Alexandria gazette. [volume] (Alexandria, D.C.) 1834-1974, 1913-12-13
DIRECTORS OFFER /
/ TO PAY $4,000
Proposal to be Submitted to
!, Depositors in Defunct
Company.
SUIT MAY BE STOPPED.
Seven Directors of Virginia Safe De.
posit and Trust Company Ready to
Pay Money to Court.


Element of all claims against them in
the suit which has been instituted by
Howard w. Smith, receiver of the
Virginia Safe Deposit and Trust Cor
poration, the big Virginia banking
concern which failed three years ago
pwlng its depositors $550,00O, has
been made by seven directors Of the
company whom the receiver is en-
ieavoring to hold responsible for the
oss of the depositors' money on ac-
count of their alleged negligence in
managing the Trust Company.
rhe offer has been submitted
by Mr.. Smith to the 1000 depositors
Pf the defunct company and in case
majority of them both in number and
hmount of their claims ratify the ac-
teptance of the compromise all fur
her proceedings against the direc-
bors making the offer will be discon-
Finued.
The directors making the offer are
All prominent business men of Alex
rndria, George S. French, Henry X.
Field, C. C. Leadbeater, Thomas j..
Fanncn, Gardner L. Boothe- The es-
bate of John ?. Robinson, deceased,
represented by the widow, and the
Estate of Henry Baader, deceased,
Represented by his executors are!
ltiso included.
When the trust company failed, De-
tember goth, 1910, it was found that
bhe affairs of the institution were
involved through the al
legged defalcation Of C. J. RiXey, presi
bent of the corporation, who is now
bn inmate of the Western Asylum for,
bhe Insane at Staunton, Va. 1t was
charged by the receiver after investl-
rating the affairs of the concern that
The directors had permitted Mr. Rixey
10 control the affairs Of the institu-
bon without proper supervision. They
had failed to inspect the books of
Ehe concern, count the cash on hand
br approve the discounts and loans.
There was no charge of any personal
dishonesty against any Of the 'direc-
tors as they are all men of the high
est character and standing in the
but it is said that they
had too much confidence in Mr.
Rixcy. Some of the 'aepositors en-
tered suit against the directors Tor
the money that had been lost through
their handling of the banks AFFAIRS
but the Supreme Court of Appeals
held that the receiver was the proper
person to bring suit against the d.
rectors. The suit was filed a year
Eae.o and has been pending in the
courts since.
Receiver Smith recommends that
the depositors accept the compro-
mise as offered by the directors. He
states in a circular letter to them
that this decision was reached after
consultation with Samuel G. Brent,
attorney for the receiver. In tins let
ter he says" ."The directors are con-
testing the suit vigorously and the
indications, are if the litigation IS
pursued, it will not be finally terml1'a-
ted for several years. 1t is impossl-
bic to tell what will be the outcome
Enf the litigation, or if successful what
mill be the financial responsibility OF
4be directors when a final Judgment
is obtained"
1t is further stated by Mr., smltn
that if the compromise is accepted
the amount of money so received, sup
plemented by the funds already IN
hand, will enable him to pay to the
creditors further dividend of ap:
proximately, seven or eight per cent
The creditors have already received