The Fargo forum and daily republican. [volume] (Fargo, N.D.) 1894-1957, 1913-11-03

The North Dakota Improvement Co,
after hearing the testimony and argu-
ments on the motion to have someone
uAner than M. A. Baldwin appointed
as receiver, the court, IN announcing
his decision, said:
We are now at the close Of two
days examination of this matter.
Practically, the sole question for de-
termination at this time Is whether
ceiVer.
At the time of the first hearing
there was no disagreement between
4 persons present as to the ap-'
continent of Mr.. Baldwin, both the
plaintiff and the defendant in that &C
tion agreeing to it in open court and
thereby consenting to it. The court,
however, at that time took it upon
himself to make an Investigation or
the affairs OF the company TO quite an
enlarged extent. l think we were in
session about two hours. Mr.. Farmer,
the secretary of the company, was
upon the witness stand. We went into
the question from the standpoint of
his technical knowledge of the books
and properties of the corporation. Mr..
Baldwin was also upon The witness
stand. and the court personally inter-
rogated him concerning his relations
to the company and to the q OF
its affairs, and somewhat perhaps as
to his policy with reference to the
future, in the event the court should
appoint him as receiver. | thlnk /
closed my remarks in making the APP
pointment by saying that ii at n
time in the future there was just
cause shown why he should be re-
moved, l would promptly remove him.
1t seemed to me at that time that in
order to prevent a multiplicity of
suits that were possible to occur, the
properties should be Immediately put
into the hands of a receiver, and
when the order to show cause in this
proceeding was presented to the
court, the court promptly signed 1T,
and fixed this time, beginning yester-
Day, for the hearing. So in a very
large way we shall take the matter up
DIS an original proposition for the ap-
pointment of a receiver.
l think that this investigation il
illustrates how very easy 1t is to make
a charge, and how difficult it is to
prove 1t. Allegations are made on in
formation and belief. They may be
based upon such knowledge as would
warrant the party in making them as
a positive statement, OF they may not.
When such allegations are made, very
naturally, whether made on informa-
ton and belief, or stated as a positive
fact, n they attack the financial in
tegrity of the person against whom the
charges are made, that person feels
that he Is entitled to have a full hear
ms in court; and SO yesterday morning
when the question came up, it seemed
to me, in view of these allegations
which had been made. and for my own
information concerning the true in
sides OF these transactions, and for
my future guidance In the matter, ]
ought to have the testimony given at
length. We therefore pursued that
method.
l have not time at this moment, nor
would 1t perhaps serve any useful pur-
pose, to take up these charges one by
one II make a statement of the views
of the our upon them. / think it
will be sufficient for me to say that
they are not sustained, and the impu-
tations cast by these charges are not
sustained by the evidence.
Take the question Of the sale. of this
timber stock as an example. The i'm
putation is that Mr.. Baldwin, for $500,
got this stock for his own personal
use, in fraud of this company. Now,
the testimony not only shows that that
isn't true, but to the contrary that this
stock is under the control, absolutely:
OF tho North Dakota Improvement Co.
subject to the payment Of $500, and
that the sale to Mr.. Churchill, in order
that it might comply with the statutes
was made, as it appears by the evil
denCe, as a bona fide sale to Mr.
Churchill, who was friendly to the in
~terests of the North Dakota Improve
ment Co.. ana who sells it to the NORTH
Dakota Improvement Co. for the same
amount which he paid for it.
l have interrogated counsel for the
receiver and also counsel for the plain
tiff in this action as to their view Of the
law concerning the obligations running
to the contract holders as compared
with the obligations to stockholders
because that is a very important mat.
ter, in my judgment, as affects the
question of appointing Mr.. Baldwin a.
a receiver, he being concededly a stock
holder. The answer Of counsel is il
perfect harmony with the presen
thought Of the court, and that is this