The New York herald., 1921-05-11
With $219,OOO Work I'm
done on. Cumberland st.,
Brooklyn, Building Best
Bid Was $663,000.
UNTERMYER-BARNES TILT
U. s. Attorneys Office Scored
for Failing to Prosecute Bid
ders on Plumbing for the
Government.

Amazing evidence Of pyramiding
OF city contracts in connection with
the new Cumberland Street Hospital,
Brooklyn, was brought out yesterday
by Samuel Untermyer, chief counsel
for the Lockwood legislative commit
tee, through witnesses whose exaInina-
ton began shortly before adjourn
ment. That phase Of the inquiry will
be continued to-day.
Besides showing how the city had
been forced to enter into contract
for $663.00o to complete work on the
hospital that would have cost only
$4,000 by the original contract, the
further disclosure was made that the
defaulting contractor had entered into
an oral agreement with his successor
to split the profits. estimated at $780,
900, on a f1fty-fifty basis.
Under the original contract the hos
pital was to cost the city 1857. 900.
After 65 per cent. of the work had been
completed and s23s,O0o paid, the con-
tractor defaulted, leaving to be done
approximately 35 per cent, or about
$219,000 worth of work. The high
est bid received to complete the con-
tract was for s745,333 and the lowest
1868 900.
These disclosures. with further revela-
tions of the plumbing combines hold on
the local market and testimony tending
to show reluctance on the part OF the
United States District Attorney to press
for an indictment In ca.se of alleged pool
ing of bids for Government construction
work adjoining the Brooklyn Navy Yard
were the outstanding features of yester-
days session.
City Contract for SS67 900.
The Cumberland Street Hospital mat
ter dates back to October. 1917. when
the Department of Public Charities en-
tered into a contract with Albert Win
ternitz for the construction of the insti-
tuition for s557, 900. The city was indem-
nihed by surety bonds amounting TO
about s125. 900. Vinternitz by his own
statement at that time being financially
responsible. In November, 1919, after he
abandoned the contract, the city adver-
tsed for new bids for the s219.000 un-
finished portion of the work and awarded
a contract to the One Hundred and Sew
enty-fourth Street Construction COM
pany which was the lowest bidder, at
s6e2,000. The new contract was awarded
September 2s. 1920. and executed a
month later, it being signed by one Ig-
natz Roth as president of the construc-
ton company. Meantime Winternitz. the
original contractor, had gone into volun-
tary bankruptcy.
Through Winternitz, who signed
waiver of immunity. Mr. UnterTnyer
brought out yesterday that on Septem-
Der 15, 1920, a few days before the
award of the new contract the witness
had been introduced to Ignatz Roth by
his brother-in-law, Herman Seplow. The
witness admitted that oral agreement
had been entered into at that time to
divide the profits on an equal basis II
Roth's company should be the successful
bidder winternltz identified a claim,
which. II was said. however. was later
withdrawn filed with the City Comp
troIler on the basis OF this oral agree
ment.
This claim sets forth that In consid-
GRAFTON OF certain knowledge transmitted
to the 174th Street Construction Com
pany by Winternitz concerning the Cum
berland Street Hospital contract the
company agreed to pay winternitz so
per cent OF the profits, estimated at
100000. The subcontractors identified
with Winternitz's original contract also
appeared in the new contract made by
the city with Roth's concern.
About this time, while Winternitx ad-
mitted ne was In financial difficulties,
he organized the Berwin Construction
Company with a capital Of $4,000. His
associates In the Berwin Construction
Company were Frank Merger, whom
winternitz could not identify any more
definitely except to say that he had
money; Gustav Feldman. a bookkeeper
for an electrical concern, and Charles
Hlavaky, clerk in Third avenue re-
tail radiator company.
rorGets How He Got Money.
After considerable coaching by Mr..
untermyer Winternitz admitted no had
started the company by depositing some
money with branch of the Chatham
and Phenix National Bank. He could
not remember how much money, or
where he got it. All he could recall was
that he and his three associates together
had put UP $4,000. organized and en-
tered into the agreement with .1gnatz
Roth's 174th Street Construction Com
pany. which to date II was shown had
received s135.297 from the city on ac-
count OF It's s663,000 contract. At this
point In the testimony the committee ad-
journed until to-day.
Oral tilts between Mr.. Untermyer and
Earl b. Barnes. Assistant United States
Attorney. In which Senator Charles G.
Lockwood occasionally Joined, marked
the testimony Of Elliott G. Brown presi-
dent of an engineering and construction
company bearing his name. and who was
q Commander of the Naval Reserves In
charge of construction work at the
Brooklyn Navy Yard during the war.
Tho witness testified that when he
sought bids for the plumbing work for