The Birmingham age-herald., 1911-12-13
Leather Recalled

Auditor Z. F. Leather, who testified yesterday was recalled to tell of his ex- animation of the books of Knight, Yancey x Co. that were given him. He said that the books show that in the season of 19dS-9 the firm skipped about half of the cotton provided for by the bills of lading in the records, but that during the next year the season of 1919-10, the shipments averaged little more than 10 per cent of the cotton provided for by the bills of lading. Asked whether or rot the firm of Knight, Yan- cey & Co., was insolvent at the close of the year 19G9 MT. eLathen said that the firm was nearly $2,0O0000 in the hole. lie found a statement that had been prepared by MT. Knight for V Van Gerpin x Co. amounted to only $16S,5O0 and the assets $337, ,Sc0. Witness said the firm lacked 34,0 GOO bales of having enough cotton 10 meet demands. He explained the system of issuing bills of ladins before the ship ment of cotton. Drawing bills of ex- change due in 90, 60 or 90 days and selling the exchange. He said he and J. A. By waters, foreign freight agent of the Louis vile and Nashville, had made this ar engagement, that Bywaters be interested to the exient of securing more business | for his railroad
 1 Judge 3rubb asked the witness what authority Bywaters gave him and he re- piled that Bywaters gave him permission | to issue bills as he had been doing He | would bill cut the cotton, draw for it and save interest That started during the car shortage several years ago, and 1t was the start of the whole system. He told | Bywaters that Knight, Yancey x Co., were shipping @ per cent of their cotton over l the Louisville and Nashville railroad. and | Bywaters said the system was all right Questioned as to figures. he also stated ha 1 gave the Louisville and Nashville about 1 120,000 bales in a season. the freight amounting 10 sS3,oo0 to s3i,OOo
 Judge Questions Counsel
 Knight said he had great many con versations with Bywaters about his bust ness. Judge Grubb asked counsel for the defense if they could show that By waters hal authority to give unusual priv i ieges to kright Attorney Godbey said ! they could prove that Knight thought so and the volume of the business of his | firm and the manner in which 1t was con- ducted certainly was known to the Louis vile and Nashville road. Judge Grup5 asked counsel for the defense if signing l the agents rame to ladings was forgery l Attorney Callahan answered that it was | not unless there was an intention to de- fraud
 Wanted Fact Secret
 Continuing his testimony. Kpight said Bywaters asked him to keep secret the fact that he was allowed to issue ladings ! and sign local agents names to them. Otherwise, the matter would get over the whole system and other customers would want the same privilege. Answering a question, k'ght said he had the same arrangement with the Southern, through T. w. Hnn'er division freight agent of Selma. Hunter he said, came to him dur ing the season of 1907 and complained that the Southern was not getting a fair share of the firms business and prom ised that the Southern would do as much for the firm as the Louisville and Nash vile road would do.
 Discrepancies in Weight
 The witness sought to establish that the officials of the railroads knew of his system. He said in 1907 he received a telegram from Hayre. complaining thai 20) bales of cotton were h@id up by the steamship company beeaute of discreD'