New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-07-07


| American Piano Company in Case.
In October, none Of the notes having
| been paid, Chapman applied for re-
| newals and was met with the PROPOSE
ton, according to his answer, that he
| buy from the company for $4,000 200
| shares of the American Piano Company
common stock and pay a bonus OF 81
900. Chapman declares the piano stock
was and is worthless and absolutely I'M
marketable. He includes the price he
paid for it and the bonus in his charges
| of usury.
Including, then. all these items and
| interest his indebtedness stood in Octo-
| Der, 1909, at s66,245 rs. He gave the
| company a note for this amount To
secure it. he says, he put up collateral,
besides that originally applied to the
S27, loan, consisting Of five thousand
shares of Standard Motor Construction
Company stock, one hundred United
Surety Company stock, one hundred
| shares of the Whilden and Hancock
Metropolitan Insurance Agency stock,
| two hundred shares of American Piano
Company common. and $4,000 Granite
Spring Water Company per cent
bonds.
| In December the debt against Chap
man had increased to 1909 %. He
| executed q new note for that amount.
| In this same month Joseph B. Reichman
succeeded c. G. Dickinson as president
of the company. Mr.. Reichman said
yesterday that he did not like the look
of the Chapman debt and that as soon
as possible after taking office he gave
the debtor ten days in which to settle.
AS Chapman failed to do so he ordered
portion of the collateral sold, and as
result Of the sale credited the broker
with $4,000 In April, OF this year. the
company brought suit against Chapman
for the remainder of $4,000.
| Chapman charges that the company
pretended" TO sell all Of his collateral
except the five thousand shares OF
Standard Motor Construction Company
stock and bid It in for itself AS
matter Of fact. he says, it continued TO
hold il against his note. He therefore
ignores the charge of $4,000, and IN
computing his Indebtedness starts with
SCI. 009 % as a basis.
From this amount the defendant asks
| the court to subtract the alleged usury
of s176o5 and an additional item OF
$500. This item. he declares, is money
of his own on deposit with the trust
department Of the company.
| What Cha pman Offers to Do.
| On August 3, 1909 Chapman says, he
| drew a check for $1,000 and deposited it
with the trust department of the COM
many in payment for future services as
trustee in connection with the mortgages
to be placed on the Titusville properties
This was all part of the holding COM
panv scheme The broker contends now
that only $500 Of this was expended,
and that the remainder should be de-
Quoted from his indebtedness
| In short, then, he offers TO pay the
! Carnegie Trust Company S43, SS4 % if 1t
will return him his collateral. And he
saws he will hand over to Wellborn the
$4,000 Titusvil1e Northern Railway
| bonds If the latter will pay him $1,000
| WeIIborn has retained TO represent
him the firm Of Putney, Twombly &
| Putney, of No. Rector street, and
| Abraham Levy, of No 81 Park Row.
MI Levy said last night:
There seems TO be a determined eff
| fort to explain the connection of the
| Carnegie Trust Company with this
transaction. I hope they will be able TO
make satisfactory explanation to the
| financial world. Mr.. Wellborn parted
with 100000 in valuable securities and
has not received 400 cents In return,
wifi, the exception of SEE, 900, which rep
resented the original loan He has ten
dered the loan originally made and has
demanded the return Of his securities.
The tender was declined because the Sc
curfties could not be returned. There
n,ust be some explanation made for the
rehvpothecation Of some Of the collateral
within a month after procuring the orig
inal loan, and some explanation for the
outright sale of some OF the same col
lateral. / shall ask the District At
torney TO continue his investigation
Denies Story of Theft.
The investigation into the bond loan
transaction was begun a week ago, when
yUeIIborn. through Henry 3. Twombly,
bie counsel. made his complaint to the
Instruct Attorney. The retention of the
Grand Jury Drought tlouDlS ~ HS'tb
and Yesterday afternoon broadsides were
published implying that the 100000 Of
,Titusville Northern bonds had been
s,olan To this charge President Reich
man of the Carnegie Trust Company. re-
nIied in a statement:
~, .,,entfon has been called to the publ
ois Of an alleged theft of 10000 worth
IDS of the Titusvlle & Northern Kali
OF 1', ~omnany from this company. 1t is an
aIa.oI1te fabrication. with not even a sem
a ,na IF truth in il. There has not been
pia a+ion of a single dollar IN this IN
"A oet All we know about the matter
sutultoN nc have been told that there Is d
y nc between the broker VINO borroWeo
ne -eonev from us, amounting Al presenl
TO ABOUT Js the client delivered to the
many pnrieinaIly. So far as we are coli-
proheii ne received. in addllloh 10 o.ie s
cerilea, 200 bonds which are nov I nm
6aVe been in possession a S1'f nave been
Of the iila ~ REPRESENTATIVES OF the pres,
eA h Mir a. 10 the State BANKING pepai
ment- -; ,,..,,, :, rlrs
a. peicbman appends to his REMARKS
M ..aroant from the STATE Banking De