The San Francisco call., 1906-06-08
POLICY HOLDERS
TO INCORPORATE
FOR MUTUAL AID
Insured Of the Traders !
Company Plan Con-
certed Action.
Former Illinois Official
Advises Against a
Compromise.

The committee of seven representing
the policy holders of the defunct Trad
ers' Insurance Company of Chicago has
decided to recommend the Incorporation
of the insured and the immediate as
signment of policies to the board of
directors for collection. The whole
scheme will be explained to the policy
holders at the meeting on Monday
afternoon.
The committee of seven met at Gen.
tury Hall yesterday morning. Chair
man W. II. Humphrey stated that he
had received no answer from the re-
ceiver of the Traders Insurance Com
pany to his telegraphic request for a
complete list of the policies held by
that company in San Francisco and for
permission to examine the books of the
company to ascertain its exact finan-
cial condition John 5. Partridge then
moved that the committee recommend
the formation of the policy holders into
corporation. 1t is the plan to have
this corporation elect or have ap-
pointed nine directors and to turn oyer
the policies to them for collection.
If all of the policy-hoIders will come
into such a corporation the cost of the
suits against. the Traders Insurance
Company will not amount to more than
3 per cent of the value of the policies.
declares Chairman f1unapi1rey.
Louis j. Behan of Chicago. attorney
for number of policy holders in the
Traders and formerly assistant at
torney for the Illinois Insurance De-
partment, has issued statement
charging Thomas Bates, representing
some of the stockholders of the Trad
ers' with insincerity. Behan claims
that the policy holders will fare far
better in the courts than if they ac-
cept the compromise offered by Bates.
His complete statement is as follows;
The news from your city to the eff
feet that Thomas Bates, as representa-
tive of certain stockholders of the
Traders Insurance Company, had ap
peared before policy holders of that
company and offered a settlement of
fifty cents on the dollar. leads me to
ask permission to present few figures
to your readers. many OF whom, doubt
less. are policy holders in, the Traders
Insurance Company.
The bill of complaint upon which the
receiver was appointed is signed and
sworn to by fifteen of the stockholders
and directors of that company, and it is
not sign SO important document with
out knowing the truth of the state
ments contained therein.
The bill alleges that the fire loss to
the Traders, in San Francisco was
ss,74s.ooo. Mr. Bates is reported as
The bill alleges the surplus to be ST.
100000. Mr.. Bates is reported as fix
ing the amount at $4,000 900.
The bin and Mr. Bates agree on the
amount of reinsurance reserve fund,
which both fix at 81 100000.
Mr.. Bates is occupying dual posi-
ton. In Chicago he is reported as be-
ing legal advisor to the receiver, and
as such ought to be neutral. taking no
part in the controversy. In San Fran
cisco he says he is representing "eight
or ten Inundated stockholders" Mr.
Rates for the
am informed, before it's failure, and
therefore should know what the actual
either grossly ignorant of things he
ought to know or he has deliberately
attempted to deceive the stockholders
Either the allegations in the bill are
true or they are false. If the bill is
true, then Mr.. Bates has been guilty
of misstatement, II the bill is un-
rectors are guilty of perjury, although
some of the persons who asked for the
appointment Mt of, Of a receiver and who
also some of the .'humliated stock
holders" represented by Mr.. Bates
AS attorney for a considerable num-
Der. OF. claimants residing in your city.
shall oppose any. offer of settlement
made by the stockholders, unless it
be on dollar for dollar basis. and
to the bitter end. believing that the
claimants will fare better at the hands
of the court than they will at the hands
of these self-same humiliated stock
holders.
Under the administration of Cover
nor Tanner l was assistant to the at
torney for the Illinois Insurance De-
partment and had large experience in
dealing with insurance receiverships
and believe that the offer of settlement
is not made with sincerity of purpose
for the stockholders who now ask TO
settle should have thought the matter
over before doing the very un-Ameri-
can act of welcning.
Last night Chairman w. F. Humphrey
| of the committee OF seven received a
Telegram from Receiver Byron L. Smith
of the Traders Insurance Company OF
Chicago in answer to Humphreys tele-
gram requesting permission to look
over the books of the company The
answer read: Confer with my adjust
err Moore. Oakland, concerning infor-
nation desired"
Chairman Humphrey will confer with
Moore today
Los ANGELES ETTGITvvE