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THE CHICAGO BANKER
July J, /pOO]
In handling the accounts of banks and bankers, this institution extends every facility which in any way can make its relations with correspondents pleasant and profitable. Moreover, we otter bonds through our Bond Department to financial institutions for the investment ol their tunds.
OFFICERS
WILLIAM M. RICHARDS, Aset. Cashier LEVERETT THOMPSON, Secretary
JOHN A. McCORMICK, Vice-President HOUSTON JONES, Cashier
LUCIUS TETER, President EDWARD P. BAILEY, Vice-Pres.
ESO URCES OVER FIVE RT Г Г- Г- Г О Гчг PO
principle with reference to the duty of an executor to faithfully defend a will in case of contest, and to impartially execute the will, including all trusts created thereunder when the will, has been probated or established. In the matter of defending and establishing a will is involved not only the question of the duty of the trust company, but also the question of business policy. The trust company is often selected as executor by the testator because he believes it will honestly, impartially and faithfully defend his will, and not compromise on every or any pretended contest. It is a valuable asset for a trust company to have a reputation for firmness in its insistence that the testator’s will become effective in its legal proof, and that the distribution of the property be made according to its terms. It is a trust company’s legal and moral duty to do this and it is good business.
The other matter suggested is that of the faithful execution of trusts under wills when established, or under trust agreements when created during the lifetime of the settlor. Many nice and interesting questions arise here in the matter of legal construction and of practical administration. Where there is reasonable doubt as to the proper legal construction it becomes the duty of the trustee to have the will or trust agreement construed by the proper court; but when there is no doubt or when the legal status has once been determined the trust company is morally bound to carry out the testator’s or settlor’s wish, even though all of the beneficiaries agree to the con-trary. There should be here no trades or
This is fundamental and vital, The trustee must always maintain a position of independence and self-disinterestedness as against the financial condition and ability of his ward or beneficiary. There should rarely be established the relationship of debtor and creditor between them, except as the same grows out of the trust transactions. These transactions should always be open, confidential, and helpful. Any money advantage given or taken outside of legitimate fees for services rendered should be.religiously avoided. While they may seem innocent and harmless and even helpful to the beneficiary, yet in time conditions change, and what was intended and accepted as an act of kindness may in the end be construed into an intentional design to secure an advantage over the beneficiary and thus place him under greater obligation and dependence than the trust relationship contemplated or justified. Examples would be the loaning of money by the trustee personally to the beneficiary; or, the acceptance by either from the other of money or any other substantial favor which would place the one receiving the benefit or accepting the favor under personal obligation. In other words, the trustee must do nothing which will prevent or make it difficult for him to faithfully and impartially execute the trust. It is important that this principle be strictly observed by trust companies; and especially in the management of large estates or trusts under wills and trust agreements. Your experience will enable you to make the application.
The subject of wills suggests an important
actions are no doubt legitimate and proper. There may be no valid legal reason why the trustee who certifies the bonds should not alone, or in co-operation with others, buy and sell them; but it is a question of trust company ethics to what extent and in what particular instances this should be done. Some even go so far as to question whether it should be done at all. I do not propose to discuss this question at length. I raise it because I believe that trust company officers should give it more thoughtful consideration. Its extensive practice is liable to result in embarrassment for some sooner or later. I am convinced that greater conservatism is desirable in this matter. You have here the temptation of large profits and substantial fees. There is in much of it also, an element of speculation and consequent uncertainty which is not consistent with the principles of sound and conservative banking, or consonant with the established high standard of trust company ethics. If any general rule were to be suggested as to underwriting it would probably have to be on the general principle or basis that the security back of the bonds should be sufficient to make them safe for permanent investment. _ The danger, however, is not in the rule, but in its application.
There is another principle which should be constantly borne in mind and persistently adhered to,’ viz.: that a trust company should never allow itself to be placed in a position where its own interests conflict with those of the beneficiary, and thus interfere with the impartial and faithful execution of the trust.
$316,000.00 Refunding Water Bonds
of the City of Trinidad, State of Colorado
The City of Trinidad, Colorado, offers for sale, $316,000.00 twenty year 4%% refunding Water Bonds, payment of these bonds optional ten years after their date in numerical order, amounts of $25,000 per year.
SEALED PROPOSALS will be received, accompanied by a certified check of 2%, up to but no later than July 26th, 1909.
All proposals must be addressed to the City Clerk. The City Council reserves the right to reject any and all bids.
Abstract of proceedings leading up to the issue of these bonds, will be furnished by the City upon request.
Signed, D. L. TAYLOR, Mayor Attest, I. S. MILLIREN, City Clerk

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Farwell Trust
HAS FOR SALE, AT ALL TIMES, MUNICIPAL, RAILROAD, PUBLIC UTILITY, AND IRRIGATION BONDS SUITABLE FOR CONSERVATIVE INVESTORS, YIELDING 3.80% TO 6%.
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