New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-01-10
Clash Likely if Preference
Is Shown Either Set in
Division of Assets.
BANKRUPTCY LAW
MAY AID DEPOSITORS
Both Sides Fear to ROCK the
Boat"-Bank Called Big POT
for Stores to Dip Into.

imminent
banking house Of Henry Siegel q 20 anu
the mercantile creditors of the se'er"'
stores over the division Of the ASSETS
REPRESENTATIVES OF the bank depositorS
assert that any attempt on the part VI
the mercantile creditors TO obtain pre-
erence i'm pavment OF their claims "oulu
NOT only be opposed but probably met
with a demand that the banks creditors
he paid in full before anything Is gwen ~
the other class OF creditors.
Some Of the mercantile creditors d.
sort that they are entitled TO ne pau"
first because they did not kno" OF inc
relations Of the several corporations with
the banking house 1t is also contehdeo
that they had no knowledge other imam
that the money put into the various en-
.ernrises by MIR. Segel was the property
Of ANYBODY but himself and his associates.
They hold that the bank is creditor Oh
Siegel q Vogel and not OF the se'erai
stores.
Melville UphoIds Oepos'tors'
Against this it is urged by couhsel LOT
the bank depositors and by Mr.. MeiVli'e'
receiver for the bank. that the cohteh-
ton OF the mercantile creditors IS u'-
tenable In law and IN equity ana thdt as
Henry Siegel, as the head OF the oaHh-
ing firm. lent money to the Fourteeilh
Street store. of which he was president
and other enterprises with whose al
fairs he was as familiar as their tangled
condition would permit, knew he was
lending to concerns not solvent ana that
the loans are therefore entitled under
the bankruptcy law to preference.
1--WE certainly shall insist upon the pay
ment of the claim Of the bank, MT Mei-
VILE said Yesterday. and while "ou!u
not wish to decide such an important
matter off hand, / must say that am
most decidedly of the opinion that the
creditors of the bank. through the BANK
itself. are at least entitled to rank with
the mercantile creditors. Whether OF ho'
they are entitled to preference Is an
other matter.
Mr.. Melville made the statement after
q long conference with John +. Murray
of Coudert Brothers. counsel for the de-
positors. As a result of the conference
II is understood that Coudert Brothers
and Mr.. Melville will work in harmony
AGAINST any attempt TO give the bank
denositors less than they think is justly
due them.
of any effort is made TO freeze out my
clients" said Mr.. Murray, I'VE VIII nave
something TO say. taking the stand that
tho hank took deposits after it was known
:. WAS insolvent, and made loans. We
will try to trace every dollar OF the money
Of the bank. The persons receiving the
money and lending it knew the condition
of affairs
The declaration of independence on the
part of those representing the pahk creu-
itors was followed by appeals from other
interests that nobody rock the poat'
William A. Marble, one of the receivers
for the stores was anxious that nothing
he said until the full report or hlinseH
and his associates be presented 10 Judge
Charles NJ Hough. of the Cnted states
court. on the ground that "piecemeal IN
formation IS apt to be misleading. Mr..
fairfield, counsel for and secretary OF
the mercantile creditors committee, VINO
was in conference yesterday with AS
sistant District Attorney Arthur t Udii'
refused to discuss the visit or any plans
for reorganization that may be developing.
While this friction between the two
classes of creditors was developing, the
District Attorneys office was being ne
sieged by representatives of both sides.
So great was the influx OF complaints
and witnesses that Mr.. Whitman assigned
Assistant District Attorney Theron r.
Strong to assist Mr. Train.
Mr.. Whitman would not discuss the
progress in the case. further than to say
that the complaints are being Invests
gated.
"The matter is unchanged he said al
the close of business for the day "All 7
can say is to repeat. We are investigat-
ing"
John 3. Stanchfield and Delaney Nicoil
called on Mr. Whitman yesterday, but
both refused 10 discuss the object of
their visit and the District Attorney was
WAS equally uncommunicative. Ii is un-
derstood. however, that the visit was i'm
the interest of persons associated with
the Siegel bank and that Mr.. Whitman
informed them that any reorganization
of the Siegel enterprises would not De
permitted TO interfere with the workings
OF his office or the operation OF the Grim
ina law if any crime had been com
mitted.
Mr.. Siegel was at his offices in the
Simpson Crawford store yesterday busy
working out plans 10 reorganize the ousl-
ness and obtain new money for that pur-
pose He professed absolute ignorance OF
the matters which the District Attorney :
Office is investigating.
From Chicago word came that OF the
81. 900 new money wanted for the Sic
gel-Cooper Company. OF that city. $4,000
had been subscribed. The impression that
this money would directly benefit the
local stores was responsible yesterday for
depositors in the bank calling at the loft
building 10 ask when IL is going to be
divided. They were assured that none OF
it will come 10 New York. II will be used
By the Chicago store 10 meet pressing
obligations. which. were it in possession
OF sgO5. 900 owed IL by the Simpson-Craw-
ford stree. II could have cared for some
time ago
The expert accountants Of the several
concerns are now working together in an
effort 10 trace each item 10 its source.
| They have learned that since the banking
firm Of Henry Siegel & co. began doing
business. it has been constant lender