£3OOO CLAIMED

Press, Volume LXXIII, Issue 22269, 7 December 1937, Page 7

£3OOO CLAIMED

♦ CIVIL ACTION CONTINUED SUPREME COURT CASE IN FIFTH DAY To-day will be the sixth, and probably the last day in the hearing of the claim for £3OOO against Archibald Donald Paterson. a civil engineer, of Christchurch, by Honing Road Surfaces, Ltd., of Edinburgh. The Scottish company claims thnt Paterson committed a breach of contract by returning permanently to New Zealand before fulfilling an engagement of two years with the company. The reason advanced by the company for Paterson's refusal to return to Scotland is that he wished to set in order the affairs of British Pavements (Canterbury). Ltd., of which he was managing director, and which harmed the prospects of the plaintiff company. Evidence in the Supreme Court yesterday was taken from the final witnesses, and counsel began their addresses to his Honour Mr Justice Northcroft, who presided. The company is represented by Mr A. N. Haggitt, of Dunedin, with him Mr J. A. Niblock, and the defendant is represented by Mr A. T. Donnelly and Mr T. A. Gresson. Peter Donald Paterson, chemist, a son of defendant, said that the failure of the demonstration of the process at Oxford was attributable to bad weather. He gave corroborative evidence of the company's lack of funds and said that this factor had delayed the demonstration. He had a good knowledge of the process, but the sands at Leighton Buzzard, where the company's plant was established, made the mix suitable for laying only in good weather. Among those to go to England to investigate the affairs of Honing Road Surfaces, Ltd., was Colonel G. J. Smith who said that he found out from two directors of the company Scott and Box, that the company had practically no money. Nothing had been done; and the company was in a parlous state. Paterson had been refused a patent for his process. Liquidation Suggested Witness added that he decided to liquidate the Scottish company, but the directors had accepted a suggestion that it should sell, its plant to British Pavements (Canterbury), Ltd., which held a debenture over the plant as security for money advanced, conditional on witness cancelling the meeting of shareholders which he had called to discuss the liquidation. He had also advised the Canterbury company not to send any more money to the Scottish concern. The Canterbury company then did not have any cash to advance, though if it had Honing Road Surfaces, Ltd., would have been able to continue. The Scottish company could not raise any. The Court adjourned to chambers for his Honour to indicate points of law in which he was interested. "Practically Derelict" "The company was practically derelict when Paterson left in 1934, and everyone knew the position in 1935 when the plant had been taken over by British Pavements (Canterbury), Ltd.," said Mr Donnelly in his address. He contended that the reasonable inference, and in fact the irresistible inference from the facts, was that in December. 1935, Honing Road Surfaces, Ltd., was unable, because of its insolvencv, to perform its side of the contract—to pay Paterson his salary—and that therefore Paterson was entitled to repudiate. It was also claimed that the company's repudiation of any payment to

Paterson in the cablegram of February 1. and above all the refusal to answer Paterson's cablegram of November 9, except by a solicitor's letter suggesting he had waived his claim for £Bl2 10s. clearlv justified the inference that the company did not intend to perform its side of the contract. In dealing with the question of damages Mr Donnelly said that the claim had been based in a way inconceivable to any lawyer, and it could not be justified by facts at all, and no evidence had been placed before the Court to justify the claim. The company had no plant, no contracts, and no capital, and every effort to raise money had failed. Had Paterson returned there was no indication that there would have been any money with which the company could have worked. Case for the Plaintiff Mr Haggitt claimed that Paterson had such a number of other interests that, although he was bound legally and morally, he abandoned the child of his own begetting. He was plainly under a contract to Honing Road Surfaces. Ltd., and under no contract to anybody else in accordance with the agreement between him and the company. Paterson's presence in New Zealand in May. while he was on leave, Mr Haggitt claimed, was every bit as unnecessary as he had said it was in England. The company was not in a position to do anything while Paterson was in New Zealand; the company was hopelessly impotent as Paterson had not explained his methods or the operation of his invention, and there was no expert who could do any work. Mr Haggitt said that the foundations of the claim for damages were three: The undoubted scope for such work in Great Britain, which had been attested to by witnesses for the defence as well as for the plaintiff; the profits from the operations of the company, and the necessity for Paterson's presence, as regards his organising ability, his expert knowledge, his credentials, and the fact that he had met engineers and others interested in the process. The company was going to be the forerunner of a public company of a much bigger size. The hearing was adjourned until this morning when Mr Haggitt will conclude his address.