The daily star-mirror. (Moscow, Idaho) 1911-1939, 1923-01-31
WOULD RESTRAIN
HIGHWAY BOARD
SUIT INSTITUTED TO PREVENT
PLACING OF FUNDS OF DIST. NO.
2 WITH EASTERN SYNDICATE.

district by SuSa B. Oversmith of thi
city, to procure. restraining orde
of $500 annually for a period o
Highway District No. 2 from invest
ing funds of the district, in the sun
of $77,5O0 annually for period o
ten years, with the Investors Syndi
cate of Minneapolis, Minnesota. Judg'
Edgar G. Steele, of the second judicia
district, signed an order Tuesday, fix
ing Thursday, February 1, at II
O'Clock am, as the time of hearing
in the action.
The action is entitled: Susa B
Oversmith, plaintiff, VS.. Highway Dis
trict No. 2, Latah county, public
corporation, G. P. Mix and J. H
Hazeltine, commissioners of said high
way district, Investors Syndicate, 6
corporation, K. B. Erickson, agent oi
Investors Syndicate, Amalie Barring
secretary of said highway district, j
H. Hazeltine, treasurer of said high
way district, defendants.
Would Invest $4,000.
1t is set forth in the complaint that
the commissioners of the highway
district, in session January 2, passed
a motion that the commissioners in
vest with the Investors Syndicate the
sum of $500 a year for a period of
1OA years lOI IIl0 puI pOSC Ol CIGdIluS
a fund with which to take care of
bonds against the district, it being
stated in the motion that at the end
of ten years the amount so invested
would be sufficient to take care of
100000 in bonds.
The purported obligation of the
highway district, if carried out, the
complaint states, will require the dis
trict to pay to the Investors Syndicate
approximately the sum of $3,750 on
the first days of February and August
of each year for full period of
ten years, and the certificate would
mature one year after the last in
sta1lment is paid
The complaint alleges that if the
funds of the district are invested as
proposed by the highway commits
sioners, no security will be taken as
provided in any of the laws Of the
state now in force, and that the pro-
posed investment would be illegal and
void
The installment savings certificate,
according to the complaint, will pro-
vide that for the purpose of determin-
ing the sufficiency of the syndicate's
assets to carry out it's obligations, the
surrender value of each year, as given
in the table of the guarantee, shall
be taken as the true value to the
owner and as the measure of the syn
dicate's liability on the certificate in
each year.
The table referred to is then repro
duced, in the complaint, showing that
three full yearly payments by the
highway district would amount to
1922, 800, while the cash. or loan value
would be $500. The amount of the
ten full yearly payments would be
5000, with a cash, or loan value,
at the end of the ten years of
$S2,50O
The complaint then alleges that the
contract, if entered into will coy
stitute an obligation on the part of
the district long in excess of the
terms of office of the present commits
sioners and would be in violation of
the rights and duties of the successors
of the present commissioners.
Allege Security Insufficient.
1t is also alleged that if the pur-
ported obligations are carried out and
the moneys of the highway district
are paid over to the Investors Syndi-
cate, the district will not receive any
security whatsoever for the funds, |
other than the mere promise to pay, |
" except that the plaintiff is informed |
and believes that it is the intention |
Of the said Investors Syndicate to de-
posit with the secretary of state, or
other officers of the state of Idaho, |
certain securities equal to 110 per |
cent of the Investors Syndicate liza !
bility on all outstanding certificates /
in the state of Idaho, and that the
security so deposited, if the same is
deposited, will be for the use and
benefit of all of the certificate hol
1ers within the state of Idaho, but
hat said security, under the terms of
he said ten year savings certificate, I
when issued, will be for much less in
yalue than the amount of cash actu-
lily invested by all of the investors
n the said Investors Syndicate with
n the state of Idaho.
The complaint then states that it
s the belief of the complainant that
he investment would be highly
speculative and not adequately Sc
ured.
Urges Idaho Investment.
1t is further alleged in the COM
,laint that the board of commissioners
f Highway District No. have never
ublished any proceedings relative to
he proposed investment of the funds
S provided by law and that the COM
nissfoners are trying to proceed to ,
ncur liability on the part of the
ighway district without thoroughly
the soundness of the I
roposed investment and whether the
eturns are the best that could be !
valuable under like circumstances. [
he complaint then alleges that the
eturns from the proposed investment !
yOuld be inadequate and much less ]
han could be procured under a like {
orm Of investment in Idaho, and that {
ne same kind of investment could be {
lade with better security within the /
ighway district and with a guaran-
eed return of seven per cent COM Y
Ounded annually during the ten-year r