Articles

How J. K. L. Ross Spent Sixteen Millions

JAMES BANNERMAN April 2 1955
Articles

How J. K. L. Ross Spent Sixteen Millions

JAMES BANNERMAN April 2 1955

How J. K. L. Ross Spent Sixteen Millions

With seven yachts, seven limousines, two racing stables, thirty servants and some unfortunate oil stock, James Ross’ boy managed to go through quite a bundle. When he had spent it all he was “poor” on a measly $50,000 a year

JAMES BANNERMAN

A MACLEAN’S FLASHBACK

IN THE SUMMER of 1918, just before the end of the First World War, a Chicago sporting newspaper named the Eye told in front-page headlines about a naval engagement that had nothing to do with the waning war at sea. Even without the sound and flash of dreadnoughts’ guns however it was arresting enough: NAVY OFFI-

CER IN GIGANTIC COUP WINS FORTUNE AT SPA.

The Spa referred to was Saratoga Springs, a racetrack and resort town in upstate New York, where the navy officer was “credited with engineering the most stupendous coup of the present racing year, making the previous splurges of other high flyers look like the veriest piking efforts.”

The officer wore the uniform of the Canadian Navy, the paper said, without identifying him further. It reported however that he had wagered $25,000 at the racetrack on a horse named Canso, and another $25,000 at booking establishments all over the continent. And Canso won the race. But that wasn’t all: Canso was only part of a parlay

on which the navy officer cleaned up a million dollars. The New York Jockey Club had felt obliged to tell the plunger to ease up because he

was spoiling the sport for more moderate bettors.

Some of these flamboyant details were probably idle racetrack rumors, but even rumor sometimes failed to do justice to Commander J. K. L. Ross, a multi-millionaire playboy, Canadian Navy officer and a racetrack plunger whose betting not only startled Saratoga on that summer afternoon but became a legend for a decade.

Ross, the son of a self-made businessman, was a handsome six-footer with an air of blue-blooded assurance and privilege and the money to match his manner. Two years before he brought off his big coup at Saratoga he inherited sixteen million dollars from his father. With it he led the kind of life most men live only in their dreams.

He had a forty-room house in Montreal’s Peel Street, high above the city on the slopes of Mount Royal, with thirty servants. At one time or another he owned seven yachts, not counting two he bought simply to give away. He kept two racing stables, each with its string of thoroughbreds, and his black-and-orange colors were famous and familiar at every big track from Montreal to Mexico. He once admitted betting fifty thousand dollars on a single race.

The money he gave to hospitals and schools and for charity ran into millions. In 1928, twelve years after he got his inheritance, he was declared a bankrupt, but he even went broke in the grand manner. He still had an income of at least fifty thousand a year his creditors couldn’t touch, and until he died in 1951 it supported him in sunny elegance on an estate in Jamaica, in a house that was one of the show places of the island.

In Ross’ heyday, from the end of the First World War to the beginning of the boom that burst when the stock market crashed in 1929, he stood out as Canada’s supreme example of the millionaire sportsman—our solitary counterpart to the Whitneys and Vanderbilts and Goulds of the United States. Other wealthy Canadians of that golden age, like Sir John Eaton, the Toronto departmentstore owner, and financier Sir James Dunn, had both princely tastes and the means to gratify them. But none had quite the glamour and gusto of Ross, and none had quite his magnificent way with money.

When he invited a party of friends to the races, he took them there from Windsor Station in downtown Montreal in a private railway car he

had specially built for him. It was longer and heavier than a standard Pullman, and, in addit ion to half a dozen staterooms with proper beds instead of mere berths, it had a dining room, a living room, and a bathroom with a huge tub and gold-plated taps. And on the way to the track, as the veteran Montreal sports columnist Elmer Ferguson once wrote, Ross provided his guests with “a chef, a wonderful meal, and champagne flowing like oil in Texas.”

Ferguson also wrote of a day at the Blue Bonnets racetrack when he parked his modest automobile alongside one of Ross’ six or seven Rolls-Royces —a sleek red roadster that couldn’t have cost less than twelve thousand. While he was admiring it Ross came up, and asked him if he liked it. When Ferguson assured him he did, Ross said, “Then take it, with my compliments. It’s a nice little car, and I’d like it to be owned by someone who appreciates it.” Ferguson didn’t feel he could accept, but the offer didn’t surprise him. As he said, “He was that kind of a guy.”

Once, after Ross had a slight argument with his wife, he decided fo give her a necklace. He told David Hogg, his

Continued on page 55

How Ross Spent Sixteen Millions

CONTINUED FROM PAGE 29

confidential business agent, to go to New York and buy one. When Hogg asked how much he wanted to spend, Ross said he didn’t think anything very grand was indicated, and that $125,000 would be about right. When Hogg got back to Montreal and showed his employer the glittering treasure he’d

bought, Ross barely glanced at it, and dropped it into his pocket as casually as if it had been a penny matchbox.

His lavishness wasn’t merely a matter of prodigious spending. There was an exuberance about him that made whatever he did seem a little larger than life-sized, and gave it the bright implausible color of a travel poster. He went in for yacht racing with a flourish that has seldom been equalled. His seventy-five-foot Gloria was in the same exalted class as George V’s famous Britannia, and he raced her as a fellow member of the King’s own

club—the super-exclusive Royal Yacht Squadron at Cowes.

When he took to tuna fishing for sport, off the Nova Scotia coast in the summer of 1908, he made his arrangements on the scale of a maharajah setting out on a tiger hunt. Although he fished from a small rowboat he kept a motor cruiser standing by, and a launch shuttled between boat and cruiser to bring him refreshments. For the first three seasons his bad luck was characteristically spectacular. All the fifty-odd tuna he hooktxl got away, after fights that lasted up to nineteen

hours. When the run of bad lí. toward the close of his fourth the change was even more spectL The tuna he finally landed we%& six hundred and eighty pounds-—* biggest caught until then with hoo. and line.

Ross, good-natured and unaffected with everybody from princes to taxi drivers, was the son of a man of monumental shrewdness. James Ross, a Scottish-born civil engineer, came to Canada in the 1870s by way of the U. S., where he had been in charge of construction and maintenance on a couple of old Commodore Vanderbilt’s early railways. When his son was born, at Lindsay, Ont., in 1876, James was manager and chief engineer of a small local road; but in 1883 he got the contract to build the whole of the Canadian Pacific’s main line from Winnipeg west over the Rockies. Soon after that he gave up engineering and concentrated on making money, with such relentless determination and in such enormous amounts that by the first years of this century a newspaper felt free to describe him as a flinthearted financier.

James Ross gave his son three name's —James Kenneth Levenson. When J. K. L. was ten he was sent to Bishop’s College School at iÆnnoxville, Que., an English-type private school for the wellto-do. 'Though his career at Bishop’s was undistinguished, both in the classroom and on the playing field, he blossomed out when he entered McGill University in 1893. There he stood near the top of his classes and shone as a star lineman on McGill’s 1896 champion football team.

lie Took Aces from Their Ears

Meanwhile his father had bought into the street railways of Toronto, Montreal and Winnipeg, owned a large part of the tramway system of Birmingham in England, and controlled the vast Dominion Coal Company, which operated most of the mines of Nova Scotia. When young Ross graduated in 1897 with the degree of Bachelor of Science, the old man began grooming him to be his heir, and put him to work in Montreal as a kind of apprentice manager in several of his businesses.

In 1898 Ross was shipped off to England for two years of similar apprenticeship there. As a boy he had been shy and diffident, and even at the beginning of the English phase of his training he still hadn’t developed much ease of manner. This bothered his father, who thought up a wildly original plan to correct it. Old James had a theory that few men have more unshakable self-confidence than a conjurer. He ordered Ross to get in touch with what he called “a prominent magician” before he left England and to take lessons. Ross did as he was told, discovered he had a natural gift for sleight of hand, and for the rest of his life liked to startle a new acquaintance by suddenly producing an ace of spades from his left ear, or astonish his guests with an after-dinner display of card tricks.

When he returned to Canada in 1901 J. K. L. brought back with him a Napier, one of the first motor cars on Montreal’s streets. Not content to confine his driving to city streets he made the ten-mile trip to Dorval over atrocious dirt roads. There he was greeted by reporters sent out on the off-chance that he would arrive.

The year after the memorable drive to Dorval Ross married Ethel Matthews, daughter of the Toronto financier W. D. Matthews, and his father made him assistant to the general manager of the Dominion Coal Company. The mines were near Sydney,

N.S., where Ross lived when his not-toodemanding duties didn’t require him to be at the head offices in Montreal, or he wasn’t at his summer place on St. Ann’s Bay on the northeast coast of Cape Breton, or out fishing for tuna, or in England sailing Gloria in the races of the Royal Yacht Squadron, where he enjoyed himself hugely but never won any important trophies.

In 1913, when Ross was thirty-seven, old James died and left him virtually the whole of his fortune. Ross wasn’t to get the full estate until his fortieth birthday, but in the meantime he was to have an allowance of $75,000 a year. He also got an immediate legacy of $50,000, and a clause in the will directed the executors to pay him any sum up to one million dollars at any time after his father’s death, if he should want it. to go into business or buy property.

Since he could get the money simply by asking for it, Ross was now in effect a millionaire and could live an even more ample life. He began doing it by ordering a 106-foot motor yacht, the Albacore. She was designed with six staterooms for the owner and his guests, a dining saloon paneled in maple, and accommodations for two officers and a crew of four. Ross looked forward t.o long cruises in her, but soon after Albacore was launched the First World War broke out, and he changed his plans.

Canada’s three-year-old Navy consisted largely of one ancient cruiser taken over from the English. Ross had been an ardent supporter of Sir Robert Borden’s proposal in 1913 that Canada should spend $35 millions to build three battleships for the British Navy. The so-called “Dreadnought Bill” passed the Commons but was defeated in the Senate. Ross thought there ought to be a public subscription to raise the money and made it known he was willing to start one with a gift of half a million. When war broke out before the project got really under way, he gave the half million to the government instead, to use for any war purpose it saw fit. He also loaned his new yacht to the Canadian Navy for service as a patrol vessel, and decided to do still more.

Ross bought a big U. S. steam yacht, the Tarantula, from W. K. Vanderbilt, and turned her over to the Navy as an outright gift. To get her out of the still-neutral U. S. he had to pretend he had bought her for pleasure, but as he’d had her painted battleship grey this wasn’t entirely believed. To make it more credible he brought his elevenyear-old son along when he took delivery of Tarantula at a shipyard near Boston, and sailed flying the peaceful flag of the New York Yacht Club, with the boy ostentatiously in view on deck.

’That was less than two weeks after the outbreak of war. Within a month Ross had bought another steam yacht, the Winchester, from a wealthy Englishman, and given her also to the Navy. 'The Navy renamed her Grilse, commissioned Ross a reserve lieutenant, and put him in command. He was at sea in the Grilse for two years, on patrol between Halifax and Bermuda. He never had her in action, but got two mentions in dispatches for the seamanlike way he handled her in Atlantic winter storms and a hurricane off Bermuda.

On the last day of March 1916 Ross had his fortieth birthday—the fateful day on which he inherited the sixteenmillion-dollar balance of his father’s fortune. That spring he went off active duty at sea. In the fall, still in the Navy, he was loaned to the government to be chairman of the newly formed Dominion Board of Pension Commissioners,

At the same time he set about the happy task of living up to his immense new wealth. He promptly gave almost a million to the Royal Victoria Hospital for a building in memory of his father, and another million to his old school, Bishop’s College. He invested a million and a quarter in a trust fund for his wife. In 1914 he’d bought a couple of race horses and had got a taste for racing which now grew to a passion. The year of his inheritance he spent a million or so to start a breeding farm at Verchères on the St. Lawrence-—a site he picked chiefly because the grass and water were good and it was near enough to a railway station to be convenient for shipping horses, but also because he could get there from Montreal by yacht. He had all the stables and barns painted the black and orange of his racing colors, and before long he’d got together a string of forty-seven horses.

in 1917 the Navy promoted him commander, skipping the intervening rank of lieutenant-commander as a special honor to the man who had given it two ships and loaned it a third. That year Ross had his private railway car built, in which he sometimes took friends to the track where his horses happened to be running. Perhaps because of his public service there was no public criticism of him for buying such a luxury at the height of the war in France.

A Fortune at Saratoga

Although his entertaining was as wholeheartedly lavish as everything else he did, Ross himself ate and drank moderately. But he liked to see less abstemious people having fun, and gave parties wherever he went. He gave a particularly cheerful party at the Casino in Saratoga Springs to celebrate his reported coup there in 1918, and his betting activities became the talk of racetracks all over the continent. Public guessing on his wagering barely managed to keep up with the truth and amazingly, in view of the large amounts he bet when people guessed he was losing fortunes they were all wrong.

According to the records Ross kept, he was one player who actually beat the races. His son James recently made a tabulation of Ross’ bett ing books for 1918 to 1924, noting that bets before and after that were "negligible.” In 1918, when Ross was supposed to have made a fortune at Saratoga, the books show he did indeed make one, and cleared $98,000 altogether. In 1920and 1924 Boss went down a total of $60,000 but those were his only losing years. In 1919, his best year, he won $189,000. His biggest single bet that year was $50,000, which he won, bringing him a $50,000 profit. Some of the ninetytwo other bets he made in 1919 were in t he low hundreds, but fifty-one were for $1,000 or more, including twentythree for $5,000. His books show that in 1924, when he stopped betting heavily, he made $18,000, and that his five winning years so far offset his two losing ones that he ended up $315,000 ahead of the game.

In the year 1919 his horse Sir Barton won the Kentucky Derby at Churchill Downs—the first time a Canadian owner had ever taken that famous race. Another of his horses, Billy Kelly, coupled with Sir Barton in the betting, finished second. Ross had gone to the Downs a day or two earlier with a party of friends, but the night before the race he got word that his fatherin-law, W. D. Matthews, was dying in Toronto. He left at once, and so became one of the few winning owners in the long history of the Kentucky Derby who didn’t see his triumph.

“Ross entertained on a lavish scale. He spent a quarter million fixing his home”

Long afterward, at the time of Ross’ death, Jim Coleman told in his sports column how Ross had wired Abe Orpen in Toronto and Con Enright in New York, saying to each, "Ret twenty thousand my entry SP.” They knew it referred to his Derby entry, but weren’t sure what he meant by the letters "SP” at the end. In those days there were private bookmakers who took bets at agreed odds before the race, as well as some who paid off on the pari-mutuel odds at the time it started. After consulting by phone Orpen and Enright decided Ross wanted them each to bet $20,000 straight and $20,000 place at starting odds, and made arrangements accordingly.

Sir Barton won by five lengths, with Billy Kelly second, and the entry paid $7.20 to win and $6.70 to place. As Orpen an! Enright had understood the wire, this meant they owed Ross $99,000 apiece. He wouldn’t accept it. He said he’d intended the letters "SP” as the English racing abbreviation for "starting price,” that he’d bet only on a straigh* win, and that consequently they just owed him $52,000 apiece. That was all he .would take, and he insisted they were to keep the difference. It came to $47,000 each.

When the story got out it wasn’t generally realized that Ross had refused the money because he didn’t want to profit by a misunderstanding. He already had such a reputation for magnificence that in spite of the fact that both Orpen and Enright were wealthy men themselves, there was a widespread belief that Ross had handed them an enormous and lordly tip.

In 1918 all horse racing had been stopped in Canada for two years, except for the annual running of the famous King’s Plate in Toronto and the less well-known Quebec King’s Plate in Montreal. Ross had bought a second big breeding farm, at the race-track town of Laurel in Maryland, and sent most of his horses there to continue racing in the U. S. They did so well that in 1918 he headed the list of winning owners and won $99,179 in purses. He was at the head of the list again in 1919, with $209,303. In 1920, when he was second to H. P. Whitney, the purses he won amounted to $250,586—his biggest take in any one year and a great sum for those days. But in spite of the purse money his horses brought him, it was costing dose to a hundred thousand a year to keep the two stables going.

The most spectacular reward he got for this outlay came when Sir Barton won not only the Kentucky Derby, but the Belmont Stakes, at Belmont Park in New York, and the Preakness, at Baltimore’s Pimlico track. No other owner in racing history had ever won

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all three classics in a single year—a Triple Crown that has gone to only seven owners since.

More newsworthy even than the first winning of the Triple Crown was the match race arranged in October 1920 between Sir Barton and Man o’ War. Sir Barton’s triumphs of the year before had made him the only logical match for this wonder horse—one of the greatest of all time. Man o’ War hadn’t started racing until 1919 (as a two-year-old he hadn’t been eligible to run against Sir Barton in the Kentucky Derby that year, since all entries are three-year-olds). But out of his ten starts in 1919 he’d won nine, having been beaten for the only time in his career by a horse appropriately named Upset.

The Twilight of a Heyday

In 1920, when he and Sir Barton went to the post at Kenilworth Park in Windsor, Ont., for a purse of $75,000 and a five-thousand-dollar gold cup, he had already been entered in ten races and had won them all. With such a record it wasn’t surprising that in spite of Sir Barton’s own impressive achievements, Man o’ War started an odds-on favorite.

Samuel Riddle, the Philadelphia sportsman who owned Man o’ War, had put jockey Clarence Kummer up. Ross had chosen Earl Sande, who’d ridden Billy Kelly in the Kentucky Derby as an apprentice and got his start toward fame chiefly with Ross. At the last moment Sande was replaced as Sir Barton’s jockey by Frank Keogh, and word went round that this was Ross’ ^ own decision, made because he thought Keogh was in top form and Sande wasn’t.

Sir Barton lost by seven lengths. The defeat was particularly crushing because it was obvious Man o’ War wasn’t going full out. Later there were those who insisted that Ross had at once rushed round offering big money to newspaper photographers and newsreel cameramen to destroy their films, so the public couldn’t see how hopelessly outclassed Sir Barton had been. But a man from the Toronto Globe, who’d been right behind the adjoining boxes from which Ross and Riddle watched the race, reported that Ross just turned to Man o’ War’s owner and said: "Well, it’s over. The best

horse won. My hearty congratulations, Riddle.”

From that day on both Man o’ War and Sir Barton were retired to stud, never to race again.

The next five years were the last of Ross’ heyday. Although he never topped his 1919 winnings he did consistently well, and in 1924 he won $127,465 in stakes and purses, besides ending up $18,000 ahead on his betting. He and his wife entertained on such a scale that it was quite usual for twenty people to sit down to dinner in the vast mahogany-paneled dining room of his Peel Street house in Montreal. After these dinners there was often music, of a serious sort which Ross himself didn’t care for, but which his wife loved. It was provided by concert violinists and pianists and singers, in Montreal on tour, whom she’d engaged to come to the house so the dinner guests could hear them in luxurious privacy.

In 1923, Ross spent a quarter of a million dollars to remodel the Peel Street house and make it even larger,

adding such luxuries as a darkroom to develop photographs. By way of a housewarming, he invited fifty for dinner and a hundred and twentylive for dancing afterwards to meet the Duke of Windsor, then Prince of Wales and traveling incognito as Lord Renfrew. The royal guest couldn’t get enough of the party, and stayed on and on. "In consequence,” a Montreal paper said in a discreet story, "Lord Renfrew did not arise very early yesterday.”

Although 1923 was apparently a brilliant year for Ross, it was clouded by worry of a kind he’d never felt before. His yachts, the private railway car, seven or eight Rolls-Royces, thirty or forty servants, houses in Montreal and at Laurel, and above all the expenses of racing and keeping up the two breeding farms, wore beginning to he a noticeable drain on his resources. That fall he met a man named W. A. Re,ad, a promoter and financier who was interested in racing and knew a lot of Ross’ friends in upper-class English sporting circles. Read suggested that if the Maryland farm were incorporated as a company for breeding, selling and importing blood horses, it might become profitable instead of costly.

Ross agreed, and in October 1923 the farm went into business as the Laurel Park Stud Company. But the hoped-for profits didn’t materialize, and the farm continued draining money. About a year later Read made another suggestion. He had certain properties in the oil well regions of the U. S., more especially in Oklahoma, which needed development. If Ross bought into those, together with one or two of Read’s English associates, the money from oil might carry the cost of the stables at Laurel. It seemed like a good idea to Ross, and he took a quarter of a million shares of a company called Caltex Oil.

Victimized By Ilis Friends

It was the first of a series of what lie later called “unwise investments.” The phrase was a monumental understatement. The Caltex development didn’t pay off. Ross, who had spent money in the grand manner, now proceeded to go broke in the grand manner. When Caltex was expanded to take in other oil properties—also hacked by Ross—it turned out to be equally disappointing. Until 1927 he was able to go on racing, but by the spring of that year his losses in oil had reached the point where he was in desperate need of money. In May, at Toronto’s Thorncliffe Park, he sold what remained of his stable—fourteen horses and a lead pony. A few days later he made a general assignment to his creditors. He was three million dollars in the hole.

His principal creditor was the Baltimore Trust Company, which held drafts for almost half a million that Ross had endorsed and guaranteed.

In November 1928 the company forced him into bankruptcy. The Montreal Star, owned by Ross’ friend Lord Atholstan, tactfully headlined its story “MOST REGRETTABLE LOCAL INSOLVENCY” and went on to speak feelingly of the bankrupt, who, it said, “through kindheartedness allowed himself to be victimized by designing people whom he had befriended.” After listing his philanthropies, the Star said: “The adversity which through cunning overcomes such a generous citizen constitutes a public calamity.”

The bankruptcy proceedings showed that Ross’ approach to business had been rather remarkably confiding. When he was questioned about a trip to the Oklahoma oil fields he'd taken

in 1926 with Read and a Sir Hector MacNeill, one of the lawyers asked if the object of the trip hadn’t been to examine oil properties there and discuss plans to expand their operations. Ross said he was chiefly interested in just looking around. “I had never seen an oil field in my life. I don’t pretend to know anything about oil or oil wells.” And when the lawyer asked if there had been any question of the cost of buying new properties, Ross said: “Mr. Read talked so many

figures that I left it entirely to him.” It also appeared from the proceedings that Ross had been in the habit I of signing batches of promissory notes in blank from time to time, and that these had been sent from Montreal to the farm at Laurel to meet current expenses—often several thousand dollars at a time. When the astonished examiners wanted to know how many of these blank notes he’d signed, Ross said he hadn’t the slightest idea but that he supposed there might have been three hundred. But in the whole of his evidence there wasn’t a word of complaint. He was bankrupt, and that was that.

His career of necessity entered a new phase, but although he declared to the examiners that on Nov. 1, 1928, he had no property assets and only three hundred dollars in cash, he hadn’t been thrown suddenly on the world and forced to earn his living.

A codicil to his father’s will had set up a trust fund of a million dollars, the income from which was to he paid to Ross during his lifetime and afterward to his two children, James, a lawyer who lives in Montreal but doesn’t practice, and Hylda, the wife of Duncan Hodgson of Montreal. Since the fund had been well managed by the trustees for the fifteen years since the old man’s death, it had grown considerably. Furthermore it couldn’t be attached by Ross’ creditors, because it wasn’t part of his estate. Hence he could still count on at least $50,000 a year on which to begin a new life.

In 1930 he and his first wife, who has since died, were divorced. The following spring he married Iris Fain de Lisser in her home town of Kingston, Jamaica. In 1942 the proceedings in his bankruptcy were finally wound up, and the creditors got fifty cents on the dollar. And in 1951, James Kenneth Levenson Roas died at his home in Montego Bay where he spent most of his time after his second marriage.

Montego Bay is a gay spot, and Roas enjoyed it to the full. He had a large estate. His house, which he sold in 1950 to his friend Lord Beaverbrook when he moved to the smaller house where he died, was one of the show places of Jamaica’s north shore. Ross did a lot of entertaining, sailed a good deal, and went in for dog breeding. He was made a steward of the Jamaica Jockey Club, was a magistrate in Montego, and was often asked to represent the Governor of Jamaica at social functions there.

The glamour of his heyday was gone —the roar of the crowd as his racing colors flashed past the winning post, the private car rolling smoothly out of Windsor Station as he and his guests went off to the track and the champagne flowed. But it was still what his son recently described as a “rather lively life,” led on a millionaire’s income.

What Ross himself, living on a paltry $50,000 a year, thought of it can be gathered from a remark he made not long before he died. On a visit to Montreal he ran across an old friend.

“You know,” he said, beaming, “I’m much happier now that I’m poor than I ever was when I was rich.” jç