Standard Contributories Seek Spread Of 10s Call

Press, Volume CI, Issue 29802, 19 April 1962, Page 12

Standard Contributories Seek Spread Of 10s Call

(New Zealand Press Association) DUNEDIN, April 18. Proposals to postpone and spread the payments of uncalled capital in the Standard Insurance Company were made at a meeting of the company’s contributories in Dunedin today. The meeting, which was attended by only eight contributories, had been called to make recommendations to the committee of inspection on the proposed call of 10s a share. (

The liquidator, Mr H. S. J. Tilly, announced earlier that he intended to make the call payable in Dunedin on June 29. None of the former directors of the Standard Company was present at today’s meeting and one of the contributories, Mr E. A. Bolwell, described their absence as a “most discourteous action.”

“This is an extraordinary meeting,” said Mr Alex McMillan, a sharebroker and a contributory. "There are only eight men here, and considering that the meeting is to discuss the payment of £500,000, the apathy and indifference shown is remarkable.”

There was only one woman at the meeting, but after a few minutes she realised she was at the w’rong meeting and left. The first recommendation and the only written proposal to come before the committee yesterday was a letter from a clergyman's widow. She had written to the committee some months ago* indicating the hardship she would suffer from having to pay the call of 10s on each of her shares. She suggested ’ that her burden would be eased if the call was made in instalments over a period of three years. “told Nothing” Apart from the Official Assignee's report, Mr Bolwell said that up to the present, shareholders of the company had been told nothing. He thought the call was “a bit premature” and he asked if the committee had thought of having a court of inquiry into the company’s failure or of asking the Government to institute a commission of inquiry. “There have been commissions in New Zealand for lesser matters than this.” Mr Bolwell said. There had been ■ a lot of names mentioned in connexion with the company’s failure, and if a court of inquiry was held shareholder? would know who was to blame. Opinion Questioned The company’s directors had paid out £1 million on the oral opinion of a Sydney lawyer, said Mr Bolwell. That, surely, was not a businesslike move. “Could you imagine any company director doing that? It was deplorable.” he said. Mr Bolwell then asked if the chairman of the committee of inspection (Mr M. M. Caudwell) of the liquidator had questioned the lawyer and if they had obtained a written statement. Mr Bolwell said he would like to see the statement if one had been obtained. Mr Bolwell said he also

wated to know if the committee had been in touch with Mr Wilson, the former Sydney manager of the company, and obtained his opinion. “We have been told nothing about Mr Wilson, or if his arm was being twisted,” Mr Bolwell said. “There will be some people this call will not affect, but there will be others who will find it difficult to pay.” To ease the burden for shareholders, Mr Bolwell suggested that the call be spread over two years with 2s 6d to be paid every six months. Inquiry Sought

He said he also thought the call should be deferred until there was a court of inquiry. “We should all know how the money was lost in Standard.” he said. Mr Caudwell assured Mr Bolwell that his questions had been investigated, but. at present, the committee members “are not here to give an explanation on these matters.” “How much in the £ will creditors get?” Mr McMillan asked. Because of the claims outstanding. this figure was not known, said Mr Caudwell. The money from the call was payable to the National Insurance Company and the call was due on March 31. with interest payable from April 1 at the rate of 4 per cent, or £28.000 a year. (The amount mentioned by the committee as owing to National Insurance was £695,000.]

“Some people will be facing bankruptcy over this call,” said Mr McMillan, who added that he wanted to know how far the liquidator was going to go in getting the call money. He said he wondered if National Insurance could extend the date of payment. Mr McMillan agreed with the widow who said in her letter that the call should be extended over a three-year peirod. By delaying the call and spreading payments it would ease the burden on shareholders. "I expected we would have seen some sort of statement on the company’s affairs at this meeting,” said Mr J. W. Smeaton. “I think it is a matter of great interest.”

“Who ar? the creditors? How many are represented by fraudulent bonds? What are their names? How many are claiming on legitimate claims?” he asked. “If we knew these things we would have a better picture of the affairs of the company. “I would favour postponing the call until the liquidator is in a position to place these things before the contributories.” Mr Smeaton said. Mr W. N. Satterthwaite, a member of the committee, said the liquidator was preparing a statement for con. tributories, and this would be available later. Mr H. L. Gibson, a contributories’ representative on the committee, said the problem of the company's winding-up was too great for sectional interests between creditors and contributories. “We are outsiders appointed after the company had crashed and we are all aware of the personal tragedies both for the shareholders and in some cases of creditors. “We don't represent sectional interests.” ‘ said Mr Gibson. i Directors Criticised "Can I have your assurance about the question of having a court of inquiry?” Mr Bolwell asked. “We are fearing nor favouring no-one.” replied Mr Gibson. Another contributory, Mr C. D. G. Toomey, considered that shareholders should have the full story of what happended to the company. “We have heard very little from the directors in the past, and we should know all the steps that were taken.” At this stage Mr Tilly said many of the points mentioned by the speakers were sub judice. “Why all the secrecy?” Mr McMillan asked. '"You have given us nothing and don’t intend to give us anything.” Mr Tilly then explained that details of the company affairs, including details of creditors had already been filed in Court. “What we want to know is> why Standard collapsed,” said Mr Bolwell. "Big Deficiency” “Even after paying the call there will still be a big deficiency for creditors.” Mr R. J. Knowles, a member of the committee of inspection, told the meeting. “In my mind, there is no hope of anything going back to shareholders and there may be a great loss to creditors. Delaying the call would cost £28.000 a year in interest, and we would only be tinker, ing with the problem of the winding-up.” Mr Cai.dwell told contributories that their views on the call Would be considered by the committee of inspection.