Los Angeles herald., 1908-11-01
SECRET BOND
MEETING HELD
ON LABOR DAY
NEITHER ALEXANDER NOR
MANNING PRESENT
Los ANGELES TRUST COMPANY
PRESIDENT TEsTiFiEs
says His Concern Withdrew Its Bid
Racause II Did Not Wish to Be
Exposed to Public
Criticism

speculation N IeBdIQ 10 TIC SSSA z
meeting at which the private sale 0
the good roads bonds of September
was arranged, was ended in Judg
Bordwells court yesterday. J.
Drake, president of the Los Angeles
Trust company, testified, in respons
TO the penetrating inquiries OF JONI
D. Works, that the solid three, Su
pervisors Patterson, Wilson and Ed
ridge, ]. II. Adams OF J. H. Adams q
Co. T. R. Martin, treasurer Of the
same company; Hartley Shaw, chiei
deputy district attorney, and Mr.
Drake met In the small room adJoin-
ing the board room September Z,
legal holiday, and agreed on the propo-
sition to be placed before the board
at its meeting the following day
Neither Supervisor Manning nor Su-
pervisor Alexander was present at this
meeting. 1t was learned beforehand
they would visit the county farm thai
day, and, although both had been In
formed a meeting was to be held, those
present understood they would not be
on hand.
Advertisements for bids on the good
roads bonds call for their receipt by
the board Of supervisors at O'CLOCK
Monday. A conference between Super
visors Patterson, Wilson and Eldrldge
and Deputy Shaw was held at noon
yesterday and 1t practically was agreed
q resolution should be passed contin-
be received until a week later, owing
to the present proceedings.
Hearing Resumed Early
Hearing in the bond Injunction suits
was resumed at 9 o'clock yesterday
an hour earlier than the usual time for
the court to open. J. c. Drake was
again on the stand and took up his
testimony In regard to the affidavit
of ]. R Martin where he left OFT Fiji
day. Mr.. Drake said he knew nothing
of any conspiracy that might have
been entered into between the "solid
three and W. P. Jeffries, and de-
clared there was no conspiracy on the
part of the Los Angeles Trust COM
pany.
thing about the proposed purchase OF
these bonds?" asked Judge Works.
Il spoke to Mr.. Martin about the
matter before the election" said Mr..
Drake. After the election there was
some talk of getting up syndicate to
buy the bonds"
''At private sale?"
''At any kind of a sale"
After the election Mr. Drake said
he spoke to Hartley Shaw about the
bonds. IT remember I asked Mr.. Shaw
to step into my office on his way to
lunch, about August l. He did so and
our conversation was in reference to
how the bonds should be sold. We
discussed where the payments should
be made and other matters. Later
had a conversation with Chairman
Daggett of the highway commission, at
which Mr.. Martin was present. We
then discussed the question whether
the bonds should be sold privately.
Mr.. Daggett said he was averse to TAX
ing any part in the matter; that II
was In the hands of the supervisors.
Mr.. Martin told him an offer Of one
quarter OF one per cent would be made
by us, and Mr.. Daggett promised to
make an investigation and compare
this price with what others would bid,
but promised not to disclose our iden-
tity. as we did not wish other houses
to know what we would offer"
Bids Again Discussed
The next conversation in which Mr..
Drake was a participant was held at
the offices of Adams & Co., two or
three days before the secret meeting of
September Z. Mr.. Drake, ]. r. Martin
and Supervisor Manning were present.
Mr.. Martin arranged the meeting, said
Mr.. Drake, and the question of a pri-
vate sale was broached. Manning, he
said, objected to a private sale, say
ing it would create a great deal of
criticism against himself and other
members of the board.
'"rhen we discussed the matter of
fnstallments in the bond deliveries, and |
Mr.. Manning made a memorandum |
showing how he believed the deliveries
should be made"
did you know Mr.. Manning OPP
posed the private sale before that
tine?" asked Judge Works.
mo, SIR" was the response. There |
was to be a meeting of the board next |
day and thought Mr.. Manning would
be present. 1 had a general impression
Supervisor Alexander opposed the pri-
I I'M q
members should be present"
A day or two before the secret meet
ing, Mr.. Drake said. a limit of one
quarter point was placed OH the bid by
the eastern correspondents. This, he
said, explained the inability on the
part of his company and Adams & Co.
to pay more than that price.
'Did you tell Captain Manning or
the board OF supervisors you were deal
ing with other parties?"
II don't know"
Acknowledges Secrecy
Don't you know the matter was kept
secrat?" demanded Judge Works.
II believe 1t was. The eastern cor
respondents did not want to be known"
The secret meeting was held Sep
tember z, Labor day, and. according
TO Mr.. Drake, all members of the board
were cognizant of the meeting.
How did you know that?" he was
asked.
Mr. Martin told me- I only know
as to Mr.. Manning; he was told about
the meeting two days before"
"At this meeting did you reach an
agreement as to the proposition to be
made for the purchase of the bonds? 2"
mo. sir. Mr.. Adams stated what we
could do. Mr.. Patterson protested that
we were not offering as much as had
been offered before by -dr. Martin,
which, believe, was one-half point
for part of the bonds and one-quarter
point for the remainder"
When did you first see the propo-
stion that was submitted to the
boardT p
The morning It was presented. Sep
tember g."
who prepared it?"
'sIt was prepared at Adams & Co.'S
office. Mr.. Shaw dictated part of it."
Private Sales Common
Here the direct examination of Mr..
Drake ended and the cross-examIna-
fion by Attorney Meserve began. Man
ming. said MIR. Drake, opposed the pri-
vate sale simply because he would be
subjected to criticism. Speaking of
the private sale he said it had been
the practice OF Los Angeles city for
many years to sell bonds privately, and
he told Of number of purchases Of