The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1905-01-01
MASTERS REPORT
IN EDWARD 5 CASE
Irregularities in Specific
Instances.
HEARING ON TUESDAY
Report of Mr.. n. f. SeWaIi Cites In
stances Of Errors ..Ot judgement
and Mismanagement, But Does
Not Otherwise Uphold AIle-
cations Made in Bill.

gdtlOHS Wau6 iH Dill
who was appointed by Judge Pritch-
ard a special master in the case Of
Forest, Union Trust Company ct ais
VS.. the Southern Saw Mil and Lum-
Der Comapny petitioning the removal
of Receiver w. j. Edwards on the
ground of alleged gross irregularities.
has made his report and copy OF
the same has been filed in the office
of the Clerk Of the Circuit Court
here, another copy having been for
warded to Judge Prichard at Ashe-
vile, where the matter comes up for
another hearing on Tuesday next
Mr. Sewall. who was appointed to
take testimony at Lumberton and 70
report his findings both as TO the
law and to facts, makes a report
which is on the whole decidedly un-
favorable to the receiver and largely
in line with the allegations made III
the bill of the petitioning bond-hold-
erS,
The reoprt cites several specific
instances of bad management and
poor judgment on the part OF Mr..
Edwards; and also finds that Ed-
wards had reported all of his trans
actions from time to time TO Judge
Purnell and that the same had not
been approved by him.
The reoprt shows the close rela-
tionship OF w J. Edwards, as re-
ceiver, and r. c. McNeeiy as General
Manager, of both the Southern Saw
Mill and Lumber Company and the
Carolina Northern Railroad Company.
of both of which Mr.. Edwards is re-
ceiver, and also shows the almost alb
seIute ownership OF Edwards IN the
Builders Lumber Company his in
terest in the Philadelphia Construc-
ton Company and his relationship
TO the United Lumber Company, all
of which concerns he shows TO have
protited by their dealings with the
Southern Saw Mill and Lumber Com
pany, OF which Mr. Edwards is the
receiver.
In several Instances the report
finds that the receiver is not guilty
of recklessness and mismanagement
as charged in the bin OF complaint,
while in other particulars, il is posi-
lively found that his books fail to
show some of the facts involving the
securities of the property of which
he was IN charge as an officer OF the
court and that he used these secuFi-
ties for his personal advantage and
in the interest of various companies
in which he was financiliy interestetA
as an individual.
One Instance cited In the reoprt.
is that in which it is found that Ed
wards borrowed $4,000 from the At
lantic National Bank OF Wilmington.
signing the note as receiver OF the
Southern Saw Mills and Lumber Conn
pany, and pledging FIVE one thousand
dollar timber certificates OF the COM
pany as collateral; that the receiver
never made corresponding entry
Of this transaction on his hooks. and
that the proceeds did not pass into
the trust funds, but were invested In
the construction of a tram road OF
the Philadelphia Construction Com
pany in which Mr.. Edwards vas m
dividually Interested
The certificates referred to were
receivers certificates which were lH-
sued by authority Of Judge Purnell
in an order made on March 5th, 1903,
for the purpose of raising funds with
which TO purchase timber lands Sit
uated near the mill and on which the
insolvent corporation held options OF
purchase and by the same order OF
purchase further authorized to pur-
chase other timber with the proceeds
of the timber if by any reason he was
unable TO exercise the options referred
to. The certificates were offered for
sale but nospurchasers could be found.
They were never used for the pur-
pose designated, but were sent by Re-
ceiver Edwards to r. c. McNeely.
manager of the Marietta Lumber
Company whou sed them to raise
money to pay debt which was due
TO the Marietta Lumber Company by
the Builders Lumber Company which,
as stated was managed and controlled
by Receiver Edwards.
The report shows that the receiver
leaks about eight thousand dollars
of being able TO settle his indebted
ness IL all of the timber he has on
hand can be sold at the average price
heretofore received by him.
Among other findings of the reoprt
is one TO the effect that the receiver
directed an unusually good order for
lumber which had been sent to the
Southern Saw Mills and Lumber Com
pany of which he is receiver, to be
turned over to the Builders Lumber
Company, in which he is privately i'm
terested.
The Southern Saw Mills Company
did the work and charged the Build
thousand feet when ii would have
netted SIS To $40 per thousand, the
Builders Lumber Company securing
the pritit.
II is claimed that this transaction
was not personally known by Ed.
wards at the time but was commuifi-
Gated to him afterwards, and that
while he claimed that another order
was transferred from the Builders
Lumber Company to the company OF
which he is receiver, this oredr WaS
never placed.
The special master cites several
Continued on Page Five.J