THE TE ARO HOUSE CASES

Evening Post, Volume LV, Issue 124, 27 May 1898, Page 5

THE TE ARO HOUSE CASES

THE INVESTIGATION CONTINUED MR. JAMES SMITH'S EVIDENCE. The hearing of the charges against John Craig of the theft of certain moneys belonging to Messrs. J. Smith & Co., of Te Aro House, was resumed at the Magistrate's Court this morning before Mr. H. Eyre Kenny, S.M. Mr. Ollivier appeared to prosecute, and Mr. Young defended the accused. Hugh Jones, in charge of the carpet department at Te Aro House, stated that there was money standing to his credit at Te Aro House — about £160. This money had been accumulating for about four years. Had never been asked by the accused or anj r one else to put his money into the Dannevirke branch of Te Aro House. It had been used with his consent in the Levin branch, which was purchased by Craig and witness iv November last. Regarding the £450 said to have been credited to the Dannevirke branch in the names of Jones, Taylor, and Maguire, witness had contributed no part of it. To Mr. Young — When he deposited the mtfne}' with the firm it was at interest, and he did not care what the firm did with it so long as .he got back his principal and interest. At the time Craig got witness to leave his money on deposit with the firm Craig told him that he himself was depositing money with them. " i To Mr. Ollivier— Expected to be able to get the money when ho wanted it. John Bell Taylor, in charge of the Manchester department at Te Aro House, stated that he had had £100 on deposit with the firm since 1893. This sum was at call, and bore interest at 7 per cent. Had never consented to this money being put into Ihe Dannevirke business. The money was lent to Mr. James Smith lo do what he liked with. Had not drawn any interest on the money, and had never asked for the money. James Smith, draper, carrying on business at Te Aro House, stated that Craig entered his employ about 10 years ago as a junior clerk at a salary of 30s a week. He gradually rose in the service until March, 1895, w^ien witness took a partner, Mr. W. H. Carter, agent or buyer, of London. Craig was then confidential accountant. When Mr. Carter joined the firm he gave a power of attorney to Craig, who continued to keep the confidential books. As a rule witness handed the salaries to the employe's, but Craig prepared them. Craig went over the salariesbook, added up the amount, which was written on a piece of paper, and a cheque was filled in for witness to sign. When witness was away Craig signed cheques. Witness did not check Craig's figures, but signed as a matter of course. The cheques, after being signed, were taken to the bauk — generally by Mr. Skeeu— and

"when the cash was brought back it was hauded to Craig, who divided it into the ■amounts of the salaries, which were then put into envelopes. These envelopes were given to witness, who handed them to the employes of the. iirni. Witness had nevoi made up the envelopes and their contents. Mr. OUivier — Did you ever authorise the accused to draw from tlio Bank more money than Mas required for the payment ol salaries ? Witness— No. Regarding the list ol cheques (produced), he was prepared to say that he did not authorise any ot them to be overdrawn as was shown. Knew about the time that Craig bought a buggy from House & Hurrell. It was not bought for wituess, and witness did not authorise it to be paid for out of the firm's moneys. Never authorised Craig to draw moneys of the firm aud pay them into his own account. Was aware that in 1896 Craig built a cottage in 13 id well-street. Did not authorise any portiou of the cost of that building to be paid for out of the moneys of the firm. There were branch businesses conne«ted with the firm— namely, at Westport, Palmerston, Waipukurau aud Masterton, Levin, Fielding, Dannevirke. * The firm got rid of those branch businesses. The Dannevirke business was disposed of to Barsby & Co. The "Co." was Craig. The sale of the business was entrusted to Craig. Witness was away from business, ill, at the time of the sale, but he made no objection to Craig selling the business to himself (accused) and Barsby. lie left the whole matter in his hands. " Craig mentioned that the money of James Taylor and Maguire could be applied to the purchase of the Dannevirke business, but witness told him to on no account use it without their consent. So far as his knowledge went, the money was not taken out of the Te Aro House business to buy the Dannevirke business. To Mr. Young — Craig represented a full partner, and the document produced was his second power of attorney. Witness treated| mm as having the powers of a full partner. . Craig's salary was not paid out of James Smith & Co.'s money, but by Mr. Carter. Among Craig's powers was the right of signing cheques, and his chief work was to look after the office, witness looking after the house. Accused had witness's entire confidence. Mr. Young— Yon yourself, Mr. Smith, have not authorised the making of any charges against him ? Witness— No. Did you make any of these charges against Craig ?— No : 1 have made none. lias Mr. Somerville requested you at any time to make these charges, or some charges ? — I don't think he has. Has Mr. Ollivier or his firm ?— No. Have you had any correspondence between Mr. Ollivier and yourself relating to the charges being made ? — No ; Sir Eobert Stout has received all the correspondence. Some discussion took place on the question of putting in this correspondence, duriug which Mr. Young remarked that surely Mr. Ollivier did not wish to disguise anything. The Crown could not wish to conceal any matters, but the bank might. Mr. Smith did not know if the letter asking him to prosecute Craig for preparing false balance-sheets had been submitted to him by Sir Eobert Stout. He did not think so. Mr. Young— Didn't you know that Mr. Ollivier was asking you through Sir Eobert Stout to lay an information against Craig, and Sir Eobert refused on your behalf to do so ? — I believe that is so. And after this prosecution was commenced hy the police, were you not asked, through Sir Robert, to take it up, and you declined ? — I do not know. Mr. Young — But did you receive information from Sir Robert to that effect ? Here the Magistrate interposed, and said thai the witness need not, unless he desired, tell particulars of any communication betWHPii him and his solicitor. Witness said he did not think that Sir Itobert had told him that he had declined on his (witness's) behalf to take up the prosetion. Craig did nofc tell witness he was . going away. Mr. Young— Didn't you know Mr. Craig was going to Loudon soon after he left Te Aro House ? Witness— He did speak of it. Didn't Sir Eobert Stout tell you he had received a letter from me sayirlg that Mr. Craig was leaving by a oertain steamer ou the- following Monday? — He might have mentioned it! Continuing, witness said there was a meeting of creditors on 15th April. Craig had offered to make any explanation required. Witness sent a telegram to Craig to come down to the meeting of creditors. Mr. Young— And you sent it so that it would be received after the meeting- was over ? Witness— No. The telegram I sent was to Levin, and that one (produced) was readdressed to Daunevirke. I was informed he was at. Levin. Continuing, witness said the Te Aro House branch at Dannevirke wis sold to Barsby & Co. He did not think then that that business was the business of J. Smith & Co., tut did think so now. Witness never arranged \vith Craig to buy the Dannevirke branch. The letter written by Craig to that effect was an absolute falsehood. Witness never saw the letter, and never instructed that it be written. Had never understood that the sale to Barsby & Co. was a pretence. Craig arranged to pay Barnsby on commission, but witness did not know of this at the time. Witness went to Dannevirke to see Barsby himself within the last 15 mouths, but could not remember the month. Was not certain that it was within the last 15 months. Wont there, ho thought, to see about a change of shop premises. Did not see any weekly returns from the Dannevirke business after it was sold. From the time Barsby bought the business witness had had nothing to do with it. Did not/ think he wrote to Barsby, and did not re- , gard the stock as belonging to J. Smith & Co. The letter produced was in witness's handwriting. This, however, was in March last, when tho business was being wound up. A portion of Barsby & Co/a stock was- at that time taken back into Te Aro House to square aocounts. ■ Tho Court at 1 o'clock adjourned till 2.15 p.m. i On resuming, the cross-examination of \Mr. James Smith was continued. After 'sufficient stock was taken from the Danne'■virke business to satisfy To Aro House account, witnesst sent Mr. Pyke up to take stock of the balance, whidh Craig intended to sell. Mr. Pyke returned aud reported. ~Witne.«9 did not see Jensen about buying the balance of the stock, nor did Barsby at any time. Witness did not know Barsby made an offer of £350, which was refused. All that was done by Craig. Jensen did not personally make witness any offer, but had purchased it. Witness got £400 over and above what "was owing to Te Aro House. The Eev. Mr. Findlay (witness's son-in-law) went up to try and collect the book debts, in the employ of the firm, and got £130, which was handed to witness, who did not give it to Craig. Witness knew nothing about Jones's money being transferred to the Levin business. Craig did not tell wiftaess that Jones, Taylor, and Maguire were willing to put their money into the Dannevirke business. Witness said that could not be done without their consent. Mr. Young — But what reason did you have for putting your firm's money into Barsby & Co.'s business if you had no interest in it? Witness — It was put in to accommodate the firm. Witness considered it was a purchase. He thought all Barsby's bills were paid without assistance, but all Patterson's were not. In one instance witness gave the firm's cheque to meet Pattersons' bill. Witness did not know that Craig was giving his

cheque from timo to time to help Patterson Bros, to meet their bills. The cheque witness gave on behalf of the firm was taken out of his own cheque-book, and Craig was then away. Mr. Young — Isn't it a fact that you knew Mr. Craig had been helping thorn nil 1 along, aud that, he being away, you gave theiirm's cheque to assist them ? Witness — I knew that Pattersons had always met their bills readily, aud I did not visli to see any bills of theirs returned. Continuing, witness said he did not know of any arrangement being made for the firm to assist them, or why Pattersons sent their draft without any explanation. Barsby's bills were mot without assistance from the firm of James Smith and Co. Mr. Young here asked the witness to be candid, and the Bench remarked that Mr. Smith was the first witness any trouble had been experienced with. Witness said he knew that Craig was assisting the branches, but did not know in what particular way. Craig was getting £600 odd a year. Mr. Young— Then, didn't it occur to you that it was strange how Mr. Craig could assist the branches ? — No. Didn't it strike you as peculiar ? — Well, I don't know. Mr. Craig seemed to have his own power of raising mone3 r . And very often found that power very useful aud handy for the firm ? Witness— No. (Left sitting.)