The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1913-03-29
RECEIVERSHIP
WAS Denied

Grand Forks. N, D, March 29.-After
listening to the affidavits and argu-
ments Of both the prosecution and de-
Tense in the case of the state Of
North Dakota, ex rel. Andrew Miller,
attorney general, against the Inter
national Securities Co, of America, a
local corporation, Of which E. P.
Sandlie is general manager, Judge
Cooley ruled that the application. for
the appointment of a receiver would
be denied as no showing had been
made to Justify "a reCeivership: that
the restraining order, now in effect,
be modified SO as to restrain the COR
poTation from d~ispOsing of any notes
held by it and received by it on sale
of contract Or stock, and also to re-
strain F.. Sandlie from dsposing of any
notes now held by him and received
by him from the corporation.
The idea Of the holding of the court
was unquestionably to hold the notes
intact and together that the whole
matter might be disposed of in a
proper and orderly manner, possibly
by the stockholders themselves taking
action, thus avoiding a multiplicity Of
suits and consequent expense. This
permits the company to continue it's
regular business.
Many Allegations Made.
1t was alleged by the state thai the
company was organized and promoted
by f. Sandlie and some of his rela-
tives with the sole purpose Of making
gain for them without consideration
Of thestockholders or other parties
interested; that the stock was sold at
various prices of from SO to $25 the
par value being $40 per share; that
untrue arguments were used in in
duCing people to buy the stock; that
the promoters gave the buyers the
impression hat the corporation was
of a cooperative nature; that the
company a only made one loan
during the two years of it's business:
that the corporation had only earned
1924 since its organization over two
years ago., while the running expenses
are said to have been $4,000; that
the said company is now and has been
insolVent for some time past; that Il.
Sandaie had misapproprFated the
funds and had not carried out his
trust relation with his stockholders;
that r. Sandlie as general manager
was paid an unreasonable amount for
his services, being allowed q salary
Of 1925 per month and $1,000 a year
for expenses, and given a 40 per cent
commission on all stock sold; that e.
Sandlie had exercised an unwarrant-
able control in the affairs of the COM
pany, and asked that the company be
put into the hands of 2 receiver and
the affairs wound up.
The verified complaints and exhib-
its heretofore referred to were pre-
scented by the plaintiff and on the
facts as therein alleged the appoint
ment Of a receiver was asked. In an
swer to the order to show cause the
defendant presented the affidavit of E.
Sandlie, the general manager, togeth-
or with the record of the company,
showing many OF the statements con-
tanned in the complaint to be grossly
oVerdrawn.
Account for Money.
The complaint charged the misap-
preparation of more Than $113,0 600,
while the facts as disclosed by the
books of the company show that this
company has received in cash during
the entire time Of its existence, dat
ing from January, 1910, less than
$685. 0O, of which approximately $16,-
600 had been used in general ex-
penses of the management of the
company, approximately $1,000 has
| been paid out in commissions, ap-
p~roximately $500 is accounted for in
| other investments and the balance is
in the bank.
The records Of the company fur
Their disclose that the board Of direc-
tors had authorized a commission of
| 40 per CEN to be paid on stock sales
and it appears that In November, 1912,
some $1,000 in notes had been turned
over to e. Sandlie as commission. 1t
further appeared during the hearing
that many stockholders were dissatis-
| fed and that a number of suits were
threatened, having for their purpose
the OF the notes turned in
on stock subscription.
While the showing failed to estab-
lish the theory of insolvency, it lev
ertheless appeared that there was
considerable objection to the large
commissions that had been agreed to
be paid for the sale Of stock and con-
tracts. L..
Represented Stockholders.
Atty. w. d, Mcintyre of Langdon
representing a number of ~stockhold-