The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-03-20
TRUSTEES OBLIGATIONS.
4 New Jersey. Court Decision Assailcd
by n JprSpyman.


To II EDiroR OF THE SuS-str: The
gas rate case that Is bringing so much
publicity to the New Jersey Court OF
Errors and Appeals is not the only
case in which the highest court o. his
state has rendered a decision that Is
unsatisfactory from more than one point
OF view.
The case Of Carrie :. Beam. conn
p|,a.nant. agalns, the Paterson Safe
Deposit and Trust Company. defendant.
was decided against the complainant
on November 10 OF last year and a
brief history OF the case may at his
time he of interest to the public.
The suit was brought In the Court
OF Chan"ery to compel the trust com
pary to account for a loss OF approxi-
ma,ely $1,000 occasioned by its re-
tent.on Of certain New York traction
securities which declined in value 70
the ey.ent OF causing a loss OF this
amount.
The trust company set up the de-
fence that as II had obtained these
securities cor the securities had come to
IL from the testatr.x az Investments
made by her I'm her lifetime 1t was en-
titled - hold them with the exercise
o: good faith and reasonable disrre-
ton" as the statute of 1893 prescribes
II fhIl tllt1 Hl npltlflE bl " VIC -
curities i had exercised good faith and
reasonable discretion.
The suit was begun IN February,
1912, was decided In favor OF the COM
plalnant by Nice-Chancellor Stevenson
on a demurrt~, was decided by the
Court OF Errors and Appeals In favor
Of the complainant. UNFOLDING this de-
cisiou on the demurrer. was decided In
favor Of tho complainant on the merits
~ the case At the trial before Vice
Chancellor Howell. was ieopened by
the latter and the decision again con-
hrmed. ami then finally reversed and
upset by the same Court of Errors on
November Is. 1914.
The sum and substance ot the de-
cision q reversal was that a receiver
ship was not a cause for alarm TO a
trustee and that tn" trust company did
tae proper th.ug ID holding on 20 stock
not otherwise a legal investment for a
trust futd. that had declined from 205
20 40, simply because the dividends
ana interest We're sim being paid out
% money borrowed on receivers certih-
Gates FOR the acknowledged purpose 81
Keeping the system Intact.
This is the limit tina the highos;
court q 'hs state has 60, on the rea-
sou3ble dis'-etion 20 lie employed by
r f|Hl '#hNA HFAA AAF y ~ anu
orphans WIN have trustees n the mem
tally - 'Hose who vii, go 20 the very
i'm. OF the law Just FOR the sake 81
= ing A. near 'he edge as possible and
stll keeping within the p-esc.ipeo
bounds
II there IS any man who thinks o.
leaving bis money in a trust fund in
his stat. ,a' MIN know beforehand fus.
" ~ 20 80 r' - 20 he Accountability
90 us 'r''' Oh go MS hcur0c AIRY. and ~
~ word VI a---- iirGlr
E',e- to statute - i>ra providing
4 ilor hole - e--lr" tr trustees in
clin"l - ~--i escape stands badly IN
need 90 l"vis.or ~ IL construction
hy TIE cow. needs revising
n he. gas rate case i - ""he peo-
pie who are fgAt.ng. and re- end Of
publicity Is given the matte
In 'N~ Beam case b. Vas one lone
wor-an VINO out OF her slender means
VAS fshtrg agains' overwhelming
odds. and very lt'le. 2 any. ha, beer
heard OF H.
Tho right Of trustees whether ,rlS,
companies o~ individuals. 20 take our
money and 30 v- ~ they please with {,
Affects every man who has any none
60 leave behind him and the inpor-
t1r'- OF 'h.s .1se out ,eiGhs ,ha gas
case ten fo ore. for tho decision &.
going - p" Guotel all oyer IA. mite
state VIII ".t-r 'r- U3ses IF the New
lers." Dou''~ are quoted.
r. fact. = has already been quoted
by j. New Jersey prosecutor. WHO ar
gucd INA; 10 barred a Grand Jury from
finding an iuii.tm ny against a MAJ
FOR p- jury Who hal sworn a certain
sum e money - he Ia q trust fund
watch as q matter u fact was not