Newspaper cuttings, from the manuscript, MEGAdigital (MEGA² IV/19).1 Traducción al español
THE EUROPEAN LIFE ASSURANCE COMPANY.
The petitions for the winding up of this company were again heard yesterday, before Vice-Chancellor James, at Lincoln’s-inn.
Mr. Serjeant Sargood, Mr. Dickinson, Mr. J. Napier Higgins, Mr. Kekewich and Mr. Anderson, appeared in support of the petitions; Mr. Glasse and Mr. Fry for the company against the petitions; and Mr. Amphlett and Mr. Bagshawe for certain policy-holders and shareholders.
Mr. Glasse—There are two petitions. You will take them both at once.
The Vice-Chancellor—Yes; the question is, whether the company is to be wound up, not who is to wind it up.
Mr. Dickinson said he appeared for Mr. Crawford, but Mr. Serjeant Sargood had precedence. But before Mr. Serjeant Sargood was heard he had an application to make to the court. When he case was last before the court some comments which had appeared in the Times were brought before the notice of the court, and an application was made to commit the publisher of the Times for contempt. It was desirable that no party having any proceedings should be subject to any intimidation. He found an article in the Observer—
The Vice-Chancellor—With what view are you stating this? Are you going to move to commit?
Mr. Dickinson—I may do.
The Vice-Chancellor—I cannot go into that without notice.
Mr. Dickinson—A letter having been published by Mr. Lake—
The Vice-Chancellor—I will not go into that, because it is vacation, and nothing is to be done in vacation but what the parties have had notice of.
Mr. Dickinson—If necessary, I shall apply to your Honour for leave to move to commit Mr. Lake.
Mr. Serjeant Sargood said he appeared in support of a petition filed by Mr. Coupe, who was a shareholder of the European Insurance Society, which was a company originally formed as a life and fire insurance society, and for the granting of annuities and guaranteeing the integrity of clerks, and business of that description; but the fire business, he believed, had been discontinued. Mr. Coupe was the holder of 3,000 shares. The Act of Parliament provided that a company was to be deemed to be unable to pay its debts under various circumstances which were set forth, and whenever it was proved to the satisfaction of the court that a company was unable to pay its debts, the company was to be wound up; and the real question which the court had to try was, whether the company was or was not in solvent circumstances, not whether it could pay the debts now actually incurred.
The Vice-Chancellor—I must confine myself to the words of the Act of Parliament—“Able to pay its debts.” Of course, if you change the issue, I must assume it is done with some object or other.
Mr. Serjeant Sargood said then he would take it that he had to show that the company was not able to pay its debts.
The Vice-Chancellor—The Act of Parliament is not whether the company is solvent or not.
Mr. Serjeant Sargood said that it was imperative on the court to determine whether it was just and equitable that the company should be wound up. Of course that involved the condition of the company, and whether it was prudent that the company should go on pledging its faith to the public.
The Vice-Chancellor—Prudent or imprudent is not the thing that I can try.
Mr. Serjeant Sargood said he was not discussing whether it was prudent or imprudent on the part of those who went into the company, but whether the court would consider it just and equitable that the court should allow the company to go on receiving money from the public, and whether it was not incumbent on the court to interfere.
The Vice-Chancellor—I have nothing to do with the public, but only with the creditors and shareholders.
Mr. Serjeant Sargood said he used the word “public” in its popular sense. The allegation on the part of Mr. Coupe was, that the company had granted policies to the amount of 8,750,000l.; that the company had purchased the business of a number of other insurance offices which had been amalgamated with this company, for which purchase the company paid 261,000l. Then it was alleged that, although the premium income of the company in 1868 was no less than 398,000l., so great had been the drain on the resources of the company, that instead of being able to invest a large portion of the income as they received it, they had been obliged to make a call of 5s. a share. A very important point which would be raised in argument was this—what were to be considered the debts of an insurance company—were they the obligations of the hour, or were they the entire obligations of the company? He should contend that the debts of the company were the whole of the obligations and liabilities of the company, and that the test of the company’s ability to pay its debts was not whether it was able to discharge the claims that were made upon it from day to day out of the money that it received from day to day, but whether its assets were sufficient to meet the whole of its contingent liabilities. They were in this difficulty, that they were ignorant of the details.
The Vice-Chancellor asked if it were meant that the petitioner as a shareholder of the company had presented the petition in utter ignorance of the details of the petition of the company?
Mr. Serjeant Sargood did not mean to say that they had filed the petition as a speculative petition without any knowledge of the facts, but he should submit that, taking the balance-sheet issued by the company itself, there was prima facie proof that the company was insolvent. They had not been able to get at the details, because they had been met in the cross-examination with such answers form the officers of the company as “I do not remember,” and “I do not recollect,” with a constant refusal to produce the documents. He should maintain, however, from the general balance-sheet of the company, that the company was insolvent. There was an affidavit by Mr. Hadley, a director of the company, who stated that he had often been refused by Mr. Lake an insight into the books, and that he had been unable to obtain any information of the state of the company, and that in 1866 when the question of paying a dividend was discussed at the board he opposed it, because he felt that dividends were being paid out of capital, and in that he was supported by Mr. Cyrus Legg and Mr. Crawford; but their objections were of no avail, and the payment of the dividend was determined upon; and a cheque was sent to him for his dividend, but, as he thought the dividend ought never to have been declared, he had never cashed the cheque. In 1867 he again endeavoured to obtain information.
The Vice-Chancellor, interrupting, said this was all very improper, and was intended to create a prejudice. If a shareholder or a director had occasion to complain of the conduct of the manager, he had his remedy, by going to a meeting of the shareholders and making a complaint. But the question he had to determine was, whether the petitioner had or had not brought himself within the Act of Parliament.
Mr. J. N. Higgins then read the affidavit of Mr. T. H. Bailey, actuary of the London Assurance Association. He stated that he took as his data the statements of Mr. T. Walker, the consulting actuary of the European Insurance Company, that the total amount of the sums for which policies had been granted was 8,750,000l.; that the premium income in respect of such insurances was 290,000l. per annum; that the present average of the lives assured was 42 years, and the average duration of the policies was nine years. From his knowledge and experience as an actuary, he said that if the policies had been effected for the whole term of life, which was the case with the great bulk of life assurances in other companies, the company should now have in its possession at least 40 per cent. of the premiums received on the existing policies, which proportion of 40 per cent. would amount to 1,044,000l., which sum at least should be invested at an average interest of not less than 4 per cent., and be constantly accumulating. He further stated that, taking the value of the liabilities under annuities at 140,000l., which sum had been stated by Mr. Walker, the actuary of the company, and taking the claims accrued on life and guarantee policies and general debts to amount to 120,000l., it followed that the society should have at least 1,304,000l. in actual possession, invested so as to produce a rate of interest not less than 4 per cent. In making this estimate he did not mean to imply that a life assurance society having a reserve of 40 per cent. of the premiums on the existing policies was in a satisfactory position. On the contrary, a valuation made on proper principles would give a larger sum. He was informed that Mr. Walker, in making his valuation of the assets, had taken the gross premiums without any deduction for commission and expenses, a mode of calculation which he considered unsafe and erroneous. He added that to put the 261,000l. paid for the transfer of the business of other societies as an asset was preposterous, and that deducting this sum, and also 595,000l., the uncalled capital, the total realised assets of the society, assuming them to be good, amounted to 470,958l., which was 833,041l. less than the amount that ought to be in hand. Under these circumstances, he was of opinion that the company was insolvent, and that if the company were allowed to go on the present funds would in a few years be exhausted.—Mr. Higgins also read the affidavits of Mr. Robert Tucker, actuary of the Pelican Insurances Company and of the National Reversionary Investment Company, which was pretty much to the same effect as that of Mr. Bailey; but he added that with regard to the valuation of the liabilities, amounting to 312,486l., and deducting 140,000l., included therein as the value of the annuities payable, there remained only 172,486l. as provision for those liabilities; and as the premiums were usually paid annually in advance, it was to be assumed, in making a valuation, that as they fell due at all times of the year, there was half-a-year’s premium due on each, the other half being supposed to be in hand. If, therefore, from the said 172,486l., half-a-year’s premium, amounting to 145,000l., were deducted, there would remain only 27,486l. as a reserve.—Mr. Higgins also read the affidavits of Mr. Patterson, the actuary of the Commercial Union, of Mr. Hendrichs, the actuary of the Universal; of Mr. Ingall, actuary of the Mutual; of Mr. Augustus Morgan; of Mr. Ansell, the actuary of the Atlas—all to the same effect; Mr. Ingall stating that in his opinion the European was hopelessly insolvent, and that the payment of every claim on a life policy now dropping in was an injustice on the younger lives. The affidavit of Mr. Lake, the manager of the European, and his cross-examination, were also read. In his affidavit he stated that there was no debt of the society which the company was not prepared to pay, and that all the claims on the society were regularly and promptly paid as they became due. In his cross-examination, Mr. Lake stated that before he became manager of the European he was manager of the British Nation, and before that of the Unity, and before that of the Trafalgar; that he received from the European a salary of 500l. and one per cent. on the premium income of the company; that 200l. was the regular monthly cheque on account of the 1 per cent., and that he received from the company between 3,000l. and 4,000l. a year; that when he went to the European from the British Nation, so far as he knew, nothing was paid by one company to the other; that there was a claim by Mr. M‘Clelan, the former manager of the European, which was referred to arbitration, and that he was awarded a sum of from 12,000l. to 15,000l.; that the payment to Mr. Sheridan did not come under his notice, and he could not state the amount—that it was not 50,000l., and that his impression was it was under 10,000l.
The Vice-Chancellor remarked that this, he took it, was a very illegitimate use of the power of cross-examination. It had nothing to do with the issue before him, and was introduced simply for the purpose of creating a prejudice.
Mr. Serjeant Sargood said a large sum had been paid by this company to other companies for the absorption of their business, and it was right to show into whose hands it had gone. The sum so paid figured as an asset of this company.
The Vice-Chancellor said it seemed to him to be idle and irrelevant. He agreed that this was not an asset of the company.
The reading of the statements of Mr. Lake, in cross-examination, was proceeded with. He stated that when he was manager of the British Nation, he was entitled to 2 per cent. of the premium income. When he became manager of the European he was to be entitled to only one per cent. of the premium income, and to one per cent. on the amount paid in as capital. He did not like this, and he went to the directors and said, though under that arrangement he would have been entitled to between 7,000l. and 8,000l. he wished to give that up; and they presented him with a free policy of 5,000l., payable three months after his death. The whole amount of the life claims last year was 100,000l., but of that 20,000l. had been in abeyance for years. He believed that the company were overdrawn to a small amount with their bankers, Messrs. Hopkinson, some 4,000l. or 5,000l., and in addition to that there was an advance of 10,000l. This advance was in June. But there was not one insurance company in London that did not do exactly the same thing. 400l. was paid to Hopkins, the clerk to the solicitors of the company, for services about the opening of the account with Messrs. Hopkinson. The former bankers were the London and Westminster. He himself had an advance from the company of 1,605l. for his private purposes, for which he gave as security a policy of 4,000l., and his free policy of 5,000l. On being asked “Do you think you could have met the claims of the company for the next two years without a call,” he replied, “I cannot go into the future in that way. I believe the majority of the shareholders would be willing to pay any call that might be necessary.” Further questioned, he said he did not know how much of the 71,500l. due from agents was good; and on being asked about his shares, he stated that he is a holder of 500 shares; that he did not know how many he held a year ago, but it was more than 1,000; and that the largest number he ever held was 3,000. Some were sold during the present year, and they realised from 3s. to 5s. a share.
The cross-examination of Mr. Thomas Walker, the consulting actuary of the company, was also read. In it he stated that in making his calculations he did not take into account the 70,000l. a year expended by the company. If he had, that would have made a difference of three-quarters of a million. The premiums of the society were loaded above the premiums required to cover the risk by about 25 per cent.
The evidence of Mr. Parmenter, the accountant of the company, was also read. He stated that he believed the assets of the company were reduced 60,000l. a year in 1868; that the income was about 360,000l., and the expenses, including commission, about 70,000l., or about 20 per cent. of the receipts. The expenses this year, he thought, would not exceed 50,000l., or 15 per cent. The account with Messrs. Hopkinson was opened about the end of 1867, and at the end of 1868 the company owed them about 15,000l.
Mr. Sargood then resumed his address to the Court, which had been interrupted by the reading of the evidence. He said the affidavits of Younger, the principal of the guarantee department, and of Kelly and Jackson, the principals of the other departments showed, not how the company paid its debts, but how it was enabled to stave them off. They had to meet within the year claims amounting to 101,831l., and of this sum claims amounting to 59,649l., and no more had been paid. Then there was 20,696l. due in respect of old claims carried forward, some of them for many years, waiting for proofs, or for claimants to appear, and in regard to which they said no immediate provision was necessary to be made. He contended that the company was in a state of hopeless insolvency. The balance-sheet of the company only showed a surplus of 109,000l., but when they took off the 260,000l. paid to other companies on their absorption, which was clearly not an asset, and they came to examine the other items, it was evident that there was a great deficiency, and he submitted therefore that the Court should comply with the prayer of the petition, and wind up the company.
Mr. J. N. Higgins followed on the same side.
Mr. Dickenson then addressed the Court on behalf of Mr. Crawford, the other petitioner. He examined the items of the balance-sheet minutely, contending that it afforded sufficient evidence of the insolvency of the company.
Mr. Kekewich having been also heard on behalf of Mr. Crawford.
Mr. Anderson said he appeared for three policy-holders, and he suggested that his Honour should appoint two actuaries to inquire into the affairs of the company and make a report.
Mr. Amphlett said he appeared for a large number of policy-holders and shareholders. If his Honour should hold that the legal requisites of the statute had not been complied with, of course there was an end of the matter, and the petition would be dismissed; but suppose his Honour should hold that the legal conditions had not been complied with there was an important question behind, namely, whether the court would make the order. Now upon that point the view that those he represented took was this. They thought it would be a great evil to the policy-holders and shareholders to have the company wound up under the Act, but that it would be still worse that the company should be allowed to continue under the present management, and the present improvident arrangements, and they suggested that if the directors would give a pledge that they would put the matter on a different footing, that if necessary they would at the meeting of the policy-holders all resign their offices and allow new directors to be appointed, then those he represented would ask his Honour not to grant the prayer of the petition; but if on the other hand the directors stood on their strict rights and refused to resign, and determined on conducting the affairs of the company in the old fashion, then his clients would join in asking that the company be wound up.
Mr. Bagshaw said he appeared for Messrs. Grindlay and Co., who were the holders of three policies, and they were in this dilemma, that this very day 90l. was due for premiums, and the alternatives presented to them were either to pay the money at the imminent risk of its being devoted to pay the policy of the next person who died, or to refuse to pay, by which they would lose the policies. The view that they took was that the case came within the equity of the statute. On the three policies they had paid as much as 2,200l.
An affidavit of Mr. Avens, a sharebroker, was read, stating that he attended the recent meeting of policy-holders, and that he recognised some 50 or 60 clerks and agents of the company, who were stationed in different parts of the room, and who refused to hear Mr. Lowe, and created great confusion.
Mr. Kekewich stated that Mr. Crawford had offered to leave it to two independent actuaries to inspect the books, and if they said it was right that the company should go on, he would withdraw the petition.
This closed the case for the petitioners, and the Court then adjourned till to-day, at half-past 12.
CHARGE AGAINST DIRECTORS OF BARNED’S BANKING COMPANY.
Mr. Charles Mozley and Mr. Lewin Barned. Mozley, of 27, Leadenhall-street, London, and Lord-street, Liverpool, were summoned before the Lord Mayor, at the instance of Mr. Michael Emanuel, outfitter, 63, Leaden-hall-street, City, the charge against them being that they, in the month of June, 1865, and at divers other times, then being directors of a certain public company called Barned’s Banking Company (Limited), unlawfully did make, circulate and publish, and concur in making, circulating, and publishing a certain written statement, to wit, a prospectus of the said company, they then well knowing the same to be false in divers material particulars, with intent thereby to deceive and defraud the complainant and other shareholders, and induce them to become shareholders, contrary to the 24th and 25th Vic., cap 96, sec. 84.
They were further charged in the summons with unlawfully conspiring together with divers other persons to commit the aforesaid offence, and also by divers false pretences and subtle means and devices to cheat and defraud the complainant and other shareholders of large sums of money of the amount, it is stated, of two millions sterling.
Mr. George Lewis, solicitor, instructed by Mr. Joel Emanuel, solicitor, on the part of certain shareholders, appeared for the prosecution. It is understood that Mr. Poland, barrister, is retained for the defence.
The defendants did not appear, however, either personally or by counsel; and it is believed that an application was afterwards made for warrants against them, but that they were not granted in the meantime.
THE Directors and officials of the European Assurance Society have baffled the attempt made to wind up their Company: but they scarcely need to be reminded that all the value of a victory depends on what you do with it. They are not likely to make the fatal mistake of rejoicing over their success and forgetting to secure the ground they have won. The dismissal of the petitions for winding up the Society may seem to the outside public like a vindication of its past, and a guarantee of its future; but the persons more directly concerned know that it is nothing of the kind. To understand the judgment fully we must understand the judgment fully we must understand what the petitioners attempted to prove. They were not able to say that the Society could not pay its debts; it had paid all that were due; but what they did say was that it had paid current debts out of monies which ought to be laid by to meet prospective but inevitable liabilities. Their contention was that the Society was paying old and matured policies with the premium income from new ones, discharging to-day’s debts out of income which itself creates new debts which will become due to-morrow; that it was therefore prospectively insolvent; was going along the road to ruin, and ought to be stopped now lest its last state should be worse than the first. In proof of this charge the affidavits of several eminent actuaries were put in, in order to show from the published accounts of the Society and the sworn admissions of its Manager and its Actuary that a great snowball of accumulating liabilities was rolling down upon it, and must inevitably overtake it sooner or later. But here their evidence failed. Vice-Chancellor Sir WILLIAM JAMES held that it was not proved that the Society must inevitably be overtaken by its liabilities. The point turned in a great degree upon the unpaid capital. The actuaries, whose reports were relied on by the petitioners, had not reckoned the whole 595,000l. unpaid capital as an asset, and indeed experience did not permit them to believe that it was possible to get it all in. A call which should have brought 70,000l. had only produced 50,000l. But the Court having no evidence before it of the insolvency of the shareholders, must regard them as solvent, and reckon the whole capital as an asset. It may be very ruinous to shareholders that every farthing of their capital should go to pay debts, but that it not the question, and in reckoning whether there is any probability that the policies of this Society will be paid as they become due, every farthing of the capital comes in as an asset. The shareholders are the people indebted, the policy-holders have consented to be their creditors, and it is not proved that there will not be enough to pay every policy-holder when his claim comes due. The shareholders may lose their money, but there is no proof that the policy-holders will lose theirs. “Profit or loss, prudence or imprudence,” said Sir W. JAMES, “are matters with which this Court has nothing whatever to do. This Court gives no opinion whether persons ought or ought not to trust the Company. . . . . The petitioners have failed to prove that which it was requisite for them to prove—viz., that this Company is insolvent, and that being so, the petition is dismissed with costs.”
There are, of course, three questions involved and three parties interested in this decision. The managers and officials of the Company must make their peace with the shareholders as best they can, and when they have come to some fresh understanding together they must set to work to regain the confidence of the public. The shareholders have now a chance of redeeming their position, but they must not forget that they have it to redeem. Their liability has saved the Company; their capital is its security; their shares, which should be sources of income, are also debts. But that is their matter, not the business of the public. If they have let their officials spend money which ought to have been saved to meet the policies as they come due, they may have to pay that money themselves unless they can contrive by new and cheaper management to save it. They are spending 70,000l. a year in expenses of management. Here alone, as the VICE-CHANCELLOR intimated, is almost a sufficient opportunity for reduction to redeem the whole position. The question for the public, however, is not the value of European shares, but the value of European policies. The VICE-CHANVELLOR’S judgment is much more reassuring to the policy-holders than to the shareholders. The Society has been mismanaged, but not ruined, and an elaborate investigation has failed to satisfy the VICE-CHANCELLOR that there is any present danger of inability to perform the contract in its policies. Both shareholders and policy-holders will benefit by the investigation. Mr. GLASSE formally recorded in Court the offer and pledge of the present Directors that the shareholders should decide for themselves as to the future of the Society, and that meetings of both shareholders and policy-holders should be called, to confer on its position and prospects. It may be hoped, in the interest of this large and valuable business, that this pledge will be generously and unreservedly fulfilled.
But besides the shareholders and the policy-holders there is the public; and the public cannot be left out of the reckoning. The Society will want new business; and the question is—how is new business to be got? The Society is not where it was before these petitions were presented, and it remains for the Directors to decide whether its position shall be better or worse. Pandora’s box has been opened, and the evils which have swarmed out can never be shut up again. The opinions of eminent actuaries will remain on record, and the rebuke of the VICE-CHANCELLOR will be remembered. The Court gave no opinion whether persons ought or ought not to trust the Company, and the only chance for the Company is to give persons every opportunity of forming that opinion for themselves. The European Society must do this now, if it is to flourish. There must be no mystery, no reservation, no complication of the accounts; everything must be clear, straightforward, and open. The VICE-CHANCELLOR very mildly rebuked the publication among the assets of the item for purchase of businesses. The Society had spent 261,000l. in paying for amalgamations, and put down the money as an asset. Of course every actuary who saw the balance-sheet said, as the VICE-CHANCELLOR did—“That item ought never to have appeared there.” Future statements will no doubt be so made as to stand criticism. The Directors have fought the petitions with so much energy that they clearly believe the position of the Society to be sound. Let the public know, then, the entire liabilities of the Society, the classes of policy under which the liability is uncured; the whole of its assets, and what they consist of; let them be able to trace the expenditure or investment of all money paid in premiums, and to see that no more of it is squandered in huge salaries or compensations, and they will soon learn to have confidence in a Society which puts confidence in them, and the European Assurance Society will become as prosperous as any.
THE OVEREND, GURNEY, AND COMPANY PROSECUTION.
Mr. G. Lewis, jun., applied at Vice-Chancellor Malins’ chambers yesterday, on behalf of Dr. Thom, for the means necessary to enable him to proceed with the prosecution he had commenced against Mr. John Henry Gurney and other directors of the above company who had been criminally indicted for conspiracy and fraud. He grounded the application on an affidavit made on the 28th of last month by Mr. G. H. Lewis, solicitor to Dr. Thom, which set forth that the directors had been brought before the Lord Mayor and committed for trial to the Central Criminal Court. A true bill was found against them, and then an application for the renewal of the hearing of the case at the Court of Queen’s Bench was granted.
Mr. Markby, solicitor, attended on behalf of the shareholders, and objected to any money being granted out of the funds in court for the purpose of the prosecution of the directors.
Mr. Lewis said that the application was made under the 167th clause of the Public Companies Act, and he contended that the terms of the Act were so explicit as to leave no doubt as to the right of an individual, even though not a shareholder, who was interested in a company, to take proceedings against the directors, or apply to the court for winding up. He submitted that the only question to be considered was whether there was anything in the present case which did not come within the meaning of the Act. He quoted as precedents the cases of the Leeds Bank, the Unity Bank, and the Joint Stock Bank. In the second of these a Mr. Finnis was prosecuted, and although, as in the present case, a true bill had not been found against him at the time, a similar application was made, and funds were granted for the prosecution. Vice-Chancellor James said that it did not matter whether the proceedings were instituted by one or more shareholders.
Mr. Buckley, the chief clerk, said that there was no doubt as to the jurisdiction of the court to deal with the funds.
Mr. Lewis said that about 70,000l. had been spent out of the funds of the company twelve months ago, and about 20,000l. since. The present case was one of material importance, and all he asked was for 5,000l., which would not be more than a shilling per share. It would be monstrous if Dr. Thom should be required to carry on the prosecution at his own expense.
Mr. Buckley said that the shareholders had already spent a great deal of money, and might not feel disposed to spend any more.
Mr. Lewis submitted that the question was not one to be decided by the shareholders, but by the Act of Parliament.
Mr. Buckley said that as the term would commence today he would sooner not express any opinion on the matter, and he appointed Friday next for the hearing of the summons.
THE PROSECUTION OF THE ALBERT ASSURANCE COMPANY DIRECTORS.
APPLICATION FOR FRESH SUMMONSES AGAINST THE DIRECTORS.
Mr. Hamilton Bromby, accompanied by Mr. Edward Lee, one of the prosecutors in the charge of conspiracy against the directors of the Albert Assurance Company, Waterloo-place, attended before Mr. Knox, at the Marlborough-street Police-office, to make an application for fresh summonses against the directors.
Mr. Knox said he should be sorry to comply with the application. What he had said on the last occasion was, if Mr. Straight attended before him with Mr. Lee he would grant fresh summonses.
Mr. Bromby understood when Mr. Knox dismissed the summonses last Saturday, that he said if Mr. Lee would appear with counsel he would grant fresh summonses. Mr. Lee was present, if the magistrate would like to hear him.
Mr. Knox said on the last occasion, out of consideration for Mr. Straight, the senior counsel for Mr. Lee, and his great earnestness in the case, it being apparent that Mr. Straight was convinced of that which he (Mr. Knox) certainly was not, that there was bona fides in the prosecution, he intimated that if Mr. Straight would appear with Mr. Lee and ask for summonses they should issue.
Mr. Bromby explained that Mr. Straight was out of town, and further he did not know whether Mr. Straight would have been instructed to make this application, but at all events he (Mr. Bromby) was instructed to do so, and Mr. Lee was present to answer questions if needed. He was there as Mr. Lee’s counsel, instructed by Mr. Murray, and he now asked that the magistrate’s promise last Saturday he carried into effect, and that fresh summonses might be granted.
Mr. Knox said in deciding on this application he must take the whole of the facts into consideration, and do justice to all parties. Mr. Lee had already applied and obtained summonses against the directors, and had been examined in chief by his own counsel in support of his case. Mr. Lee had been partially cross-examined by the counsel for the defence; and it was well understood that his serious cross-examination was to be reserved for the next hearing. Instead of appearing and affording an opportunity of being cross-examined, Mr. Lee had chosen to absent himself, on what he did not hesitate to say was a trivial and trumpery excuse, namely, that he had gone into the country to collect some debts.
Mr. Bromby wished to make a few remarks personal to himself. He was partly responsible for Mr. Lee’s absence, and what had operated on his mind in advising Mr. Lee was this, that it was extremely hard on a private individual to have to incur considerable expense and considerable personal inconvenience in endeavouring to set law in motion against persons whom, rightfully or wrongfully, he believed to be criminally responsible; and he felt it was hard that in addition he should be compelled to attend the court on every occasion when the charge was gone into, no matter how important the business that might call him elsewhere on other duties, perhaps to his great loss; apart from which, he would remind the magistrate that Mr. Lee had been cross-examined on the first hearing, and had been re-examined by his own counsel, and therefore Mr. Lee was not aware that he would be required to be present at the next examination, believing that the witnesses to be called would occupy all the day with their examination. It was Mr. Lee’s intention to have attended at the next examination, and to have afforded the counsel for the defendants an opportunity to complete his cross-examination.
Mr. Knox said it was well understood that the cross-examination by the counsel for the defence on the first occasion was merely preliminary to a more serious cross-examination, which was to have taken place on Saturday last. With the full knowledge of that arrangement Mr. Lee chose to absent himself, and the only excuse which his employer, Mr. Vallancey Lewis, assigned for his absence was that he had sent him to Southampton, because he had no other clerk to send. He now said he absolutely and peremptorily declined to grant fresh summonses, except they were applied for by Mr. Straight, and an assurance given by that gentleman that he had carefully looked into the case, and was satisfied there was bona fide ground for a prosecution. There was also another view to be taken of the matter. The interests of public justice would not suffer by his refusing to grant fresh summonses to Mr. Lee, as proceedings were pending in Chancery, and it would be competent for the Vice-Chancellor to direct a prosecution if he thought a case of fraud could be made out against the officers of the company.
Mr. Lee wished to address the magistrate, but
Mr. Knox said he would either hear Mr. Bromby or Mr. Lee, but not both.
Mr. Bromby said he must bow to the magistrate’s decision, but in fairness to Mr. Lee he wished to state that that gentleman was most anxious to be put in the witness-box that he might be fully cross-examined. Whatever truth there might be in the groundwork of the accusation brought against Mr. Lee, he was prepared to give an explanation which he felt sure would be perfectly satisfactory, and which also would show there was no truth in a great deal of what had been urged against him.
Mr. Knox said he expressed no opinion on Mr. Lee’s conduct, and except on the condition he had mentioned he should decline to grant summonses unless applied for by some bona fide shareholder or policy-holder. Mr. Lee well knew his serious cross-examination was to take place at the succeeding examination. He ought to have been in court last Saturday to defend his character, but he was absent. As he did not consider that Mr. Lee was a bona fide shareholder, he did not feel himself justified in bringing the directors to the court again, and must therefore refuse the application.
AMERICA.
(FROM OUR SPECIAL CORRESPONDENT.)
NEW YORK, Oct. 2.
It is very difficult for anybody writing at this distance to know where to begin in trying to give an English reader an intelligible account of the nature of the convulsion in the “Gold Room” by which this city has been agitated during the last ten days, because one can hardly tell how much English readers know about the “Gold Room,” the character of the men who frequent it and “operate” in it, or about the peculiar performance known on the New York Stock Exchange as a “corner.” Making a corner is, in reality, the modern equivalent of the mediaeval practice of levying “tolls” vi et armis on peaceable traders, on the high road or on rivers. It is not gambling; it is something more and worse. There is an element of chance in gambling, even when you play with marked cards or loaded dice. The victim may escape, for he may refuse to play beyond a certain point; or you may make mistakes with your cards; or the dice may fall with the heavy side up. “Cornering” is rather lying in wait for the gambler when he is on his way to the gambling-house, with the money he proposes to stake in his pockets or when he is coming away with his winnings on a road you know he has to take and then putting a pistol to his head and forcing him to disgorge. When a mediaeval baron was hard-up, we are told by the chroniclers or preachers of the time, it was no uncommon thing for him to call his vassals to arms, simply to overhaul the rich travellers, or ambassadors, or trading caravans on the highways, in order to despoil them. A New York “operator” does not do this, the time for it is past; but neither does he put himself always on equal terms with his rivals, and fight them fairly, according to the rules of the market. If he speculates simply for a rise or a fall, and takes his chance, he may lose, and often does lose. When he is tired of gambling, and wants to be sure, he makes a “corner”—that is, he collects about him a band of confederates, and between them they muster, by borrowing or otherwise, a considerable sum of money—ten or twenty years ago it would have been a few hundred thousand dollars, it is now a few millions—and thus armed make arrangements to despoil the other operators as they are leaving the market. They know that large numbers of speculators have “sold short,” or are willing to sell short—that is, have agreed to deliver a certain quantity of a certain stock at a certain price, and they contract for a large quantity from them on these terms. Then they go to work, and buy up all of that stock they can lay hands on, until they have either secured all of it there is in the market or all there is to be had on any terms; and then they have the unhappy “sellers short” at their mercy, and the latter have to pay over the difference between the price at which they agreed to deliver the stock and the price at which the “corners” are willing to sell it.
Formerly these operations were confined to stocks exclusively. Since gold went out of circulation they have naturally enough betaken themselves to gold. Gold is now regularly bought and sold in the market, and quoted from hour to hour, just as stocks are. Although not in circulation, foreign accounts have to be settled with it, customs duties have to be paid with it; and in addition to this, inasmuch as the price of it is still affected by a variety of influences, financial and political, it affords as good material for speculation as any stocks. Accordingly there is an Exchange known as the “Gold Room,” devoted exclusively to “gold brokers,” and as two-thirds of the purchases are not real purchases, attended with the transfer of the coin, but mere bets; there is a “Gold Clearing House,” to which each gambler sends in his memoranda at the close of the day, just as banks send their cheques to the clearing houses, and there the gold he has bought being balanced against the gold he has sold, he has only to pay the difference. So that he may deal in millions, and never have occasion to pay over more than a few thousands. “Corners,” too, are made in greenbacks by a process which I think I tried to describe to you some weeks ago. The operators collect all of them they like; borrow all they can from the banks, and some fine morning money is found to be awfully tight, and stocks consequently fall, and the operators rush in and buy, and their game is finished. “Corners,” too, are occasionally made in sugar, coffee, tea, cotton, and there is hardly any commodity that some dealers do not gamble in by “selling short,” but these things the chiefs do not touch. They confine themselves to the money market proper.
Their success a few weeks ago with the great greenback “corner” emboldened them so much that they made great preparations for raid on the “gold-room” a fortnight ago; raised all the money they could, and got into the combination as many persons with large credit as they could, and then went to work.
But I feel that it is almost useless to convey to your readers an adequate notion of the men who got this last combination up. James Fisk, jun., the hero of Erie Railroad war, was at their head; his confederate, Jay Gould, was his lieutenant, and their followers were composed of a few men of the same kind, and that kind is something peculiar, and something which is produced nowhere but in the United States, and in the United States is only seen in perfection in New York. Take Fisk at the representative of the class. He is entirely illiterate—that is, he has learned in a New England district school to read, write, and cipher, and he has been bred up in that practical acquaintance with the operations of trade which nearly every New England boy possesses. The church and Sunday school probably tried to teach him morality, but totally failed in doing more than giving him a knowledge of figures.
THE EUROPEAN LIFE ASSURANCE COMPANY
DISMISSAL OF THE PETITIONS.
The petitions for the winding up of this company again came on for argument yesterday, before Vice-Chancellor James, at Lincoln’s-inn. The case appeared to excite great interest, and the court was crowded to excess the whole of the day.
Mr. Glasse addressed the court for the company against the prayer of the petition. He said, before he entered on the merits of the petition, he wished first to make an observation with reference to a suggestion made at the close of the sitting on Wednesday, that the company should call a meeting of the shareholders and policy-holders. The chairman and the directors had proposed more than once to call such a meeting; and this was no act of grace, for by the terms of the deed of settlement any five shareholders holding collectively 1,000 shares might call a meeting. Of course they did not recede from that offer, but if it were to be made the subject of an order, he could not agree to it. The time had now arrived when he could expose those calumnies and aspersions which had been cast on this company. He should submit that the petitioners had no legal right to present such a petition; and that if they had, their conduct disentitled them to the indulgence of the court.
Mr. Dickinson—The term “conspiracy” has been used.
Mr. Glasse said he would adopt the term. He would undertake to prove that the generic term “wreckers” applied to those who were seeking to wind up the company. The Act of Parliament provided that a company should be wound up when it was proved to the satisfaction of the court that the company was unable to pay its debts, or when the court was of opinion that it was just and equitable that the company should be wound up. With regard to the first point, he submitted, first, that the court could not be in a position to say the company was unable to pay its debts unless a creditor came before the court and proved that he had been unable to obtain payment of his debt. But here no creditor was complaining that he had not been paid, and he should contend that it was not for a shareholder to move the court to take steps for the protection of creditors and policy-holders. The court, however, had not heard that any claim on the company remained unsatisfied, and the fact was that every admitted claim had been paid. Then with regard to the contingent liabilities of the company, he contended that according to the reported cases the court was not entitled to take them into account in considering whether a company should be wound up. In the matter of the Agricultural Insurance Company exparte Spackman, Vice-Chancellor Knight Bruce had dismissed a petition, and in dismissing the appeal Lord Cottenham said the contingent liabilities of the company ought not to be taken into consideration, because the premiums hereafter to be paid might meet all those liabilities. Nor had he a right to look into the books. The Act gave no such power, and he could not inquire into the mode in which the company had carried on its business. The Act provided certain tests of the solvency of the company.
The Vice-Chancellor—You must not assume that I am with you on this point. They have to prove to my satisfaction that taking the whole amount of their assets and capital, including the unpaid-up capital, the company is absolutely insolvent. If the company is absolutely insolvent then the Act of Parliament applies. It appears to me that before any question of law arises I cannot apply the Act of Parliament till it is proved that the company is insolvent.
Mr. Glasse said he was not there to prove a negative, and that it was for the other side to prove the proposition affirmatively.
The Vice-Chancellor—It is a question of fact.
Mr. Glasse—Just so; and I say they have not made it out, and their evidence is concluded.
The Vice-Chancellor—I entirely put out of view the point that was pressed upon me—that an insurance company is to be treated differently from any other company.
Mr. Glasse—My position is that they have not proved a debt due.
The Vice-Chancellor—I do not agree with you. Supposing you had a capital of 10,000l., and you had got some person to discount your bills for a million, would not that bring you within the Act of Parliament?
Mr. Glasse said if that was made out his Honour would deal with it; but that was attempted to be made out. All that was attempted to be made out was that the assets were not immediately available. In Re the National Live Stock Company, 26 Beavan, 153, it appeared that the company had always been carried on at a loss, and yet the Master of the Rolls refused to wind up the company. And in the Anglo-Greek Steam Navigation Company, on application being made to wind up the company, on account of the gross misconduct of the directors and manager, the Master of the Rolls held that the misconduct of the directors and mangers, although it might be such as to render them liable, if a suit was instituted against them by the shareholders, was not a ground on which the court would think it just and equitable to wind up the company under the Act where there was no evidence that their mismanagement had produced insolvency, or that the company was a mere bubble company, or where there was a reasonable prospect that under proper management the company would become prosperous. They in the case of the Suburban Hotel Company Lord Cairns held that the court would not wind up a company on opinion-evidence that the company could not carry on its business with success. Now he (Mr. Glasse) took upon himself to say that, apart from the balance-sheet of 1868, the court had nothing to go upon but opinion-evidence, and opinion-evidence of the actuaries of rival assurance companies. By that balance-sheet it appeared that there were claims on the company of 109,000l., but they were all paid.
The Vice-Chancellor said he should be very much astonished if it were contended that a claim which became due, say on the 31st December, 1868, should be paid out of moneys coming in in 1869.
Mr. Glasse said unless they could do that, no insurance society only a few years old could go on.
The Vice-Chancellor said his opinion was that current income was not available to pay current claims, and that they ought to be paid out of the insurance fund. Of course they might take the money they might have in hand rather than sell it out, placing that amount afterwards to the insurance fund.
Mr. Glasse said to a proposition so qualified he had not a word to say. Then the other debt of the company, as shown on the balance-sheet, the debt due to the bankers, had been paid, and instead of the company now owing its bankers 5,000l., the company had a balance of 17,000l. in the hands of the bankers at the time the petitions were filed. Every debt was paid, and the court, he submitted, had no power to take into account the liabilities of the company. In the case of the Joint Stock Coal Company, which was carrying on business at a heavy loss, the Master of the Rolls said he had no power to make a winding up order, nor had he power to direct a meeting of the shareholders. Then, there being no debt due, or none that the company was not able and ready to pay, and the court having no power to take into account the future liabilities of the company, he submitted that the court could not grant the prayer of the petitions. But further, even if the court could take into account the liabilities, the court had nothing to go on but opinion-evidence, and he could produce counter opinion-evidence showing that the company was perfectly solvent. Mr. Burt, one of the firm of Coleman, Turquand, and Co., had made an affidavit in which he stated that he had examined the balance-sheet of the company, which he believed to be, in all respects, an accurate balance-sheet, and that he had no doubt that the society, as regarded its policy-holders and creditors, was perfectly solvent; and it would continue to be so if it were only allowed without molestation to continue its business, and he should hold that opinion even if the 261,000l. paid for the business of other companies was struck out of the assets. Then there was the evidence of Mr. Woolhouse, the actuary of the Emperor Company, which was to the same effect. Independent of these considerations, he submitted that Mr. Coupe and Mr. Crauford, the petitioners, had no right to petition at all. By the 109th section of the deed which they had executed it was provided that the company should not be dissolved unless a resolution to that effect was carried by three-fourths of the shareholders at two meetings. But they had taken no step to convene a meeting. Then with regard to Mr. Coupe, when the call was made he employed a solicitor, who represented that he was a ruined man, and that it would be of no use suing him, and then, when the company refused to let him off the call, he employed other solicitors to file the petition. Then, with regard to Mr. Crauford, he had been an agent of the society at Edinburgh, and it was in evidence that he desired to become an agent of the company at Chicago. He was a director of the company, and was sitting at the board with the other directors on the 20th September. On the 21st the petition was filed. There was the affidavit of Mr. Hayward, who at first was a co-petitioner, and he stated that he received a letter from Crauford requesting him to meet him in Chancery-lane, and that he did so, and went with him to some chambers in New-square, where they saw a solicitor, and Mr. Young, who was afterwards to be the provisional liquidator; that it was stated that it would be well to get the petition filed at once to prevent anyone else getting the appointment of liquidator, which might be to the prejudice of the company; that he found it was expected he was to be one of the petitioners, and he at first refused, but afterwards reluctantly consented; but on the same evening a solicitor, a neighbour of his, advised him to withdraw his name which he did. Mr. Glasse contended, therefore, that the conduct of the two petitioners had been such as to act as an estoppel upon them, and for all these reasons he submitted that the petitions should be dismissed, and with costs.
Mr. Mellon followed on the same side.
Mr. Fry said he appeared for 469 shareholders, holding 149,875 shares, or nearly one-half of the whole of the shares; and he also appeared for 5,402 holders of policies, the value of their policies being 1,451,000l. With regard to the shareholders, he did not wish to add anything on their behalf. But with regard to the policy-holders, they were distinctly of opinion that the company should go on. He contended, from the figures of the balance-sheet, that the society held assets to meet its liabilities, that it was paying its claims, and ought not to be wound up.
Mr. Beevor, Mr. Locock Webb (who said he appeared for virtually the whole of the Irish policy-holders), and Mr. Cotterill followed on the same side.
Mr. Dickinson replied on the whole case, and with reference to the attack which had been made upon Mr. Crauford, he said evidence had been given that months before he filed the petition he had been writing letters to the chairman, stating his dissatisfaction with the management of the company.
The Vice-Chancellor, in giving his judgment, said—The same reasons which induced me to hear this petition as soon as possible during the vacation, the enormous amount of interest that seems to be involved in the case, and the great embarrassment which the hanging over of a
[The CHAIRMAN said he was quite willing to give a pledge to that effect.]
[Mr. LEWIS thought it was very important, in reference to the policy-holders, that, before the meeting terminated, it should intimate whether he was correct in assuming that, without binding themselves to specific details, the shareholders were decidedly in favour of some such scheme of reconstruction as that which had been placed before them.] (Loud and general cheers were the response to this appeal.) It would strengthen the liquidators very much in meeting the policy-holders and dealing with them to know that that was an almost unanimous opinion. (Cheers.)
Mr. COTTRELL said as one who was a policy-holder as well as a shareholder, he thought it would be well if half a dozen shareholders were selected to represent the body at the policy-holders’ meetings; adding that he would propose the appointment of such a committee to attend the meetings, to watch over the general interests of the shareholders, and to investigate the affairs of the company.
Mr. LEWIS remarked that when they knew what the policy-holders intended it might be desirable to form a joint committee, but not before. (Hear, hear.)
A SHAREHOLDER wanted to know whether, in case the concern were not resuscitated, the shareholders would be responsible beyond the 17l. uncalled.
Mr. LEWIS said, having been asked the same question at a meeting of shareholders the other day, he had taken care to furnish himself with a copy of the policies issued by that office, and it appeared to him that the liability was limited to the amount of the shares. He did not mean to say that they might not have entered into other contracts which he had not seen. That would place them in a different position, but as regarded all the policies originally issued by that company, and also all those of which he had seen indorsements, the company was clearly not liable beyond the amount of the shares.
This terminated the proceedings.
IT is fortunate for the Shareholders of the European Assurance Society, that their late manager and late directors did not succeed in burking all public discussion upon its affairs. The sensitiveness to public comment which those officials exhibited, has been amply justified by its results. They fought the winding-up petition with vigour and success, and that resistance was the one final service they have rendered the society. So soon as the shareholders followed the advice given them by the press, and took their affairs into their own hands, the reign of mismanagement was over. The report of the Committee of Shareholders presented to yesterday’s meeting fully bears out all that we have said as to the need of a reconstruction of the Society’s management, while the result of the meeting has been to effect exactly the changes which were needful to regain public confidence, and to put the business on a second and healthy basis. The Committee “were of opinion that there had been gross mismanagement and recklessness in purchases and amalgamations with other companies, and in enormous and unjustifiable expenditure.” They condemned “the want of proper vigilance on the part of the directors, and the great power acquired by the general manager, which power had been very frequently exercised improperly.” They, therefore, recommended an entire change in the management of the society; and a call of ten shillings a share to produce a reserve fund which should justify public confidence. Their investigation had produced its effect. They were able to meet the shareholders with the means of a peaceful revolution in their hands. The manager had resigned, and the meeting at once accepted his resignation. The directors had previously taken the same course, and the resignations of eight out of eleven were also accepted. The three which remained will, it was said, elect their successors and then resign, so that the change of management will be compete. The new directors will, therefore, be Messrs. J. BROWN WESTHEAD, M.P., Alderman CARTER, M.P., A. BRISTOWE, J. FIELD, CHILDE, E. HEALLY, and the Hon. AUBERON HERBERT. Such a directorate will command public confidence, and will speedily redeem the society’s position. The shareholders have not only overthrown a bad government, but have set up a good one, and have saved the business by putting it into new and better hands. There can be no question that with such management as the Society will now enjoy it may still be made one of the best and most prosperous of Insurance business. The new directorate enters on a large and valuable business which nothing but mismanagement has imperiled, but which a thoroughly wise and popular management will probably seedily restore.
AMERICA.
(FROM A CORRESPONDENT.)
NEW YORK, Oct. 8.
“Order reigns” in Wall-street. The bulls and the bears are engaged in counting their dead and wounded. The war has been transferred from the Stock Exchange to the press. Every man supposed to be connected with the late fluctuations in gold is “interviewed” from morning to night by reporters. Who constituted the “gold ring,” who lost money by its operations, and who made money by it, whether any Government officials were connected with it, and if so who those Government officials were, are the sensation questions of the day. Messrs. Gould and Fisk admit their connection with the ring, but they assert that a certain Mr. Corbyn, a brother-in-law of the President, was the originator of the scheme, and that the stock which he contributed to the association was the promise of the President that no sales of Treasury gold should take place for some weeks.
Notwithstanding Mr. Corbyn’s indignant denials, there appears to be abundant evidence to show that he was in alliance with Fisk to “corner gold,” and that he made use of the name of the President to influence the market. That he did this, however, without the knowledge of Mr. Grant is the universal opinion. As a President Mr. Grant has proved to be a failure. He has inaugurated no reign of purity, and he has not freed himself from the trammels of party. Having chosen his Cabinet, he seems to have considered that he might subside into a constitutional king who reigns but does not govern. He spends a great part of his time travelling over the country, and leaves politics to take care of themselves. But while the country has lost confidence in his talents and firmness, they still believe him to be an honest man; and this belief has not been shaken by the complicity of his brother-in-law in stock-jobbing manoeuvres. Mr. Corbyn meets the accusations against him by denials which convince no one, and by appeals to friends to come forward and testify that he has always been a moral and religious man. As for Messrs. Fisk and Gould, they are sharp New England men, and no more feel shame for the exposure of their robberies than an African savage comprehends the iniquity of eating a missionary.
Although the name of Fisk is a household word here, and carries terror and dismay into the heart of every holder of Erie Railroad stock, yet, as his fame is hardly European, it may interest some of your readers to know who he is, and who he was. Mr. James Fisk first appeared before the public as a circus-rider. Although he gained a considerable reputation for jumping through fiery hoops, and balancing himself upon the backs of horses, he had a soul above such vulgar triumphs, and left the arena in order to engage in commercial pursuits. For several years he travelled through New England with a pedlar’s pack, and traded in wooden nutmegs and other Yankee notions. But still his ambition was not satisfied. He felt that he was born for better things, and exchanged his pack for a stool in the office of Mr. Drew, who then shared the railway throne with Commodore Vanderbilt. His shrewdness soon attracted the attention of his principal, and, having acquired a little money, he gave up his clerkship, and, with the aid of Mr. Drew, became an “operator” in Wall-street. As he was intelligent and perfectly unscrupulous, he was employed by many persons to do their dirty work, and to bear the abuse which followed detection. In the course of his business he made the acquaintance of a certain Jay Gould, a third rate stockbroker, and of a pettifogger of the name of Lane. These three worthies, like the two centurions of Tacitus who determined to revolutionize the Roman Empire, determined to make themselves absolute possessors of the Erie Railroad; and, like the centurions, they succeeded. The wonderful manoeuvres by which three obscure individuals become maters of a wealthy railroad company are too well known. At present Mr. Fisk, Mr. Gould, and Mr. Lane form an executive committee, who manipulate all the finances of the Erie Company, and who own besides a fleet of steamers. They keep a judge in their pay to interpret the law in their favour, and they are able to carry any new law which they may require through the State Legislature at Albany. Although the earnings of the Erie Railroad must be largely in excess of the expenditure, they pay to their shareholders no dividends. All the money that comes into the exchequer is devoted to corrupting officials and judges, and making purchases for the company by which they enrich themselves. The directors of several English lines of railroad do not enjoy the absolute confidence of their shareholders; but what would be sad if the chairman of an English railroad were to buy Covent-garden Theatre, sell it for double the amount which he paid for it to the company, transact business in the green-room, and carry on an opera with the proceeds of his railroad? Yet this is what has been done by Mr. Fisk. The offices of the Erie Railroad are in that excellent freehold which he sold to the company, the “Grand Opera House,” and the money of the Erie shareholders goes to keep up a theatrical company. Englishmen who have invested their money in the line will be glad to hear that their enterprising President recently produced Sardou’s comedy of Patrie, in a very creditable manner, and that at the present moment their money is employed in reviving the legitimate drama by the representation of one of Shakespeare’s plays. There is a species of Royal box, in which on most evenings Mr. Fisk is to be seen dealing out hospitality from a well-furnished buffet to his friends and admirers. As I am fond of making the acquaintance of celebrities in their homes, I was introduced to Mr. Fisk the other day in his box, and partook of a glass of excellent champagne, for which, and for the play, which was well acted, I beg to tender my thanks to the proprietors of Erie stock.
As a sensation, Cuba is, to use the American expression, played out. Americans are occupied at home in endeavouring to grow rich, and they care very little for the acquisition of the island. The Cuban junta in New York, and its agencies throughout the country, failed to inspire either confidence or respect. They were perpetually making appeals for money, and most of what came into the treasury went to support a herd of dingy-looking patriots, who infested third-rate hotels, drinking, smoking cigarettes, and abusing Spain. The rest was invested in the purchase of recruits, who took very good care to convey the intelligence of the port from which they were to embark to the United States authorities, who were then obliged to interfere to prevent their sailing. From all accounts nothing has been really done by the revolutionists in Cuba, and the contrast between their magniloquent boasts and frothy deeds has alienated all sympathy for them. They are now ridiculed and despised by the entire press. Neither the Republican nor the Democratic party ventures to take action against them, for fear public opinion should again veer round in their favour; but I think both the Government and the country are prepared to accept the view which Mr. Sumner has taken of the matter, that they must become belligerents before they are recognised as such. Even should Mr. Sickles be able to effect the purchase of the island, I think it is very questionable whether Congress would vote the money to carry it out. The Munro doctrine is a theory, but taxation is a fact.
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