Former I.V.M. Directors Must Repay £150,000

Press, Volume C, Issue 29702, 21 December 1961, Page 19

Former I.V.M. Directors Must Repay £150,000

(N.Z. Press Association-Copyright)

SYDNEY, Dec. 20. Two former directors of International Vending Machines Pty, Ltd., were ordered by the Supreme Court today to repay £150,000 to the company. They were also directed to pay interest on it from June, 1959. to the date of payment, at the rate of 5 per cent, a year. Mr Justice Jacobs made the order against Louis Steen and his son, Joseph Steen, of Dover Heights, an ■ Eastern Sydney suburb. Charles A. Law, official liquidator of I.V-M- had sued the Steens for £200.000. The Judge said the case was a classic example of the mischief which a section of the Companies Act sought to prevent. The Steens, it was claimed, negotiated an invalid loan of £200.000 between I.V.M. and A.M. Holdings Pty, Ltd, in June, 1959. to enable the latter company to buy shares in I.V.M. Evidence was given that

Joseph Steen and his father and a brother sold I.V.M. last year for £260,000. Mr. Justice Jacobs wound up I.V.M. on a petition by the Taxation Commissioner, to whom the company owed £673,000. Capital of £lO2 The Judge said I.V.M. was incorporated in June, 1958, with issued capital of £lO2. divided into shares of £1 each. Louis Steen and Joseph Steen had 46 shares each, and were the only directors. Sidney Steen held 10 shares. The present application, he said, was to make Louis and Joseph Steen liable for a loan by the company to A.M. Holdings of £200,000. The money was used to buy from them and from Sidney Steen their respective shares in I.V.M. Mr Justice Jacobs said a primary fact was that a company had lent £200.000, without security, to another company. whose only asset, in effect, would be the shares in