by Paul R. Spitzzeri
Once the inventory of the Temple and Workman bank and its owners, F.P.F. Temple and William Workman, was released on 4 February 1876 to a shocked Los Angeles citizenry, George E. Long, a creditors committee chairman, scheduled a meeting for 2:30 that afternoon at the county courthouse just a short walk south of the headquarters of the failed bank at the Temple Block.
According to the Los Angeles Herald, there were some 125 creditors “some of whom were ladies,” at the gahering. Long called the meeting to order, with a chair and a secretary appointed. The first speaker was Edward F. Spence, who with Daniel Freeman, was serving as bank assignee, and the duo had compiled the detailed inventory.
Spence stated “that an informal meeting of creditors some time ago had appointed a committee” of four creditors which worked with Spence on the process of working on and submitting the inventory to the county recorder. Spence said that he “recommended that the creditors appoint a committee of three to advise with the assignees and render their assistance in settling the affairs of the bank.”
Henry T. Hazard, a lawyer and future Los Angeles mayor, “objected to the appointment of assignees without the concurrence of creditors” and claimed “there had been considerable dissatisfaction expressed.” Despite Hazard’s complaint, however, a motion to create the committee was passed by the assembly. Then, there was a reconsideration and a larger committee of seven of the largest creditors was appointed instead. These included:
George E. Long, who was owed $20,000
John Jones, $40,000
Domingo Rivara, $23,000
L.J. Thomas, $10,000
Felix Mancho, $17,000
Francisco Sabichi, $4,000
Yet, Hazard again raised a protest, arguing that he “did not want a committee for fear that there would be a slate fixed up” that would drive an agenda that other creditors would not want. What he wanted was to nominate names for the committee, but not to vote to create one yet. His motion, though, did not receive a second.
Will D. Gould, a lawyer who opened an office in the Temple Block building that housed the bank when the structure was completed in 1871 and still operated from the same space when the building was condemned in 1925, requested that cooler heads prevail in the meeting “and did not care to have have an attorney serve on the committee.” This clearly meant Hazard and the paper reported that “his remarks elicited some applause.”
At that, it was decided that “Mr. Robert Turnbull representing $8,000 [owed to him] was appointed on the committee in place of Mr. Hazard.” This group then appointed, as Spence had recommended, a three-person committee to work with the assignees, these mane being Rivara, Long and H.C. Wiley.
Freeman then spoke and “stated that he considered himself in every way a member of this meeting—as a personal creditor and a representative of Temple & Workman.” He might have added that he was a debtor, as noted in the inventory. Freeman went on to note that “a movement is on foot [afoot] to throw the estate ito bankruptcy and have it controlled by a commissioner in San Francisco in the interests of preferred liens in the property.”
Freeman warned “that bankruptcy should be avoided by all of the creditors, and he believed that it was the purpose of this meeting to sanction the action of Temple & Workman in appointing assignees.” He continued that allowing the assignees (he and Spence) to do their work would mean that “the estate would pay dollar for dollar and leave a large surplus for Temple & Workman, whereas it disposed of by San Francisco parties, it would not realize ten cents on the dollar.” He then suggested that the advisory committee of three report back in one week on a plan of action.
Notably, when Henry D. Barrows moved for a vote “as to the opinion for or against bankruptcy,” it was reported that “through an awkward misunderstanding the vote was largely in the affirmative and seeing that they had blundered they went back to do it all over.”
Attorney John G. Eastman then proposed a resolution that “the creditors of Temple & Workman’s Bank here assembled is against throwing the estate into bankruptcy.” Judge S.S. Thompson then rose and argued that “it would be impossible for the assignees to discharge the mortgages that now encumber nearly all of the property,” but if those holdings culd be “cut up into small parcels it would realize more for the creditors than by any other way of disposal.”
Thompson also stated that “he had been informed on reliable authority that Baldwin refused to accept payment for his mortgages unless interest were paid up to maturity, making an item of about $430,000.” Stoking the fires further, Thompson claimed “I believe there is fraud enough apparent in the Baldwin mortgage to set it aside and compel him to take his chances with the other creditors.” to which it was reported there was applause.
Thompson then asked “how is it that he holds the absolute transfer of the Sanchez ranch and 5,000 acres in El Monte, making altogether property worth $110,000, and besides this holds mortgages on all the other estates.”
What Judge Thompson did was to open up some very pertinent detail about the nature of the Baldwin loan’s mortgages and the story of Juan Matias Sanchez, in particularly, is a noteworthy one to tell.
Tomorrow, the story of Sanchez and more from the creditors meeting will be taken up, so check back with us then!