TRUSTEES’ CLAIM

Ashburton Guardian, Volume 56, Issue 290, 19 September 1936, Page 9

TRUSTEES’ CLAIM

REDWOOD FORESTS COMPANY.

EVIDENCE IN MORTGAGE CASE. (Per Press Association.) AUCKLAND, September 18. A legal action involving companies associated with Mr J. W. S'. McArthur was continued in the Supreme Court to-day. Plaintiffs are Thomas Henry Dawson and Leonard Knight, as trustees for the debenture-holders of New Zealand Redwood Forests, Ltd., and they are joined as plaintiffs by T. E. Jones, of Dargaville, one of the debentureholders. Defendants are Sterling Investments Company (New Zealand), Ltd., in. liquidation, Wymvood Investments, Ltd., and the National Investment Company of Queensland Proprietary, Ltd. Tlie action was brought by plaintiffs for the purpose of having declared invalid a mortgage of £7500 which was given in April, 1031, by New Zealand Redwood Forests, Ltd., to Kotalii Lands, Ltd., and on subsequent dates was transferred to various other companies. Plaintiffs alleged there was a conspiracy between defendants to defeat and delay the rights of the de-benture-holders of the Redwood Compony. They claimed to be able to show these companies were members of a group controlled by J. AY. S. McArthur and that although in the case of some of them McArthur was not actually a director, nevertheless the companies concerned acted in accordance with his wishes and under his direction and control. John Patrick McVeagh, a solicitor, said that in 1934 an action was commenced on behalf of Elizabeth Smith against the Investment Executive Trust.

Mr J. B. Johnston (for the defendants) objected to this evidence. McVeagh said the claim asked that certain transactions be set aside whereby Miss Smith had become the holder of a very large parcel of debentures in the Investment Executive Trust. The action was settled on March 9, 1934. The settlement provided that the Investment Executive Trust was to pay Miss Smith a sufficient sum to enable her to purchase the same shares and securities as she had transferred to the Trust. In return, Miss Smith surrendered the debentures to the Investment Executive Trust, said the witness. The first payment, a cheque of £B2OO, was made on March 16, 1934. J. W. S. McArthur guaranteed the settlement. Altogether three payments were made to witness’s firm by cheques for £B2IO. £SOOO and £3755, and there was a further payment of £IO,OOO made in Sydney. The total amount involved was .round /about 029,000, including £26,965 in cash. The case was adjourned till Monday.