"He Was Supposed to be Wealthy"

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On Friday morning at the DC show, Joe Nemecek and I met with Ed Fingerman from Fountain Pen Hospital to look at a whole mess of Victorian pencils he was selling.  By the time we were finished, I bought 17 of them.  This was one:

It looks like a Hicks or maybe an Edward Todd, but what is imprinted near the nose was something I hadn’t seen before:

“John Mason.”  I suspected there might be a story behind that name, but I never suspected the story would be as compelling as it turned out to be.  Much of the following research regarding the meteoric rise and spectacular belly flop of John Mason turned up in a forum thread in one of the silver forums titled “John Mason - New York - A Shattered Dream.”  (See http://925-1000.com/forum/viewtopic.php?t=30017.)

John Mason was born April 6, 1868 in New York, the son of James Mason and Marie Louise Youngs.  John’s father must have died when he was a young man, since the 1886 New York directory lists Marie Louise Mason as a widow living at 218 East 11th Street, while the 1889 City Direcotry lists Louise M., widow of James with an address of 35 west 17th Street, where she lived with John, a jeweler whose business address was 15 Union Square.

Young John had taken a job working for Tiffany & Company in 1884, at the age of 16.  While there’s no indication that the Masons did not lead a comfortable life, young John’s fortunes were about to take a dramatic turn for the better.

John Q. Jones, the President of Chemical Bank, constructed an enormous mansion at 246 Fifth Avenue, New York in 1857, where he lived with brothers and sisters until his sudden death in 1878.  John Jones’ only heir to his vast fortune was his younger brother, Joshua Jones, a playboy who had moved out of 246 Fifth Avenue sometime around 1868 and into the New York Hotel, making a career of living comfortably as a gentleman. 

After Joshua inherited his brother’s estate, he removed everyone from 246 Fifth Avenue and refused to allow it to be occupied or rented.  When Joshua Jones died on March 23, 1888, his estate was worth seven million dollors – that’s seven million 1888 dollars.  His executors were ordered to liquidate the entire estate, including the house at 246 Fifth Avenue, which was sold to the next door neightbor at auction and was promptly demolished, replaced with the building that still stands on the site today, constructed in 1889:

One ninth of Joshua Jones’ estate was left to “the children of his cousin James Mason,” of which the 21-year-old John Mason was one:

John Mason had at least one sibling with whom he shared his slice of this enormous pie, a sister named Edith Mason Faxon.  While the amount he inherited would have supported him for the rest of his life, for John this was little more than an appetizer.  The pie Mason wanted was much, much bigger. 

After six years of working at Tiffany & Co., he hatched a plan to “out-Tiffany Tiffany,” in the words of one contemporaneous account.  He left his former employer and borrowed money from everyone who would lend to him on the strength of his new status as a wealthy, independent man.  In summer, 1890 he set up a jewelry factory with all the latest machinery at 330 Seventh Street, and he opened a brand new, elaborately decorated showroom: at 246 Fifth Avenue, New York - the very address previously occupied by Joshua Jones:

Whatever valuable experience John Mason acquired during his apprenticeship at Tiffany & Co., he left it at the door: the 22-year-old now saw himself as the prosperous owner rather than a startup enterpreneur working to carve out a niche in a highly competitive market.  In an article I recently published here about the Mauser Manufacturing Company (http://leadheadpencils.blogspot.com/2017/07/the-mauser-manufacturing-company.html), I included discussion of how difficult the early 1890s were in the silver market, with the “free silver” movement pushing prices down and driving many established firms to ruin.  The impetuous Mason, however, either had no idea or had no concern for how difficult his position was.  Even though the great panic of 1893 had yet to come, cracks in John Mason’s facade quickly became apparent.

The first sign of trouble came in early 1892.  Mason sued a supplier who had sold him $10,000.00 worth of watches on credit; after Mason had repaid $8,300.00 of the purchase price, he sued the supplier, claiming that the watches weren’t as good as those offered by Tiffany & Co.

Mason lost.  He also took another action which suggests that his situation was more dire than he let on: he abandoned the showroom at 246 Fifth Avenue, the address he had worked so hard to reclaim, moving up the street a bit to number 262:

By the summer of 1892, with other lawsuits mounting against him, John Mason had nowhere left to run.  On June 21, 1892 he made a general assignment of all his assets to his lawyer, John Oscar Ball, for the benefit of his creditors:

“He was supposed to be wealthy,” the article in The Sun read on June 22, 1892, reflecting the general disbelief the public had that someone who had inherited so much could have exhausted all of his resources in so little time.  However, as the creditors met to devise a plan for liquidating what few assets remained, it became clear that while John Mason had inherited $100,000, he had borrowed $144,000 from relatives to set up the enterprise – and then borrowed from many, many others.   His books revealed that he had 115 creditors, including minor claims from Edward Todd and W.S. Hicks (the pencil pictured at the beginning of this article appears to have been made by Edward Todd).

So strong was peoples’ faith in John Mason that many were financially ruined by Mason’s failure.  Charles Magnus, a diamond dealer who had a claim for more than $13,000, had a breakdown over the stress of Mason’s failure, leading his brother to announce publicly that while his brother was deeply concerned by these events, he was not in fact insane:

On July 29, 1892, the Jewelers’ Circular ran a story regarding Mason’s “peculiar jugglery of his inheritance” –

The British press picked up the story in the Watchmaker, Jeweler and Silversmith on August 1, 1892. 

At the meetings of creditors, Mason’s lawyer, John Oscar Ball, attempted to build a consensus among Mason’s many creditors.  It was decided to seek a buyer for the entire operation, and Ball placed an advertisement in The Jewelers’ Circular seeking interested parties:

The Gorham Manufacturing Company, which had a claim against Mason for some $7,000.00,  submitted a proposal to purchase John Mason’s enterprise, and at a meeting of Mason’s creditors on August 4, 1892, the purchase was unanimously approved.  Mason’s firm was appraised and John Oscar Ball conveyed all of the stock in John Mason’s failed enterprise to Gorham for $45,000.00, out of which Gorham deducted the $7,000.00 it was owed.

But the story didn’t end there.  One of those 115 creditors was just waiting for the ink to dry on the agreement before springing her trap. 

On August 10, 1892, John Mason’s sister, Edith Mason Faxon, obtained judgment against her brother in the amount of $80,576.60, representing the unpaid balance of money she had loaned to Mason, and on August 23, she filed suit claiming that Mason’s assignment to his lawyer, and other transfers to his wife, were made in order to evade and defraud Mason’s creditors.  The entire transcript of Faxon v. Mason is preserved from the appeal taken in that case (see https://books.google.com/books?id=OA3k7iizOp8C&pg=RA30-PA24&lpg=RA30-PA24&dq=gorham+%22John+mason%22&source=bl&ots=dyN4e9tVo1&sig=Hz17vy4Mu7Cmoi2UQYQbAPg4ckg&hl=en&sa=X&ved=0ahUKEwjUo7e3t6TWAhWF7SYKHaNYAQ8Q6AEIMTAC#v=onepage&q=faxon&f=false):

Edith was the largest creditor of Mason’s, with a claim that was nearly half the entire amount by which he was indebted.  In the end, she won her case – the judge at one point wryly noted that while Mason had assigned his cufflinks to his wife, he did not assign the shirt to which they were attached. 

From what I can tell, the sale to Gorham was never disturbed; Edith was probably just wating for the business to be liquidated so that she could pursue a pot of money rather than the assets of a failing business.  Nor does it appear to have been an inside job, by which she recovered money from her brother only to give it back to him, given the aggressive litigation between the siblings.

John Mason would never recover.  On October 20, 1899, he filed a petition in bankruptcy:

By 1900, his wife had left him and was living in Winchester, Massachusetts, while John Mason remained in New York City with his stated occupation being that of an artist, according to the census that year.  John remarried, to Effie Afton Clark, daughter of George K. Clark and Isabel Lathrop, on May 2, 1906. According to census data research posted at 925-1000.com, the 1910 census found the couple in Old Saybrook, Connecticut; in 1920, they turn up in Philadelphia.  The 1930 census shows that John’s wife is married, but John is no longer in the household, and the 1940 census indicates that Effie is widowed.