Director Called 'Unprincipled'

Press, Volume CV, Issue 31058, 13 May 1966, Page 1

Director Called 'Unprincipled'

(N.Z. Press Assn.—Copyright) MELBOURNE, May 12.

Some of the activities of the Korman group of companies appeared to have involved not merely mismanagement but misfeasance, breach of trust and dishonesty, Mr P. Murphy, Q.C., said in the latest report on his investigations of the Stanhill group of companies.

The report said Mr S. Korman was wholly unfit to direct any public company.

It also said that Mr Korman was “unprincipled and untrustworthy” and that his

aims stemmed from his ambition for power and money.

Mr Murphy, a Government investigator, said this in an interim report on Factors, Ltd., and other companies in the Korman group, tabled yesterday in the Victorian Parliament.

He said it might appear that, whether or not Factors was wound up, proceedings ought in the public interest to be brought against officers of the company for recovery of damages. Mr Murphy said this was a matter for the Chief Secretary (Mr Rylah) to consider. “I expressly forbear from making recommendations with regard to the possible criminal and quasi-criminal proceedings which may be taken against Factors or its officers,” he said. 4

However, when considering whether some of the directors might have been guilty of offences against a subdivision of the Crimes Act, Mr Murphy said he noted there was a limitation period for the bringing of such prosecutions. This limitation period of two years after the commission of the offence or six months after the first discovery was far too short. Mr Murphy recommended that it be lengthened to give the Attorney-General a discretionary power to allow prosecutions even though the period had expired. Number of Instances “In my opinion the facts set out in this report discloses a number of instances of misfeasance and breach of trust by directors of Factors," he said. y

“It is inconceivable that the company, which is dominated by Stanley Korman, would institute proceedings to recover damages against its former or present directors. “A shareholder in the company is not in a position to take such proceedings.” Mr Murphy said that at this stage he would not express any opinion as to whether or not Factors should be wound up. If misfeasance proceedings could only be taken by a liquidator and if it followed as a matter, of course that a liquidator after his appointment would take such action, then this would be an argument for winding up. However. Mr Murphy pointed out that it did not necessarily follow that a liquidator would Institute proceedings.