CHAPTER XIV

The second day of January, 1913, was marked by the installation of Samuel Gunterson as underwriting head of the Guardian and by the announcement of a radical separation rule by the combined companies of the Eastern Conference. Each was likely to have a far-reaching effect.

Smith read the news with stolid eyes. He did not credit O'Connor with having had sufficient influence to carry the separation act through the Conference, but all that the astute President of the Salamander had hoped for, and in antic.i.p.ation of which had laid his plans, had come to pa.s.s--the Guardian was out of the Conference, the separation rule was to take effect almost immediately--and Gunterson was at the wheel.

Smith well knew what a leverage would be used against his company. He was still brooding over the fateful item when Mr. Wintermuth sent for him.

"Have you met your new chief yet?" asked the President, in a friendly manner.

"Yes," said the other, shortly. He held out the paper. "Have you seen this yet?" he inquired, in turn.

"_The Journal of Commerce_? No. Is there anything especial in it?"

For answer Smith laid the paper open on the desk, pointing silently to the item which meant so much to the Guardian--and to every company outside the Conference.

Mr. Wintermuth adjusted his gla.s.ses and read the article carefully.

"Well, well!" he said thoughtfully. "So they pa.s.sed it, after all! I never believed they would dare. It's a little too much like a boycott--it gives them too much the appearance of a combination in restraint of trade. Tariff and rate-making a.s.sociations are proper and necessary, but to attempt to dictate to agents what companies they shall not represent--or at any event penalize them for so doing--is going pretty far. No, I didn't think they'd dare."

"Three months ago perhaps they wouldn't have," Smith suggested. "It looks like a reprisal aimed at us, more than any one else. All the other outsiders are old hands and can take care of themselves, but we haven't gotten acclimated--we're liable to have a bad time. And I think I know who accelerated the whole movement, sir."

"Yes--I understand whom you mean," said the President, compressing his lips. "No doubt this was part of his plan. Well, you seem to have followed this thing pretty closely, Richard--what do you think we had better do?"

"Isn't that rather a matter for Mr. Gunterson to decide now, sir? I don't want him to start with the idea that I am trying to dictate the underwriting policy of the company. Of course, I have my own idea of what would best serve the interest of the company to do--although in some ways I'd hate to see us do it."

"And what may it be?"

"Go back into the Conference."

"What! Go limping back with our tail between our legs? Put O'Connor in a position where he could say that we were strong enough to go out and stand alone when he was with us, but after he left we were too weak to stick it out? Never! I won't go back into the Eastern Conference, if it costs the Guardian every agency in the field. . . . Boy, ask Mr.

Gunterson if he will be so good as to step here a moment."

In the brief interval before the new Vice-President put in his dignified appearance, neither of the occupants of the office spoke.

"Ah, Mr. Gunterson. Good morning once more. You know Mr. Smith, our General Agent, I believe?"

Mr. Gunterson bowed with urbanity. Courtesies exchanged--a matter of some little time--the President again spoke.

"Did you notice, in this morning's _Journal_, that the Eastern Conference has pa.s.sed a separation rule, Mr. Gunterson? I do not know whether you are aware that the Guardian is not a member of the Conference; shortly before the resignation of your predecessor we withdrew--largely upon his recommendations. There is no reasonable doubt that at the time Mr. O'Connor believed such a rule would go into effect, and very likely he was more or less instrumental in getting it adopted. At all events it is clear that he wanted us to get out, and here we are--out! And almost any time, now, we are likely to be put out of nearly every agency in the East where Conference companies predominate--which means ninety per cent of our agencies."

"I see," observed Mr. Gunterson, sagely. "I see."

"Now the question is: what are we going to do? Mr. Smith here advises that we confess our inability to operate in an open field without the invaluable a.s.sistance of our late Vice-president, and go back into the Conference. By merely sacrificing our self-respect we could save our Eastern agency plant. I have put you in charge of the underwriting of the Guardian, Mr. Gunterson, and I would like your advice on this."

The att.i.tude to be a.s.sumed by the Vice-president was too obvious to be creditable to his sense of perception.

"I would not give them the satisfaction of seeing us reverse our policy and confess ourselves defeated--surrender before a gun was fired. We can fight and win," said Mr. Gunterson, promptly.

It was rudimentary cleverness; a babe could have perceived what reply Mr. Wintermuth desired.

"Good!" said that gentleman, much encouraged. "I'm glad to hear you say so. That's exactly the way I feel about it, myself. I'll see O'Connor d.a.m.ned before I'll let him think he has forced our hand. I think your att.i.tude is quite correct, Mr. Gunterson--I like the way you begin."

"Thank you, sir," said the Vice-president, modestly; then, deprecatingly nodding toward Smith:--

"Probably from a strictly conservative viewpoint Mr. Smith's advice is good. And the Guardian is a conservative company. But a little properly placed radicalism is not a bad thing at times--is not that true, Mr. Wintermuth?"

To which Mr. Wintermuth a.s.sented with a smile.

"At all events the fight, if there is one, will be confined to the smaller places. They can't touch us in the big cities, can they?"

pursued Mr. Gunterson, following up his advantage.

"No," said Smith, shortly. "The rule won't affect us here in New York, nor in Boston, nor Philadelphia, nor Buffalo, nor Baltimore. At least those places, and some others, have always been excepted cities--making their own rules. Unless the local agents through the local boards vote for separation, we're safe there. I'd hate to see a fight started in those towns, though."

"You seem a little reluctant to get into any controversy, Richard,"

said Mr. Wintermuth, kindly. "To be sure, you haven't been through so many as we have. But sometimes it is necessary to fight--and fight hard, too."

"He has not weathered as many storms as you, sir," Gunterson interpolated with a smile. "Nor," he added, "as many as I myself, perhaps."

"Perhaps not," said Smith, dryly. "Is there anything else you want of me, sir?" he turned to the President. "If not, I guess I'll get back to my mail."

"Go ahead," returned his chief. "Mr. Gunterson and I will plan this thing out together."

And Smith left the office with as much numb despondency in his heart as he had ever felt in his thirty-odd years. He knew--what the others did not seem fully to appreciate--that there was an animus in this attack of O'Connor's which would stick at nothing. He saw, or he believed he saw, the excepted cities of Boston, Philadelphia, and the rest, under the polite coercion of the Eastern Conference, pa.s.sing similar separation rules of their own. He foresaw the Guardian forced out of Graham and Peck's agency in Philadelphia, out of the Silas Osgood office in Boston, and losing its long established connections in other cities where the Guardian's business was as well selected and profitable as that of any company of them all. He looked gloomily down a long vista of losses and disappointments, and it appeared to him there could naturally be but one end. However, it was no doing of his.

He was there to obey orders and to transact the company's business as the management desired it to be done, and in the press of other crowding matters he was glad to forget everything but the tasks before him.

The days succeeding the Conference announcement brought very little in the way of further developments. So still was the insurance stage, indeed, that Mr. Gunterson began to think that there would be no trouble, after all, and Smith to speculate on the ominous stillness and on what new moves would flash from behind this seeming curtain of inaction.

Almost at the very time of this speculation on his part, a train was carrying toward Boston no less a person than F. Mills O'Connor of the Salamander. Almost at the very hour of a Tuesday morning, when Mr.

Gunterson was gravely a.s.suring Mr. Wintermuth that he believed he would be able, in spite of the Eastern Conference, to preserve the company's agency force without the loss of a single important agent, Mr.

O'Connor, after more or less indirect preliminary conversation, was presenting his desires quite bluntly to Mr. Silas Osgood.

"To be perfectly frank, Mr. Osgood, the Salamander has never gotten the premium income it should get from Boston, and worse than that, it has always lost money. Now you've got a place for us in your office, and it's the Guardian's place. No--hold on a minute--let me finish. I know that Mr. Wintermuth is an old friend of yours, but Mr. Wintermuth is about finished with the fire insurance business. Now you know that your relations with Gunterson, who is a hopeless incompetent, will never be satisfactory, and you also know that Gunterson will probably put the company out of business within two years. You appreciate also that the Salamander is a bigger company than the Guardian--it has twice the Guardian's premium income--"

"And half the Guardian's surplus," interrupted Mr. Osgood, softly.

"No matter about the surplus. Edward E. Murch and his people are back of us, we've got the premium income, and we're in the game to stay, while you as a practical insurance man know, no matter how far your sympathies may go in the opposite direction, that the days of the Guardian are numbered. I'm offering you the chance to take on one of the livest companies in the field to-day in place of a concern that's headed for oblivion by the most direct route. It's a chance I would jump at if I were in your place, but I understand the sentimental consideration enters in,--it does credit to your heart, Mr. Osgood, and I respect you for it,--and in view of all that sort of thing I came here prepared to give you certain inducements to switch the Guardian's business to the Salamander."

"Inducements? Of what sort do you mean?" inquired Mr. Osgood, mildly, although his face was a little flushed.

"Well, increased lat.i.tude on lines and cla.s.ses--a larger authorization in the congested district--those are some things. Possibly also," he suggested delicately, "a little extra allowance--let us say an entertainment fund--to be used in cultivating brokers with an especially desirable business."

"But," said Mr. Osgood, "we are members of the Boston Board. We cannot offer any greater inducements to brokers than any of our fellow members offer."

O'Connor saw his suggestion had not been taken kindly.

"Of course not," he agreed. "Although I know one Boston agent who once a month plays cards with his best broker, and curiously enough he always loses exactly five per cent of that broker's account with him for the previous month. Such things are sickening--and they put at a disadvantage those of us who live up to our agreements. But I don't suppose any Board could make a rule preventing an agent from taking a good customer out to dinner and perhaps the theater once in a while--that was all I meant to suggest."

Mr. Osgood, who felt considerable doubt as to this innocent limitation, rose.