Putnam patriot., 1911-06-02

having the notes when due "ith lh' terest and profits. The profits re- celyed by Andem when he dealt on this account. were , per cent. per year.
 i. The special account business was conducted as follows. Arnold s customers on this account loaned him their money on similar notes at D per cent. He purported to purchase at his option specific stocks in his own name with this money and to divide with his customer all profits on that 1 individual transaction over per cent.
 G Audem did not know and did not fnduire what proportion of Ar holds business was in either of the three classes of business specified | above
 When Andem dealt on this special account. as he did for the most part after 1908, his profits averaged about | l2 per cent. and Arnold never re- ported a failure ta make profit In any of Andem.s dealings. What prof l it's or losses had been made by other customers he did not know and did not inquire.
 1 r. There was evidence before the Gourt which sustatns the inference that oh months transaction in 1908 with sG00o0 invested Andem re- eeived q profit of $t20; and that in transaction in 1908 with $20o0o0 in vested he received a profit of $265.76 1 in three months.
 l do not find that Andem was more fortunate than other investors with Arnold or that his average profits on 1 his special account investments ex- ceeded 12 per cent.
 l X. During Andem's transactions with Arnold he was agent for the l GrosVenordale Company. large mlll | company located a few miles from Putnam, and he lived about six miles from Putnam and did not bank at 1 Putnam or make his household pur- ehases there and seldom visited Put 1 nam except to consult Searls Rus sell as attorneys for the Grosvenor- dale Company.
 l 9. He knew that Arnold began business in 1904-5 in one room and | saw his business apparently grow un- til he occupied the whole of two story building in Putnam, and em- ployed seven clerks in 1910 and had branch offices in Keene, New Hamp- shire Danielson, Connecticut, and in another place.
 10. Up to and at the time of the giving of the mortgage in question l Arnold represented his business as in a most prosperous condition, and that he was in 1910 having his most prosperous year.
 ii. There were no suits pending against him, and Andem was not aware and had no notice that any creditors were pressing him, or ever had pressed him, if any were doing so or had done so.
 l t2. Andem received $l6000O check from Arnold dated May goth | 1910 and drawn against the First National Bank of Putnam, Conn. 1 This check he deposited to his ac- count in the Webster. Massachusetts. hank where he kept his account. l The check came to the Putnam bank l through Boston on May 23d 1910 and there were not sufficient funds ln AT nold's account to meet it; the cashier notified Andem and was directed not to protest it. and on May 27th AT mold deposited s20S2.2b and the sIooo' | % check was honored. In th's depos- it of S20S225 was check from An l dem 10 Arnold dated May 20, 1910 for $16500o.
 13. do not find that this check was given by Andem to Arnold In or l der to prevent the protest of the prior check by it's being deposited on AT nold's account l find that Arnold got it for that purpose. but not Mlth Nndem's knowledge Arnold repre- sentea 10 Anaem. as he had done oi- len, that he had a short pohtaole transaction in hand and would pay him Si6qq 00 on June list 1910 on an investment of Sl65aa0 for that period, and Andem gave him the check ot st6s000 on that arrangement
 Arnold always represented that ne was keeping his funds on all accounts closely al work in stocks and other wise so as to produce larger prouts'
 In other words. l am satisfied that on May a5th Andem and Arnold were not beginning to conspire to save
 Andem from loss in an impending mmre of Arnold. .
 IA Arnold during all his dealings
 with Andem occasionally gave Ahaeul n past-datcd check instead or cash or d new note. when he purported tu haye a transaction not quite matnred
 vhru q note became due. He also
 gave such checks at times when ne w1u0rted to have a transaction ol verv short duration with sure prom
 An8em dealt with Arnold quite 5 sNfersNeIy particularly after i9o>
 4rt he kept no record of his trans
 .- ,..4 bfs ttro6fs except as aN
 pears eu his cheek book. Ills cheSf
 hook shows that he drew about 2'
 -harEs in faNar of Arnold to tht amount of S56o0oeo in the course o his dealings with Arnold rom No vemher 6. l9o6 to June l. lele' an' he testified that he had also gwen hlu some cash at times, but at any one time there were not many trahsas
 tious pendne.
 1e On June 1, 1910 Arnold was m debted to Andem in su amount m eN
 cess of s2230000, for which Andem ! held the following paper: .,, I. One demand note. S9ooV.O( 1, lC 2. One l5 day note, ooVV.V> s. Note of May l6-10 pay
 able May S1-l0, le6S' ., Check dated June l-l0 1ess.OI
 5. Check dated June 1-l0 So,i.as
 $. Check dated June 4-l9 lSz-'Vc
 7. Check dated July l-lo -eVo'V'
 <. Note dated Jany l-lo
 and due July l-lo '-V'V'