New-York tribune., 1908-12-08
NEW INSURANCE SUITS
ASK BURNHAM FOR s109 900.
Mutual ReSerre ReceiUerS MoTc
4gdinst Old Directors.

Permission was granted yesterday by JUDGE " 1Iu
IN the United States Circuit Court TO " "iiiifn -
burn Ressell and Charles d Rushmore Fecei'eiS
the Mutual Reserve Life Insurance. COMPANY "
Nis .uro suits in equity TO recover large Sui' -,
re,,e6 70 be diverted from their proper uses AHo
erst suit against Frederick Augustus 6uInnAi
prssfdent Of that company and OF its preue0e,
;he Mutual Reserve Fund LIE Assoclauon' S"4 IS,
him with rnisappropriatins f1OSooV' AIo P'
o.he- large sums TO his uses Inc eecOhu
sui,. against George u. Eldridge George BurnfaIn'
Richard Deeves. Horace II BrockwaS Ho" 80
! Fhters and Charles E. Mabie, directors chaIte
them with connivance in and Ia1IuIe " ~
loofinE Of the companys funds
Eurnhsrn fbe receivers sllege, while presloeht
snd director was virtually the whole assoc'aHot'
softnz about all the votes at board reeliAeS C
proxies raising his own salary whenever no -
IKE il and handling he liked large conuhseiN
fund until the State Insurance Department iHtei
fered with that pastine- lie was hnsoe u a,
of the Mutual Reserve Fund Life Association IA
1885. having been prior 10 that oiIe0'O-
general counsel ,,o-
Til. chief feature Of the biIl-the alleged DIVER
sion Of $4,000 and probably other surns-"as o4Sea
On a transaction concerning the relns. In go
,gsks held by the Northwestern Llfe Ass4i c.
C'o-ananv Of Chicago. About Nay l. 4S'o' e64u 80
,.,,-e-s. l,fv the association made a contract
With De Witt &. Merriam. whereby ne iol e.,
rllrius the Northvesterns poicyhooefs !" , a."
Mutual Reserve Fund Association was I" ~ 49,
x per cent OF the first years premiums A1iu -
= en- On renewals on July 6, 1900, another COLI
erect Vas made with him promising 10 EiNe mn
On this reinsurance business a bonus o. !" . Pc
rent IN the first years premiums sno Per cen
IN eu further premiums SO long as palo- !" aU
g. - 81. commissions under the nrst contract
Before August L 1901. the bill went on pay
sreresating either $4,000 or seS.V'e were HAU0 ~
him under the May contract
ON MAY q 1901 Merriam assigned that cohu@ct
- q Ievinson and on July OF that year
s,i1son agreed with the association TO conliiiuUs
su commissions to S11.e56 g. He was 10 acCep. .
note Of O. u Wetherell to run two Yeas I01
sa,a On With 40o shares OF the National IAfe IN
surzuce company of the United States OF AieIic@
= Collateral which with accrued interest on July
2 amounted 10 the fun value or his claim
was g portion of the assets received Holii ~
Northwestern Life IN the reinsurance trsnsaclloH-
The hill says:
Your orators believe, and therefore aIese. tRat "a =
lsrEe portion Of the moneys in form agreed 10 %
psid 10 said Merriam by the SontIzcs 3. Q. f the
tsid note of the said WethereI but what psrIcu1ss
- stat. were never intended to be paid TO the
said Merriam nor 10 rs Tecel'eo .3d Ds I'M 70 be pad
- and received by certain persons TO yoaI sf 3TaI
nov ~ n9" g 1oeeeds sa thSa WeTe neG 1raduent
fll disposition Of the assets OF suGn Ser he
said contract and such wrongful and frauga5ea' 1d
disnositjon thereof made with the khoWledse
Corsent and assistance and partly for the beneht
of the said defendant
The contract made with Merriam on July . con-
+,rued the bill was without consideration ano was
-aa4 eight payments. aggregatins SIVs'V"' "elo
made 70 one George Storm as Merriarns asslsneer
,,,,rror+;ns to be made under that contract 1he
bill continues.
vo,,r orators believe. and therefore aege L-sSS @
or te 7oonave thus paid the salo tIeoI In
: rs-1a oarf was secretly turned over 70 ~
<enis9t without any consideration belhg pau 'i
for hy him.
~, Eeb-re-v Il 1896 there came into the possession
,r The association large contingent fund-anouhte !
~, s-,e-iAed-vvfich by resolution OF the ooaIo oA
,si-ecto-s was turned to Burnhan lot MS use
z-5-bout INV accounting o. any nature Ch -Aus
. 1905 -l,e directors voted him 500 q week on lie
REGULAR TayrolI TO be used as contingent lund' %
-f,l,out accounting therefor On OCTOBER = lo'7'
.fo Insurance Department having questioned 1hese
,-,,,eac,io1,s they we're discontinued, and Burn
7-sr,-s salary was raised 500 q week to s'o"
ON November Is. 1900. It was Increased TO 500
week.
Tho tIl also recited that in 1898 Burnham CON
spirad with Horace II. Brockway TO OBTAIN |o,o'''
,,l,I,n was 10 be paid 70 Brockway as salary i"o
months after his name was put on the payToA
F7,,vnhan asked him for $500 which he got An
other item Of $780, paid in 1901 TO Nlchols ana
Bacon on the pretence that it was in settlement OF
= s1it against association actually went 10 SET
,le s,lit brought against Burnharn for $7oIb loaned
10 him by J. Douglas Wells. the bill charged