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BANK RECEIVER IS NOT NAMED The North Liberty State bank will operate for the next 90 days under the authority its own officers, and under receivership, under ruling handed down by Judge Fred superior court No. Friday afternoon, denying petition filed Lenn Oare in behalf Arthur Gilliom and State Bank Commissioner Luther Symons. The will be carried to the state Mr. upon receiving Judge Bingham's rul-
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District Backs Rochester Veterans' Site as Hospital Rochester, Ind., will be backed site for the new veterans' hospital for which already been by This decision reached Monday night at when legion representing every post the Thirteenth met and discussed the matter. Four Bend, Elkhart, made #bids for the after much disPATTEE SELECTS cussion the local delegation withdrew its favor Rochester. Elkhart and Mishawaka followed the South BANK'S RECEIVER Bend delegation's action. The meeting called by District Bend, decide upon would Names John district in G. Schurz in its appeal for the hospital. Fight Over North Lib- Following the decision committee consisting of United States Senaerty Petition. James Watson and Arthur R. Robinson, Indiana, Representative Andrew Hickey the ThirAfter bitter controversy between teenth district was selected to work counsel for the the Indiana with government officials an effort to bring the hospital to Rochesbanking commission over the apHenry Barnhart, conpointment, Judge Cyrus Pattee gressman, appointed circuit court to-day named John Washington Schurz, accountant and income tax and appear before veterans buconsultant, receiver for the which receive the delegafunct North Liberty State bank, tions from various cities of the state Immediately following his appoint- Friday. ment Mr. Schurz was sworn Mr. Barnhart appear before made arrangements for the posting the and peti$10,000 bond. tion from the Rochester legion, Kitwo-hour battle of words raged wanis club, circuit judge in circuit Monday when Samothers that the attorney the bank visit Rochester and and one of its stockholders, presentinspect site along the banks for the Lake M. Hass, Liberty ber take charge the understood that shortly after bank's affairs. petition the the signed by 49 North citizens, lection of the site will be made and whom are in the that will bank. as be Cites Interest. let that the hospital can be occuLenn Oare, representing the pied before the summer over. state objected It is that the cost vigorously the operating the and farm Hass asked that South Bend day while trust company be named. large of physicians and nurses He pointed out that of will always be on duty. those signing the petition are stockThe site selected for the hospital holders liable under the settlement of claims. For this rea- the Carruthers farm state he they should have No. mile east of Rochesargued, no the appointment. ter. This farm acres, the Parker contended that Mr. front Lake the Hass would have the interests of the north side being bounded by the Erie and railroad. at heart that the bank It was decided to hold the district trust company would be exorbiconvention Mishawaka March 17. tant. The convention is expected to bring indicated during the contronearly 400 legion memmight be bers of the auxiliary to Mishawaka liable 100 cent for varied program of entertainon their stock in the institution. ment, which men of all Explains Motive. northern state post cities to In invited. Pat Barnes, radio announcday Judge for WGN, Chicago, expected to "There has be speaker, North
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THREE COUNTRY BANKS IN ST. JOSEPH COUNTY CLOSED South Bend, Ind., Feb. 28.--Three banks in the farming communities of St. Joseph county have closed their doors within the last fortyeight hours and H receivership for another has been asked by the state banking commission. Since Jan. six banks of the county have been closed after n run. The state bank at Tyner closed its doors Wednesday In an effort to protect its depositors after a small run had been started. News of the Tyner closing spread quickly and within an hour after the Farmers State bank of Walkerton had opened for business a run on deposits forced Its closing. The bank will not reopen until compleof an audit. The latest closing occurred late Thursday afternoon when directors of the Farmers State bank at Lapaz called In Thomas Barr, state inspector. Uneasiness among depositors and generally unsound business conditions were given as the reasons for the closing. The closIng was described as a "precautionary measure." The state bank commission Thursday fileda petion In the St. Joseph Circuit court asking a receivership for the Lakeville State arranged: bank, which closed its doors carlier Music. in the week because of frozen assets. On Jan. 17 the North Liberty State bank was closed because of shrinkage in deposits. The day Music. before the closing of the North Liberty bank the Argos State bank of Argos suspended business. Music.
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TWO BANKS IN STATE CLOSED South Bend. Ind., Feb. 28. The number of banks which have suspended operations in this vicinity since Jan. was boosted to six. when the Farmers' State Bank, of Walkerton. and the Farmers State Bank. of Lapaz, closed their doors yesterday. The State Bank. of Tyner, suspended business Wednesday after noon after a small run had started. The State Banking Commission yes terday filed a petition in the St. Joseph county court asking receivership for the Lakeville State Bank, which was closed earlier in the week because of frozen assets The North Liberty State Bank was forced to close Jan. 17, because of a shrinkage of deposits. The Argos State Bank, of Argos, suspended operation Jan. 16.
BANK RECEIVER SUED. The Citizens' Trust & Savings bank of South Bend to-day brought suit in circuit court asking $2,100 from John G. Schurs, receiver for the North Liberty State bank. The South Bend bank is receiver for the Lakeville State bank, which, according to the complaint, holds note from the North Liberty institution dated in July. 1927
PYLE ADJOURNS BANK DEBT SUIT After hearing considerable testimony Wednesday, which failed to clear up the mystery of mutual debts between the Lakeville State bank and the North Liberty State bank, Circuit Judge Dan Pyle adjourned the hearing to allow the Citizens Trust & Savings bank of South Bend, receiver for the Lakeville bank, to investigate further the $1 951.37 debt on its books credited against the North Liberty bank. When suit was filed by the receiver for the Lakeville bank against John G. Schurz, receiver for the North Liberty bank. Mr. Schurz filed a cross-complaint against the Lakeville bank receiver for $380.56, which he found owing the North Liberty bank by the Lakeville bank.
ARGUE PRIORITY OF CLAIMS Three Closed Institutions in County are Now Awaiting Ruling. A third St. Joseph county bank was added to the list of closed banks which are awaiting an important decision by the Indiana supreme court before paying dividends to depositors whose funds have been tied up in the institutions for several months. The petition by the Citizens Trust Savings bank, receiver for the Lakeville State bank. for permission to make blanket distribution of 10 cent, was blocked by objection by Union township and the town of Lakeville, whose total municipal funds make up two-fifths of the entire amount of deposits in the bank. Attorney Roland Obenchain, representing the and town, told Circuit Judge Dan Pyle that while the need their funds as well as the individual depositors, It was their decision await the supreme court's ruling concerning the priority of claims against closed He stated that the municipal funds in the bank total about $20.000 and that the entire deposits tal about $50,000. There is more than $5,000 ready for distribution by the receiver, which would release approximately $2,000 to the LWO government units and $3,000 would divided among the several hundred Due to this state of affairs and additional moving factor in the depreciation of the bank's assets, Mr. said, the municipalities are forced to oppose the pres. ent distribution and await the highor court's ruling. Receivers for the Franklin Trust company of South Bend and the North Liberty State bank signified some time ago that they are ready to make distributions of considerable amounts when the supreme court rules, Miss Ethel Weaver, receiver for the Franklin bank. stated that blanket distribution of 10 per could be made once should the supreme court that public funds do not hold priority over individual depositors. Should the municipal funds be given priority, Miss Weaver said. 20 per cent may be paid. St. Joseph county has about $44.000 tied up in the Franklin bank, while several townships also have smaller amounts in the closed bank. John G. Schurs, receiver for the North Liberty bank, said some time ago that sizeable distribution is ready to be made to depositors. but the Liberty township funds held in the bank make necessary await the supreme court's ruling. The matter has been before the high court for more than year and despite the fact that many receivers for closed banks throughout the state are awaiting ruling before releasing funds, the court justices have failed to make a decision.
STATE COURT'S DELAY IN BANK RULING SCORED "Pathetic," Says One Receiver; "Dilatory" Second Charges. AFFECTED Public Funds Held Up; Also Prevents Distribution of $20,000 in County. More than $20,000 is lying dormant in St. Joseph county bank vaults awaiting decision by the Indiana supreme court that will provide for the distribution of the money by receivers for three defunct banks in the county. The same decision will directly effect nearly $1,000,000 in public funds tied up in three other closed South Bend which are now in the liquidation. Definite action by the higher court has been for nearly since the test case was transferred to that court from the Indiana court, where on file nearly two years before justices of that court disagreed decision. Since the Cound its way to the supreme court, several similar appeals have been taken from every section of the state. estimated that throughout the state effected by court's delay in handing down ruling. Calls Delay Attorney Orie Parker, who represents Miss Ethel receivfor the Franklin Trust company, declared: pathetic the way the court delays action on an important issue of that kind.' Schurz, receiver for the North Liberty State bank said: supreme court has the reputation being dilatory. or years making decision and, from past experiences, another five years before the ruling is made. The Franklin company has about $8,000 for the question the priority claims on public funds blocks the payment the money to depositThis question must be setin the higher Mr. Schurz said today that he could distribute about $8,000 if the priority claim dispute was The blocking the payment $5,000 ready the hands of Citizens' Trust Savings bank. receiver for Lakeville State bank Three Banks Affected. Three other large South Bend closed and in the process liquidation, are also hampered by the dispute to priority. They are Union Trust company half million dollars being held in public funds. The bank about $100,000 public funds tied up, of which $85,000 belongs to Bend school Over $100,000 school funds being held the American Trust comSeveral townships also have pany. funds in the closed South Bend banks. was pointed out that suits against surety bond signers coverthe money these banks have ing but determination been priority claims would exonerate the bond signers in event the public funds are given priority. Only recently the Union ship the town of this county, awarded in superior court No. against bond covering in Lakeville State the amounting to bank, $20,000. Will Be Appealed. This decision to be appealed the supreme court Attorney Walter Arnold, was said Saturday. petition by the receiver of the following the judgment, distribute blocked by town and until the higher court rules on the claims. The Washington State bank has one payment of 10 per but time that sufficient addithe tional funds were available to meet claims in the event the priority court ruled their favor. higher Continued Page Six. Column
AUTHORIZES $5,000 FOR DEPOSITORS Continued from Page One, Column Five. closed banks in St. Joseph county for many the supreme court's delay in making the ruling. Judge Pyle said. in making the decision, that he certain the supreme court could rule no other way than public funds are common deposits. or municipal depositors are common depositors Obenchain Backs Move. Roland Obenchain. attorney for Union township and the town of Lakeville. said that it was generally felt the higher court's ruling would be in harmony with that of Judge Pyle and added that if were not adjustments would be later to conform with the decision of the supreme court. Judge Pyle's decision today was made the protest of Township Trustee Delbert Neddo and officials of the town of Lakeville, who had total public fund deposits in the bank of $20,000. Their 00jection was technical and matter of form to keep the court records clear pending the supreme court's ruling. Both governmental units today agreed to the distribution and approved stipulation that in the event the higher court finds public funds are preferred claims, adjustments will be made later. Through the distribution. which will be made within the next few days. Union township will receive about $1,400 on deposits of $14,000 and the town of Lakeville will be given $600 on deposits of $6,000 These will be deducted from the judgments for the full amount of the deposits granted both units in suits against former officials and directors of the bank who signed personal bonds as surety for the funds. Superior Judge Elmer Peak made the ruling several days ago. 400 Will Get Funds. Lenn J. Oare, attorney, representing the bank's receiver, said today that about 400 depositors will receive checks in the distribution. There were about 500 depositors in the bank, of which 100, Mr. Oare said, had very small accounts. peculiar condition arose when Mr. Oare was asked who would pay the new tax on the checks to be issued to the depositors. He said it would probably be charged to the receivership. The tax will amount to about $8. Attorney Orie Parker. representing Miss Ethel Weaver, receiver for the Franklin Trust company, said today that the position of the funds ready for distribution in that institution is entirely different from that of the Lakeville bank and probably would not be effected by the ruling. He pointed out that the receivership has already made payment to public fund depositors, but can not make further distribution until fina. determination is made on the question of priority claims. The Franklin Trust company receiver has about $8,000 on hand awaiting distribution. It was felt, however, that similar sum being held by John G. Schurz, receiver for the North Liberty State bank, may ultimately be affected by the court's decision.
NORTH LIBERTY STOCKHOLDERS IN BANK SUED Receiver and Name $25,000.