Mel & Esther

When Leonard Asbury Busby, Chicago tractionman, died in 1930, he left an estate of $1,598,000 and debts of nearly $1,000,000. Named as executor was the trust company affiliated with Chicago's big First National Bank, of which Mr. Busby's good friend Melvin Alvah Traylor was president. Last month, after the estate had shriveled to a mass of debts, Mrs. Esther Busby marched into the Probate Court and sued First National for the $500,000 equity which had been hers when her husband died and the bank took charge.

High point of the trial was Mrs. Busby's account of her dealings with President Traylor and the bank. Handsome, smartly dressed in black, sometimes smiling, sometimes weeping, she told how she called on Mr. Traylor in the autumn of 1930 and said, "Mel, I can't stand the suspense. I have to know about Leonard's affairs. The children are in expensive schools and I have other obligations to meet."

"Well," said Mr. Traylor. "it's this way, Esther. You have an enormous amount of securities and an enormous amount of debts."

"Mel, what do you think is going to happen?"

"One man's guess is as good as another. But I think things are going to be much worse before they are ever better." And he explained to her that the bank was arranging to take over the securities from a broker. "He said that the market could do awful things to the account."

The bank overruled her suggestion that any sales of securities in the estate be made through "our friend, Warner Orvis, on the floor of the New York Stock Exchange. Mr. Orvis was a frightfully smart man."

In the beginning the bank allowed Mrs. Busby $2,000 a month. When it was cut to $1,250, an officer "asked me not to ask questions." Finally while in Europe Mrs. Busby was notified that the estate was a total loss. Back she came to see Mr. Traylor. The best comfort that he could offer was: "Well, Esther, you'll have to take it on the chin like the rest of us."

But Mrs. Busby, who was used to an income of $50,000 a year, had no intention of taking it. She went to the vice president who handled the estate. Said he: "The question is, Mrs. Busby, what will you do to help the estate?" Mrs. Busby was willing to help to the extent of taking only $600 a month. But the more she thought about her plight the madder she got. As soon as she sued the bank cut off the $600 allowance.

When President Traylor took the stand for the defense, he readily admitted that if the securities had been sold Mrs. Busby would have been far better off. But, he argued: "My guess was wrong. If any one can answer the question of when to sell and when not to sell, all the hazard will be taken out of the banking and investment business. . . . We thought the market would show an upturn and I still think that, with the situation as it was at that time, we should have held the securities for future sale. . . . Among the securities . . . were 4,941 shares of Middle West Utilities. I advised her to sell some and she said she wanted to retain at least 2,000 shares because her husband knew Samuel Insull quite well and had great confidence in him and his stocks." Mrs. Busby, her good-looking young daughter beside her, made a noise in her throat and glared at Mr. Traylor. Mr. Traylor reddened.

First National's chief defense was Mr. Traylor's defense--that it had merely made a bad guess. Last week with the case completed Probate Judge O'Connell was pondering his decision--sure to be widely read by all good bankers who made bad guesses.

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