by Paul R. Spitzzeri
As a number of posts in the “Reading Between the Lines” series on this blog have amply demonstrated, James Perry Worden (1866-1945), who was hired by Walter P. Temple in the early 1920s to write a history of the Workman and Temple families begun by attorney Johnstone Jones (who bowed out because of ill health), was quite a character in his correspondence with Temple and his eldest child, Thomas W. II.
These missives are filled with underlining, capitalization, extra spacing and other techniques to convey urgency, but were so overused it proves challenging to know if there was anything in Worden’s correspondence that wasn’t of the utmost importance in his mind. The historian, who earned a rare PhD in the subject back in the 1890s, was best known for his fastidious editing and additions to the memoir of Los Angeles merchant Harris Newmark, Sixty Years in Southern California, published in 1916 with a second edition issued a decade later.
Newmark, who came to the Angel City in 1853 was among the vanguard of Jewish merchants who found success here and his book, with Worden’s substantial contributions, has long been a valued resource of regional history. Aside from Horace Bell, whose 1881 tome Reminiscences of a Ranger and the lesser-known posthumous On the Old West Coast, published in 1930, are entertaining but filled with fictional flights of fancy intermingled with actual events, another chronicler of note was Jackson A. Graves, an attorney and banker, whose My Seventy Years in California, appeared at the end of November 1927.
Graves came to Los Angeles in June 1875 following lawyer John G. Eastman, for whom Graves worked in San Francisco and who opened a practice with Anson Brunson. At the time, the region had been in an extended boom for several years, but that would soon change dramatically with the collapse of a silver mine speculation bubble centered on activity in Virginia City, Nevada but with San Francisco capitalists and banks deeply invested. The failure of the Bank of California in late August sent shockwaves throughout the state, including by telegraph as the news reached Los Angeles and panicked depositors headed to the two commercial banks in town: Farmers’ and Merchants’ and Temple and Workman.
The former was formally presided over by ex-governor John G. Downey, but its managing cashier, the brilliant Isaias W. Hellman, another of the prominent Jewish merchants in the Angel City, was the guiding force and its excellent management and ample cash reserves proved equal to the emergency. Initially, however, as Hellman took a well-deserved vacation for a return visit to his native Prussia, Downey agreed to close the institution for all of September at the behest of F.P.F. Temple, the president of the other bank, Temple and Workman. Furious at Downey’s decision, Hellman, apprised of affairs by telegraph, rushed home, stopping in New York to borrow money to further restore confidence at his bank.
When Hellman reached Los Angeles, he placed the loaned funds on the counter of Farmers’ and Merchants’ as a visual symbol of stability and then quickly engineered Downey’s removal as president, though he remained a director. As for Temple and Workman, former partners with Hellman in Hellman, Temple and Company from 1868 to 1871, they were in dire need of money and Temple and his managing cashier Henry S. Ledyard spent nearly three months in search of loans, but came away empty-handed until a deal was struck with Elias J. “Lucky” Baldwin, whose nickname came from his fantastic stroke of good fortune as the stock bubble referred to above was ready to burst.
Specifically, Baldwin left San Francisco for a trip and instructed an agent to sell his stock in a Virginia City silver mine when it reached a certain price. Yet, the story goes, Baldwin took the key to his safe containing the certificates and so they could not be sold at the defined amount—but, when he returned, the price actually rose much higher and when he disposed of the stock he came away with about a couple million dollars. One of his purchases with his marvelous new gain was the Rancho Santa Anita, which he acquired from Newmark (who raised his price when Baldwin demurred on an initial offer) and which became his local headquarters.
Baldwin saw that Temple and Workman were among the wealthiest, if not the richest, persons in Los Angeles County with tens of thousands of acres of choice land from the eastern San Gabriel Valley out to the coast west of the Angel City, but he also quickly perceived they were in a terrible jam. First, in October he acquired the western two-thirds of Rancho San Francisquito, adjacent to Santa Anita, from the two men and Lewis Wolfskill (son-in-law of Henry Dalton, long-time owner of San Francisquito). Then, the following month he arranged a $210,000 loan to Temple and Workman, but, as the former wrote to the latter on 20 November, “on rather hard terms” with respect to interest, payment dates and penalties, and the like.
When the Temple and Workman bank opened on 6 December, it was heralded as a turning point in the economic difficulties plaguing Los Angeles. That evening, a banquet was held at the Pico House hotel, owned by ex-governor and compadre of the bank’s owners, Don Pío Pico, with Baldwin appearing with Temple to receive acclaim for his “help” to the institution. The Los Angeles Star called the dinner “a grand chapter in the history of Los Angeles,” with its rivals, the Express and the Herald were also complimentary of Baldwin and Temple for their working together to avert more financial distress. Among those in attendance was Graves’ boss Eastman.
Yet, while the Star reported $70,000 more deposited that first day than was withdrawn, the tide quickly turned and the borrowed money was taken out by depositors in increasing numbers, leading Baldwin to advance another $130,000 before declining to provide any further funds to the bank. It then closed on 13 January 1876, becoming the first major business failure in the Angel City and leading to the ruin of William Workman, who committed suicide four months later, and F.P.F. Temple, who still was permitted to take office as county treasurer even as he soon filed for bankruptcy, though a series of strokes led to his death in April 1880.
It turned out that Graves, who became a full partner of Eastman and Brunson, worked extensively on behalf of the original assignees of the failed bank, Edward F. Spence and Daniel Freeman (the latter being a partner of Temple in the development of the Centinela subdivision and townsite, which failed and in the Boom of the 1880s became part of the successful Inglewood project.) As he explained in his book, “I handled the details of the legal work performed by that firm for the assignees.”
As Graves was working on his autobiography, however, something was brought to his attention that he considered so important that it warranted its own chapter, but, first, let’s look at Worden’s letter to Thomas, in which he began “only a line, but important, in part, at least.” To the historian, a line meant a full page, but, characteristically, he followed with the query, “Can you keep my confidence?” and then writing, “if so, I can serve you; but if you are forgetful, and communicate what others would best not know, it will ‘ball things up,” and do no good.”
Worden then observed that Graves’ book came out about a week-and-a-half earlier, adding that the author was president of Farmers’ and Merchants’ and “for years the representative of I.W. Hellman, (who may be said to have made him, financially,” though if Temple had let Hellman run their bank, he would certainly have been “made” and much more! In any case, Worden allowed that My Seventy Years in California possessed “much good matter,” but a subpar index and a lack of photos, so that, “it cannot hold a candle to the Newmark’s, ‘Sixty Years,” thanks, of course, to Worden’s efforts.
After adding, naturally, that the second edition of the Newmark memoir rose in value some three times since it was published in September 1926, the correspondent then informed Thomas, who was studying law at Harvard University outside of Boston, that “in this book, Mr. Graves, as one who was living at the time of the Temple & Workman failure, and who did some of the legal business in winding up the affairs, under the Receiver, etc., has written a w h o l e c h a p t e r on that Bank failure, (!) in which he scores pretty heavily your Grandfather, F.P.F. Temple.”
Worden continued that “immediately that I discovered this, I motored out [to the Homestead, where Walter Temple had recently completed La Casa Nueva after five years of construction] to see your Father, and to lay the matter before him; and I very strongly advised him to get a copy at once” because he and all the Temples should have copies and to do so before it went out of print and the cost to purchase rose. Yet, the scholar was shocked that his patron did not want to buy Graves’ book but purportedly said to Worden that “my copy, bought at my own expense, would do for him!” Beyond this, “he wished me to ‘keep the matter under my hat,’ and say nothing to you about it!”
Obviously, this was not honored as Worden added,
This is the last thing I think ought to be done, as y o u M U S T get a copy for yourself and the future. Therefor, without ever letting your Father know hat I have so written you, – – in fact, without mentioning the book to him at all,– let me advise you to write C H A R L E S Y A LE, Esq., Dawson’s Book Shop, 627 South Grand Avenue, Los A., enclosing to him the card I now enclose to you, for introduction, and with in F i v e
D o l l a r s, and order him to send a copy to you at your Cambrideg [sic] address. You won’t regret it in the future !!!!!
Worden ended by informing Thomas that he sent him and his brothers, Walter, Jr. and Edgar books for Christmas and would forward an article from the Express about Jonathan Temple and his wife Rafaela Cota concerning “the great change in Los A. since their days.” He concluded, “you may show this with p r i d e to any one in the East.”
The author then dashed off a handwritten postscript of sorts, saying “I forgot to say that this attack of Graves of Farmers & Merchants (IW Hellman) Bank, on your grandfather FPFT, & the T & W Bank, re failure and re charge that your grandfather used Bank’s money to help get himself elected [county treasurer,” was a “very urgent reason for us all sticking together & NOT failing to publish the T book & effectively answering Graves.” The note reminded Thomas to “keep my confidence as to this!”
As to Graves, his chapter was titled “Letter to Mr. M.H. Newmark,” and he began by saying that Marco H. Newmark, one of the children of Harris and co-editor with his brother Maurice of their father’s memoir, contacted him on 25 May 1927 “saying that it was said by people that the Jews caused the failure of the Temple & Workman Bank [the word “Bank” was not actually in the institution’s name], in 1875, and wanted to know what I knew about it.” Graves added that he reviewed some of his material at his house and the following day penned a letter in reply.
Graves told Newmark,
There never was a more villainous slander of the Jews circulated at any time or place since the world began. I denounce such an assertion as false and malicious. No other man alive today is in as good a position to know its falsity as I am.
He went on to note that he worked on legal matters involving the failed institution and then added that he once asked Hellman why he ended his partnership with Temple in 1871. The answer was “Mr. Temple’s only qualification in a borrower was that he must be poor. I saw that doing a banking business on that basis would soon leave me poor also, and I dissolved the partnership.” As to the reason why Temple and Workman collapsed, Graves simply stated, “neither of them were bankers, not did they have an employee who was a capable and competent banker.”
Moreover, the letter continued, “the bank was headquarters for the speculators who built up a little real estate boom, which collapsed with the failure of the bank.” Graves recorded that Temple and Workman had very little business from merchants, “nearly all of which was in the hands of Jewish firms,” who almost all did their banking at Farmers’ and Merchants'” The exceptions included Newmark and Company “who were customers of Temple & Workman, but they did not owe the bank anything when it failed.” Moreover, in a sale under a decree of foreclosure, “Mr. Harris Newmark and Mr. Kaspare Cohn bid in the Temple Block and paid their good money for it.”
Respecting Jews who owed the bank, Graves recalled that “the principal one was Simon Levi, commission merchant who could no get credit at the Farmers & Merchants.” He also noted that “H.S. Ledgyard [sic], an Englishman [actually a Canadian of British parentage], was an employee of the Temple & Workman Bank” He went on to observe that “there was located here quite a colony of Englishmen known as ‘remittance men,’ all without asserts, and every one of whom owned the Temple & Workman Bank, and none of whom paid a cent of the indebtedness.” Without directly saying so, he insinuated Ledyard was associated, but how, of course, is not noted, with these “remittance men.”
Graves told Newmark he didn’t see the bank books (Horace Bell claimed he was given them and offered the books to Hubert Howe Bancroft, but didn’t know what happened to these valuable records—are they still out there somewhere?) but was told by assignee Spence that “the books showed expenditures to the extent of $50,000 by the bank under various fictitious accounts, which was spent in the election of Mr. Temple as Treasurer of Los Angeles County.” Details of the inventory conducted by Freeman and Spence and released on 3 February 1876 showed that Temple had personal liabilities of over $184,000, but no specifics were provided.
After staring that “the bank never had an adequate cash reverse, but led a hand-to-mouth existence,” Graves wrote that Eastman and Brunson prosecuted a great many cases for the assignees and listed a few dozen, all of which were either settled out of court with offsets based on deposits with the bank or a judgment rendered in favor of the assignees. The lawyer continued that, regarding judgments, “I think very little money was ever collected.” Moreover, only two Jews were on the list, these being Matthew Kremer and Samuel Hellman, “both of them responsible, and each of their cases were settled by allowing them a credit for their deposit and they paid the balance.”
A baker’s dozen of cases against the bank and assignees were listed, with a half-doze settled with respect to items left for safekeeping with the bank and the assignees hesitated to return without court approval, another of that number won by the plaintiffs and only one won by the bank—that being a criminal case brought by the district attorney. Making a modern analogy, Graves stated,
Among the people sued by the assignees of Temple & Workman were adventurers of every kind, people exploiting mines on the same principle as the Julian Petroleum has been run . . . There were hundreds of notes in the Temple & Workman Bank so utterly worthless that no action was ever brought on them, as moneys expended for costs would simply have been thrown away.
He concluded by assuring Newmark that “the bank lost nothing to amount to anything through their Jewish clients” adding that most of the lawsuits were filed against Americans, Basques, French natives and Italians, “many of them being sheepmen.”
Worden’s letter and Graves’ chapter are notable for their reflections on events of a half-century prior and it is striking that the lawyer thought the bank’s failure was on par with the Julian Petroleum scandal, which was still very much in play in late 1927. There are plenty more of Worden’s correspondence to the Temples to share, so look for those in further editions of the “Reading Between the Lines” series.