The Bridgeport evening farmer., 1917-01-18
Chamberlain Tells of Agree
ment to Stifle Competi-
ton Here.
BURR g. KNAPP BANK
ASSETS CHIMERICAI
Witness Tells Referee That
Arkansas Lead Mines were
"Holes In Ground"

port, at yesterday afternoons session
of the Burr & Knapp trusteeshiI
hearings in the United States District
Court.
OF the Coleman" letter, written by
the president of the Georgia Loar
& Trust Co., in which the expression
real money was given much prom
inence by the complaining petition
J ers, Mr.. Chamberlain made full ex-
PLANTATION. He told how the GeoE.
gia Co. had been formed to buy 10
per cent. mortgages from the farm
ers in Georgia and adjoining states
which were brought here and replac-
ed at 8 per cent. or less, that the
business was immensely profitable
but could not be operated by the
northern banker.
At the failure of Burr & Knapp it
was necessary to have some agency
here. Hervey Burr had volunteered
to try to organize a new company. He
had hopes of having his cousin, Miss
Penfeld, OF Boston, H., Leroy Roy
an Lewis and a Mr.. Henshaw of
Bridgeport, contribute some real
] money" This fact was communi-
Gated by Chamberlain to his Georgia
friends and became the basis Of the
real money" letter. There was no
other "real money in sight, Cham
berlain testified.
The stock OF the City Title Guaran-
ty & Trust Co.. was taken for the
purpose Of reorganizing the Title
Guaranty & Trust Co., because the
legislature was not in session. No
stock Of the new comp any was ever
sold and the impression that 1t had
increased largely in value is mistae.
Cham berlain said.
Supplementing previous testimony
with regard to the value Of the insur-
ance business OF Burr & Knapp
Chamberlain sprung the surprise of
the afternoon when he told Of the
manner in which insurance companies
doing business in Bridgeport are
bound together by an agreement not
to appoint new agents in this city.
"In the first place this insurance
business is the most peculiar ever
built up in this city. 1t was founded
actually on system Of compulsion.s
No man could obtain mortgage from
Burr & Knapp except he cancel all in
surance outstanding on property and
transfer it to companies held by Burr
& Knapp Knapp quarrelled with ev-
Bridgeport yet held seven different
companies business here. He got
these before general agreement by
which no insurance company can es-
tablish new agency in Bridgeport.
He built up an organization that in
1918 did $4,000 business in premiums.
when the Burr & Knapp failure
occurred general adjuster came to
this city and .said that the companies
permitted receiver to become tenn
porary agent. They appointed me.
Then the bank started. The adjuster
came back. I had been appointed
trustee. The adjuster said that the
joint rules of the companies did not
permit a trustee to be an agent. They
would not permit me to sell the in
surance agencies though they said
could sell the books. etc. He said
that the companies were not going to
have their agencies lost, under the
agreement and that the seven repre-
sentatiues of the various companies
represented by Knapp were then in
the city ready to hold a general meet
ing and save their agencies here. l
took no part in the meeting but was
later Informed that they had turned
the agencies over to the Title Guar
anty & Trust Co..
II told the agents that while
owned the bulk Of stock in the City
Title Co. I had no money to put into
the new concern and did not know
where I could get it. Stiles Goodsell
had encouraged Hervey Burr in the
idea that a new company could be
established Burr went out and got
his intimate friends to place their
money in the concern. He financed
the whole arrangement. Royal Lewis
put in about $4,000 cash, think. Mr..
Henshaw $1,000 and Mr.. sBurr's cousin
the balance. I sold Mrs. Burr's inter-
est for $500. And it was advertised for
sale in all the city newspapers for a
week. I would not have even joined
with anybody In the purchase of it at
that time. My interest at that time
was in the Georgia Loan & Trust Co.
In the transfer of stock what was in
tended to be done was that I should
receive $4,000 par value. Mrs. Knapp,
81, 900 After the purchase Of stock
and the payment of obligations Of the
City Title Co. to Burr & Knapp the
new company had about $4,000 cash.
II am perfectly frank to admit that
I wanted Hervey Burr to make liv-
ing out Of it, but outside of that, no
living person could sell the business
Of Burr & Knapp to anybody else and
there is nobody today, if the Title
Guaranty Co. goes out of business,
who can take that Georgia Loan &
Trust Co. business and make it pay
even though in the past over thirty
millions of dollars worth OF securities
have been sold herein twenty years
past.
In fact the C.tle Guaranty Co. to
whom the stock was sold for $500 has
run behind $500 in two years on title
searching business. The records have
been kept up but title searching bus
mess in this city is controlled by q
few persons and until they die the
business will not go elsewhere.
Burr, & Knapp had no profitable
business of any kind to turn over to
anybody" Chamberlain asserted in
answering question as to why the
mortgage and rent collecting busi- |
ness Of the bankrupt estate had not |
been sold. Burr q Knapp actually |
ran behind $4,000 year on BUSH
ness expenses for the last ten years |
OF their business Besides this in
living expenes they ran behind an
other $4,000. The total averaged
annual deficit Of the company for the |
lat eight years Of their business was
approximately $4,000.
Did you get those figures from