The Mount Holly news. [volume] (Mount Holly, Burlington Co., N.J.) 1891-1942, 1918-06-18
A New Receiver

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Clarence l.. Cole, referee in bank
ruptcy, during which accusations were
made by opposing factions that extrav.
agant salaries and mismanagement
had caused the financial stress, credit.
ors of the Newlin Haines Company
owners of the st. Charles, an At
lantic City hotel, yesterday voted
to place Henry w. Leeds, proprietor Of
the tChalfonte, in charge of the St
Charles as receiver, succeeding Ed
ward e. Grosscup, state purchasing
agent, who was appointed by the
Court two months ago.
The Haines Company, which ex.
pended close to $35O,0OO year ago in
constructing an imposing fireprooi
front on the Boardwalk side of the
hotel, was forced into receivershir
through the application of New York
creditors, and Grosscup was named by
the United States Court. 1t developed
at that time that the outstanding
claims of creditors, not including
mortgages, total in the neighborhood
ofs18O, 900,
The New York claimants were in
Court yesterday, asking for continu.
ance of Grosscup as trustee, while
Philadelphia and local creditors want.
ed Leeds, The latter is president OF
the Chalfonte Hotel Company and
senior member of the firm of Leeds &
Lippincott, owners of Haddon Hall,
two of the most successful hotels along
the beach.
On test, 112 creditors, with claims
aggregating $4,000. voted for Leeds,
while II others, whose claims totaled
SAT, 900 voted for the retention of Re-
ceiver Grosscup. When the result was
announced, William Bilder, of New
ark, attorney for the minority faction
OF creditors, raised the point that the
claims OF 80 of the creditors of the
majority faction were irregular in that
they had included proof of claim and
power of attorney in the same instru-
ment. He insisted that Federal Judges
Reilstab and Haight had given the rul-
ing in the United States District Court
in receivership proceedings. Referee
Cole asked for further proof.
Bilder also charged that the Haines
Company forced the receivership by
assigning $4,000 in company bonds
to preferred creditors, asserting that
Mrs. Newlin Haines, wife of the head
of the company, received $4,000 in
collateral for claim Of $4,000, and
that her aunt, Mrs. Jeffrey, received
1927, 900. He maintained also that
when Haines transferred the hotel pro-
perty to the Newlin Haines Company
he received $500, 900 in common stock
and $50 1000 in preferred stock, putting
in his goodwill" at $3.50, 1000. Haines
then proceeded, he charged, to dispose
of his preferred stock to the company.
using company funds to advertise it,
while he was drawing salary as mana
ger. He said that Haines had disposed
of $24O0 of his preferred holdings.
]. Hector McNeal, representing
Philadelphia creditors, declared that
the hotel had showed gain of Sc, 500
for the mouth preceding Easter over
the corresponding month year ago,
and that the reorganization plan was
progressing encouragingly when the
receiyership was forced. The company
was facing interest, taxes and other
claims amounting to 1874, 900 for 1918,
but he felt certain it could work out its
salvation in three years if given the
opportunity.
On cross examination Attorney Nc
Neal admitted that he had approached
Mr.. Leeds and asked him to act as
trustee for the creditors. He admitted
receiving $500 for his services for the
Haines Company and the committee
of creditors, but denied receiving q
cent after the receivership was created.
Newlin Haines, under examination,
admitted that he had approached
many of the Atlantic City creditors
and asked them to vote for the selec
ton of Leeds as trustee. He did this
he said, because he believed Leeds tc
be one Of the ablest hotelmen in At
lantic City.