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SUT SEEKS TO BAR BANK ASSESSMENT 100% Levy on Continental Owners for Shares in Commercial Hit. Suit to enjoin Controller of the Currency J. F. T. O'Connor from A per Trust on Continental ment collection against of stockholders 100 Co. cent the of organi- assess- the zation's 4,000 shares in the Commercial National Bank was filed in District Supreme Court yesterday. The plaintiffs at the same time sought an injunction against an assessment levied against Continental stockholders by Receiver John F. Moran on the basis of individual stock ownings in the trust company. The four Continental shareowners who,entered the suit protested favoritism allegedly shown by O'Connor to Commercial depositors to the detriment of the Continental Trust Co., which was bought out by the now closed Commercial in January, 1930. a Continental's purchase of the 4,000 shares of Commercial stock the plaintiffs declare illegal as done without authority as an investment by officers of the trust company. Invalidation Is Asked. Plaintiffs in yesterday's suit demand invalidation of this stock purchase. which has resulted in the trust company's being listed as a Commercial Bank stockholder and liable to that extent for the debts of the Commercial National O'Connor ordered the 100 per cent assessment against Continental stockholders May 29, several months after a similar assessment was levied on Commercial stock. The total amount which the controller seeks to collect from Commercial holders is $400,000. the assessment. In protesting the suit contends individual that when the Commercial Bank bought out the trust company, the latter had sufficient assets to pay all valid claims. This eliminated necessity for an assessment. plaintiffs state. states the of the trust company time the sale solvency The of suit further precluded that need at the for of a asks of a court during substitution appointment receiver receiver and trial of the case to replace Moran. Money Paid Out Attacked. Moran. according to the plaintiffs. has to suit recover moneys refused improperly bring paid to out to invalid a the trust company satisfy such against claims, petitioners claims. state, Chief originally is among debt listed on the bank's books as $2,600.000, but later scaled down by liquidation to $668.000. The "debt" corresponded to the Amount of deposits in the trust company at the time of the sale. The revised sum included $200,000 in interest charges. The bank's officials refused to correct this error after it was brought to their attention by the protest of the trust company's directors, the suit states. Plaintiffs in this connection allege the trust company officers "colluded and conspired' with officers of the bank to continue this wrongful constuction of the contract by which the assets were the and trust to company's assess interest charges purchased instead of guarding the interests of the trust company. Debt Illegitimate, Is Claim. The suit claims money borrowed by the trust company from four banks to the last the purchase 4.000 Commercial block shares of consti- 800 of tutes an illegitimate debt. since the lending banks knew the money was to be used in purchasing the stock, an allegedly illegal transaction. It was asserted this money was borrowed at the direction of Wade H. Cooper, then president of both institutions, now under indictment on a charge of misapplying funds of the Commercial Bank. Attorney Frank S. Nesbitt filed the suit on behalf of Leila S. Dunn. 2925 Glover driveway; Anne S. Callahan, 3301 University avenue: Agnes V. Scott. 2400 Sixteenth street, and G. T. Scott, 4912 Quebec street. O'Connor. Moran and Robert T Baldwin, Commercial Bank receiver, are named defendants.
