Evening star. [volume] (Washington, D.C.) 1854-1972, 1908-10-18
FIRM FAILS FOR MILLIONS
GAY & co. OF BOSTON PETITION
ED IN BANKRUPTCY.
Creditors All Over the Country Rep
resent Claims Aggregating
Nearly 100000.

BOSTON Mass. October T.-E. n.
Cav & Co. stock brokers, with offices on
Congress street. were petitioned into
bankruptcy by creditors in the United
States district court here today. The
firm consists Of Ebon II. Gay and Joseph
W. jackson and the creditors VINO
brought the petition are j. Morris Boards
lee of Canton. Pa. who had secured judg-
ment against the firm in the New York
supreme court for $3.O97; Elliot Norton
of New York, who got a Judgment Tor
$685. and Horace E. harrington. clerk
employed by the firm. who claims that
S2O7 for salary is owed him.
In their petition the three creditors set
forth that the alleged acts of bank
ruptcy are that August the firm made
a general assignment to John p. Rey-
nolds. jr., for the benefit Of creditors and
that the concern conveyed and transferred
to Reynolds the whole or part OF the
property with intent to hinder. delay and
defraud."
Passing Of Interest.
The action of the firm in August fol-
lowed the passing Of interest payment on
the bonds of the Hudson River Electric
Power Company. in which they were
largely interested. While an assignment
was made to John p. Reynolds August
s, by agreement Of the largest creditors. 1t
was arranged that the business should be
Nquidated instead of thrown into bank
ruptcy.
Mr.. Reynolds. in a statement today.
said that more than so per cent of the
firms creditor banks assented to a six
month extension of their loans. Today
he refused to comment upon the bank
ruptcy proceedings. 1t Is generally be-
lieved among bankers and brokers Of
the city that the liabilities may reach
$8.OOO,0OO
The firm Of E. H. Gay & Co. was or
ganized about ten years ago and has
made a speciality of dealing In steam
and street railway. electric power and
municipal bonds.
Manager Reynolds Views.
Mr. Reynolds, who has had the manage
ment of the affairs Of the firm for the
past two months. in an interview stated:
Acting under an irrevocable power of
attorney. I have been managing the az
fairs Of E. H. Gay & Co. for the past two
months. Gay & Co. have number of
gas power and traction properties among
their assets. and more than 50 per cent
of the creditor banks assented to a six
months extension of their loans
1.-THE two properties which have been
the heaviest burden are the Hudson River
Power Company and the Pittsburg, Bing-
hamton and Eastern railroad. commit
tee Of Boston capitalists and business men
are making a thorough investigation of
the Hudson River Company preparatory
to reporting plan Of reorganization. and
the Pittsburg Binghamton and Eastern
railroad matter will be handled the same
way
Mr.. Reynolds declined to quote any fig
ures or discuss the probable effect Of the
bankruptcy proceedings
The Arm formerly maintained oflces In
New York. Philadelphia, Montreal and
other cities.
Reynolds Management Unsatisfac-
tory.
NEW YORK. October 17.-Elliott Nor
ton of this city. one of the three petition
ers against the firm Of E H. Gay & CO..
said that the management OF the firm S
affairs by Mr.. Reynolds had not proved
satisfactory to the majority of the cred
itors. He said Mr.. Reynolds seemed to
them to be acting in the interests only of
the larger creditors. Mr.. Norton added
that the three petitioners would be joined
by many others and that there are cred
itors all over the country representing
claims aggregating nearly 100000 who
approved the action taken in Boston to-
day.
L H. Gay & Co. was described by Mr.
Norton a bond and not stock brok-
erage house. 1t has been in existence
nearly fifteen years. and its secured and
unsecured debts were placed by him a,
upward of $7OO0.OOO.
Its present plight dates from last June
when Mr.. Norton obtained a Judgment
for more than $170,OOO whereupon the
creditors REQUIRED the firm 70 place itseIt
under the management of Mr.. Reynolds