Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1914-06-26


eral streets.
Automobile shop of r, H. Robson.
The Norton House.
been formed to look after the interests
of the creditors Most of the banks con-
cerned will be represented on this COM
n1ittee of which j. S. Alexander, presi-
dent of the National Bank of Commerce
will be chairman.
New York banks are said to have made
large advances to the Claf1in company
recently with the hope of averting finan-
acknowledgements. New York banking
interests, It Is understood have agreed to
offer such assistance as may be neees-
sary to some of the Independent retail
stores affected.
Tried to Avert Failure
Interested merchants have been closet
ed with j, p. Morgan and other promi-
nent bankers day and night for the past
week in an attempt to avert the failure.
II is understood that $50, 100000 was neces-
sary.
MIR Morgan and others were most gen.
erous.' said one who participated in the
raising the whole amount or none at all.
calamity of this same sort which
threatened sometime ago we averted, but
at that time only 100000 was necessary
and $500, 900 was subscribed.
Joseph Martindale, president of the
Chemical National Bank. and Frederick
A. Juil1iard, wholesale dry goods mer-
chant were the receivers appointed. They
were named in the friendly proceedings
two suits in equity-one brought by John
C. Games, vice president of the H. B.
Clafin Co.. with a claim of s366S; the
other by William P. Odell, with a claim
of $500
involuntary Proceedings
There were also involuntary proceed
ings which sought the appointment of
different receivers and alleged that the
company was insolvent. These proceed
ings were instituted by creditors with
claims aggregating $50, 900. Their attor-
neys said that they represented other
creditors with total claims of about $780,
900. No action on this petition was taken
today. but Mr.. Clafiin. Mr.. Eames and
Dexter y. Force. treasurer of the COM
pany, were subpoenaed by the petitioning
creditors to appear on or before July to
answer to the suit and show cause why
the company should not be adjudged in
solvent by the federal court.
The petition in the Games suit"
said John IT. McGovern, attorney for
these creditors, alleges present in
ability to pay debts, but does not al
lege absolute Insolvency The answer
of the company admits this present
inability. Our petition. however. al
leges absolute insolvency. In their an
swer they will probably deny that they
are insolvent, but We will seek to
have different receivers appointed to
protect our clients; unless in the re-
organization proceedings a satisfac-
tory adjustment is made of their
claims"
OF Tremendous Proportions
Receivers Martindale and Julliard
said that the failure was of such ire
mendous proportions that it would be
several weeks before it would be pos
sible to know where they stand. MFR.
Martindale said the chief duty of the
receivers at present was to say moth
ing and to use every effort to con-
serve the assets of the company,
What scheme Of reorganization will
be employed he said. cannot be
suggested now"
Temporary Decentralization
Though the failure is perhaps the
most important in the history of the
dry goods trade in this country. New
York bankers predict that chief and
perhaps only potent general effect will
be a temporary decentralization in the
dry goods trade.
Announcement of the failure caused
general decline in the opening of
the stock market but losses were not
heavy and succeeding transactions
caused reaction to some extent. In
fluential banking interests said that,
in their opinion, the retail houses In
Clafiin control were financially sound.
All were inclined to describe the
crash, however, as the biggest mer-
camille disaster the country has ever
known. John Clafiin has been asso-
ciated with the dry goods business
for more than 40 years. He is regard
ed as the A. T. Stewart of his time.
At the age of 20 he entered the en-
ploy of his fathers firm, then known
as H. B. Claf1in g. Co Three years
later he became a member of the firm
and in 1890 formed the corporation
which went under today. He is trus-
tee of many financial and charitable
organizations.
The order appointing the receivers d.
reefs them within 10 days to prepare a
list of all creditors and send them no.
tice of an early meeting at which 1t shall
be voted whether the receivership shall
be continued and who shall be chosen
from that time forward, whether the
business shall be continued and, if SO.
what, IL any, sums the receivers shall be
allowed to borrow and on what terms;
whether the assets shall be sold and, IL
so. when and in what way.
At the meeting Is to be chosen a cred
itors' committee or committees with
whom the receivers may from time to
time consult, and who shall be vested
with power TO act for creditors in the
management of the estate SO far as the
resolutions passed at the meeting shall
so authorize.
Judge Hands order directs the receiv-
ers to attend in person or by attorney the
80 al