The sun. [volume] (New York [N.Y.]) 1833-1916, 1905-04-11

the stock have given that consent.
"Our chief purpose u 10 avoid delay
We want, il possible. an Immediate APP
provul Of the charter now n the hands OF
tho Superintendent Of Insurance and TO
that Cnd we do not ask 10 halt the pro-
cccdings 80 that we may intervene All
wo want f. an opportunity 20 examine the
raUers and determine whether or not 70
intnrN enc He got what he wanted.
SHEPARD ATTACKS NATURALIZATION PLAN,
Nlr. shepard. In beginning bis argu-
mont for Mr. Lord. said that the right OF
q .iockholder 10 vote his stock was a prop
Crtv right which could not be taken away
from him, and that the power to amend
or modify the charter Of any corporation
did not contemplate the destruction Of TINS
right. Il appeared beyond any doubt
that the naturalization plan was the re-
sult OF a violent personal quarrel bet een
officers Of the society involving serious
charges. 50 tar a. appears, no repreeaen-
tntive body of the GQnOOO policyholders
or Of the stockholders had been consulted
in regard to the proposed change Mr..
Alexander himself was on record as having
stated that three Of the siA counsel en-
poyed by the board Of directors had eN-
pressed grave doubts Of the legality OF any
step 10 amend the charter 50 as TO take
away the voting power Of the stockholders
In the control OF tie society.
There has been" said Mr., Shepard,
"a complete revolution, complete de-
gtr.Ction Of VIVA. has heretofore been
supposed 10 be the properly rights OF the
stockhoders But what has been done
in the interest Of the pOiCyhOldeTI The
original charter provided that the policy
holder td'i have right TO q share In the
surplus of the society. The proposed
new charter proyide7 that the policyholder
may have such a night.
Here are 500 COO worth u asset s.
Here are 6OJcJO policyhoidprs ~ iLh certain
rights ana here are Stockholders with
other rights How ought 50 delicate q
trust TO be discharged? One would think
with capfIlueSs and fairness. There was
no reason for haste-nOthing Is 10 be done
until next December. Why was mesSen-
ger cont with the Quarter 70 SyHlCus8 while
these proceedings were pending before
your Obviously the Inference to be drawn
Is that the directors regard a thing once
done hard TO undo. Tor some reason the
thing has been done without notice 20 the
stockholders ana without the policyholders
being taken into the confidence OF the
hoard. Except as some few happened TO
get information the whole thing has heen
done under blanket. The question Is
whether It can really he done in this land
end State IL violates our property rights
and is not consistent with the State law.
sToCKHOLD EBs' RIGHTS TO SURPLUS.
Mr. Shepard took up the question Of
the society's surplus with reference 10 his
clients interest in it, That VT. Lord IL
entitled 10 a share in this surplus he APP
parently took for a fact. for be declared
that one Of the reasons for his being in
court was 70 protect his share in the sur
plus. whatever it may be. The Chei
reason for believing that the stockholders
Of the Equitable have certain interest in
the soCiety's surplus il was said. was
A statement attributed to President Alex
ander recently in which he said that al
lowing for the future obligations Of the
society as regards policies and It's other
liabilities. there would still De $1,000 OOU
left. Obviously, Mr.. Shepard said. this
belongs TO the stockholders.
The Equitable society, sail he, has
written many policies Of many different
kinds. but we assert from Information end
he lief that no policy has been written which
gives TO the policyholder a share In the
whole surplus. In each case the policy
holders share In the surplus is determined
by his contract with the society"
HoREBLowER DIssENTs.
Justice Maddox evidently was interested
In Mr.. Shepard's statement that be was
In court TO protect his clients interest in
the Hociety's sur pus. for Mr. Hornblo wer,
counsel for the society, had not got far in
his reply when the Justice asked whe Their
there Is any provision In the soCietys char
ter TO show the right of the sJockholdsr
20 any share of the surplus
There II none, replied Mr.. Horrible weT
1T is provided that the capital stock shall
he 500, 600. and that the lolders OF il shall
receive ga per cent. emi-annually.
But" interrupted tue Justice. what
pro vision is there for a shareholder to
receive any part of tna surplus?N
There j. none" MIR. HOInllo wer re-
peated The theory of tie mu tuahzation
plan is that the pohcyhoidets own all the
assets
Mr.. Shepard's statement that he was
retained 20 protect the interest Of his client
in the sooiety's surplus led to talk after the
court proceedings TO the effect that the
real purpose Of the Lord action was ult-
mately 10 establish a value other than the
regular per cent. value of the stock Of
the society. This was denied by Mr.. Lord.
Mr.. HomblOwer refused in, his argument
70 be drawn into" any controversy as
between the factions in the board OF the
directors. All parties in the board he
said, are united in the mutua lization plan.
and he regarded Mr.. Shepard's references
10 "internecine strife as an effort TO lead
him aside from the main question al issue
He also said that he appeared for the So
Ciety, not for Mr.. Alexander.
$40 SHARES VOTED TO AMEND CHARTER.
Mr. Hornblower said that he had taken
the privilege Of advising Mr.. Alexander 10
make no affidavit controverting the allega-
tons made regarding the controversy in
the society. brief affidavit by President
Alexander was submitted. In this he saws
that the allegations regarding the contro-
Versy in the society are immaterial TO any
question arising in the suit: He wants,
though, he says. to deny the charge that
the amended charter was adopted by the
board Of directors as the means OF com
promising a strife within the society. The
charter, he asserts, was adopted by directors
representa- $40 shares Of the capital stock
AZ Mr.. Hyde was one Of the directors
who voted for the adoption Of the charter
the shares on which he voted must have
been included in the $50. It aas been re-
ported commonly since the hrst stormy
meeting Of the directors that Mr.. HYDE
had been acquiring the stock Of the society
umtf he was supposed 10 hold now about
900 OF the 900 shares.
NO HARM TO sTocKHoL@ER.
Mr. Hornblower denied that the property
lights OF the stockholders would In any
way be interfered with by the proposed
naturalization plan. The idea OF the society
ct the beginning was that il was organized
for the benefit OF the polioyholders, and not
In the interest Of the stockholders
"On the one side said counsel for the
society, we have the right OF the policy
holder who has contributed his hard earned
"a wings TO build up the surplus Of the 40
ciety; on the other side the right Of the
atockhoder No harm can come TO the
etockhoder His right in the surplus.
II be has any right in IT, Is not taken away
from him. All that is taken away il his
right 10 vote for the entire board OF direc-
tors. He still has left a right 70 vote for