Supreme Court COUNSEL’S ADDRESSES IN FROCK COMPANY DISPUTE

Press, Volume XCIX, Issue 29330, 8 October 1960, Page 4

Supreme Court COUNSEL’S ADDRESSES IN FROCK COMPANY DISPUTE

Submissions tor the plaintiff had not been completed in the Supreme Court yesterday when Mr Justice Macarthur adjourned the hearing of the claim by Eric Edwin Vaue in a claim against his former wife, Emily Christine Vaile and Du Vaile Garments. Ltd., for 499 shares in that company. The hearing will continue on Monday, when it will enter its sixth day. Submissions by counsel yesterday occupied 4j hours. Mr B. J. Drake, with him Mr A. K. Archer, appears for Vaile. Mr C. M. Roper, with him Mr L. G. Holder, appear! for Emily Vaile, named as first defendant, and Du Vaile Garments, Ltd., second defendant. Mr Roper, in his address for the defence, submitted that Vaile’s main ground for his claim to half the shares in Du Vaile Garments, Ltd., was that a partnership existed between him and Emily Vaile about the time of the making of the 12 sample frocks for J. R. McKenzie, Ltd., and that, subsequently, Vaile had shares held in trust for him in the company. Vaile, in his pleadings and amended pleadings before the Court, claimed alternatively that if no such partnership existed there existed a joint interest, in husband and wife relationship, giving an implied trust. Vaile also made a claim for wages. His first pleadings clearly indicated that the claim for wages was alternative to, and not in addition to, his claim for shares. His second claim! appeared to be a claim for wages due to him from Du Vaile Garments in addition to half the shares. Partnership Proof Counsel said that, as the de fence saw it, Vaile must establish proof of partnership before the company was formed and that the evidence fell far short of showing there was any partnership implied or in fact. “The defence concedes Vaile has ability in artistic fields and might well be gifted by God, as he says, but throughout the years Mrs Vaile has borne the cross. “The broad picture is of that of a man with artistic talent but with little else—a man who in his affairs has shown himself to be unstable and irresponsible. “He is a man who first became interested in dress designing about 17 years ago, about the time of his marriage to Mrs Vaile who has been interested in the clothing trade since she was a gir} of 14. “On the one hand is Mrs Vaile with her long interest in- the clothing trade, exceptional ability as a machinist, a very able administrator and, in her evidence, a cutter of ability. She has for 10 years successfolly conducted her own business in a highlycompetitive trade and, at the same time, helped Vaile in his numerous financial difficulties. ‘Mrs Vaile was determined to have her own business and determined to allow Vaile, because of his n umerous financial muddles and failures, no Centred in it.

"Their relationship cannot be regarded as any other than employer sod employee. As tilings stand at present, Mrs Vaile has legal title to 999 shares and Vaile title to . one. The onus is on Vaile to show that this is not the true position. "Vaile’s Aims” “Vaile knew throughout that he had no half-share in the company but he did nothing until be was dismissed in 1958. “Although he then claimed a half-share, he tried to obtain money by threats. Then he launched patent infringement proceedings. “If he had any aim, it was to ruin Du Vaile Garments, Ltd., and deprive Mrs Vaile of her livelihood by causing her to lose her contract with McKenzies,” counsel said. Counsel reviewed the evidence at length and submitted that it showed no proof of a partnership between Vaile and Mrs Vaile at any stage. He submitted that, in regard to the claims for wages, Vaile had been paid what he was’ worth to the company, if not more, and there was no merit whatsoever in his claims. Address For Plaintiff For the plaintiff, Mr Drake submitted that there was a partnership between Vaile and Emily Vaile before and at the time the contract with McKenzie’s, Ltd., was obtained. If the Court held there was no partnership, Mr Drake submitted here was a looser arrangement, >eiween husband and wife, which built up a common asset, largely .oodwill. the property of both of hem. which was sold to Du Vaile Garments. Ltd., and resulted in the formation of that company and giving Vaile a trust interest in it. Vaile claimed half the shares in the company. He also claimed wages from the company on grounds that he had been grossly underpaid for his services. Even if the Court found that the company had paid sufficient, say in 1957, the books showed Vaile to have been paid £l3OO. Vaile in fecit had been paid £2OO less than the books showed in the year ended March 31, 1956, and £157 less for the year ended March 31, 1957. Mrs Vaile did own 999 shares in Vaile Garments, Ltd., but the Court had authority to go behind the legal title. The plaintiff, in feet, did not seek to disturb the title but only for a ruling that Emily Vaile held shares in trust for Vaile.

Court’s Comments His Honour said it might be of significance that the formation of Du Vaile Garments and Emile Gowns as companies was at practically at one and the same time. What went on immediately before the formation of these companies could be significant and he wanted all the help he could get from counsel in submissions on these points. “It is shown dearly in the cash, books of Du Vaile Garments before incorporation as a company that Mrs Vaile was drawing £lO a week and Vaile £2 a week. Hus is just one of many pieces of evidence that pdint to the fact that two people, Vaile and Mrs Vaile were carrying on a busi-, ness in common with a view io profit—which is a, satatutory definition of ‘partnership’,” counsel submitted. He submitted that the arrangement carried on after the incorporation of Du Vaile Garments as a company and, irt effect, the two were sharing the profits.