Jurisdiction hearing

Press, 25 November 1981, Page 7

Jurisdiction hearing

PA Wellington The Securities Commission does have the power to investigate the circumstances of a particular company take-over, Mr John Wallace, Q.C.. has told the High Court at Wellington. He was representing the commission at a hearing which is regarded as a test case to determine its jurisdiction. The applicants seek a prohibition order preventing the commission from inquiry into the proposed take-over of Properly Securities. Ltd. by City Realties. Ltd. Those parties are City Realties. Mr Frank Renouf. who is chairman of Property Secrities. Renouf Invest-

ments. Ltd. and the National Insurance Company. The hearing was’before Mr Justice Quilliam, who reserved his decision. Mr Wallace said the commission regarded the hearing as being of the utmost importance. If its powers were restricted in the way in which the applicants contended, then the commission did not. under the Securities Act. 1978. have a role as a watchdog of developments or events relating to securities. If that was so. Mr Wallace said, its role was limited to making reports only after events had happened — a very limited, retrospective law reform role.

The arguments advanced by the applicants were inconsistent with the clear purpose of the act, which was to give the commission appropriate powers, to keep the law and practices concerning securities under review. Mr Wallace said that the act allowed the commission to review the circumstances of a particular take-over, and that review could take place before a take-over was completed. These points had been rebutted earlier by the counsel for City Realties. Mr D. L. Mathiesdn. His Honour said his decision would be released as soon as possible.