The Bridgeport evening farmer., 1917-01-09
Sc NSATION OVER
new EVIDENCE IN
BANKING INQUIRY
Seek to Prove Burr & Knapp
Solvent When Receiver
ship Was Asked.
INTIMATE PLOT TO
HOLD "FREEZE OUT"
Allege Scheme to Benefit
Insiders. and Eliminate
Miner Creditors.

The prosecution Of charges against
John c. chamberlain, whose removal
as trustee of the Burr & Knapp estate
is asked in the United States district
court by number of creditors today
introduced evidence before Referee
Carleton E. Hoadley purporting to
show methods of frenzied finance the
equal of which has scarcely been
seen in Connecticut, if fully substan-
tiated.
Ffom records placed before the
coIrt today it is made to appear that
the firm of Burr & Knapp, on paper
at least, was solvent at the time re-
ceivership was asked in the state
and that dissolution of the
business was asked because the part
ners of Burr &, Knapp had disagreed
among themselves as to division Of the
assets. \
Schedules in bankruptcy were in
troduced, disclosing that as matter
OF estimated record the firm of Burr
& Knapp had at the time of the trus-
teeship assets of $918,513 with liza
bilities of but $906.207.
Evidence is being adduced by the
prosecuting attorney, Spottswood d.
Bowers today to prove the outlined
contention to the court that a huge
plot existed to corral all the assets
III a newly formed company for that
purpose and by squeezing out the
minor creditors, insiders might profit
hugely thereby
The defanse for Attorney Chamber
lain, will it is believed produce num-
erous witnesses, including Herbert M.
Knapp, to disprove the allegations of
the petitioners and to show that even
though such plot might have existed
during state proceedings the trustee
while acting in that capacity under
the United Statesc district court.
That officers of the Title Guaranty
& Trust Co., formed sto take over as
sets from the City Title Guaranty &
Trust Co., were at least accorded ex-
tended credits in the Connecticut
courts when purchasing stock and
other assets of the City Title COM
pany was shown from the receivers
records and other book entries today.
The petitioners counsel today in
troduced a witness who swore that in
the contemplated purchase of certain
Fairview Lawn lots covered by the
Henry Dawson mortgage, he hast
been told by Trustee Chamberlain
that the papers transferring them to
Chamberlain had been made subse-
quent to the Burr & Knapp failure,
cross examination Instituted
by John S. Pullman, counsel for the
trustee, to show that the witness
might have been confused in his un-
derstanding of the transaction, failed
of it's purpose, this most = startling
revelation yet made in the trial, will
it is, understood be directly rebutted
during the defense.
Adolph Sherman, one of the cred
itors petitioning for the removal of
Trustee Chamberlain was the first
witness of the morning session. He
testified regarding the failure ,of
bidders to get the full records of the
company demanded and of the pre-
vailing opinion Of bidders at the auc-
ton that the privilege of access to
the expiration book granted by the
trustee had impaired the value of
the business as an asset to Burr &
Knapp estate. He estimated that the
insurance business Of Burr & Knapp
was at one time worth $4,000.
Alfred Camp, dealer in ladders and
at one time an insurance agentiin this
city, whose business now forms a
nucleus of the Bridgeport Land &
Title Co., testified that conference
before Referee Banks the question
had arisen as to whether the insur-
ance business of Burr. G. Knapp
should be considered as a liability or
asset. The referee ruled that it was
to be considered an asset Creditors
had then asked Judge Banks if the
trustee as such had not protected
them as assets but had let others
have access to them, should the trus-
tee not be removed. Judge Banks
did not answer the question.
Camp declared what he had since
learned Of the insurance business he
valued it between $4,000 and $4,000.
D. Fairchild Wheeler, president of
the Bridgeport Land & Title Co. testi-
fed that he did not have direct nego-
tiations with Trustee Chamberlain
for the insurance business but had
made a conditional bid of $4,000.
Luther w. Brown, a. builder and
real estate investor of this city shed a
light on the Fairview
Lawn transaction, when he stated that
had wanted to sell some
remaining lots covered by the Dawson
mortgage or quit claim deed for $4,000
that he might pay off Dawson.
Clash between counsel resulted In
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