The sun., 1915-06-19
CIRCUIT JURY HEARS
OF THEATRE DEAL
Witness Admits Part Of Col
lateral for SI6.072 Note
Was Worthless.
IN MAZE OF MORTGAGES

Charles. f.. Ring. formerly the owner
of an iron and steel business inherited
from his father. was the principal wit
ness examined yesterday at the trial OF
Edward VI. Grout in Brooklyn.
Mr.. Ring testified that his note for
si6.g72. which was included In the Union
Rank report as n good and collectible
asset" was secured in part by worthless
collateral
Tire note was made on February II,
1910. and covers an Indebtedness created
on several smaller notes during the time
that David 4. Sullivan was the presi-
dent Of the bank II Is closely identified
with the Liberty Theatre deal. in which
the bank Is said to have lost more than
100000 Mr.. Ring helped to build this
theatre. subsequently filed a lien against
II and then accepted theatre stock In
payment Of his claim. This stock. 391
shares Of common, together with several
mortgages. was put up as collateral for
the loan.
on direct examina ton Mr.. Ring ad-
mitted that second mortgage for
$4,000 on property In Grand street.
Manhattan, was subject to a first mort
gage for $4,000. Then Mr. Cropsey
produced documents to show that this
second mortgage. although practically
worthless as 1t stood. according to his
contention. had been assigned twice al
ready when Mr.. Ring finally assigned II
to the Union Bank; and, furthermore,
that the Union Bank itself had accepted
two assignments of the mortgage and
was holding IL as collateral on two loans
when the bank report OF March 25 was
sent to the State Banking Department.
In January. 1909. Ring wrote to Mr..
Grout, II was shown, asking for more
lime -four months) In which to meet
his note and suggesting the sale Of GER
tain collateral in order to reduce his
Indebtedness. The request for more time
was granted. but the collateral was kept
intact.
Asked what assets he had at that time
besides the collateral in the Union Bank
the witness replied that he owned a
building on the B,wery subject to three
mortgages for 100000. sIo0OO and
$4,000. He had offered the building for
sale AT Mr.. CIRCUITS suggestion, ne said
but had bought II in over several bona
fide bids. His hid was sI65 .0oo--s2n 900
over and above mortgages and expenses.
" that time he owed bout 500. 900
TO individuals he said. and about 10000
10 the Merchants Bank.
stephen Z. Baldwin. counsel for Mr..
Grput. made an effort to show that
Rings Indebtedness had been created
when he was identified with the bank
as a director during the Sullivan regime
and that later he had imposed on Mr..
Grout by issuing a false statement OF his
financial condition and by hiding the
fact that he had Incorporated his busi-
ness and had transferred most Of his
pr perty 70 mis- wife
The witness admitted that after he
became president of the bank Grout
pursued him almost constantly for more
collateral He also admitted that he
had assigned a foundry AT Kent avenue
and South Eighth street To his wife. al
though he was in debt TO the Union
Il INK for more than $4,000 at the time.
Other property was transferred too, but
Mr. Ring defended all these transfers
N the ground that the bulk OF his in
deh,edness was on account OF bills re-
Ccivahle.
THE Union Bank owed me money
instead Of me owing the bank money.
because ~ the opera House construc-
tinn Company" the witness shouted
The trial will he resumed on Monday.