New-York tribune., 1908-02-14
DEPOSITS MAY OFFSET
DIFFERENCES SETTLED.
Clearing House Grants Claims of
DepoMfors an Suspended Banks.

The difference of opinion between the loan COM
,n.ftee of the Clearing House and the depositors
of the Mechanics and Traders Bank and the
Oriental Bank relating to the liquidation Of the
collateral hei5 by the Clearing House against loan
certificates issued TO the banks disposed of
nj meeting of the Clearing House loan committee
Yesterday morning by resolution recognizing the
eo1;,tahlc rights claimed by depositors whose notes
.he Clearing House holds.
These depositors insisted the deposits stand
ing 10 their credit at the time the banks closed
,seir doors should be offset against their notes,
the total amount being approximately A.oooooo.
Strauss & Anderson. with Grout & Grout, acting
.s counsel for the depositors of the Mechanics and
Traders Bank, had numerous meetings with the
representatives OF the Clearing House and their
counsel. ordyke, Ladd & Bristow, and claimed the
tight on the part of the depostcrs to set off the
denosits against the amount of the notes when
navrnent demanded.
In round figures the Clearing House holds some
6 ene.o Of notes of this kind to secure about
& 600 Of loan certificates issued. but among these
rofen1akers. while there are many who had de-
osits In the bank at the time It closed its DOORS
,bs-e are a great many whose deposits were small
sr5 who assert no such right
The attitude at first taken by The Clearing House.
.,s+ II stood in the position of an innocent third
Marty holding these notes for value before ma
tursty and that it had right to enforce payment
.-,-rout regard 10 the equities existing between
che various classes of derositors, has now been
r,adihed SO that all depositors are protected Inc
adopted PROVIDES tn2l
iI accept payment of maturing notes while grant
s. >, the depostor the right TO reserve the amount
of the balance standing 10 his credit in the oank
e+ the time II suspended business, without preJu-
s,,. n ,re depositors right insist offsetting
-. 6e-osit the Clearing House Association
olso agreeing TO take further action 10 en-
-o-ce collection OF any balance which may be due
-, I'll other available free collateral; has been
exhausted
~ Clearing House Association reached this de-
-, =, the interests of the business houses which
-, ,5eY.osi,ors in these banks and so that ali
f,,sior as 10 the rights OF depositors as among
.s.,,ssIzes might be avoided The foilowins
i,e will be sent 10y Manager Sherer OF the Clear
,- House TO each depositor with every can lor
-svrnent of maturing notes:
W. are hereby notified that your lnote. draft
sc-eI7rarce) for s.. dated lso anu ,a1,- III
tuIls clearing House Association security for
ep Indebtedness Of the bank and that lhe sanle
Nil be presented for payment IN Que course a' ma
tur1ty- ,,, - ,-o,- ,-.5i+ as a 5eDositor
- me - bank the time it suspended and De
sre 10 withhold for future ADJUST Ine lne aotil IN,
,1,aer erlch amount of deposit and the amount OF
xrsJ~ Indebtedness will be accepted by this asso-
cistion without preudlce TO me rgI tii oa md
cation enforce payment 81 me uil al.ut @ s
without prejudice TO your right TO insist that your
oepcst should he offset.
orr obligation will be presented in due course
e. the place where il is made payable Where such
martial payments avaied Of # there are IN,
So-sers on the note waiver Of demand, protest and
49, - should be given by the indorsers,
well as the makers. in order 10 avoid protest or
The item Settlement on the above mentioned basis
ce~f+Tad check If presented before the due date
In the event Of such partial payment further
action VIII not be taken by the association until
al other available free collateral has been eN-
tsusred