The San Francisco Call. Newspaper, October 1, 1902, Page 1

ST RRTTON HINTS AT A COMPROMISE Fight for Fortune May Soon Be Ended. Trustees, However, Are Probably Powerless to Settle. Administrators Deny There Is Conspiracy to Loot the Estate. + COLORADO SPRINGS, Colo., Sept. 30.— *The averting of the crisis which threat- ened to commit Dines, Chamberlain and Rice, executors of the Stratton estate, to r Jail; a writ of certlorari, which acts as | an injunction upon the County Court and | takes 2ll matters relating to the appoint- ment of the administrators out of that | court to the District Court; the filing ° replies by the administrators to the ’ rges of conspiracy brought by attor- & forthe executors: an affidavit by ex- #he Venture Corporation, which threatens suit agafnst the estate and also for ad- ministrators, end a rumor, more or less founded, ‘that the hefr to the estate is willing to make a compromise of the mat- ter, if arrangements can be agreed upon, were the features of the day in the Strat- fon estate litigation. The hearing of argumepts in the mat- ter of the writ of certiorari will, in ail Jgehability, not take .place until eaply “Xl week When the hour for the return of the eitstipns" on the executors arrived, court was Bot called to erder. ‘At 10:30 o'clock eounsel for both sides came into court | Zad stiy ted for adjournment until 2| clock the writ of certiorari s'clock. At was issucd where they ministrators, Nst In 2 all matters were stopped The replies of the ad- Blackmer and Hamlin, con- general denial of the charges the answer filed ¥ ¥ the executors, whic in efre were. » 18de in ch charges two of them, were financially interested in | the ¢state already and were implicated in | a conspiracy to d te the estate and | profit by it in irregular ways. The af-| fidavit of Charles S. Thomas avers that he was retaized by the administrators to | lght the esent battle only and that adminisirators were duly notified before retaining him that he was interested as 1 attorney in persons antagonistic to the The report that young Stratton is will- ¥ag to compromise with the executors has been given wide publicity here to-day, e Inguired into the law in the| belng (h( opinion of all the at- ho b hat me executors have no power what- to make aLy compromise. WOW TO0 BE UNFOLDED Od‘bnted St. l’nuh Case l‘.y Be Beady to Begin To-Day. ET. LOUIS, Sept. 30.—After a busy aft- ernoon’s work, in which the venire for e special jury was exhausted, nineteen competent jurors, representative Bt. Louls business men, were secured to- ward the twenty-fow- necessary to com- plete the panel, Judge Ryan was com- $lled to-night to issue an order for an- sAher venire of fifteen in the trial of Rob- »#rt M. Snyder, the banker and promoter, charged with bribery in connection with the passage of the Central Traction bill by the Municipal Assembly. It is expected the completion of the panel will take a short time to-morrow. The defendant then has the privilege of eight peremptory challenges, the State four. This will reduce the panel to the | twelve tequisite for a jury. Then the | first of Circuit Attorney Folk’'s witnesses will teke the stand and will unfold the tale of the inducements made the as- sembly to pass the traction measure. By wpoon, unless the wunforeseen interposes, everything will be in readiness to proceed wi the trial. 4 LA B Evans Sails to Investigate. WASHINGTON, Sept. 30.—The Nayy Department received a cablegram to-day from Rear Admiral Robley D. Evans, second in command on the Asiatic station, announcing his departure from Kuiksang for Harlkow, aboard his temporary flag- ship, the Helena.- He is en route to the port -~ of » Ichang, ‘on the great' Y overnor Thomas purporting to explain | the alieged fact of his being attorney:for | that the administrators, or | ut i& not regarded serjously by persons | though | GOOD OFFICES OF THE OFFERED TO SETT IKEVANE BOARD BOND D THAN EIGHTY-FIVE THOUSAND DOLLARS Investigation Reveals Vast Loss to the School Fund Resulting From - Series of . Transactmns m thch Speculators Profit. DDITIONAL and startling dis- coveries have been made by The Call concerning the deals in county bopds of California made by the Kevane Board of Examiners. Since June 21,:18%, the Kevane board has pald out in premiums on county bonds purchased as an invest- ment for the State the great sum of $85,560 10, while the face velue of such | securtties in' total 1s $711,00. In other | words the premiums have amounted to 112 per cent.of face value, of-ail the securities purchued. The greater ‘ part of this money has been expended in such fashion as to awaken wonderment. | It is now found that in addition to the |$19,000 unnecessarily paid out by the ex- |aminers as a premium to secure eighty- | seven Kern County bonds that were about ‘w be retired, the examiners also paid | for the 235 refunding bonds that were |1ssued by the same county a premium to bond speculators of $26,121 5). This was | the largest of the deals of this sort, but a premium of $8819 20 was paid to bond | speculators for 128 bonds of .Monterey County; the sum of $19,295 for 15 River- side County bonds; $10,221 50 for 190 bonds of the denomination of $5000 of Mendocino | Ccunty, and $1365 10 for eleven bonds of San Luis Obispo County. The enormous size of the gains that bond speculators and those who have atetted them could have made out of the State, if the present entire uninvested | part of the State school land fund had | been dealt with in a similar way, is easily ‘!hov\n The fund on September 1, 1902, | amounted to $1,143,005 45. Twelve per cent of that sum is $137,171 57. If the Kevane | boara had placed the $1,143,09 45 that is now on hand at the same rate as the |$711,008, the State would have been cinched {in premiums to the tetal extent -of | 5222731 67. The taxpayers of the State may breathe easler to know that the opportunities for such perniclous activity have not been offered to the Kevane board, but $85,560 10 has gone glimmering away from the pos- seesion of the State into the pockets of bond speculators and others and the State is out and injured to that extent. These general statements show the vie- |fousness of the system practiced by the | Kevane board. Of the several transac- |'tions the three in Kern County, of which only two have been mentioned hitherto, will_attract the modst attention possibly, because the premiums paid by the State |on the securities of that county alone in a period of seven months represent $45,- 122 30 of the State’s money thrown away without the corresponding advantage of as much as one dollar of benefit to Kern County. Every dollar of the $45,122 30 went irto private pockets. | RUINOUS PURCHASE IN KERN. | State Money to Extent of $26,000 | Goes to Brokers. During the last weck the files at the State Capitol have been carefully scanned. From them the story of how $26,121 50 was taken from the State school land fund for private benefit is derived. In June, 1899, the Kevane Board of Exam- ipers bought from private parties two Jets of bonds, one numbering 5 and one numbering 37, all of which the county had voted to retire, and paid for them 2 premium in total reaching $19,000 80. The county had voted to issue 285 refunding bonds, having the total face value of $235,000, and the Kern County Board of Supervisors, without calling .for a single w, accepted the propesition of Trow- e & Co. of Chicago, bond-buyers, to gell to them the entire issue for par and ed interest. The award of the % Trowbridge & Co. under these peculfar rnmnces was opposed by a Bakers- ‘banker, who alleged, truthfully, that the county “could have secured better terms. Subsequent events haye:demon- strated this fully. The matter came before the Supreme Conrt of California, 'Mdl, on Scptelnber ENT WILL BE E BIG COAL STRIKE LS WASTE MORE 16, 1299, decided in favor of the Supervis- ors of Kern County. Within & very short time after fhe decision by the Spureme Court of the State the Chicago bond- buyers took possession of the entire block of $225000 of Kern County vefunding bonds and they got them without paying any interest, as the records prove. From this time on the bond-buyers did not let the grass grow before they un- loaded the $235,000 bonds on the State of ,f‘nlifornln at the large profit of $26,121 50. i | The ease with which the Kevane Board of | Examiners had/been persuaded to squan- | | der the State’s money for the expiring |bonds acquired in June of the same year llo the amount of $19,000 80 pointed the | State out as an easy mark. The event | proved that this calculation was correct. In just about two months and a half the bond-buyers got the Kevane board to | glve them an advance of $26,12150 for their _speculation. This news will irritate the t@#xpayers of Kern County materially when they se: how $26,000 - that might . have gone into the county for its support was given to bond-brokers from Ckicago. Prior to the first disastrous deal in the Kern County bonds, involving the abso- lute waste of $19,000 of the State's money, the Board of Examiners of the Kevane regime made no investments. But, after that, as the official records at BSacra- mento show conclusively, the bond-buy- ers found the State to be a'*'good thing.’ Two small transactions took place in the vear 1899, in addition to those in Kern County. Five bonds of the City and County of San Francisco, dated April 1, 1874, of the total par value of ere bought by the board, at a premium of 3627, this deal taking plaece in November, 1899. In October, 1899, the Examiners also bought eleven bonds of San Luis Obispo County, dated July 1, 1885, the total face value being $11,000, for which they paid a premium of $1365 10. SURPRISE FOR MONTEREY. County Gets Thousands Less for Bonds Than State Pays. In 1901 the bond-buyefs succeeded ‘n making two famous deals with the Xe- vane board. The countiés involved were "Monterey and Mendocino. The facts con- cerning one of these have been already published at length. The taxpayers of Monterey County have something to learn about the marketing of their secu- rities, which is published for the: lm time in this issue of The Call. The County of Monterey made two a.t, tempts to issue refunding bonds before this end was finally accomplished. The first attempt was in 1897. In October of that year the Supervisors of Monterey County entered inte a remarkable agree- ment with Trowbridge.& Co. of Chieago, bond-buyers, the same parties who sub- from the State on the Kern County bonds. I sequently got the premium of $26,12150 | the It is. hereby' revroeueea ‘n onfiroty ‘trom ' 000 of the records of the Monterey County Su- pervisors: ‘Thursday, - October 7, 1897.—It is, by the unarimous vote of the Board, ordered that the chairman of the Board be authorized and em- powered to enter into a contract in the name of the County of Mdnterey with Trowbridge & Co., incorporated, for the purchase by sa'd company of one hundred and thirty-eight thou- #and dollars of borlls of the County of Monte- rey at 4% per cent, sald company to pay a premium therefor of $1650, sald purchase to he oontln'ent upon the successful issue of the coming - spectal . election. to be called in November, . 1897, for the issuance of sald " bonds for the : purpose of refunding the bridge bonds, and the: ¢g=rt- house and jail bonds of the County of Monte- rey, safd contrakt to. be accompanied by a cer- tified check from. sald (Trowbridge & Co., for 52000 for the falthful performance of safd con- tract. - For some renlon the voters; ot Mantarey County turned this proposition. down by a decistve majority. It will . be leen that under the vote of the Supervisors the bond speculators had. the entire. issue _pledged to them at.a’ stipulated price even before a special election to vote ‘on’the question had been called. ¥ In 1900 the refunding {ssue again apr peared betére the Board of. Supervisors of Monteréy County.. The amotnt of Ye- funding bonds: to', oted;on was fixed at $128,000, ‘or. $10,000 -less nn.n ‘Wwas pro- posed in ‘1897~ A .special elgetlanfwu held on Decémber. 3,199, at which the fe(\lnd- -ing bonds' to* the’dmount of $128,000, all 4 per cents, were authorized by ghe decisive | vote of 1527 in favor to 253 agalnst.’ Then the Supervisors ordered that the County Treasurer._should advertise for blds to be opened on January 7, 190L: . . The bids that were rece&ved were as !ol- lows: <Bj H. Rollins & Son, $1000°and acerned in- terest; Mason, Lewis. & Co. of Chicago, $102 50 and acorued’futereat; N.:W. Harrls & Co. of Chicago, $1520 25 less accrued interest. The' supenhnr- were ;not ntlmed, with ol e -lo _— —_——— _——— e —_— 2 ,._,_.1‘ DOCUMENTS REPRODUCED FROM THE FILES IN THE OFFICE OF THE STATE/ CONTROLLER AT SAC- RAMENTO; GIVING EVIDENCE OF TRANSACTIONS IN WHICH BONUS WAS BIVEN FOR SECURITIES THAT KER* COUNTY HAD VOTED TO REFUND. ks Sac e = possession of the State .of . California through “the act of the examiners on Mareh 6, 1901, less than two months after Rollins & Son got them. The State paid the speculators a premium of $8819 20, so that a handsome profit was again netted to bond brokers at the cost of the State school land fund and the State was made once more a loser by this sort of financiering. It will: be observed by comparing -the blds received for the Monterey County bonds of 1901 by the Monterey Supervis- ors that the bond buyers had a keen appreciation of the good thing they were getting. The highest bid opened on the first day, namely January 7, 190, was $1320 25, less accrued interest. On the second opening of blds, only two days later, Rollins & Son bld par, accrued interest and a pre- .mium of $2875. Had the bonds appreciated in value $1500 In two days? The proper answer to that would be undoubtedly that the bond buyers knew what could be done with the State of California, which had taken mo step to bid for the securitles, but ‘which, in a very few weeks, put up Im of §881! STATE DROPS MORE MONEY. Qm Tmnefiom Aflscflng'londo ol cino and Riverside. #This review of the bond deals of the Kevane ‘board 1s .not complete without -some - allusion to Mendocino and River- le county bonds, of which an accoynt | has préviously been given. 'In\ se of Mendocino County the :m‘ gave no one a chance to bid 190 .bonds of -the denomiration of $500 each, except H..B. Smith, a brother of Supervisor Smith. The board took from him ‘acertified check for $1000 and sold Nfl the “entire issue on June 4, 1901. mt‘h js an abstractor of records and not.a man. of ealth. . The board, which must have known he was buying the bonds .to sell ‘again, as he had not $96,000 of his own to invest, gave him until June 26-to. have the legality of the bonds looked nto and to pay the remainder of the ,000. In just’ twenty-elxht days from Smith got the entire issue of ino -County bonds in this way, the (Kevane Board of Examiners gave W.m««t $10,231 50. Smith, it may be recalled, was inter- ‘at Ukiah' by a reporter for The ' On ‘that’ occaslon he sald. that he ‘he was going. to do with the l";bougm them. - The State to'get.these bonds as a bid- Mendocino County Super- board again waited to throw land fund money of the River- tm a — new courthouse and voted to issue bonds to the amount of. $150,000 in 4 per cents. September 1, 1902, the bids were opened by the Supervisors of Riverside County. i Again the State was not in the fleld to get at first hand the securities that it wanted. Trowbridge, Niver & Co. were | represented Dby the highest bid. They took the entire issue of bonds for $156417. On September 11, 1902, just ten days after the Chicago bond-buyers got hold of the bonds, Kevane and Post bought them for the State at an advance of $12,798 above Al prive phis W%. :’m These are the fact¥1nou: of financlering, not for but against the i Interests. of the State of California; by the- Kevane Board of Examiners. ™ is an unparalleled record of working rinst the commonwealth.” The interest trom the State school land fund is applied to the support of the public. school system of California. The loss of $35,560 is a serious matter. What the State has lost some one has made at the expense of Califor- nia. To trace this money to the pockets to which it has found its way would be | difficult. The method by which this very | great sum was diverted from the support | of the public schools is a maticr of public | record. | i POLICE OF NEW ORLEANS ARE FEARFUL OF TROUBLE Railway Company’s Power Is Cut Off and Linemen Refuse to Do Repairing. NEW ORLEANS, Sept. 30.—Nearly the | entire police force of New Orleans was concentrated this morning at the Arabeila barn of the New Orleans Street Railway Company with the expectation that there ‘would be trouble when the company at- tempted to run cars to-day. It was as- certained, however, that the pdwer con- necting all but one of the circuits in this barn with outside lines had been cut off. The cutting off of the power will not prevent the running of cars in the lower or business part of the city, but if any cars are moved in other sections of New Orleans to-day mules probably will be used. The electric linemen in the empioy of the railway company, who went out on a sympathetic strike yesterday, refuse to repair the break in the supply wire. A mail car made a trip down Canal street this morning with mail matter-and a passenger car has moved since Sun- great inconvenience, RICH COAL MERCHANT TRIES TO END HIS LIFE Financial Difficulty Disturbs New Yorker’s Mind and Causes Him to Attempt Suieide. NEW YORK, Sept. 30.—Because of financial difficulty Henry C. Schell, a coal ‘merchant of this city, tried to kill him- self by shooting to-night. The doctors say there is little hope for him. Schell is |45 years of age. He lives with his wife and three children in a handsome resi- dence, and generally has been thought to be prosperous. A relative of Mr. Schell said he had a large sum of money—about | $200,000—tied up in litigation, and that fis business was his source of revenue. The disturbance in the coal market has af- fected his business seriously, causing him to"become despondent. S e L Dies Aloof From Friends. PHOENIX, Ariz., Sept. 30.—John Rog- ers of Boston died in the County Hospital to-day. Just before death he sent for a Presbyterian minister, but was uncon- scious when he arrived. All that is known of him is he came of an old New England. It is sald 'he made’a fortune in Boston nuuuu.ulmnmcolmomh- ing. He seemed to be a man of culture, who had hidden ll:.a)‘lf from frieads, Legal Action o Follow Moral Suasion. g i President Calls the Cabinet for Con- sultation. Attorney General Knox IS to Devote All Energies to the Problem. Spectal Dispatch to The Call. CALL BUREAU, 1406 G STREET, N. W., WASHINGTON, Sept. 30.—The goo offices of the administration, will be offer- ed to end an intolerable situation which threatens great danger to the people of the United States. Moral suasion will be exercised by the Government to settle the differences between the operators and § miners in the Pennsylvania anthracite~ region. President Roosevelt is now concentrat- ing his attention to this grave problem. Realizing that business interests through- out the United States and particularly the East are vitally affected by the coal strike, it is his earmest desire that this element of embarrassment shall be either* entirely removed or partlally ended and. at once. If the moral suasion efforts of« the administration meet with no success, efforts will be m=de whereby legal action. may be taken to force a settlement. - HOLDS TWO CONFERENCES. For the purpose of considering the situ-’ ation and to obtain a satisfactory relfet] measure President Roosevelt to-day held two conferences with Attorn.y General” Knox, Postmaster General Payme and Secrétary Moody, of the Cabinet, and Goveryor Willlam Murry Crane of Massa-: chusetts. Those mentioned were the only] membery of the Cabinet in town, und Governor Crane was called In on accountiy of the President’s confidence in Governoa', Crane’s excellent judgment In matters of® public policy. The conferees sat with the § President on the second floor apartment of the temporary White Hous€, and de- spite the fact that his injured leg keeps him quiet the President earnestly talked over the situation with them for half an hour. He made it evident to each mem- ber of the party that it was his eager de- sire to relieve the present serious condd tion of affairs arising from the coal strike~ At the conclusion of the conference At- torney General Knox, who of course will conduct any legal proceedings which may be found possible, declared that he saw no way for the President to interveme legally for the purpose of settling the - coal strike, That is the situation to-day, but Attorney General Knox will devote all his energies, even to the exclusion of other public business, in the effort to find some method of legal proceedure whereby the strike may be terminated. Not only is President Roosevelt giving this matter his close personal and offictal attentidn, but the Interstate Commerce Commission is also interested in the pos- sibilities of a solution of tfie problem. PROMPT ACTION DESIRED. When the three Cabinet Ministers and Governor Crane had concluded their talk with the President and were fully inform- ‘ ed and impressed with his desire that they should lend their enmergies to the problem they retired to anothes room. & Then for two hours they discussed the situation from every standpoint. many carriers and policemen aboard. Not day morning and although all kinds of conveyances arc seéen on the streets for the accommodation of the peoplé there is President Roosevelt, it 1s thought, will be willing to take almost any action which promises to relieve the situation. Those who have talked with him on the subject say that he is more absorbed in it than any other question of public policy mow confronting the administration. This afternoon after the first conference the President sent for the gentlemen who had been with him in the morning, and they réemained with him for over an hour. So interested was the President in the discussion that he did not see Dr. Lund, who called for the purpose of sxamining the wound on his leg. When tife confer- ence was ended the conferees maintained absolute sifénce In regard to it. | TR el PREDICTS EARLY SETTLEMENT Mayor of Philadelphia Refuses to Appoint Delegates to Conference. PHILADELPHIA, Sept. 30.—Mayor Ashbridge to-day declined to comply with the request of Mayor Maybury of Detroit to appoint a delegation of citizens to at- tend a conference to be held in that city on October 9, to advise ways and means for obtaining a reasonable coal supply from the mining regions of Pennsylvania and West Virginia. The Mayor’s reply is as follows: “Governor of Commonwealth, clergymen and citizens are actively working for set- tlement of strike in anthracite coal flelds in this State. My judgment is differences will be adjusted and work resumed be- fore date of conference Mayor Ashbridge to—da:‘cmmted with President Baer of the Reading Company to furnish fifty tons of coal daily, be- ginning next Wednesday, at the Philadel- phia Hospital and Almshouse. Tre Mayor's telegram and the con= Continued on Page 2, Column 4.