The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-05-29
QUESTION MADDOX'S RULING.
ALEXANDERS LAWYERS STICK TO
NATURALIZATION PLAN.
Advise an Appeal. and Apparently Ono
VIII He Taken-Frick Committee Re-
port and Directors Meeting This
Week-Hyde Rejects WAsh.Up Plan.


VIII He Taken-Frick Committee Re-
port and DIRECTORY Meeting This
Week-Hyde Rejects wash.Up Plan.
President Alexander Of the Equitable has
sent to managers and agents Of the so
ciety letter inclosing a copy OF an opinion
he has received from four Of his lawyers,
William B. Hornblower, Adrian b. Joline,
William n Cohen and Charles e. Hughes.
The opinion has this to say Of Justice Mad
do1's decision against naturalization:
III the opinion Of Justice Maddox
stands as a correct Interpretation Of the
legal status Of this society, single stock
holder, holding ono share Of stock Of the
par value Of $780, has the legal right TO
defy the wishes Of the remaining 900 shares
and Of the entire board Of directors and Of
the policyholders and to prevent for all
time any concession whatsoever to the
clalms-which the board Of directors Of
this society has heretofore three times
equitable-of policyholders to a share at
OF this great society.
THE same result follows as to all other
life insurance companies organized under
the act Of 1858.
these consequences Of Justice Maddox's
opinion are certainly most startling and
are of the greatest moment to the rights
Of polioyholders in general.
@When the proposal to extend to policy
holders OF this society the right to vote was
about to be brought by you to the atten-
ton OF the board OF directors, at its regu-
lar meeting in February last. the under
signed conourred In two written opinions
one to the effect that the board had the right
to proceed under the charter and by a
three-fourths vote of the board to confer
upon pohcyholders no lding policies OF
over 5000, the right to vote; the other to
the effect that the charter could be amended
under section So Of the existing insurance
law by a majority vote Of the board, 90 as
to confer the right to vote upon policy
holders generally.
Giving all due weight and respect to the
OPINION of Justice Maddox, we remain
firmly convinced Of the correctness OF the
opinions which we gave in February last,
and with full sense Of our professional
responsibility, we feeli our duty to reiterate
the same.
I'VE are clearly Of opinion that the de-
cision Of Justice Maddox is erroneous
and We believe that 1t should be and will be
.To acouiesce in this decision would be
to abandon what the board Of directors
have heretofore undertaken to accomplish
in the direction OF mutualizing this society
as to 1t Is control and manag ement, 80 as 10
carry out in part at least what the founders
Of this society had in mind when the charter
was adopted.
Not only did the original charter Of this
society provide In terms that the insurance
business Of the company should be carried
on upon the mutual plan and that the board
Of directors should. in the particular man
ner therein named, have the right to con-
Ter upon certain Of the policyholders the
right TO participate in the election Of direct
ors, but it has always been asserted in
publications Of the society, from the time
that this society Is. In effect, a mutual
company, carried on for the benefit Of the
policyholders.
1t would, in our opinion, be most injurious
to the interests Of the society and to it's
thur amended saa s shoud not be eersa
arant cd by Justice Maddox, and we are
firmly Of the opinion that the appellate
courts will decline to approve OF the views |
validity Of the proceedings Of this board in
ado ut ing the amended charter.
Mr.. AIexander's letter adds:
4As you will see, the result which s upon
a preliminary motion. is not final DISPOSE
ton Of the questions involved. / have
confidence that the just and
salut airy action Of the board In the adoption
Of the amended charter will eventually be
sust aimed by the courts.
This will be a most important week for
persons concerned in the Equitable con-
troversy. The report by the eociety.s
self -investig eating committee, OF which H. C.
Friok Is chairman, will be made and meet
Ing Of the board Of directors will be held
the reorganization OF the society and to act
on any changes In the management Of the
institution which the Frick committee may
see At to recommend.
Efforts were continued Yesterday by the
Alexander people to reach some under
standing with Mr. Hyde that would end the
but they were futile. Mr..
Hyde. 1t was said is determined now to
vindicate himself and he will enter into no
compromise until the Frick committee
report has been made public and possibly
not until Supt. Hendricks has reported on
his investigation.