Evening star. [volume] (Washington, D.C.) 1854-1972, 1913-01-06
TILT WITH THE CHAIRMAN
OF THE subcommittee
Temporary Halt While Matter Is
Discussed by Members.
EXCEPTION IS OvERRULED
Testimony of Former Treasurer of
Southern Building Corporation.
Scope Of Investigation !
Brings on the Protest.

Inc insurance investigation. headed
by Representative Johnson of Kentucky.
examining into local insurance condi-
tons in the District committee room i'm
the House Office building came to "A
temporary halt this morning. when
Charles A Douglas challenged the pro.
priety Of some Of Representative Red
neld's questions. and charged that the
committee in general had 80 far ex-
ceeded its original intentions, and had
overstepped its power to such an extent
that II would take at least a dozen
years 10 conclude the hearings IL they
keep up at the present pace
Mr.. Douglas forced the committee 10
retire and talk over the question OF
whether or not certain testimony regard
ing the carly days of the Southern Build
ing Corporation are relevant matters.
The committee decided against Mr.. Doug
las.
Mr.. Douglas charged the committee
with digging into personal affairs of both
individuals and corporations. which. he
said, are merely side issues
He told Representative Redfield that
he had a decidedly incorrect view OF the
power Of the committee. Representative
Redfield made reply. in brief, that he
intended to find out IL there was any
fraud in any of the operations surround
ing the Southern building, and Mr.. Doug
las thereupon characterized Mr.. Redfeld's
| assertion as IAN improvident statement
and said it would have to be upheld or
retracted. Mr.. Redfleld was told that the
committees procedure Is amazing in its
utter and complete unfairness."
Mr.. Redf1eld explained that accord
ing to his view the early days OF the
Protective Holdings Association OF
Southern Building Corporation OF
Washington seemed to merge into the
| Commercial Fire Insurance and the
panies and that he intended to know all
about 1t. He also said that the real
estate transactions OF the Southern
Building Corporation have ended In
most unusual valuation on the South
ern building. He proceeded. after the
committee had decided I'm favor OF his
questioning. on line of inquiry deal
ing with the first sales of stock and
bonds of the Southern Building Cor
porati0n.
Testimony Of James M. Baker.
James NJ. Baker. assistant librarian OF
the Senate, said he was elected treasurer
of the Southern Building Company In
January, 1910, and was reelected in 1911.
but not i'm 1912. He wac asked TO tell
the story of the purchase of the site OF
the Southern building at 18th and III
streets northwest. He said ais belief was
it cost S410,OUO-about S1I foot.
The first mortgage was SSVoeo, and the
| second and third aggregated SloaWsp. he
said. TO that was added stock SOLD al
par or better, aSgregating somewhere
around Sss6.U1o. The outstanding lndeot-
edness was about S1.5i0.ooO.
Mr.. Baker went through the details OF
the corporation's beginning and I'm wind
ing up that part of his testimony said Tue
companys stock liability was Sl,2'5,o"
The builders and architects took ABOUT
$40, 600 in bonds. he said
Mr. Baker said: II do not know any
thing about the transactions before L
became treasurer. 1 was invited into
1T after il was organized as the South
ern Building Corporation. Mr.. Meek
was the first treasurer.
Company's Total Indebtedness.
MY recollection is that my connection
with it began a year after the property
was taken over from the st. Matthew
Church people. i do not know whose
name it was in. In deciding the mort
cages there was a total Indebtedness
of $500, 900. To that was added stock
that was sold for cash. My recollec-
ton is that none OF it was sold under
par That aggregated, my recollection
Is, about $4,000. I would not want
to be more accurate than that. j think
it might have been $4,000. to be ac-
curate. but it was not over Spco'
which would make the total Indebted
ness-the outstanding money indebted
ness-S1, $4,000. The bonds were sold.
WHO were the builders! Hepresent-
T,t,,, ,clya
The Thompson-Starrett people were
the builders, under a contract that pro-
yided for a cancellation of the second
mortgage bonds. provided the building
did not exceed certain cost. l do not
remember now what that was"
Gould YOU provide the committee
with a COPY OF that contract" asked
Mr.. Johnson.
NO. sir. / haven't 1T.
Disposition Of the Bonds.
Mr.. Baker continued: Those bonds
were put in escrow into the United
States Trust Company. My recollection
is indistinct as to the exact amount
hut something like s125.OO0 of those
bonds were put in escrow. 1 am not
sure as to that date. 1t was before
the annual election of last year. 1 do
not know whether the suit which was
fled by Thompson & Starrett against
the corporation had been filed at that
time or not, but $4,000 was involved
in that My recollection is that IL the
Tbompson- -Starrett people established
their claim il would leave approximate
lv $4,000 OF those bonds to be cam
celed-of the second mortgage bonds.
"That would have brought the out
standing Indebtedness down to s1,310.-
0O0 To which you add the cash that
was derived from the stock that was
sold. which would make 1t about ST.
"at the last meeting Of the board that
.ttended my recollection is it was stat
ed that. with the exception Of this con-
Comnany. the conditions OF the company
wera i'm a satisfactory shape. They had
fairly enough money to meet their ma
turing interest obligations. and have
not attended to the matter since. That
Is all / know about Tiny recollection,
mean, as to the loans and indebtedness.
II is a matter Of record that the build