The Virginia enterprise. [volume] (Virginia, St. Louis County, Minn.) 1893-19??, 1912-09-27

r LIE OId banker looked me SeaTcnlnG-t
ly in the face. Wy y s.*= / ~
Randolph Mason said that we were
not to tell this thing to any one" Ito
avoid a. charge of notice under the
case cited,) "but you are his secretary,
and take it that he has sent you to
see If we; ourselves, understand IT,
Then he pulled out the drawer of
the table and laid before me the mort
gage, q copy of the one executed for
Myron Gates, report of the Supreme
Court Of Appeals of West Virginia,
and copy Of the Acts of its Legisla-
trre. Each volume was marked with
slip Of paper. The banker opened
FIRST the volume of Acts.
"You will observe" he said. that
the old form Of acknowledgment for
corporations was changed by this act,
and a new form given. in which the
president of the corporation must Ger.
tify under oath that he is such ohicer,
and authorized to execute such a pa
per. Now, the scrivener who drew
the Gates mortgage used the old form
Of acknowledgment as be found it in
the form books, while our mortgage,
you will notice, is executed under the
new form of acknowledgment"
':Well," I said, what important ef-
feet can that have? The Gates mort
gage Is in proper form, there is only
mistake in the certificate. of acknowl
edgment. That does not invalidate
the mortgage, nor affect the validity
of the bonds"
For answer the banker opened the
volume Of reports, and passed it across
the table to me, his finger marking
the page.
1t Vas decision of the
Court of Last Resort in the
state where the mortgaged prop
erty was situated. holding that such
mortgage, certified under the old
form of acknowledgment, could not be
admitted to record so as to create
lien on the property, that such an &C.
acknowledgement was void, and that
spreading such a mortgage, so &C
knowledged, on the county RECORDS did
not make IL recorded lien.
The matter was now clear. The
Gates mortgage was not lien. Gates
was only a general creditor The first
and only lien on these coal properties
was this last mortgage, which was
properly acknowledged, and could be
admitted to record. The estate pledged
was worth merely the amount of the
last mortgage. When it was fore
closed, as it doubtless would be, Hurst
& .Solmeyer's clients, the innocent for
eign holders of the really secured
bonds, would be paid in full. Myron
Gates would come in after them as a
general creditor, but there would be no
assets with which to pay his debt. His.
bonds were, therefore, worthless, his
debt worthless. The bank had been
paid in cash. the note liquidated; thus
the! bank was not affected. Hurst &,
Solmeyer would make twenty thousand
dollars. Myron Gates was the only
one upon whom the loss would fall.
He would be out two hundred thou
sand dollars.
l
son had merely said, LET the man ex-
ecute this mortgage and pay the
bank" When he had looked at tho
legal paper he had instantly seen the
old form of acknowledgment and knew
that it was void. ~Myrop Gates drafts
necessary only to get the money from
Gates and pay the note at the bank,
so that this valid debt would be liquid
ated with cash and the bank eliminat-
ed from the problem, then create a
proper lien to a second creditor and
leave Gates to whistle for his money.
The case was simple, eminently prac-
ticable, impossible of failure. Myron
Gates had set his own trap, digged his
own pit. His trap had crushed him,
his pit received him, the score was set
tied with him to the last cent.
I saw, also, why Randolph Mason
wished to keep the explanation con.
fined to the fewest possible persons.
He did not wish Gates to discover tho
defect in his mortgage until he at
tempted to foreclose 1t, after the first
default In the payment of the interest
on his bonds, one year after the exc
cution of the mortgage. It would then
be too late for any proceedings in in
solvency to affect the second mortgage.
So he had left the solution mystery,
even to me, and enjoined Hurst & SOL
meyer to secrecy. Myron Gates would
rest easy until he began to foreclose,
some months, perhaps, after the end
of the year. Then he would awake to
find his mortgage smoke under him.
his bonds rags, his debt vanished.
closed the book and looked up at
the old banker. He sat combing his
long white beard with his thin fingers,
cunning, comfortable smile gathering
at the corners of his mouth and twink
ling softly in his sharp eyes.
mr.. Parks" he chuckled, IT regret
that you do not know the Prophets.
There is so apt comment in the Book
of jeremiah"
found General Cruge7 waiting for
me on the deck Of the Baltic when
arrived. Good fortune had restored
his middle age, his step was springy.
the muscles of his face drm again, the
old light rekindled in his eyes. He
put his arm around my shoulder. and
we walked to the bow Of the steamer.
The old man was thrilling like boy
over his anticipated plan. He would
join EMILY in Paris, they would spin