FINDING No. 27 Based upon Judge Haight's statement of his desire to use Kaufman in cases pending or to be brought in the Third Circuit, the conference unanimously approved a further retainer to Kaufman of $10,000. ANSWER I refuse this request as stated. What took place at the conference of September 12, 1935, depended principally, if not entirely, upon the testimony of Mr. Dwight, one of the directors of Universal. His diary does not indicate that Kaufman's relation to Universal was discussed at this conference. What he now says is based upon recollection more than six years after the conference was held. After such a lapse of time and with so much discussion as has revolved around Kaufman's connection with Universal, it would not be surprising if his recollection was faulty as to exactly what was said at that time. He was clearly in error in thinking that Judge Haight said he had sent the Root briefs to Kaufman. I do not think the evidence warrants the finding requested. FINDING NO. 28 After the conference had approved the payment of $25,000 to Kaufman, Halle ordered the check five days before the petition for certiorari was denied, and the check was actually drawn and the appropriate entries made in the company's books four days before that event. ANSWER I affirm this request with the qualification that the approval of the payment to Kaufman was based entirely upon Halle's statements. FINDING NO. 29 Pursuant to the arrangement agreed upon by Halle, Haight, Whitney and Dwight on September 12, 1935, Kaufman was paid his $10,000 retainer fee for 1936 on March 18, 1936. ANSWER It is true that Kaufman was paid $10,000 on March 18, 1936. The evidence does not satisfactorily show that it was pursuant to any arrangement agreed upon by Halle, Haight, Whitney, and Dwight. I therefore refuse this request as stated. FINDING NO. 30 Kaufman, having learned that Universal had secured an advantageous settlement of the Mid-Continent case, requested $10,000 from Halle so as to bring his 1932-1935 retainer fee to the $35,000 which he had originally requested. Halle compromised this request and agreed to pay Kaufman $5,000. This sum was paid to Kaufman by Universal on July 27, 1936. ANSWER It is true that Universal paid Kaufman $5,000 on July 27, 1936. I refuse to find the other facts alleged in this request as not based on satisfactory evidence. FINDING No. 31 In December 1936, Universal paid Kaufman $10,000 for his retainer for 1937. This payment was made in December 1936 rather than in 1937 at Kaufman's request, purely for his own income-tax reasons. ANSWER It is true that $10,000 was paid Kaufman on December 2, 1936. The reasons for the payment at that time do not satisfactorily appear. I therefore refuse this request as stated. FINDING No. 32 The $50,000 paid Kaufman by Universal in 1935 and 1936 did not constitute compensation for services exclusively in the Root case. ANSWER I refuse this request as stated. The evidence definitely shows that $30,000 of the amount paid Kaufman was for services in the Root case. The reasons for the payment of the remaining sum do not satisfactorily appear. FINDING NO. 33 The two payments to Kaufman in 1936 of $10,000 constituted Kaufman's retainers for the years 1936 and 1937, respectively. ANSWER Refused. These payments were not retainers in any normal sense and their purpose was obscure. They may have been additional payments for services in the Root case. FINDING NO. 34 Kaufman's retainers for the years 1936 and 1937 were to be applied against services rendered in the Crew-Levick case and to be rendered in that and other litigation which was then pending or contemplated in the State of Pennsylvania. ANSWER Refused. The evidence has not convinced me that these payments were retainers for legal services. They may have been applied against services in the CrewLevick case, which however were not extensive. FINDING NO. 35 All payments made by Universal to Kaufman were fully disclosed, were made by company checks, and were duly entered in the appropriate books of account of the company. ANSWER It is true that all payments made by Universal to Kaufman were made by company checks and were entered in the books of account. It is not clear what is meant by the request for a finding that they "were fully disclosed." The evidence dose not indicate anything further except that in the auditor's reports sent to stockholders appear items showing $25,000 paid Kaufman in 1935 and a like amount in 1936. FINDING NO. 36 No effort was made by Halle or by any officer or employee of Universal to conceal or disguise the payments to Kaufman. ANSWER Refused. FINDING NO. 37 The appeal in the Root case, which was argued on January 7, 1935, was decided in favor of Universal by the Circuit Court of Appeals at a conference held by the Court on January 17, 1935. ANSWER The evidence indicates that a conclusion was reached in the Root case on January 17, 1935, although neither Judge Buffington nor Judge Davis definitely remembered that it was. The case was technically decided on June 26, 1935. FINDING NO. 38 Immediately after the conference of January 17, 1935, Judge Davis left by motor for a vacation in Florida where he learned for the first time that his cousin, Charles L. Stokley, was in financial difficulties. Affirmed. ANSWER FINDING NO. 39 After his arrival in Florida, Davis learned by letter from Judge Buffington, dated January 18, 1935 and addressed to him at Mount Dora, that to him had been assigned the writing of the opinion in the Root case. ANSWER Affirmed. FINDING No. 40 In 1935 cases were assigned by the senior Judge of the Circuit Court of Appeals for the Third Circuit for the writing of opinions only after the determination of the appeal. ANSWER The testimony was that it was the usual practice for cases to be assigned for opinions to members of the court only after they had been decided. FINDING NO. 41 Sometime after January 17, 1935, Davis who was then in Florida learned for the first time that some of the property of his cousin Stokley had been foreclosed by the Town of Mount Dora for unpaid paving liens amounting to approximately $29,000 or $30,000. ANSWER Affirmed. FINDING NO. 42 Stokley told Davis that he thought he could compromise this, indebtedness for about $7,500 and asked Davis to endeavor to obtain a loan to enable him to redeem his property. Davis agreed to do so. ANSWER Affirmed. FINDING No. 43 Upon returning north after his vacation, Davis endeavored to secure a loan of $7,500 for Stokley from John A. Campbell and Robert A. Messler, both of Trenton, N. J. ANSWER Refused: The evidence has not convinced me that Davis ever made any application to anyone other than Kaufman for the loan in question. FINDING NO. 44 Davis continued to negotiate with them until at least after July 18, 1935; they ultimately declined to make the loan. ANSWER Refused. FINDING NO. 45 Stokley first received a definite offer that the Town of Mount Dora was willing to compromise his tax liens for $10,000 in July, 1935. Affirmed. ANSWER FINDING No. 46 On July 12, 1935, Stokley informed Davis for the first time that the Town's claims could be compromised for $10,000. Affirmed. ANSWER FINDING No. 47 The opinion on the Root appeal was filed on June 26, 1935. Affirmed. ANSWER FINDING No. 48 Some time after July 18, 1935, Davis, for the first time, broached to Kaufman the subject of a loan to Stokley. ANSWER Refused. The evidence shows that Davis and Kaufman discussed this loan as early as March, 1935. FINDING NO. 49 Kaufman, when approached by Davis, stated that he would be interested in making the loan if the title were good and the value sufficient to afford ample security. ANSWER Refused, as not based upon any credible evidence. FINDING No. 50 On October 24, 1935, Kaufman met Stokley at Judge Davis' chambers in Trenton and agreed, in conference with Stokley and Thorn Lord, Davis' law secretary, to lend Stokley $10,000 to redeem his property. ANSWER Affirmed, with the qualification that Davis was financially interested in the loan although it was nominally made by Kaufman. FINDING NO. 51 Kaufman was interested in the return of 8% per annum on his investment, if the security was adequate. ANSWER Refused. The evidence does not convince me that Kaufman was interested in this transaction as an investment of his own. FINDING NO. 52 Kaufman insisted that Lord go to Mount Dora, at Stokley's expense, to insure that all proper legal formalities in connection with closing the loan were observed. ANSWER Refused. Lord testified that he was only a messenger and was not retained as an attorney to attend to the closing of this transaction. FINDING NO. 53 The delay in the consummation of the loan by Kaufman to Stokley was not due to Davis. ANSWER Refused. The evidence does not warrant the conclusion that the delay in the consummation of the loan was not due at least in part to Davis. FINDING No. 54 The delay in the consummation of the loan by Kaufman to Stokley was not due to Kaufman. ANSWER Refused. Kaufman delayed making the loan until he received his fee in the Root case. FINDING NO. 55 Late in November a title policy on the Stokley property had been obtained and Lord went to Mount Dora and delivered to the Town Kaufman's check for $10,000 and received from the Town a deed to Kaufman of Stokley's property. Affirmed. ANSWER FINDING No. 56 By agreement dated November 25, 1935, Kaufman agreed to convey the property to Stokley upon payment of the principal amount of $10,000 and interest at 8% per annum; the agreement provided for the payment of interest on April 1st in each year. In 1935, and at all times subsequent thereto, the Stokley property was worth at least $20,000. ANSWER Refused. There is no competent evidence before me from which I can find what the Stokley property was worth. FINDING No. 58 The Stokley loan was made upon ample security. ANSWER Refused for the reason above given. FINDING NO. 59 The Stokley loan was a bona fide business transaction. ANSWER Refused for the reasons more fully expressed in the body of my report. FINDING No. 60 All payments made by Universal to Kaufman were made outright, were deposited by Kaufman in his own bank accounts, and constituted funds with which he was free to deal as he saw fit. ANSWER Affirmed. FINDING NO. 61 No officer, agent, employee, or attorney of Universal in any way expressly or inferentially authorized, directed, suggested, or approved the Kaufman loan to Stokley. ANSWER Affirmed if no attorney other than Kaufman is meant. |