The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1912-01-15
COURSE OF ACTION
HAD BONOS BURNED
Owners Would Not Have Suffer-
ed Loss Through Equitable
Fire.
REISSUE NOT UNUSUAL
Indemnity Fixed for Corporation
Should Old Certificates be
Recovered.

Equitable building was wrecked b:'
ire. and before II BECAME known that
the 3l,00o,000.0 600 or moro worth Of
securities in it's vaults were unharm-
ed there was much perturbation amor :.
owners Of stocks and bonds that had
been put away for safckeeping with
tile Mercantile Safc Deposit Company
Or put UP as collateral for loans with
the Equitable Trust Company or the
Mercantile Trust Company, now Il
branch OF the Bankers Trust Company.
The question at once arose what re-
course they would have II 1t turned out
that their securities had been burned
up or destroyed IN the collapse Of the
floors that fell TO tho bottom OF the
building. Tho same fear was felt FOR q
Enort time FOR The $500. 100000 worth
OF securities belonging 10 the Equitable
Life Assurance society and policy
holders would have been greatly dis
tnrbed II President Day had not
promptly and extensively circulated
the news that the society'A big vault,
III which the assets were kept, had
been found intact as COON az the Are
%as under control.
While none Of the securities in these
vaults was lost, It IL believed that
EtockE and bonds IN comparatively
small lots may have been burned up
In the Offices OF other tenants. such 3
lawyers whose CHEATS had left securi
k'es with them over nigh, for one
purpose or another.
The course that VIII be necessary
In these cases Is the game that would
have been necessary on q much more
extensive scale II the vaults had not
Htthstood the Are. Ia no case would
any OF the owners have been likely
10 lose any part OF their holdings. even
if the certificates that enDody their
interests had been destroyed. The sit
ult!on would have been no different
from that OF the individual holder
who loses a share OF stock or n bond.
either by having IL burned up OF by
leaving II on the ferryboat on his way
30 his suburban home. Cases OF this
Mind arc OF frequent occurrence and
most of the largc corporations have
established 4 routine by which new
certificates may be issued 10 the
holder.
First OF all he is required to make
affidavit that the certificate Is lost be-
yond the possibility OF finding IL after
dIligcnt Eearch. Sometimes he can give
evidence that he has actually seen 81
burn up with his household effects. and
the strength OF such AFFIDAVIT naturally
varies with the circumstances. Tn"
next thing he Is required TO do Is 10
give bond TO indemnity the Issuing
corporation against the possible future
production of the certificate supposed
10 have been lost. Most companies re-
quirc that this should be In double the
amount OF the securities claimed. There
IS no law on the subject. and each cor
poration makes .ts OWE rules. both in
regard TO the amount OF the bond, and
81; regard TO the ccnclusivcacss OF the
proof OF lous
The leading surety companies make
regular business OF the Issue OF such
bonds, and the established charge is
per cent OF the amount involved.
The bonds run nominally for twenty
years. as, II no other claimant turns
mp in that time, the ;i;io OF the holder
OF the new certificate IS legally estab-
l!shed under ordinary circumstances
In fact, however. IL such a casc arose.
the surety company would bo liable
eveS after twenty years. so that tine
bond in effect is perpetual.
Before such a bond is issued the
surety company requires an affidavit as
TO the loss OF the certificate, and that
the holder has not disposed OF It or
any interest IN 1t TO any person by way
OF pledge. sale. assignment, or other
wise. The usual form OF aiiidavit also
shows on it's face that II is made Tor
tho purpose OF Inducing the surety COM
pnRy 10 become surety on IA bond re-
Quired so that n duplicate OF the oriSi-
nal certificate may be issued. This
clause has the effect Of prot :cting tn.
surety company against fraud or per-
jury as In that case the mater OF tne
s;lidavit would DC criminally liable ana
would probably land in jail.
After all this has been done. the Gus
tomary course is for the issuing cor
poration to advertise it's in.cntlnn Of
Issuing the new certificate and after
some months, IL no protest develops,
it is issued. Any accrued interest or
dividends would then be paid over TO
tho holder.
In these ordinary cases l. is assumed
that the Issuing corporation has it's
records intact and can ascertain from
its transfer books whether the claim
ant is the actual owner of the ccr;ii-
cate In the Equitable fire these rec
crds pertaining to the Union Pacific,
Southern Pacific, and other Hartman
lures were presumably destroyed. Had
any holder of the s'cu:i,. cs ct these
roads sustained 4 iosa i'll tho Same
fire, additional complications would
have heen introduced in their re-
issue. Ii tho Equitabla Life. Cor in
stance, had lost Its securities and il
some of them had been stocks or
bonds OF the Hartman roads. /. would
have been as cnsy TO establish the fact
Of ownership.
Where these records are missing re-
course would naturally bn had TO rec
Ords OF the reGidtrar, usually q frost
company located in some othe- Duild-
ms. In the case of the Hartman
lines however. the regis.rnr for one
OF the principal roads was tile Mer-
camille Office of the Bankers Trust
Company, also located In the Eqnita BILE
Building. Had tho vaults OF the sew
eral Institutions not withstood the fire,
therefore. much confusion light have
resulted In This hypothetical case.
With u concern OF the sispdinp- and
responsibility OF the Equitable lie,
however IL It's own records showed 1t
tho holder Of certain securities, neither