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For a long time Henry N. Smith has been one of the
most conspicuous bear leaders in Wall-street.
Addison Cammack and the German firm of Woerishoffer
alone have divided the honors with him for most
prominence in this direction. Cammack, Woerishoffer,
and Smith have been close partners, and things
financial have been in such shabby shape generally
that they have largely fashioned the course of
things in the Street to their own liking. But not
long ago Messrs. Cammack and Woerishoffer saw the
error of their way, and when the Vanderbilt interest
sought to provide a bull market Cammack and
Woerishoffer did not stand in the way. They are
generally credited, indeed, with having put their
shoulders to the wheel to help things around. Mr.
Smith was left standing alone. He was deserted,
betrayed, say adherents whose rhetoric is a trifle
strong. Three weeks or more ago Wall-street was
filled with rumors to the effect that he was ruined.
He stoutly denied these rumors and affected to be
careless of the gossip that abounded on every side.
But the Soutter failure disclosed him as a heavy
debtor to that firm, and the squeezing process that
is so well understood in Wall-street left him little
further hope of fighting the battle out
successfully. The writing was on the wall. He went
under yesterday without a murmur.
It was fate that the Vanderbilt vengeance should be
wreaked. Mr. Vanderbilt in inviting Mr. Cammack and
Mr. Woerishoffer into the new bull regime had
carefully guarded, so the story goes, against
allowing any benefits to accrue to Henry N. Smith.
Indeed, Smith's prop was removed. He could not win
with his enemies reinforced by old-time friends, who
possessed his secrets and the key to all his
movements. There are specific charges made against
the Woerishoffers by the Smiths, one of which may
lead to legal complications. It is alleged that Mr.
Smith and they were lately joint partners in a bear
account involving 180,000 shares of stock, with
differences on the market reaching a very large sum.
Mr. Woerishoffer is reported to have promptly met
the differences on his half of this, leaving the
other half to be cared for by Smith, and the Smith
following, going further, ever that Mr. Woerishoffer
then went long of the stock and sent up prices on
Smith. Now the customers of Heath & Co., who are
naturally the persons most interested, claim that
upon the grounds of a legal decision rendered in a
case brought by Deacon S. V. White some years ago
Woerishoffer can be held liable for the differences
on the remainder of the account that one partner in
a joint account cannot withdraw by a settlement in
such way, but must continue responsible for the
whole liability till all is settled. This claim is
likely to lead to much intricate litigation before
an end is reached. In the interest of Mr.
Woerishoffer it is asserted that there is no "joint"
account whatever, and that this claim will not be
considered seriously on the Stock Exchange.
Henry N. Smith has an interest as special partner in
the brokerage firm of Charles I. Hudson & Co. It
represents $100,000 all paid in. Mr. A.H. De Forest,
of this firm, is the brother-in-law of Mr. Smith.
The firm of Hudson & Co., in a public statement
yesterday afternoon, explained that the failures of
the day had no bearing upon their business; they
were in a prosperous condition, and could suffer no
embarrassment through Mr. Smith's connection with
them.
Some feeling was manifested on the Stock Exchange
over the charge that though Heath & Co. were alleged
to have drawn up their assignment on Thursday night
they renewed contracts yesterday before announcing
their failure. This grave accusation may lead to
serious entanglements. A large portion of Heath &
Co.'s liabilities consists of due bills for
dividends on the many high priced stocks of which
the firm has been short for many months. It is the
custom when stocks are borrowed to protect short
sales for the borrower to give due bills for the
dividends as they accrue, and fully three-eighths of
the losses are due in this way to the owners of the
stocks. Among the brokers the firm is supposed to
have been daily borrowers of not less than 150,000
shares of stock, and have paid out vast sums in the
way of shaves for the use of such stocks as
commanded a premium for use.The stocks settled at
the Stock Exchange comprised the following lots, and
were bought in without creating any excitement: Two
hundred shares of Michigan Central, 100 shares
Canadian Pacific, 200 shares Delaware and Hudson,
200 shares Louisville and Nashville, 400 shares
Omaha preferred, 300 shares Oregon Railway and
Navigation Company, 4,700 shares St. Paul, 700
shares Missouri Pacific, 500 shares Union Pacific,
1,200 shares New-Jersey Central, 5,900 shares
Northwest common, 300 shares Chicago, Rock Island
and Pacific, 4,600 shares Lake Shore, 10,400 shares
Delaware, Lackawanna and Western, 4,900 shares
New-York Central, and 9,100 shares of Western Union
Telegraph in all 43,700 shares. In addition the
following long stock was sold for account of the
firm: One thousand two hundred shares Philadelphia
and Reading, 1,100 shares of Erie, 600 shares of St.
Paul common, and 200 shares of New-York Central,
3,100 shares in all.
Giovanni P. Morosini has begun a suit in the Supreme
court against William Heath & Co. and has obtained
from Judge Donohue an attachment against the
property of that insolvent firm. In his affidavit to
procure the attachment Morosini said that for
several years he has had $480,000 in cash on deposit
with Heath & Co., subject to his draft, and that the
only debit that could properly be made against that
sum was for 2,380 shares Manhattan Railway stock and
25 Metropolitan Elevated Railway second mortgage
bonds, which he ordered the firm to buy for him, and
which in the aggregate cost $215,000. He therefore
asserts that the firm owes him $265,000 in cash on
account of his deposit, and also holds on deposit
for him the stock and bonds mentioned. Mr. Morosini
said that he called for his securities and money
yesterday and was informed that Heath & Co. could
not deliver them, as the securities had been
hypothecated or sold and the cash otherwise disposed
of. He said he had never authorized the defendants
to make use of his money and securities, and he
charged them with defrauding him and intending to
defraud their creditors generally. As an additional
reason for the attachment he said that Charles E.
Quincy, the junior member of the firm of William
Heath & Co., is in Europe and has no residence here.
Mr. Smith was an ardent lover of horseflesh, and
many years ago bought a farm near Trenton, which he
has gradually improved and added to until it is now
known all over the country as the Fashion Stud Farm.
When a few years ago the noted trotting mare
Goldsmith Maid, which died the other day, was in the
height of her fame, Mr. Smith bought her for
$35,000, and it was as his property that she made
her record of 2:14 in September, 1874. Among the
other noted horses belonging to Mr. Smith are the
stallions Jay Gould and Socrates, both now at the
Fashion Farm, which has been for several years owned
by his wife. He has never been very prominent in
society, residing quietly at his house at the corner
of Forty-fifth-street and Fifth-avenue. In the
Winter he is always to be found at the opera, owning
a box at the Academy of Music.
Mr. Smith's wife owns the house used by Mr. Smith
for his home, at Forty-fifth-street and
Fifth-avenue, as well as the house adjoining. There
is also said to be other city real estate in Mrs.
Smith's name, with property in New Jersey. Mr. Smith
owns a seat in the Stock Exchange. In the assets of
Heath & Co. are to be estimated to Stock Exchange
seats, worth $25,000 each, one in Mr. Heath's own
name and one in the name of his partner, Major
Charles A. Quincey, who is now on his wedding trip
in Europe. William Heath & Co. have for several
years past done probably the largest commission
business on the Street. The house was founded in
1860, and has passed through the vicissitudes usual
to Wall-street houses in times of panic, having
suspended once or twice before yesterday. In
addition to the New York business, they have a
branch in London under charge of Thomas E. Davis,
and have been engaged in enormous arbitrage
transactions between the New-York and London
markets. While credited with large profits for
years, they are supposed to have suffered losses
aggregating $600,000 during the advance of the past
few months. The firm had a branch in Paris for
several years during the speculative excitement
growing out of the boom of 1879, but gave it up a
year or two ago. Heath gained considerable celebrity
at the beginning of his business career for the
rapidity of his operations and the celerity with
which he got from one side of the market to the
other when he found himself wrong. His figure is one
of the best known in the Street, he being fully 6
feet 6 inches in height, gaunt and angular, with a
huge drooping mustache. He is as quick in his
locomotion as in his operations, and this
peculiarity has gained for him the sobriquet of "The
American Deer," which was first bestowed upon him by
London brokers while he was there managing some
gigantic operation many years ago, and which has
stuck to him ever since.
At the time of the Black Friday panic William Heath
& Co. were among the brokers acting for the
Gould-Fisk syndicate. When the crash came Heath left
the United States and went to London, where he
remained for over a year. At the time the impression
was very general that had he remained in the city
revelations attendant with great loss to Gould could
not have been prevented, and that his temporary
absence was due to the wish of Gould and Fisk to
have him out of the way until the storm had blown
over.
End Of Article
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