-. The answer
further expresses the belief that Alexander
a few others 81 the Individual defe sedaRs
whom this defendant is at present unable
to identify. knew anything about them.
The answer further alleges that there are
certain entries N some Of the society's
but that such entries are obscure and un.
ineligible except to those who are cog
infant Of, or participated IN, the trans-
actions. The answer denies that by reason
Of the transaction It became in any way
pany the sum Of sesS. 600 or any part thereof,
The answer further admits on informa-
ton and belief that It is true, as al
legged in said Paragraph II Of the COM
plant, that on. or about July Il, 1905, the
amount OF said account, then aggregatinR
about 36S5 900, was paid to said trust COM
pany by some person or persons unknown
to this defendant. but this defendant al
leges that said payment was made only
after the said Mercantile Trust Company
had asserted claim against this defendant
therefor and a right to charge said amount
against the funds Of this defendant then on
deposit with the said Mercantile Trust
Company and after this claim had been
resisted and disarowed BY the present
mAnaging officers Of this defendant
Paragraph 10 Of the complaint further
states that an examination Of ali the facts
connected With the loan to the Depew I'M
provement Company u now being prose-
cuted with q view Of recovering, either By
action or BY adjustment out Of court,
any sums that may be found due to the
society by any persons Interested In or
connected With the Depew Improvement
Company who may be found liable.
Paragraph ~ Of the answer aelrnits that
Wwarrantedly large sums were kept on
depoait with various trust companies at a
loGa to the society. a. by inyeetment laroer