Mr. Wintermuth had, in the mist of years past, discovered on one of his trips abroad a reinsurance company rejoicing in the name of the Karlsruhe Feuer Rückversicherungs Gesellschaft, or more briefly, the Karlsruhe Reinsurance Company. With the managing director of this worthy institution he had taken the unspeakable waters at an almost obsolete German spa, and although the waters did him no good, the reinsurance treaty that he incidentally arranged with Mr. August Schroeder made a very satisfactory termination of the treatment. It was a masterly contract—for Mr. Wintermuth—and its acceptance by Mr. Schroeder only showed that his experience with American business was very limited or that the waters had sapped his vitality to a degree more than was perceptible. It allowed the Guardian to do almost everything it pleased, restricted it not at all, never protested any action however unexpected, waived every possible right and privilege, paid a liberal commission and a share of the profits besides—in short, it was an ideal treaty and one which was the admiration of those few privileged characters who knew its merits. Nevertheless it had also proved to be a good contract for the Karlsruhe, for such business as the Guardian ceded had paid a modest but unfailing return to its Teutonic connection year after peaceful year.
One can therefore only faintly conjecture Mr. Wintermuth's surprise and genuine anguish upon receiving, one bright April morning, a communication in German, which, being translated by Mr. Otto Bartels with something more than his customary stolidity, proved to read, stripped of all superfluous verbiage, substantially as follows:
"The managing director of the Karlsruhe, in accordance with the conditions of the contract, hereby gives six months' notice of the termination of the reinsurance arrangements now existing between the Karlsruhe and the Guardian."
When, the following day, Smith returned, Mr. Wintermuth's first greeting was silently to hand him this letter. The younger man, with a little assistance from the President's recollection of Bartels's translation, managed to decipher the tangled German, and sat for a long minute without speaking.
"Why do you suppose they're canceling? And why didn't we get this through their London managers, I wonder?—they're the people we've done business with for the last ten years," he said at length.
"What difference does it make?"
"None, perhaps. Still, it strikes me as rather odd. Almost as though some one had planned that this should look as though it emanated from a point less in touch with William Street than London is."
"Then you think—?"
"Who else could it be but O'Connor? And these German underwriters are perfect babes in the wood—they're just idiotic enough to cancel a profitable contract merely to take on an experimental one with a bigger premium income in its place. Now, nobody outside the office knew the conditions of our contract with the Karlsruhe—except O'Connor. No, there's no question about it. He probably offered them a little better commission arrangement and a bigger business—and they fell for it."
"Very likely that is so," agreed Mr. Wintermuth.