'MORAL GROUNDS'

Press, Volume LXII, Issue 18602, 29 January 1926, Page 9

'MORAL GROUNDS'

yOOLSTON TANNERIES

ENQUIRY.

CROWN CASE OPENS.

DENIAL OF LIABILITY. (SPECIAL TO "188 MESS.") WELLINGTON, January 28. lie Woolston Tanneries Commissioi earned its sitting this morning, wlie tf r McDonald, who had been chairma % tie BO«d of Trade, was furtlie coined by -H r M-™« regarding th scheme for the regulation of tho pne t jjiJes to enable the Board to brinj standardised boots scheme int. operation. Jfr McDonald said that chnrge3 o had been made against th piston Tanneries, but investigate a t j, e books showed that there ha( Ijfea none. The Hoard had come tc ifce conclusion that the embargo mus la fetlmed in the interests of tin jkDdarcliEed boots scheme. At a meet W In the Prime Minister's room l ff M evident that a change had com. aver the Government's policy in re gird to removing the embargo. Tin Gjferfiaent had decided to go on witl ' (he rtandardised boots scheme, bu: 0 to Continue the Embargo. •To Sir John Findlay: When the em U»»b Waß removed, and the Woolstoi SeH6S had agreed to quote firn S for three months, they had as MiaelJ cn&nce as anyone else to deter toifiS *h6t the consequences would be to. tt&fiod they wanted protection foi L. for three months. No nidueelnenl Wagered to Mr Ollivier to rlos< dflW&i Tney Wanted him to continiK ■i. tjj 0 interests of the consumers. Ai m result of the action taken by tb< floVerritoerit the price of boots did nol jMr ttftmensurately with the price oi Hides advanced 100 per cent. bSot&dld apt advance more than 66 2-1 US? «*&• He would naturally expect that if leather advanced 100 per cent feoots would have advanced 100 pei «at. ' • Witness did riot expect the jlajjp to come bo booh. The slumr, i&Wred in America in 1920, but ir »rfc»tanii'-»6t till 1021. It was o3».then that there was a fall in the pßSral, level, of prices. In New Zeaftsl feather cnme„ first -—towards the if,& Si 192& owing to the collapse of the American market. Witness had jot foreseen that; be did not therefore thlßk i\A ttinlptili.V 'Would suffer loss af the result of their quoting firm prices f*r three months. Jfo Promise to See them Through, fiie Cdrnmissioner: But there nduld Jtave been tho loss through eai lying oh? \ Witness admitted- that it whs condeivaile that there. might not have ken a loss but for the collapse of the American markfit. There was no protniso to- BSo through. There, was no indemintj or guarantee to Mr 01f litfcf. Thd ISoafd of Trade never ! Conteffifilatol such a thing. i , Sir John Mfoy suggested that if a.'AMi OUwier «as a. business man he r '< VouldtlMegaiaV'Tes, I'll quote, but / It we !«& SIIOM. then you will have to pay for ii" (To witness): There Via tttaffltjti Made? Witateij. m Sr JdtA AAJlny quoted from a letto tidiki to Mr Ollivier to the Rm.mtim on Marc* 6th, stating iMfr BJfeg of rtiinourß and remarks ft Jtysra Ut alleged profits made by. Wftoomptoy, they must decline to take m nsmiftability for fixing prices, and <toMtU#'-that, the Board of Trade McnJd'-JSffle to Christohttrch and fix #io«f%them. The letter added that tqey were quite prepared to carry jta tfltir iusinfs&S as in the past, but ■ «W # tho antagonistic feeling Wtfw'Sg&Jnst thom by efiftaiii people, w%ft forced t6 claim protection; PS, m_, Government through the i. y/IPr** *Sid ho believed the reason j» W» letiet was a threatening gestjirt by the Prime Minister at that jwt. -He was threatening middlemen, frocalarly as to what would happen WtoSnuTthey did increase their 1 prices "?$ W&t was considered fair and mtabfe; Witness had refused to *° an y piofiecution* of the &Ti*l Queries for profiteering. *«UM been suggested to him. mL* ohfi *s?dlfty! By whom ? Witness: By one of the Ministers. j_wiu on ond side, and most of the W'wnmsnt wero on the other.

-i *'l Was the Board;" Jfc Jolia Findlay; Have you any iffiiiS? Mr Leb B * ld yoU 6houltl |»hS6ss: I did not say Mr Lee. ; Jg&<John Findlay: Have you any i "iTOia any Minister? j yjgjyX 88 ' « * fi ß a private coh- \ quoted from fur- ■ W etoespondeace at the time. One a JK W»timated that the company was **W to quote prices up to August Sir John Findlay asked if the IWtay were over requested to stabilTOJjftita for six months? 'lkfcuJf 8 * «6t by the Board, but the *E?fiL U,e JP* iod , Was that they could SSn&fiecs, t}la •»«*«* chaMce we X*^ 8 of success With our boot "SS». Witness stated that lie had jj*w Mr Ollivier for a twelve months' SJWJ- ?he policy of tho Board 'litoL montba iu 'regard to all 1 fcfAl Findlay: l s that embodied | iflm« m ? ,r *L? f tho Board > or is * ner « 1 Ssrs? tt "** minutes showing your ■" 's3n§K *°. ¥h for an arrangement of 1 'fff Mr Ollivier? i " ifi»rH : * Coldd make any arrange- ! Tftlpd With Mr Ollivier. "fej™ l Fiddler: Why? sSSF'i *«»»» 1 was then th« 3teTU*s. t6r ,n *!«» Board. yoM Findlay: In fact you were i Jl&fi e11 ' ihore ' B !1 ° tlse >« ' Wt Mt about »*—l w as the Board. «SiaPJ"*x that T I,ad no <> the asaist■r**£ES? *°&P e & nfc ofiicers. I had *«*&. t™l\ Mr Halle ? and i * JSu? Mr Hart . *he other mem* «■'*** fifih? * did ™H d naturally • *» Board. , **MiCT i! - ,oner: You knew the Nil*..*"* Board? -JfMli Yes. E frJbttofrlLi t( L furll »€r questions by «tte?fe*2 t a hard time Bff MtalSST 11 of the * far as tho charges were faU,M o£ New Zea - g Zealand Thcro would still be , JmSr «K2'yi n e et «ng tides? 1 *P **"< th «y did. They ' '*». Kndlay -asked

the witness if it was not 3 fact that that scheme was aimed at relieving tho public from the effects of the war? Sir John Hosking: Not so much of the war as of profiteering. A Special Loss. In reply to Mr Myers, witness said the Woolston Tanneries suffered a special loss which other tanners did not suffer. Witness admitted that no legal responsibility attached to the Board of Trade in respect to the position the company subsequently found itself in. Mr Myers intmated that ho had no more witnesses to call. Tho Case for the Crown. Sir John Findlay briefly addressed tho Commission. The withdrawal of the first part of the petition, he said, had eased his task. He bad thought that the main gro*und of tho petitioner would be the removal of tho embargo as having done special injury to the Woolston Tanneries, bub now ho bad to meet what was practically a new case Mr Ollivier would have to show that ho had a justifiable expectation that tho Government would come to his assistance and relief. He su"».nitted that that expectation could not have existed in Mr OUivier's mind, as Mr McDonald had sworn that he had offered Mr Ollivier no inducement to carry on, and to stabilise prices. In none of the conversations with Mr McDonald bad Mr Ollivier referred to .the possibility of receiving compensation. Tho whole matter was a commercial one, and should bo regarded in a commercial manner. There was no implication whatever to make good losses as tho result of carrying on. The Commissioner said the analogy was not altogether a good one. The suggestion was that tho Government might have imposed the embargo or adopted some other method to prevent loss.

Sir John Findlay: Mr McDonald never dreamt of committing tho Government of the country. Tho Commissioner: Ho did not expect the losses. Sir John Findlay: Then why should wo pay them? The Commissioner: It is a question of equitability, or ns to whether there should be some compensation. It is not a question of contract. It is a question of moral obligation—a request on one side to a person who has the power of relieving the other side from loss. *

Sir John Findlay suggested that if a contractor made a heavy loss on a contract through his own mistake, ho would not be-given compensation. The Commissioner: I don't know. I think a fair man would probably make compensation. It is very often done. The Government in many cases have acted in the same way. Sir John Findlay: Then it comes down to this: That every man in business who loses money is entitled to come to tho Government? "fairness arid Good Conscience." The Commissioner- Not at all. What we have to find 'in this case is „whethei tiiero is anything in fairness and good conscience that would justify the Government in coming to the assistance of tbeso people. If I was looking at it purely from a business point of view, I woilld say: Where is the contract? The question is whether there is not a moral t-mitri, in which case the person should get the benefit of it and receive some reimbursement. •' You cannot argite from the analogy of a business contract. Sir John Findlay: Tho structure of Mr OUivier's ease, involving the assumption that he was acting as f. philanthropist eager to serve the Government is not justified. He was acting from motives of commercial profit, and to secure his business. I submit that tho whole correspondence and facts and his conduct is consistent With that submission, and that submission alone. ,

"At the Solicitation of the Board." After the luncheon adjournment, Sir John, Findlay emphasised his contention that the claimant was not entitled to compensation on any moral grounds whatever. The ■ Commissioner: The moral grounds they claim are that they acted at the solicitation of the Board of Trade—that they acted with a view to helping the Government or the public. They do not put forward any express promise. They also say that the Government was in a position to save therii from loss but did not act. Sir John Findlay: As I said, we challenge those grounds. The Commissioner: iou say they were actuated solely by motives of commercial profit. Sir John Findlay: and that the losses were due to other causes entirely. . , The Commissioner: If there Was any moral obligation the Government might have discharged it by putting on the embargo again. Sir John Findlay: They did not want to put st burden on the rest of the community. The Commissioner: The Government did not hesitate to put a burden on the veuk nf +.lib-rnmnmnitv in the interest

of the farmer and in the interest of the miller. v Sir John Findlay: It was purely a matter of business* The Commissioner: Then they are in no different position from the other tanners. Sir John Findlay: Exactly so, sir. The losses were suffered by every, other company and trader* in the Dominion, yet tho Woolston-Tanneries Company is the only one that is to have any claim for compensation. Evidence for the Crown. Sir John Findlay called Percy Norton Qttarterniaiu, accountant, who said he had examined tho books of Woolston Tanneries, Ltd,, with every assistance from Mr Ollivier. He produced several tabulated statements, aild gave evidence in detail, largely of a technical character, in reference to the financial position aild the business of the Company. He said his investigations showed that the company was trading with very little capital indeed. Sims, Cooper also seemed tp benefit when the "Woolston stocks were realised. Hero Mr Ollivier interjected: That's not true. "Witness gave particulars of the shipments to England. "When it was absolutely necessary that cash should bo found, these goods wero shipped to the London Produce Company, Ltd., another organisation of Sims, Cooper's in London. This firm arranged a credit which came through the Bank of New Zealand. "Witness did not know tho exact amount, but ho'knew-it was large, because the Tanneries Company remitted £20.000 subsequently to London to cover the deficiency. Witness gave figures showing the losses on shipments to be hea/vv, and made reference-- also to the company's financial business with a boot factorv and a retail boot shop. Sir John 'Findlay: What was the firm ? Witness: I had better not mention names. The Commissioner: There is no need to mention names. Sir John Findtoy agreed.

Outside Enterprises. Witness produced one statement shouiiHc the extent to which the c-oni-Ijnnv beranio involved in connexion witn these outside enterprises, the hgur*» rising from £10,600-in WW to b { in 1920. There was another retail hoot business in which the company Usui money invested. The total invested in the retail boob"business was after taking off £20.000 arranged l«> tvav of bank guarantee. Witness. gsr\e details of the dealings in regard to unsaleable and inferior goods in >ew /<e«land. and of the shipments to J.ondon. Ho said ho was prepared to show ilintthe Loudon shinments disclosed n Mil" loss of £09.18?:- W2O-21 shii-meiit-,

and exchange and interest, CiOro. As far as the losses on_ the London shipments were concerned they could be definitely traced. After this witness had been under examination for over an hour, the Court adjourned. • Mr Myers intimated that he would have to recall Mr Ollivier to give explanatory evidence in regard to some of the witness's statements. The Commission was ndicmrtTed till to-morrow morning, when Mr Quartermain's evidence will l>c continue*!. There are several -other Crown witnesses in attendance, and the hearing is not likely to conclude this week.