Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1911-01-12
CASUALTY co. MAY
SUE FOR COST OF
ITS PROMOTION
CONTINUED from First PaEe.)

Leonard A. Duncan and Robert J.
Montgomery.
They were clerks, surveyors, and
others of absolutely no business stand
ing in the State said Gardener. land
their is no doubt in my mind that they
we're put on the board TO be the tools
Ct Gray and Vaudeville"
With this contract on their hands
the company began business as a com-
l~nercial surety company, the first in
New Jersey. AS soon as they tried to
do business in New York. Illinois and
Massachusetts they found themselves
kept out by a law that debars any
insurance corporation whose cost of
promotion has been more thar ) per
cent. of the capital stock.
This is the reason" explained Mr..
~Feigenspan, that we had to sever our
connection with the Gray-Mandeville
people, as our books showed that we
had paid a 90 per cent. commission to
them and as long as we were bound
to them by the contract passed by that
dummy board we could never hope to
get into the New York territory. Not
oiA1 NAV paL bh0 o6tlitS = iiitblll
petent, and we knew we could never
get anywhere as long as we were tied
down to them"
Contract AbroEated.
The contract referred to was abro-
gated on July 16 last, and the agents
Immediately began negotiations to re-
damages. Finally they made an
offer, Mr.. Feigenspan explained, to set
tie for $40, 000, which was refused on
the ground that it was exorbitant. Re-
Gently the Gray-Mandeville concern
started suit to recover damages for the
breaking of the contract, placing the
case in the hands of Edwin G. Adams,
q local attorney in whose Office the
dummy board held it's first meet
ings.
One of the charges against the di-
r~ectors of the casualty company
brought by Mr.. Gray was that they
had received rebates on their pur-
chases of stock. Numbers of the stock
holders who came TO the meeting with
The idea that this rebate had come out
of their own pockets afterward told the
president that they a grossly mis-
understood the situation. The charge
pIuNed W bt IL DOOillti dil6t
Matter of Rebates.
1t was further explained that when
it became known to the directors UNI
der what conditions they had received
these rebates all but one of them re-
turned the amount they had received
into the treasury of the casualty COM
pany where, they said, it really be-
longed. The single exception was one
whose death prevented him from fol-
lowing the example of the other d.
r~ectors.
Toward the end of the meeting the
question was raised of the possibility
and ACCESSIBILITY OF compelling the re-
turn of rebates granted to parties other
than members of the board of directors.
Richard Boardman, a Jersey City at
torney, finally moved that 1t was the
sense of the meeting to favor lega'
action against the Gray-Mandeville
Company and all others who had re
ceived rebates to recover these sums.
The motion was passed.
New Directors Named.
The new board of directors was an
nounced as follows:
Christian w. Feigenspan, David o
Watkins, William j. Gardner, George
w. Jagle, Winton c. Garrison, Edward
c. Stokes, John T.. Conroy. John Howe
George j.. Roberts, Abraham Roths-
child, E., c. Hutchinson, William II.
Barnard. John j. Radel, James c,
Hinchliffe, Harry C. Mitchell.
The last two names are additions TO
the old board Of directors. Mr.. Hinch-
life comes from Paterson and Mr..
Mitchell from Trenton.
After the stockholders meeting the
new board met and organized. Chris
tan w. F~eigenspan was made presl-
dent, David o. Watkins first vice-pres-
ident, William j. Gardner second vice
president and general manager. George
w. Jagle treasurer. and Harry c..
Mitchell secretary.
Mr.. B~oardman's motion was placed in
the hands of a committee to be APP
pointed by the chairman for further
action. Mr.. Gardner said he thought a
part of the 20 per cent promotion fee
received by the Gray-Mandeville con-
Germ could be recovered If legal action
should be taken.
As to the suit against them the di-
rectors express no anxiety. They are
confident that Gray and Vaudeville
can recover no damages on a contract
made, as 1t was, by a dummy board
of directors, and one which they claim
was never ratified by the present
board.