BANK OF NEW ZEALAND

Press, Volume XLIX, Issue 14758, 30 August 1913, Page 5

BANK OF NEW ZEALAND

APPLICATION FOE DECLARATORY ORDER. (PHESS ASSOCIAIIOX TKLEGB'AM.) WELLINGTON. August 29. Judgment by the full Bench in connection with the application made for an originating summons asking the court to make a declaratory order in the case of Sidney Kirkcaidie.. Charles Premlcrgast Knight v. Bank of New Zealand, was dc-hvered at tiie Supremo Court this afternoon. iiif question involved was whether tho shareholders of tho Bank of New Zealand had the power to increase the capital of the H.n.k by tho isi.ie of fre*:>. shares, and tlie answer ot the court was in tho negative. Questions to t«c (!>-■:.aid ami the ansue.s <hy mc Cau-i Justice; woio as follow: — 1. Whether tho right ai.U po.Vi.-is ot tho s.ia.vnoiucis ot liditk i)i -New /.i.';i.ai.vl ujw.i li,<-iii by (a) tiie bank's CiCvu oi soc.iomeilt. Ill) .-urCC.OII O Ot liio /-v.aiaiul 'iiu.ii; Ai-. ot J>tJi, aul In SOCiioil >i oi nil* U.li.liliiji; Act Ol lliUb, ot iuci-ea.-jiliii Uio <:al)i<.ai or Uio b.ini» hy mc isjiu- oi licw" is buojeci c> a,iy. :ii.<l ir to to wnai, icmiicliuHo or co k .Jii.'Ous'r Answer.—Shareholders have nopowei to uUiUorijju tiio ixiiii of Low siiaiCL at.y or ait oi Uio provision*. inuiiLioned. Mr .iu>cire Chapman announced that as tin; i.io were ic..<;<..i.> lio d;U no: imnii it io r>'.m tiieiu 'liuv w-aud I)-- , /!a.;ui.d to liic M^i.s k r:;r IL.- (;e.:\ery to tno partus. Ino i,iKv n..«*i as. cv tat. result, iii.v no wuma bLupiy ivaU tuc ai.bivcrs to tiie .-.uuiliiucd to t'j.i iik< •ui-'iio oi Luc court. ' QucntT-i.i Are ..-.a.uvnoldcns reiroiu crvciiii-K 1K "- V ' s ' UilS > C0!l ' iVi-nng vii holders thereof riyiits, privn"'wS, or pi.o.jcus, Wi.ich »»n. iiiu.<- u uio nt;iUL,, or priorities aiuKNicti to mo pMieicnee snares meutioncU in bccion y oi tuo UanK oi 'iseu- /.calai.d Act ol or are tliev rcsti-iciiid in any outer reaped.Answer. — Yes, tm-y are for reasons already . . QuosLioii -'5. iw.i Liio creation and issue, of iucrcaciul capital in tno iorin oi now ordinary wnaics subject to tiie ouii..ii.ious iH-.>:.natu'r niencioned iall within such or otiier restriction (if any; on tiie power of the shareholders to increaso the bank's capital oy tuc issue oi oidinary snares, namely (a) Tho issue or iuriher ordinary siiares, which shall, for the purpose of occlion 1U of tno Lank ot -\wv Zc«iaml Act of lliuo, and for oilier purposes, rank pari passu with the ordinary shares of tlio Bank existing at the time of tho passing of Act. (b) Tho issuo of lurther ordinary shares which shall entitle tho holders thereof to share pari passu with other holders of ordinary shared lor the time buin-j, of the bank in tho profits available each year ior division amongst the shareholders, after first paying out or providing out of such profits, dividend, or dividends, which holders of '•preierence shares'' would ha entitled to under the Bank of New Zealand Act of ii-03, if the capital of the Bank had uofc been increased; or

(c) The issue of further ordinary shares, which shall enlitlo the holders thereof to share pari passu with other holders of ordinary shares for the time being of the Bank in the profits available in each year for.division amongst the shareholders after first paying or providing out of such profits to the holder or "preference shares" the maximum dividend of ten per cent. P . Answer. —This question has been already answered in the answer to question . 1. Question 4. Whether shareholders of tho Bank "are entitled to direct the directors of the Bank to call up, or alternatively whether directors of the Bank are entitled to call up, the uncalled liability to £3 6s 8d per sharp subsisting on tho ordinary shares of tho Bank,-and whether, upon the payment of such liability, or of ar.y part thereof, tho amount so 'paid shall be deemed to be part of the capital of the ordinary shares and entitled to he treated'for tho'purposes-of Section 10 of the Bank of New Zealand Act, and for all other purposes as part of the capital of the ordinary shares of the Bank.

Answer. —The directors may call up the amount of the liability, but they cannot be conir/ollod to do so.

Question ;j. Whether, urxm the creation of any now capital the Punk may be authorised to issue, shareholders may direct and resolve- that such new capital shall bo issued at par or at a premium, and in particular may determine, direct, and resolve that the new capital shall bo offered in the first instance to holders of shsires numbered 1 to 150.030. both inclusive, in proportion to the amount of capital held by them, and in such event whether the holders pf the ;, preforcnw shares" would be entHe-1 to require such new capital to be offered to tliom, in tho proportion which their holding of "preference shares" boars to the whole share canitnl of tho Comminv.

Answer. —Yos. if"thorn was a ricrht to isfuo new ■ shnre*, they nvpflit be issued as the shnrol'oMe-rs resolved, but there is no such right.