COURT OF APPEAL.

Press, Volume LX, Issue 18127, 17 July 1924, Page 6

COURT OF APPEAL.

; WAIRAKEI CASE RESUMED. (PJUBSB ASSOCUTION TKJSMAH.) WELLINGTON, July 10. ' The Court of Appeal was to-day engaged considering the appeal from the decision of Mr Justice Herdman, delivered at Auckland in April last, of Arthur CJeave, of Auckland, printer, against WairaKei, Ltd. After a lengthy trial, 'lasting five' days, the company succeeded in. obtranihg judgment against Cleave on claims for £6265; but Cleave-in a counter claim in effect succeeded against the company on a clium for £2057. Tho elaimi of' the company arose, out of certain transactions in iliares of the oompaiiy in which Cleave . was concerned.

Mr Myers, K.C;, opening for the appellant,, dealt with transactions in which Cleave sold : five, thousand shares (which had been allotted to him by the directors as part' of his conmiis-' sion) to one L. >C. Johnson. Mr Johnson's cheque for the money dtle on allotment (15 s per share) being honoured, Cleave' paid the allotment money himself to the company, whose directors decided to let him step into the shoes of Johnson. Cleave then sold these: shares to various purchasers* who obtained transfers which were approved by the company. The company received altogether from Cleave and these various purchasers 20s in the pound for these shares, Wt afterwards clafflned to-recover, tind did re* eovor, from Cleave the sum. of £l2oo (5s per. share allotment money on five tliousand shares) on tlie ground that the shares could have been, and should Ir.Lve been, issued at par. In effect. Mr Myers contended, the company jiaa ; recovered by the action £(5250 for five j thousand £1 shares, but were entitled I only to £SOOO. •• Mr Myers therefore! contended that the part of the judg-i [ ment' < whioli awarded, the company |i£l?so-w«s wrojig.-'' ' 1 Air Richmond, for the company, cohi tended that Cleave was, a trustee of the assets of the company. Johnson's j shpres were illegally allotted. His application was a bogus one. His cheque \nis dishonoured three months after his application, but the companv was. not notified till much later. Cleave could have notified the company that the cheque was dishonoured and got them to cancel the allotment. JoEhson's name was put on the register and was not properly taken off it. That being' so he was still ii. member, so the company had, allotted his shares in error to" other people. Tho directors "had no right to sell for los to a fellowdirector sliares which he had already sold before they were allotted to him, for £l. ......

The case stands part heard. The Court refused leave to George Toogood, solicitor, of "Wellington, to appeal to the Privy Council against the Court's decision in a case in which Toogood sought to recover costs from William Henry Nash, which costs were incurred by the respondent's wife with Toogood, she being tin unsuccessful party ,in a divorce suit,