The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1905-07-29
which the state has suffered in the First

winch Ine SIdLG Has SlIOA C4 Al NAAC L AAN2S
National bank failure.
Governor Hoch says that suit will be
started against the company at once
unless it indicates its intention to make
a settlement with the state. The Scran-
ton company bonded Kelly to the
amount of $500, ,OO0 c. J. Devlin is on
the bond for a like amount, but since
his failure ther is no hope or chance OF
realizing anything from him, and the
states only recourse now is to hold the
trust company responsible
Though Governor Hoch feels confident
that the bonding company will make
good without a suit because the con-
Germ could not stand having its reputa-
ton SCARED by refusing to pay an in
demnity, yet there is every indication
that the collection will be fought, for
Robert Dunlap, counsel of the Santa Fe
at Chicago, has been called into the
matter by the Scranton company for
the evident purpose of resisting the
claim.
Governor Hoch was in consultat ton on
Friday with ]. w. Gleed, Attorney Gen
eraI Coleman and F. L. Williams of
Clay Center. They talked about this
bond matter at length.
The governor would not talk concern
ing the matter to any great extent. II
do not know that we will bring suit, or
that we will have to bring it,, he said,
because 1 believe that the company
will realize that it is Obliged to pay the
out cost of litigation to U.s."
Are you ready to bring suit?" was
asked of the governor, in case it gets
to that point
well, yes. I think we are prepared
for that emergency, but I do not antici-
pate any trouble. The company GER
tainly cannot fail to see that it will be
to its own interests to pay up. 1t GER
tainly could not expect to get much
business if it did not pay. It would be
in n11IxT IN hut
where as we'll"
1--WE have had some correspond
ence with the company, and it has not
refused to pay, although it has evaded
a direct reply to our questions"
Then there is also Kelly's resigna-
ton which the governor still has
locked up in a drawer marked ''in
escrow" Hoch has been holding this
slip of paper with a significant tenac-
ity. Though he refuses to say what
conically in this way: ''Mr. Kelly has
not got the resignation. That is all
can say" 1t is evident that until the
bond is made good and the examina-
governor will hold on to the resigna-
ton.
Just now the state could use to de-
cided advantage the money which
has been lost in the First National
bank. The funds in the state treasury
will have to begin to stamp warrants
mot paid for want of funds" Kan
sas has $547,000 tied up in that bank.
Of this sum about $4,000 is money
from the general revenue fund, $75,-
600 from the permanent school fund,
and $4,000 from the annual school
fund. The rest is scattered among va
rfous other funds.
Assistant State Treasurer John
Kelly stated this morning that there
is about $4,000 now in the general
fund. The monthly payroll of the
state aggregates about $175,600. Mon
day is pay day The $50, 900 will pay
off all the claims that come in the
first few days, but when the bills from
the state Institutions begin to roll in
they will have to be stamped. Under
a new law state warrants pay but 4
per cent. They used to pay per cent.
The banks ordinarily would carry the
4 per cent. warrants, but they can put
their money to better use now, so the
holders will either have to discount or
carry them themselves.
The state officials still hang on to
tn eidea that the state is a preferred
creditor. In case the plan to hold the
Scranton company fails, the bank may
be asked through the courts to first
pay off the $547,00O of state funds.
The receiver, however, will not treat
the state deposit as preferred, and liti-
cation or that point is sure to follow.