ACTION FOR LIBEL AGAINST THE DAILY TIMES." SUPREME COURT.—CIVIL SESSION. (Before his Honor Mr. Justice Chapman.)

Daily Southern Cross, Volume XX, Issue 2259, 17 October 1864, Page 6

ACTION FOR LIBEL AGAINST THE DAILY TIMES." SUPREME COURT.— CIVIL SESSION. (Before his Honor Mr. Justice Chapman.)

; NEW ZEALAND BANKING COnPOKATION (MMITSD) Y. -„ "s. ' , •-- - CDTTBX AND ANOTHER. '■? This was an action, for libel brought by John Reid »' Mackenzie, manager and attorney of the New Zealand Banking Corporation (Limited), ag"ainst William ; Hem y Cutten and Julius Vogel, piopiietoi'3 of the Otago Daily Times'. " Great interest in the case was ( manifested ; the court being crowded tluon"houb the " day. ( Messrs. James Trendergast, J. E. Barton, and James Smith, weio for the plaintiff ; and Messrs. Sewell and Gairick, of Christehurcli, for the defendants. • ,As soon as the special jury had been sworn, • Mr. Sewell asked leave to amend the second plea by the insertion of the words. " as a bnnk of limited liability," and to make some othei consequent amendments. Messr?. Barton and Pendergrast were heard against the amendments. The Judge niled that they should be made. Mr. Sewell then applied for leave to amend the second piragi\i|ih of the 6th plea, so that it might coi respond with the ovact terms of tho alleged libel — justifying the facts, mil setting foitli that tlto alleged libel was only a. reasonable and fair comment on these 1a 1 ts. - A very long and strictly legal argument onsucd ; the principal points nr^cd as against tho amendment being that tho plaintiffs had a vosted interest in tho plea as pleaded, and that it would be to the benefit of their case that what was asked —w Inch was a reconstruction rather than* an amendment— should not be allowed. The Judge held that any plea could be withdiawn at any moment j and that it would then be unfah that what had been couiteously wilhdiawn should be made.matter of comment to the juiy on behalf of the plaintiffs His Honor suggested that the plea should take the form of declauug the truth of the essential uarts of the alleg d libel. Mr. Sewell nssohted, and various modifications were proposed and discus ed, and the oiiginal fouith plea was sti uck out. Ultimately, the declaration and pleadings stood thus • — That before and ,\b the time of the committing by the defendants of the grievances hereinafter mentioned, the plaintiffs were incorporated under and in puisuance of an Act of the Imperial Legislatui c, made and passed in tho 20th yeni of the icign of our present Majesty Queen Victona, and eutifcled "The Companies Act, lS(i2," by the name of ' The Xqw Zealand Banking Corporation (Limited}, 1 ' and at the same -time of committing the said giievauces, the plaintiffs were cai'rying on business as bankers at London, in that pat t "of C4ieat Bntain and Ireland called England, an,d also 111 Dimedui, in Otago, 111 the colony of New Zealand, and the defendants," at the time, namely, the 2Sth June IS6I, when the plaintiffs weie so incorporated and carrying on business as aforesaid, falsely and maliciously printed and published of the plaintiffs 111 a newspaper called the Ota/70 Js,n7i/ Tunes, the following — that is to say "This reminds Jus ,of the e\ti aouliuary manner in -which Mr. Hivt6hison's offer (meaning an offer made by Mr. .'rfitjtchiswi to the dnectois of the Dunedin Gas'Coiiipau'y, to tiko a lease of their gas-worts, on certain tcims) came befoie the Directors (meaning the Dnectors of the Duuedin Gas Company) It (meaning tho said offer) was bickod up by something moie than the influence of a bo ly called the New Zealand Banking Coipoiation (meniiinir the plaintiffs). ' Its acceptance -n as made tlie price of the loan, of a sum of money. Weio the institution referred'to (meaning the plaintiffs' bank) what it purports to be— a public" bank— we should feel it a duty to stigmatise such a pioposition in the seveiest teuns, as injuriously opposed to functions coming within the scope of a banking institution. But in ti nth this (meaning the plaintiffs') so called Corporation is only one in name— ib has neither Charter nor Act of Coipoiation, >.nd evades the law by assu»i uifj to be a public hank We aie, peihaps, entitled to vcgaid it (meaning the plaintiffs) as somcthiug between a Mo'ifc de Pietfi (nieaninw thereby a paw nbrokm^ establishment) and a Credit Mobiher Society, trading in a name closely reseiuUint; that of s>la\\ Hilly corpoiatod bank. Still, making every allavUnce for the anomalous natine of the institution (meaning thereby the plaintiffs) making the offer, it mnstbe pionoimccd a veiy e\traoidiuuy onp Its <uibstance is. 'hat on ceitun t> rms and conditions this nnmcoipmated corporation (me ming thereby the plaintiffs) will advance a sum of money on th&debentuies of the company, 111 conMdenfcion r,f a lea«e of the wmks beinsj granted to Mr Hntjh.so-i it a retitil of 10 per cent.' on thoir value. On the fate nf this pioposil tlicie is almost undeniable juftoft' that the advancer (mcaninc thereby th- pl.iiirti'l) of the money is to take a beneficial interest 111 the lelease. Otheiwisc, if more sccunty weio wanted, the stipulation that the lease should 1 c granted u ould not be asked. A moment's consideration shows this lo be the case. At the time tho offer was subletted, a committee was examining into Mr. Hutchison's management, in consequence of complaints having been~'alle»ed against it With.no oppoitunity of sifting tliese allegations the offer was miile. mid one of its effects was the suspension of the inquiry. Again the ofieier er guarantor Jmeaning the plaintiff«)~mnst be aware, if his proposal is carried out, that the shaieholderswill have no object 111 continuing theii liability. Having no voice in the management, all they would want would he the interest "011 their shaies. This they could collect through any one to whom they might transfer them ; and if the proposer he a business man, he need scarcely be told that a few weeks after the arrangement is made theie will not be responsible shareholders to whom he can 1001, People would be fools indeed, for tho take of "otdnw ten per cent, on the value of their shaies, to continue an enormous liability. The works mk'ht blow up • the Company might be cast m damage ; or losses might occur in 1 * .hundred ways, and the holders of debentures have to look to the shareholders for repayment Its may be safely predicted that no shareholder woiikl.pia.ee himself in such a position and the lenders of tho money, thereFore, will simply have te rely <nrth*woi ks for repayment. But if the unincorpomted -oowoiation (meaning theieby the plaintiffs) did noe'intsnd to take an interest in the lease (meaning tHe "lease to be giantod to the --aid Mr. Hutchison) iat would have much greater security for thd 'mftney. The shaiehokleis, equally with the directors, -would have been lub!e for ib. Tf the services of tho proposed le-see weie valuable' the Company 4iad> them alieady s cmed ; and supposing he would do as much for his employers as for himself, the ptofits which he could make would be available as .security; only the Company would not have 'been obliged to retain his services, and if 'desirable, it could have secured another manage- The security, then, in lending the money '.to the Company, unfettered by the leasing condition, was superior, and since the lender (meaning Ihe plaintiffs) desired the lesser security, it is U\v to ass.nne that he was to take an uileresi 111 the lease the granting of which was made al.'conditiona 1 . 'condition of the loan of tho money. But thtfn. come to the question, what right has an institution (nun ung the plain tiffs) pretending-. 'to bo a public one, to act liitmsman-ner.-aud.'takea suneptitioiw iuterest in »n undertakrncr 'Without making it.elf responsible (meaning tliereUj, that the plaintiffs h.ul oflerod to lend-a sum bf -jiftuey to the Duuehu Gas Company to be secuted by a, mortgage of the company's woiks to the plaintiffs "On condition that the said company would grant a tease of their works to one Mr Hutchison, and tha<-, tho plaintiffs secietly and fraudulently were to be inte-ested m the said lea>,e, and in the piollfcg to bo morlo by the carrying on of the Bud. gas work* fcW fc,l c tlie said Mr. Hutchfson was to be apparently 4Tw only person responsible as lessee of the works, and that the plaintiffs intended thei ebv noretly and. fmiKldlontly to share the said profits, without rentfenns .themselves liable for any losses th*t might bjeinputml during the continuance of tho said lease;) ,lh,w.i» the point about which the public are concerned. -..Tho Gas Company will ,. ass into , hands lt^will, be impossible to make lespo.mble. ? e 2^* es , r f?P ODSlblllt J r en <i' -with a deposit note of £500, whmlfrlie. is to give as for lent. But to whom ace the consumeis to look m case they sustain diMnagss^ There are many contingencies under which' gas suppliers might be liable for heavy damages— escapes of gas, for instance, might he productive of large losses, for which the company would be liable. .'But with dummy shareholders, with an •undisclosed partner (meaning thereby tho plaintiff) and with a lessee liable only on a deposit receipt giren ,as security for rent, to whom are the confumen to look ? » Whereby the plaintiffs wcie in- - jured in their'credit and reputation as such eorporawon as 'aforesaid, and as such bankcid as aforesaid, ; *nd-m their said banking business i \ h , ere [ or f * he Plaintiffs claim to recover from the „ defendants the sum of £5,000. *,* •» Thejollowing were the pleas :— "jj*, defendants say— That they deny all the .^mttenal- allegations in the declaiation contained the allegatious thab tho plaintiffs were , oeforo and at the time of th.c committing of tlie

alleged grievances incorporated under and in pursuance of an Acb of the Imperial Legislature, made and passed in the twenty-sixth year of the leign of our present Majesty Queen Victoria, entitled " The Companies Act, 1862," by the nam» of " The New Zealand Banking Corporation Limited," and that at^thc time of the committing of the said -alleged grievances the plaintiffs were cairying on business as bankers, at London, in that part of the United Kingdom of Great Britaiu and Ireland called England, and also iv Dunodin, in the province of Otago. Second Plea : And for a further plea, the defendants Nay :—: — 1. That the alleged libel in the declaration set forth formed pmt of an editorial article, printed and published by the defendants in a newspaper called the Otago Daily Times, on the 28th day of Juue now last past. <. 2. That the said article and the said alleged libel were fair and bon,\ fide comments and cuticisms on the nature :inrt character of the business of the plaintiffs earned on in Duucdin afoiosaid, and of the nature and chai actor of their bank in the said place, as a public institution, and ot tho conduct of the plaintiffs in their capacity of public bankers, in, relation to advances made or to be made by them to a certain public compauy, called "The Duucdin Gas Light .uul C'oko Company," and on the effect winch tho making of tho «aid advances would have upon the interests of shaieliolrieis and other poisons inteicbted in the welfare of the «iaid company 3. That the •-aid alleged libel was so printed and published as afoicsaid by the defendant without any iiialicc on their part. Tliiul Ploa : And for a further plea to so much of Iho said alleged libel as imputes to the plaintiffs th.it limy weie a coiporatiou only m name, and that they canied on business without cluiter or act of in coipoiation, the defendants say — 1 That bofoie and at the time of the publication of the said alleged libel, the plaintiffs, byandthiongh one John Reid Mackenzie, their attorney, cai-ned on business as [public hankei? in Dunediu, in the pro - Miice of Otago, undjr the n.uno or style of "The New Zealand i'auking Coipoiatiou (limited)," as a bank with hunt >d liability, without being empowcied by any Act of the Legislatuio of New /Zealand, or by any Act of the Imperial Parliament extending to or in force in tho said colony, or by her Majesty's Letters Patent, or by lioyal Charter, or by any other lawful means 'wlutsoe'vci, to sue or be sued in a corpoi ite name iv her Majesty'-* Courts of Judicature iv New Zealand, and without being empowered by any of the means aforesaid so to cat ry on such business, or to acquire and hold real or personal piopeity in the said colony, and without being empoweied by any of the means afoiesaul to issuo bank notes or bills for the payment of money, and without malting tho lefcunis icqnned by the Bankets' Returns Act, ISoS, and the Cankeis' Returns Act Amendment Act, IS6O ; although all times elapsed and all things happened to lender it incumbent upon the sad plaintiffs to make the said requited lctuiiib, wheicby, andiu consequence whereof, cieditois of the saM plaintiffs would be put to and sustain great and unnecessaiy expense, inconvenience, and delay in receiving payment, by legal pio cess, of then jut>t debts and demands, andp'opei supervision could not be had or cxeieisetl by the sharoholdeis and customeis of tho said plaintiffs over the busmen and concerns of the plain tihV said banking establishment, in New Zealand afoies-aul. 2. That tho woiils in this plea pleaded to weie used with lefcrencc to, and weic only intended to, and did only apply to, the blanch of the plaintiff's said banking businoss, established in New Zealand managed and conducted by the said John Eeid Mackenzie. Fourth Plea: And for a fiuther pica to so much of the said alleged libel as imputes to the plaintiffs that they tiadod in a name closely lesembhng that of a lawfully mcoipoiated bank, tlie defendants say :—: — That for neatly two yeais pnor to the time when the plaintiffs commenced to cany on business as bankers in New Zealand, afoiesaul, to wit ; in or about the month of Januaty, now last past, and thcncefoith at all times since, a certain company incorporated by the name ot style of the Bank of New Zeala d undei andby vhlue of the Now Zealand Bank Av,t, ISOI, made ana passed by the Governor and Legislature of tho said colony, in the 24th and 25th ycais of the leign of her present Majesty, earned on business as bankers in Duticdiu and in diveis othei places iv the said colony, in the name .inn on behalf of the said Bank of New Zealand ; and the plaintiff* by then said attorney, well knowing the pi anises, commenced to catry on and weieat the time of the publication of the said alleged libel engaged in cairying on business in Dunedin, •ifoicsaid, as bankeis, under the name oi stjle of 'The New Zealand Banking Coipoiatiou (Limited).' Fifth Plea. — And foi a fiuther plea as to so much of the said alleged libel as lelates to the pl.untilN, contained in the wouls following, that is tosiy . — "Still, making eveiy allowance for the anomalous natuie of the instituti')ii making theolfct, it must be piononnced a veiy e\tiaotdinary one. Its substance is, that on ceitaiu conditions Ibis unmcorpoiated corpoiation will advance a sum of money on the do bontiues of the company, iv consideration of a lease of thowoiks being gi anted to Mr Hutchison at a rental of ten per cent, on their value. On the face of this, proposal there is almost undeniable pi not" that the advancci of the money is to tike a beneliuial intctest in the leise. Otheiwisc if mere security weio wanted the stipulation that the lease should be granted would not be asked. A moment's consideration will show tins to be the case. At the time the offer was submitted, a committee was examining into Mr. Hutchison's management, in con-equence of complaints having been alleged ngainst it With no opportunity of Mftrig the^e allegations, the offer was made, and one of its effects was the suspension of the inquiry." 1. That the defendants say that Hie facts alleged in the declatationas libellous aie substantiilly true. 2. That pnoi tr> the tune of the publication ot the sail alleged libel, a ceitam joint stock company, called "The Duucdi u Gas Li>,dit and Coke Company," thon causing on business in Duntdin afore said, was indebted to divers persons and bodies cot porate in certain large sums of money. The replication states : — Ist. That they join issue on the defendant*' fir,t plea 2nd And for a replication to the defendants' second, third, fouitli, and fifth pleas, the plaintiffs deny- all the material allegations theiein contained The issues stated to the jmy weie as follow — 1. Have the word* in the declaration mentioned the ilefamatoiy sense «et forth and averred by the plaintiffs, or any othei defamatoiy sense 2. Were the said words fair and bona fide comments and ciittcism-. on the natuie and character of the business of the plaintiff earned on in Dunedin afore-aul, and of the natui c and character of ' then bank iv the said place as a public institution, and of the conduct of the plaintiffs in their capacity of public bankers, as iv the defendants' thiul plea is alleged t 3. Were the plaintiffs, at the time of the publication of the said words, engaged iv cai lying on business in Duneilin, as a bank with limited liability, without being lecognised as a corporation by the law m foice in New Zealand, and without being c'othed with the powers necessity to give oubnaiy lemedies to creditors, and without being emp nveie I by law to catry on business as a bank' with Hunted liability, or without being abJc to e\ciciso the usual functions of bankets iv New Zealand, and without making the periodical letuins lequhwl by law » 4 Are tho allegations m the defendant-.' fifth plea substantially true? 5. What damages, if any, are the plaintiffs entitled to recover fiom the defendants 1 Plaintiff to admit, that the Bank of Now Zealand, incorporated by Act of Assembly in New Zealand, caines on the business of a banker in Dunedin. Defendants to admit the publication of the a'lef'ed libel.— Olarjo Daily Timti. October 5. °