THE LAW RELATING TO MINING COMPANIES.

Press, Volume LVIII, Issue 11110, 31 October 1901, Page 3

THE LAW RELATING TO MINING COMPANIES.

REPORT TO PARLIAMENT.

(PBESS ASSOCIATIOX tELEGRAM.) WELLINGTON, October 30. The report of the Joint Goldfields and Mines Committee on the petition of Herbei*t Easton, of Dxinsdin, was laid on th© table of the House to-day. The petitioner asked that legislation be passed in order to prevent what he alleged -«r«re acts of commercial immorality in mining companies known as "The Cook Group." The Committee, in its report; summarises the various charges made, and says gome have not been proved and- others are - matters that should be dealt -with 'by the law courts. In regard to certain, charges .made in connection with the- flotation of the Golden Grey Company, the Committee says the part of this charge which concerns it is the formation of a company merely for speculative purposes on the snare market. This is against public policy, and is purely a species of gambling, and should be stopped by legislation, iffl parties knowingly entering into such a transaction are particeps criminia. The Committee thinks legislation is necessary to prevent- the occurrence of such a case as that .alleged to have taken place in regard to the formation of secret rirfgs for speculative purposes by promoters and directors. The Committee suggests the law ehonld be altsred to the effect that where any moneyfor application, allotment* or calls is dua upon shares, then the same should be noted on the transfer of these shares before it is completed. The Committee recommends proceedings should be instituted by the Crown to test the legality of certain com- j panics wbdch had been formed by less ■ 'than seven sbarebolders as required by the Companies Act. The law should also be amended u> prevent the "safety", olauses ■ of the Act being overridden, and to en- ! sure that all shareholders should be treated alike when calls are sued for.. In regard to the charge of riwrehplders voting • and directors acting when their calls were unpaid, the Committee found that Mr. Cook, acting as director for several companies, had actually pained to himself large sums f6r.'brokerage* while he was still owing large! sums, for allotment- charges. The Committee says the law ■certainly requires amending in the direction of depriving a shareholder of the. right to,; vote or, act. as a dirfectqr until'ire. has paid bis allotment money.. The' Committee*found that 51 r Cook .had paid for.his, and Mrs Cook's shares.in the seven companies whose books wereput in evidence, the suru of £2140, font- Messrs Cook T and Gray received £1841 back from the ■-. companies "for Brokerage, secretary's salary and directors , tees. The .Committee' recommends that the law be altered on the lines it has indicated, and .to provide that all mininff companies shall be registered under the Mining Companies Act. The House, on Mr Scddon's motion, decided that the report of- the Committee .should be, published "Hansard." ~ .