New-York tribune., 1905-08-01
ALL OLD DIRECTORS SUED.
MAYER CHARGES WASTE.
Personal Profit in Equitable Ms
management alleged.


| several of the defendants Yesterday Attorney Gen
eral Mayer began his suits against all the members
OF the old directorate of the Equitable Life Assur-
ance Society. These suits have twofod object
to compel the restitution OF any money belonging
to the Equitable proved to be wrongfully diverted
to the personal profit OF any. Of the defendants.
and accrued interest, and to compel each director
TO account for his osicial conduct. and TO bring
| about the removal of any director proved guilty
| Of wrongdoing
The Attorney Generals work really was begun a
week ago. when e. II. Hartman was served with
| a summons. although the complaint was not then
ready. Mr.. Mayer wanted to make that Mr..
| Hartman should be served before he began his
| trip 10 Japan. Several of the directors accepted
| service yesterday through their LAWYERS among
them James Hazen Hyde
While certain specific acts are charged against the
directors In the complaint among them the giving
of leases 10 the Mercantile Safe Deposit COMPANY
and the Missouri Safe Deposit Company, the grant
ing of excessive salaries officers the transactions
In connection with the consolidation of the Western
National Bank and the National Bank of the United
states the loan or s6s5 00 and large advances 10
agents the proceedings by the Attorney General
behalt or the people are intended primarily to open
the way TO judicial inquiry the entire manage
ment of the Equitable The scope of such an inquiry
would be practically without limit. II could take
up questions which no definite section OF the Insur-
ance law or the Penal Code cover
MAY BRING INDIVIDUAL SUITS
The Attorney General is not certain whether he
VIII nave 10 foliow this action. omnibus suit
which names the Equitable Society and forty-nine
against officers and directors because of specIfc
acts brought out in the evidence taken in the trial
OF TINS action That will depend in great part on
the answers filed by the defendants They will have
twenty days from the date of service of the COM
plaint in which to file answers
Inc action probably will be brought TO trial il.
the October term The witnesses will be the di-
rectors themselves Under the insurance laws the
report of Superintendent Hendricks and the test;-
mony taken before him can be used presumptive
evidence.
The complaint is imposing document of thirty
three pages. divided into twenty-one sections At
tached to it exhibits copies of the Equita BILE
charter its amended bylaws and a list of officers
and directors and members of the executive and
finance committees. II names defendants the
Equitable Life Assurance Society of the United
States and all the old directors.
REQUESTS IN THE COMPLAINT
Because OF the misconduct and misma nal ement
which the complaint alleges, the Attorney General
asks OF the court:
First1That the defendants. and each of them.
r soGiety Of the United States account for
position OF the funds and property committed tG
second-That the individual defendants. and each
Of them, be compelled TO pay 10 the defendant, the
Equitable Life Assurance Society of the United
which they, or any of them, have acquired to
sy or voon of their G dnss lost
Third-That any defendant or defendants now
eocietyi upon proof Of mseoaduct he remoTed
b h nfw oc u Se % % to Rd @ l
same, in order to supply the vacancy or vacancies
Fourth-That the net surplus Of defendant
ciety, after 6educting sufficient amount to cover
to- or credited to- applied for the benefit Of the
With e chareq n and With IN
Fifth1That the plaintiff have such other or fur
MYSTERIOUS LOAN TO TRUST COMPANY.
Much attention is devoted to the mysterious loan
OF sSS5OOO carried with the Mercantile Trust Com
pany. If this loan TO the Equitable Society,
the complaint argues. mention of its use is found
the Equitablc's books. II, the other hand. II
was TO Mr. Alexander and Mr. Jordan indi-
viduals the Equitable. through its subsidiary COM
pany. had been lending money its officers prac
tcaly without security The Attorney General also
treats at length the system of advances TO agents
saying that the Equitable had lost through these
advances much money for loans improperly secured
The first four sections of the complaint reCite
the organization OF the Equitable and the provisions
Of its bylaws. Under them il the duty of
The directors the interests Of said de-
fendan society. to preserve its property and
from waste. to permit one. either of their
number or utside thereof waste the said prop
erty and assets. and TO see that the laws of the
State governing the management Of said society
were observed and enforced. and that the proper
rules the mana cement Of the society. including
| the ascertsinment and application of net sur
plus thereof in accordance with the charter and
with law, made and carried out and to act
for the good and protect the interests of the said
society and its policyholdefs. and generally 10
exercise properly the corporate powers of said de-
| fendant society"
Nevertheless, disregarding their duty the So
ciety the directors have negligently, improperly
and mprovidently performed such duties, and ha-
btually and continuously done caused or suf-
fered 10 be done. wrongful. illegal and improper
acts (some Of which hereinafter set forth in de-
taD, by reason whereof the defendant society has
suffered great loss and damage. and funds
assets and property have been wasted and lost and
much money and property to which 1t has been and
is entitled has been withheld from it GALL great
damage), and the individual defendants have ac-
quired to themselves, caused permitted TO be
transferred 10 others In violation of their duties
money, property and the value of property properly
belonging to said defendant society
The complaint sets forth the duties OF the ex-
ecutve and finance committees. then recalls ex-
animation by Superintendent Hendricks the testi-
mony taken by him and the report he made TO Gov
ernor Higgins. The ninth section is devoted to a
resume of the work Of the Frick committee
SAFE DEPOSIT LEASE ATTACKED
Section 10 takes up the lease with the Mercantile
Safe Deposit Company. The complaint shows as
Superintendent Hendricks brought out in his report
that for nearly fifteen years OF occupancy the safe
deposit company paid the Equitab BILE only 80 ss 40
more than what paid for alterations and i'm
provements to the premises. Meantime the com
pany was paying large dividends 10 its stock
holders. among whom were James H HYDE James
W. Alexander William Alexander Gage y Tar
bell Valentine p. Snyder Thomas D. Jordar
Charles r. Alexander. Henry r. Winthrop Alvin
W. krech and William H. Mcintyre officers ana
directors and members Of committees of th.
Equitable All OF Section II is devoted IN tho ,s
of the Missouri Safe Deposit Company taken I'm