ROYALTY DISPUTE.

Auckland Star, Volume LX, Issue 133, 7 June 1929, Page 5

ROYALTY DISPUTE.

ALLEGED SECRET AGREEMENT GUMDIGGERS SUED. CLAIM FROM MANGAWAI. Allegations of a breach of contract were made in the Supreme Court to-day before his Honor, Sir Alexander Herdman, by Hayward Charles Subritzky, of Mangawai, North Auckland hotelkeeper (Mr. Hall-Skelton) against two gumdiggers, John Joseph Silich and Nicholas Silich, of Dargaville (Mr. Webb). Subritzky sought an order restraining the defendants from selling gum from one partner to the other in an uncleaned condition and from breaking in other respects the terms of an agreement entered into on May 12, 1927.

A claim of £531 5/ was made against the defendants, the various items being £131 5/ for loss of royalty on gum sold, £200 on account of the depreciation in the value of the land, £100 for loss of royalty payable on the amount of gum left in the ground, and £100 for general damages. For 10 months the terms of the agreement were carried out, said Mr. HallSkelton, and kauri gum obtained by the defendants from the plaintiff's property at Mangawai was sold at a royalty on its value as sold to Auckland merchants in a clean condition. After September 15 of last year the defendants entered into a secret agreement. Sale Between Partners.

The area over which the defendants had digging rights was nine acres, said the plaintiff in evidence. Both the men worked together and weighed the gum in his presence. They said nothing to him about the secret agreement. Prior to September last both the defendants approached the plaintiff and also the mortgagee to reduce the royalty from 25 per cent to 20 per cent. A reduction was refused. Auckland firms had offered plaintiff a price of £24 to £26 a ton for the gum. Replying to his Honor, plaintiff said all was cleaned on the diggings before being shipped to Auckland. Continuing his evidence, the plaintiff said one of the defendants sold to the other for £14 a ton. The royalty was paid on the weight of the clean gum, although the price of £14 was for the gum in its uncleaned state. Regarding the condition of the ground, the cost of levelling it was estimated at £40 an acre. About six acres had been dealt with under the agreement between the parties. The gum showed a purity of over 87 per cent. His Honor: How much did you pay for your land?—£7ooo. Probably you paid that for your licence. In cross-examination Subritzky admitted the total Government valuation of the whole area of 23 acres was £310. It was an alluvial flat with peat deposits.

Edward John Bellingham, managing director of E. E. Bellingham and Co., Ltd., producers and exporters of kauri gum, at Mangawai, said the value of the land had been adversely affected by the digging operations because the level -was much disturbed. Also stumps were left buried or partially buried, and too much partition land had been left unworked. A considerable value of gum had not beeu extracted and a series of ridges and hollows was to be seen on the area worked. There had been a marked piling up of the land in one direction. To Mr. Webb, witness said the highest recognised standard of gum was 90 per cent pure. Several witnesses said that the cost ot putting the area in a suitable condition for cultivation would be over £30 an acre. ~■•■,■, William Wynne considered the land had been left in a disgraceful state. He considered 50 per cent of the gum had been left in the land. His Honor: What is the land worth for agricultural purposes ?—About £30 an acre. Question of lOU. Witness wae closely questioned by Mr. Webb as to whether he had been offered a sum of £50 to give evidence in support of the allegations. Mr. Webb: Were you given an lOU for £50? Witness ridiculed the suggestion. Did you tell Constable Mills that Subritzky had given you a IOU? Again the witness did not give a direct answer and was, inclined to treat the suggestion lightly. His Honor: This is a serious matter. It is nothing to joke about. Did the plaintiff make an arrangement with you? —No. No arrangement at all? —No. Mr. Webb: Do you remember having a conversation with Constable Mills and a traveller named Mr. Green ?—Yes.

You didn't say that "Sub." the plaintiff, had offered you £50?— No, not that I know of.

"I am here to see the man gets justice. I consider he has been badly treated," added witness.

His Honor: That is for the Court to say. Before the case for the defence was opened Mr. Webb informed his Honor that the defendants had been prevented from removing a quantity of gum that was dug and ready for sale. His Honor: It seems unreasonable that a man should pay royalty on gum that was not cleared. At a certain stage, added his Honor, an arrangement was made between the two brothers, who were the defendants, and one brother sold to the other for a price that was only about half the price that had previously been paid for the gum when it was sent to Auckland. It did not seem honest. Mr. Webb submitted that there was no stipulation in the agreement of a minimum price and the defendants were therefore entitled to sell the gum in the form that paid them best. (Proceeding.)