Macomb County MI

EARLY BANKS and BANKERS Pg 917

From Leeson's History of Macomb County, Michigan 1882

The following paper on the above-named subject was prepared by Lew M. Miller, of Lansing, and read before the pioneers of Macomb, June 13, 1882.

So far as can be at present ascertained, the first attempt to organize a bank in Macomb County was made in the year 1834. At that time this county was one of the most thickly settled in the Territory, having within the same boundaries as at present a population of more than 0,000. The center of that population was here at Mt. Clemens, then an ambitious little settlement, and one of the most important points in the Territory. In common with the rest of Michigan, this village suffered great inconvenience from the scarcity of currency. Business was hindered. "The butcher, the baker and the candlestick-maker "had to barter and trust in many of their commercial transactions. Great enterprises were checked, and all the possibilities of the country were lying undeveloped. Such a state of affairs could not be otherwise than irritating to those who had cast their lots in this community. A conference of public-spirited citizens was held and a committee appointed to draw up a memorial to the Legislative Council. Who were most prominent in this movement and who composed the committee, we now have no means of knowing; but their memorial was duly presented to the Council by John Stockton, then a member from Macomb and St. Clair Counties, on January 20, 1834. It is mentioned in the journal us "a memorial from a committee of citizens of Macomb County, praying for the passage of a law to establish a bank at the village of Mt. Clemens."

Similar, though less formal, action was taken at about the same time by citizens of Shelby and the eastern part of Oakland County. They forwarded to the Council two petitions, numerously signed, u praying that a charter might be granted to a bank to be called the Clinton River Bank, and to be located in the town of Shelby, county of Macomb. One of the petitions was presented by Elon Farnsworth, of Wayne County, on January 21, and the other, on February 4, by Charles C. Hascall, of Oakland County. The memorial from Mt. Clemens and the two petitions from Shelby were referred to the Committee on Incorporations.

It did not seem expedient, however, to a majority of that committee, from the facts S90 forth in the memorial and petitions, to grant any charters, at that time, to any banking institutions in Macomb County. The committee, therefore, recommended that the prayer of the petitioners be not granted, and the recommendation was concurred in.

The reasons which led the majority to this conclusion are not set forth in the report of the committee. The whole matter is dispatched with tho usual brevity of early Legislative journals. To us there may seem something curt in this refusal to grant a request to which Gen. Stockton and his constituents were so much concerned. Yet who can now question the soundness of the committee's conclusions? One of the majority was Elon Farnsworth, to whose opinions as Chancellor and Attorney General the State of Michigan was afterward wont to listen with attention and respect. Before he concluded that the proposed action was inexpedient, he had doubtless considered well the subject; and it is interesting to note that his conclusions at that time were truly prophetic. Before many years, it became his duty, as Chancellor, to allow writs of injunction against the only two Macomb County banks under the old regime that ever rose to the dignity of an injunction. Nothing daunted by his first repulse, Mr. Stockton at once gave notice that on a future day, he would ask leave to introduce a bill to establish the Macomb County Bank, with a capital of $200,000." Upon his motion, the concurrence in the committee's report was reconsidered, and the report tabled Having thus cleared his way, he introduced UA bill to incorporate the Bank of Macomb County," which passed safely through the various stages, until it reached the order of third reading. There it stopped, having received but five ayes to eight nays on the question of its passage. The next day. on motion of Mr. Hascall, this vote was reconsidered, and the further consideration of the bill postponed until the next session of the Council.

Of the provisions of Mr. Stockton's bill, we have no knowledge. Merely the title appears in the journal, together with an incidental mention of $200,000 capital stock. It is probable, however, that its essential features were not very different from those of other charters granted to banking institutions in those days. Nothing more was heard of the "Clinton River Bank, to be located in the town of Shelby, county of Macomb." Its light had gone out in utter darkness.

Mr. Stockton made no further attempt to organize a bank during either of the special sessions of 1834, nor did ho broach the subject at the regular session of 1835. Meanwhile, measures were well under way for the organization of a State government. During May and June, a convention had met and framed a constitution, and that document was ready for submission to the people. In the interim, Gov. Mason convened the Legislative Council in special session. It assembled on August 17 and adjourned August 25. During this nine days' session, just when tho Territory was merging into a State, was passed an act, destined to fill an important chapter in the history of Macomb County. It was entitled " An act to incorporate the Macomb & Saginaw Railroad Company, and for other purposes." It was not the "railroad company," but the "other purposes" that made the act conspicuous. The principal one of the ;'other purposes" was the granting of authority to the stockholders of the railroad company to establish a bank at Mt. Clemens, under the corporate name of " The President, Directors and Company of the Bank of Macomb County."Gen. Stockton secured the enactment of that law. Whether he revived and remodeled his old bill or began anew, it is now impossible to determine. The journal of that session, might, perhaps, inform us; but that journal has long been a missing book, and it is even doubtful whether there is a copy still in existence. So we have but tradition and conjecture to guide us.

Strange as it may now seem to us, the combination of a railroad and a bank was no new proposition, when made by Mr. Stockton. The same Legislative Council, to which he now proposed it, had already, twice before, been guilty of encouraging that kind of miscegenation. During the regular session of 1835, the Erie & Kalamazoo Railroad Company and the Detroit & Pontiac Railroad Company had been authorized by amendments to their charters, to establish each a bank; and it is significant to note that the first part of Mr. Stockton's bill was modeled after the original charters of those two railroad companies, and the second part after the amendments. Hence, Mr. Stockton could point to two irresistible precedents for the passage of his bill. Furthermore, as railroad projects were then quite popular, he may have shrewdly incorporated one in his bill to help his bank scheme through. Whatever may have been the means adopted, the fact remains that he succeeded in removing enough of the opposition to his project to secure the passage of his bill; and it would be interesting to know whether Elon Farnsworth was finally won over to a support of the*bill, or whether he persisted in his doubt of the expediency of granting charters to any banking institutions in Macomb County.

The bill became a law August 24, 1835. By its provisions, Christian Clemens, John S. Axford, Neil Gray, Azariah Prentiss, James Brown, Rodney 0. Cooley and Lansing B. Mizner were appointed Commissioners to open books and receive subscriptions to the capital stock of the railroad company, which was to be $1,000,000, divided into shares of $50 each. When 1,000 shares were taken, the subscribers were to become a body corporate, by the name of the "Macomb & Saginaw Railroad Company." A single or double railroad, to be located by Israel Curtis, Jacob Tucker and Charles C. Hascall, was to be constructed from Mt. Clemens to Lapeer, and thence to the seat of justice of Saginaw County. Nine Directors were to be chosen annually, on the first Monday of October, and a President from among the Directors or stockholders.

Section 21 confers upon the stockholders of the railroad company the authority to establish a bank at Mt. Clemens, with a capital stock of $100,000. divided into shares of $50 each. The banking corporation was to be known as '' The President, Directors and Company of the Bank of Macomb County." and its affairs were to be managed by the President and Directors of the railroad company. Bills might be issued in denominations not less than $1, payable on demand at the company's banking house, within usual business hours, in the legal money of the United States. Upon failure so to redeem its bills, the corporation was liable to be dissolved, subject, however, to the provisions of the act relative to banks, approved April 23, 1833, which allowed a limit of sixty days, within which to make payment. Before bills were issued, the entire stock of the railroad company was to be conveyed to the bank as security for their redemption, and the Directors were to give collateral security to the Territory for such redemption until ten miles of railroad had been completed. Unless forfeited sooner, the charter was to remain in force forty years. Many other provisions, limitations and restrictions, which it is unnecessary to enumerate here, are incorporated in the charter.

The bank was not put into operation for more than a year after the charter was obtained. The majority of the stock appears to have been originally subscribed for by Gen. Stockton. Among the original subscribers appear also the names of Christian Clemens, Buel Ambrose, H. H. Farley & Co., James Brown, S. F. Atwood, Aaron Whitney, Jr., R. Steward, C. S. Mather, Rodney O. Cooley, De Garmo Jones, of Detroit, Enoch Jones, Edward Brooks, Ebenezer Hall, Isaac J. Grovier, A. B. Rawles, Jacob Beekman, E. G. Pratt, George Lee, Jr. William Cantield, Mrs. E. R. Hawkins, Miss Louisa Clemens (youngest daughter of Judge Clemens and afterward wife of Col. Henry D. Terry), Daniel Chandler, James Williams, William Roy, William Vandervoort, of Tonawanda, N. Y., James Brown and Israel F. Hatch and Lucius H Pratt, of Buffalo. N. Y. If there were other original subscribers, their names are lost, for the original subscription book disappeared very early in the history of the bank. It was destroyed for reasons best known to those who destroyed it. The following persons became stockholders at an early date by subsequent purchase: Aaron Weeks, James Sweeney, Cornelius O'Flynn, Charles A. Emerson, Dodge & Kibbee, Lewis Godard, George B. Martin, Richard Butler, R. Anderson, James C. Allen, Stephen White, of Boston, Daniel F. Webster, of Peru, Ill., Caroline Webster, Laura Weeks, Mary Stockton, John Norton, Jr., J. H. Lathrop and S. F. Pratt, of Buffalo.

In October, 1836, the following Board of Directors was chosen: Christian Clemens, Rodney 0. Cooley, William Canfield, C. S. Mather, Enoch Jones, Edward Brooks, Daniel F. Webster, Aaron Weeks and Isaac J. Grovier. John Stockton was elected President. By the 1st of February, two installments of stock, of 10 per cent each, had been paid in, and the bank was about to begin operations. Charles A. Emerson was then made Cashier, and bills were executed for the first time, bearing the signatures of John Stockton, President, and Charles A. Emerson. Cashier.

The first business transaction of the bank was of a decidedly peculiar nature. It dates by courtesy on Saturday, February 11, 1837, but was in reality executed on Sunday, the 12th. William Vandervoort and Lucius H. Pratt, who then owned a controlling interest in the stock, also stockholders, took each $10,000 of the newly signed bills, leaving notes of $10,000 each in place of them. They also took an additional $20,000, without leaving any evidence of indebtedness, to create a credit for the Macomb County Bank with the Commercial Bank of Buffalo, as they said. With this sum of $40,000, they left the country on the Sabbath, and a knowledge of the transaction was for a long time kept from a majority of the Directors. When it became known, it created much dissatisfaction, and from that date the hard feelings and mutual recriminations which characterize the history of the bank. date. Christian Clemens, Ebenezer Hall, Isaac J. Grovier and William Canfield speak of this transaction and others with much indignation.

Besides the regular issue of bills, another was contemplated somewhat later, but not effected. William Vandervoort caused to be engraved for the bank a plate of bills payable at Tonowanda, N. Y. Impressions were taken and a few brought to Mt. Clemens, but none were over signed.

We have now reached the period of "Wild-Cat Banks". A few of which made their appearance in this county. This term is applicable to those banks only which were organized under the general banking law of 1837. Hence, although closely allied thereto, the Macomb County Bank was not of that species. When the Legislature of 1837 convened, the whole State was wild on the subject of banking. Petitions for tho organization of banks came from nearly every hamlet and four- corner settlement of the State. Among them were two from citizens of Macomb County for a bank to be located at Romeo, presented in the house by Linus S. Gilbert. The Legislature finally passed a general law for the organization of banking associations, which was approved March 15. This act passed almost without opposition. Only four Representatives voted against it. one of whom was Isaac Monfort of Macomb County. Under this act were organized the famous " wild-cat" banks.

The Bank of Utica was the first one organized in this county under the general law. The petition to the Clerk and Treasurer of the county bears date at Shelby, May 13, 1837, and prays for the organization of a bank, with a capital of $50,000. It is signed by Jacob Summers, Payne K. Leech, Jr., Acquire W. Aldrich. Benjamin L. Watkins, L. T. Jenney, Samuel Ladd, A. G. Deshon, Gurdon C. Leech, Orson Sheldon, L. D. Owen, John James, James Covel, Jr., and Joseph Lester. On the 22d, notice was given by Rodney O. Cooley, Treasurer, and Amos Dalby, Clerk, that books would be opened at Utica. on Monday, June 20, and kept open for four days, for subscription to the capital stock. Copies of the notice were posted in twelve of the most public places in the county by Abraham Freeland, then Sheriff. On June 7. John James was appointed temporary Treasurer to receive the first installments on subscriptions, giving a bond to the Clerk and Treasurer, conditioned to pay over to the Cashier, when appointed, on the order of the Directors, when elected, the amount paid to him, or to return the same to tho subscribers, if the organization of the bank should not be completed. The sureties on this bond were Gurdon C. Leech, Lyman T. Jenney. Orson Sheldon and Payne K. Leech, Jr. On August 31, the newly elected Directors, Jacob Summers, Orson Sheldon, Gordon C. Leech, Payne K. Leech, Jr., Ephraim Calkins. Daniel W. Philips. William A. Davis. George Hanscom and John James, with A. Freeland and Joseph Lostor as sureties, in presence of Walter Porter and William Abernathy as witnesses, entered into bonds to the Auditor General, in the penal sum of $125,000. conditioned for the punctual payment of ail debts, notes, liabilities and obligations, as required by law. The next day a duplicate was riled with the County Clerk, and then a certificate, issued by the Clerk and treasurer. was filed in the office of the Secretary of State, showing the due organization of the Bank of Utica, with a capital stock of $50,000.

Jacob Summers was elected the first President, and John James appointed Cashier. At some subsequent election, Gurdon C. Leech seems to have been made President. Thus organized, the bank commenced business about September 9, and continued operations a little more than a year, when its legal tribulations began. In addition to tho Directors named above, the following persons appear as stockholders in the institution: A; G. Finden. E. Endres, J. S. Fletcher. Joseph Lester. Sheldon Owen. C. S. Madison. A. Keeney, S. Ladd. A. B. Adams. O. Stevens. L. D. Owen and A. Bond.

On March 22, the bank paid a semi-annual State tax of $37.50, and contributed to the " safety fund" in the State treasury, for the redemption of its quotes just $23.21. The holders of its $14.22" worth of bills must have fetched a long-drawn sigh of genuine relief when they read the State Treasurers report for 1838. At the close of the year, its affairs were in a sorry condition. Its liabilities were $33,753.04. while its only resources were $2,055.51, in real and personal property, and §31.114 of discounted paper, more than $22.(KM) of which was due from stockholders and Directors. The bank was utterly destitute of specie, or any other ready means for the redemption of its notes. The bank commissioners took immediate steps to wind up the concern. A bill was filed in the Court of Chancery by the Attorney General. Chancellor Elon Farnsworth allowed a writ of injunction January 5, 1839, and the days of usefulness of the Bank of Utica were ended. Its only reason for existence afterward was to play the part of shuttlecock to the legal battle door. As Chancellor Farnsworth had allowed a similar injunction against the Bank of Macomb County, just 34 days before, he must have indulged in a grim smile, as he thought of the inexpedience of granting charters to any banking institutions in Macomb County. Meanwhile, the bank's magnificent " safety fund " in the State Treasury had shrunk to $3.34. and what finally became of that is uncertain. Like all the rest of the bank's valuables, it probably kept on shrinking to infinity.

Peter S. Palmer, of Utica, was appointed Receiver February 4, 1840; his report, filed in April, shows $8,306.05 liabilities, of which $4, ?70 was for notes still unredeemed. The resources were only $7,835.50, of which but $0,775.32 were considered available. Notes and accounts against citizens of Utica were generally considered good, while notes of other "wild-cat banks " were accounted worthless.

The Legislature of 1842, passed an act to annul the corporate rights of certain banks, among which was the Bank of Utica. Under that act, the Receiver caused an appraisal of assets to be made, April 20, 1842, by James B. Carter, James Covel, Jr., and C. B. H. Fessenden. This appraisal was signed by P. S. Palmer, Receiver, by J. James and Payne K. Leech, Jr., his agents. The total valuation was $2,462.77. Individual notes were appraised at from par down to 50 per cent; Shelby & Detroit Railroad checks at par; the banking house and lot, which cost $2,015.98, at $800.39, or 40 per cent; bank furniture, from 75 to 34 per cent, a claim against the Detroit City Bank at 37J per cent. Then follows a batch of notes, "wild-cat" bills and claims, all thrown together without appraisement, too worthless to be considered! The shuttlecock had now been banged about by the battle door, until it was too dilapidated for further use, and the game stopped here.

THE FARMERS BANK OF ROMEO
was the next venture. On October 80, 1837, a petition was drawn up for the organization of a bank with a capital stock of $50*000, to be located at Romeo and known as the "Farmers Bank of Romeo." It was signed by Daniel Trombley, Jacob Coddington, George Finch, Martin F. Southwell, Asahel Bailey, Marvil Shaw, Isaac Brabb, James Thorington, Charles F. Snover, Benjamin Crissman, Abner Smith, Jr., Adam Armstrong, A. B. Cooley, James Harvey, David Phelps, John A. Shaffer, A. B. Ayres, Ebonezer Kitridge. A. Prentiss, Orratus Hulett, Rufus Carpenter, John S. Axforth and Ephraim Graves. The books were open for subscription on December 12, in the "'old red tavern." The capital stock was all subscribed, the requisite 10 per cent installment being paid on the spot in gold coin, a scarce commodity in those days. John James, of Utica, was appointed temporary Treasurer, and he gave tho usual bond, with G. C. Leech. O. Sheldon, A. B. Cooley, R. L. Clark, A. B. Rawls. G. Gates. A. B. Ayres, G. Rix and J. W. Dyar, as sureties, and H. A. Tutner and I. Cummings as witnesses. Directors and a Cashier were chosen, and John W. Dyar was elected President. An order for plates was made on a New York engraver, and in due time the bills were received. They were deposited for safekeeping in the Bank of Utica, but the great collapse came before any of them were signed by the officers of the bank, and all ideas of further business was indefinitely postponed. Yet some of the bills got out and went on their way rejoicing in forged signatures. Martin Buzzell, still living at Romeo, had a $2 bill of that bank presented to him in 1838, while doing business at Natchez, Miss. Not having much confidence in that kind of currency, he refused to take it.

Mr. John W. Dyar. still a resident of Romeo, informs me that the citizens of Romeo really wanted no bank at all; but a number of Pennsylvania "wild-cat" schemers had fixed upon that village as the scene of one of their nefarious swindles. In order to anticipate them the more substantial business men of the village organized a bank, and. with the friendly aid of Messrs. James, Leech and Clark, of Utica, subscribed for all the stock.

THE CLINTON RIVER BANK
came next, and was the second of that name. The first, it will be remembered, was to be organized by special charter and located at Shelby. The second was to be of the "wild-cat" species, and located at Mt. Clemens. Its capital stock was to be $50,000 and books were to be opened for subscriptions on January 9, 1838. The petition was dated and riled November 29, having been signed by C. S. Mather, Frederick Hatch, George Whitney, Porter Kibbee, G. C. Fletcher, E. L. Atkins, P. S. Fletcher, James B. Van Rensselaer, William Lewis, R. P. Eldredge, H. M. Dodge. James Williams, H. J. Higgins and R. F. Eastman. But the crash came like "An envious, sneaking frost. That bites the first-born infants of the spring" and the Clinton River Bank, No. 2, went to meet its illustrious namesake.

There was still another member of this "wild-cat" family, which, as Artemus Ward would say, was the most "amoosin' little cuss" of the whole litter. The general law having been changed somewhat, as to the mode of organization, a document was drawn up, on the 26th of March, 1838, and filed in the office of the Secretary of State four days later, certifying that a banking association had been formed with a capital stock of $50,(MM), to be located at the village of Belvidere—"or Belvidere City"—and to be known as

THE BANK OF LAKE ST. CLAIR.
James L. Conger was its President, A. C. Hatch, D. B. Conger, S. A. Hathaway, C. W. Hussey, S. G. Langdon were its Directors, and A. Wilcox, D. G. Gurnsey and Edward R. Blackwell were the other stockholders. Bills were elaborately engraved and printed in abundance, but before they were regularly issued the bank was swamped by hard times and the city by high water. The bills were extensively circulated by the boys of the adjacent country, and in some instances, no doubt, were passed as money upon the ignorant or unwary.

CONCLUSION

Judging the future of the county by^^e past, and that is the proper criterion to judge by, what can be the limits to the progress that will be made by the genius of the American people of Macomb in the next fifty years? We can only entertain a hope for the foreign element of the population—a hope that when the next history is proposed, the immigrants will have reached that state of intelligence which will enable them to conceive the utility of such a work, and incite them to support it, so that they may learn more, and become Americanized.

That portion of the population properly termed the American people of Macomb, seem to have made everything in which they engage so satisfactory in results, that the human mind pauses in the midst of its boundlessness, and almost seems to say—the whole work is accomplished, and there is nothing left for the inventive genius of the rising generation to do. But much as has been accomplished, the most scientific and constructive minds, those that have accomplished the grandest results in fields of mechanics and inventions, realize the fact that they have just made a beginning in the arts and sciences, and that a great undiscovered world lies beyond.

History of Macomb County, Michigan :
Leeson, M. A. (Michael A.) Chicago: Leeson, 1882.