VERDICT TO-DAY

Dominion, Volume 28, Issue 115, 8 February 1935, Page 13

VERDICT TO-DAY

Trial of Gilmour and Vickers EVIDENCE COMPLETED Mr. T. C. A. Hislop Called as Witness 'Evidence in the trial of Charles Ernest Vickers and Ernest Mabin Gilmour, who are in the dock at the Supreme Court, Wellington, on charges of conspiracy to defraud and misrepresentation in connection with the sales of shares in the Craftsman, Manufacturing Company of New Zealand, Ltd. (in liquidation), was concluded yesterday The case will conclude to-day. Counsel for Gilmour will address the court this morning, and Mr. Justice Smith, the presiding judge, will then direct the jury. The Crown prosecutor, Mr. I’, b. K. - Macassey, and Mr. W. D. Virtue, are prosecuting. Counsel for the defence are:—Mr. W. E. Leicester and Mr. T. p. McCarthy for Vickers,, and Mr. W. P. Rollings for Gilmour. Continuing his evidence yesterday morning the accused Vickers said the package of papers forwarded to the National Bank in Wellington from Australia dealing with the formation of the proposed New Zealand company was handed by witness unopened to Mr. T. 0. A. Hislop, whom the bank recommended as a solicitor who would attend to the preliminaries for the flotation of the company. Question of Patent Rights. Mr. Hislop bad said he would peruse them. Witness knew nothing about patent rights. He considered it was Mr. Hislop’s job to look into the question of patent rights. At a meeting in Mr. Hislop's office in May, 1930, Mr. Hislop was asked by a prospective in vestor, a Mr. Barbour, if he had the patent rights. Mr. Hislop said, “Hands up, it is not among these documents ’ Witness said as far as lie knew rhe reflector was a patent. He rang anu got a reflector sent round. Examining it Mr. Hislop said, “Yes, here is a patent number. I thought it would be . all right.” A reflector produced in court bore the inscription which witness read as follows: —"Patent Nos. 190032 —204464. Craftsman.” Witness' suggested that Mr. Hislop should confirm a patent, and the others present agreed with the suggestion. Witness thought Mr Hislop would do, or would have done, all that was necessary about any patent after that. At a later meeting in June, Mr. Hislop, who took the chair (the statutory meeting) asked all present if they had read the documents relating to the agreements between the company and the Australian vendor of the rights to sell and manufacture. That was the day the memorandum of association was signed, all apparently being satisfied. At this stage Mr. Hislop entered the courtroom and took his seat to listen to Vickers's evidence. “Never Asked to Explain.” Continuing, Vickers contended that he had done his duty in New Zealand by lodging the documents and asking Mr.-Hislop to go Into them. He did not know there was anything wrong until he received a warrant in April last year. He was never asked to explain. Cross-examined by Mr. Rollings, Vickers said an executive of General Motors told him in 1930 that if the company could sell them the lights a penny or twopence cheaper than they could be landed, business could be done. To his.Honour'witness said he could not describe the executive after a lapse of nearly live years. Cross-examined by Mr. Macassey, witness said he supposed Elight was the only one who had got anything out of the reflectors either in New Zealand or in Australia. When counsel asked witness if he knew what a patent was, Vickers re plied that he had never seen one. Counsel: You’re not as simple as that, are you? You’re a betting man? Witness: I like a little flutter. Not a big one?—No, little ones. You’ve won big bets with Australian bookmakers? Mr. Leicester: The same might be asked a lot of people. It doesn’t take much intelligence to bet with a bookmaker. Visit to South Africa. Proceeding, Vickers said he, the man Kelly, and Gilmour went to South Africa and formed a company there. .After witness had been there for some time and sold some shares, he found according to the Roman Dutch law that It was not allowable to sell vendor's shares until six months after the registration of the company. His Honour: A very good law, too. Mr. Macassey: A pity it had not been done here. Witness said he had voluntarily refunded the money obtained for such shares. Mr. Hislop was called by Mr. Macassey to give evidence of rebuttal. . Witness described how Vickers came to him with the papers from Australia and how he went through them and found that no patent existed, but only a trademark. A search on the New Zealand patent office revealed that no patent was registered in New Zealand for the lights. All the principal people connected with the formation of Craftsman Manufacturing Company of New Zealand up to the time of the statutory meeting, including Vickers, knew of the absence of a patent. If Vickers claimed that he did not know that no patent protection existed, then he was not speaking the truth. Mr. Hislop Cross-examined. Cross-examined by Mr. Leicester, witness explained that he wrote to the solicitor of the Australian vendor, Flight, of the rights to the reflector, whether a patent existed and for general information about the Australian company. A cable came back from Flight to the effect that no patent existed, but that the secret process of manufacture of the device w r as adequate protection for intending New Zealand investors. The letter may or may not have been sent before the statutory meeting, witness saying he could not be sure after so long a lapse of time. He did not take the customary solicitor’s diary note at the time, but relied now on his flies.

He could not recall whether a specimen lamp had been brought into his office and that he had examined it and found a patent number. “I would not have said that a patent existed simply because there happened to be a number on a bit of metal,” said witness. “As for my advising people that the number was evidence of a patent—that is absurd.” Mr. Leicester: Do you consider a trade-mark would have given adequate protection? Witness: Alone it has little value,

but when the process of manufacture of the lights was secret and difficult to imitate there would be some measure of protection. The vendors were getting £15,000 from the people of New Zealand, so do you think the trade-mark was worth that money to prospective investors? — I cannot attempt to assess the value of the trade-mark. There was also the protection afforded by the difficulty of imitation. It was left to you to see that the New Zealand company was protected? —All associated before the statutory meeting knew they were getting only the trade-mark, The 1 directors? —As far as I know. All who saw me prior to the statutory meeting knew there was no patent. “Disagreeable Process.” Counsel was continuing in this strain when he was asked by Mr. Justice Smith how far he was endeavouring to carry Mr. Hislop’s responsibility for advising on the question of the trade-mark. Counsel: I am endeavouring to ascertain how far he carried the information that a trade-mark but no patent existed. His Honour: You are limited as to the extent of Mr. Hislop’s duty. If you, are going beyond the statutory meeting you are going too far. Counsel said he agreed that Mr. Hislop had no obligation beyond the statutory meeting, unless he thought the company was not getting value for its money. That closed the evidence. Addressing the jury, Mr. Leicester said it was a disagreeable process for one man to attack another of the same profession. It must be understood that he was not attacking Mr. Hislop personally, nor his attitude in connection with the company. That did not matter to the jury or to himself (the speaker), and it did not matter whether Mr. Hislop was negligent or not, but he would make it a main plank in his case that the question of the patent rights had been left in the air by Mr. Hislop and that for some weeks the position was not made clear. If the position had been clear in Mr. Hislop’s mind he would not have written to Australia for further information as he had done. “I am not making any personal attack,” counsel continued, “but I have to bring Mr. Hislop into the case' because his duty was to satisfy himself that the New Zealand company was getting full protection. Vickers and the shareholders had the right'to assume at that time that everything was in order. Apparently Mr. Hislop was satisfied that £15,000 should be paid to the vendor because lie thought the trade-mark was a good protection. There is no tittle of evidence that the New Zealand company ever tried to get patent rights for New Zealand.” Prosecutor’s Address. In his address the Crown prosecutor, Mr. Maeassey, said it was clear from beginning to. end that tlje two accused and the man Kelly had been working together. Gilmour vr.s out telling the lies all over the place and as manager of the company he never attempted genuine trading. Vickers was unloading the vendor’s shares as hard as he could with the assistance of the two others. The company was merely a blind for unloading the shares on tlie public. The charges were not that the accused had defrauded the company, but that they had defrauded the shareholders. Their purpose was to sell as . many shares as they could quickly and then clear out. The case will conclude to-day.