New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1905-04-21
NAY REOPEN SULLY CASE.
EXCHANGE RULE FAULT.
Referee Finds Doubt as to Method
of Estimating Losses.

The Sully bankruptcy case. which was believed to
have been disposed OF several months ago. VIII be
Feopened II Judge Holt, Of the United States Dis
trict Court shall apFove opinion which was
sent 10 him yesterday by MacGrane Coke, the ref
cree in bankruptcy who conducted the hearings last
spring in the case Of Daniel J. Sully & Co The
referees opinion which discusses several important
7oints is upon an application made by Davies,
Stone & Auerbach. attorneys for two groups Of pc
titoners-EGR1n Hawley and Frank Il. Ray. against
whom an action has been brought by David II.
Miller sr trustee in bankruptcy Of the firm Of
Daniel J. Suy a Co. TO recover certain sums al
legged 10 be due creditors on joint accounts OF the
two defendants and Mr.. Suy. and f. Q. McCor-
mick l. F. Berg and Julius Kahn non-Cotton Elk
change creditors.
Hawley and Ray have petiuoned for an order per-
hitting them. their expense and through
their own attorneys and counsel. have a re-
examination OF certain claims filed against the
bankrupts estate by certain creditors which claims
have been allowed, or for order directing the
trustee 10 ask for such denomination Of the
claims The trustee in bankruptcy has moved to
dismiss this petition insufficient in law. and this
motion has been Joined in by certain OF the cred
itors whose claims are sought 10 be Te-examined.
AIR. Coke quotes Section 10 Of the bylaws OF the
Cotton Exchange, which prescribes that member
who finds himself unable TO meet his obligations
with other members at maturity shall Immediately
send letter that effect the superintendent Of
the exchange, who shall at once read It from the
Fostrum. the posting and reading OF such letter TO
operate an immediate closing OF all contracts
with fellow members, which contracts shall be
houidated and settled at the average quotation OF
Ike contracts the day such letter notice shall
be posted, unless the letter notice be posted
within hour before the closing Of the exchange
in which case the liquidation and settlement shall
be made on the average quotation OF Ike contracts
FOR the next day He continues:
Now, the trustee and the opposing creditors aver
that the notice OF the suspension Of the bankruPts
here was read and posted after O'Clock on the
q and hey 8 ag
hour fo- the closing OF the exchange Is p. m,
which shall be taken its price for the purpose
81 settling all these outstanding contracts, shall be
price OF Friday. March Is, the day on which the
notice was sent to the exchange. and on which the
suspension actually took place.
The petitioners. on the other hand alege and ask
70 tho superintendent Of the exchange by the bank
Tupts and received By him some time before 2
Friday IN question lie eXehsnFe aid not close until
after o'clock. and that even Il. which they deny,
s stated by the trustee IN his letter it stiu would
moi have been posted within one hour before the
closing OF the exchange as required by the rule,
They ask 70 be permitted 10 attack the legality
o. the rule, and also 20 show that, even under the
rule the average price al which these cotton con-
tracts should be settled should really be its average
prce OF Friday. and not ITS average price Of Satur
much lower than the average price of Friday. The
banlzrlpts had on hand large amount Of cotton
The cotton OF March Isl n SvonIS follow t5at there
would be much less money owing BY them. II any
thing. than would be owing BY them If the settle
ments were made on the average price of Satur-
day, March 9.
II IS manifest that under this rule a tremendous
power Is gwen 70 the superintendent Of the
change he may by not interpreting the word i'm
medlately' literally, by Fastening or delaying the
PsllIs LOi a loLket OF shorter time, very seriously
a1ect the property rights Of many persons. And
suppose the superintendent should be in his
Office when the notice is received and there should
De no deputy there TO act for him. II such by
deputy IS permitted under the rule, and thus. or
Tor any number Of other causes that might arise,
delay shall ensue be said that the notice has
lr-eu immediately read and posted and IL what
are ne consequences? II seems TO me that such
rue fraueht with such important consequences to
% many people, II IL Is 10 he maintained a. all
should be maintained upon strict compliance with
JUS terms. and that petitioners here have equit-
aple right 10 be heard 10 show IL they prove
that II has not been comp led with. and that by
such noncompliance their property rights have
been detefimentaly affected.
think thar the application should be granted
and an order in accordance herewith may be sub
nltted consent notice.