THE MOKAU-MOKAHATINO BLOCK AND MR. JOSHUA JONES.

Evening Post, Volume LVII, Issue 23, 28 January 1899, Page 2

THE MOKAU-MOKAHATINO BLOCK AND MR. JOSHUA JONES.

TO THE EDITOR. Sir — In accordance with the arrangement made at my interview with you on Friday last, I now beg to lay before you the actual circumstances under which Messrs. Flower and Hopkinson became: possessed of Mr. Joshua Jones's leasehold interest in the Mokau-Mohakatino Block, in the hope that these will dispel the false impresuions conveyed by the statements published in Truth and by those contained in your London special correspondent's communications as published from time to time in your columns. The block referred to contains about 56,000 acres and is still native land. It consists of hilly country rising in several places to the height of 1000 ft and upwards and is covered throughout with forest. When cleared of this forest the surface is suitable for- grassing, and would, when grassed, be classed as fairly good pasture land, probably capable of carrying an average of two sheep to tho acre. There is at present no road to the block, except a horse track, communication with the Mokau River district being still chiefly carried on by means of the small steamers ' employed in conveying produce from the northern side of the river to New Plymouth. Parts of the block contain considerable deposits of brown coal ij-nd beds of limestone, but, except these, there is nothing to give it any greater

value than land of the same class in other parts of the district. Tt appears that between the years 1877 and 1882 Mr. Jones carried on negotiations with the native owners for a lease of this land, and that between 1882 and 1883 he had obtained a lease of it for 56 years from July, 1883, at rents aggregating about £200 a year for the first half of the term and £400 a year for the second half. It seems clear, however, from documents in my possession, that Mr. Jones had no capital whatever to work or develop the property, and" was even obliged to borrow money for the purpose of completing his arrangements with the native owners and paying the annual rents, giving mortgages of his interest in the block for securing the loans made to him. The result was that in the latter part of 1892 he had become indebted to the extent of £10,500 and upwards, of which something over J87750 was owing on first mortgage to Mr. John Plimmer, of this city, and close on £1600 on second mortgage to Mr. Graham Orr Johnston, also of this city, whilst he owed something over £1000 to other persons in New Zealand, whose claims, however, were entirely unsecured. At this time (the end of 1892) Mr. Jones was in very great straits, having attempted' but in vain to raise in New Zealand the money necessary to pay his debts and to enable him to carry out his views in relation to the property. Finding this impossible, he went to Sydney in the hope of being able to effect his object, but in this he again failed, and, as a last resource, he proceeded to London with the view of raising the money there. Qn his arrival he introduced himself to my agents, Messrs. Flower, Nussey and FelloweiJ, whose address he knew, but I had no idea that he had gone to London until, I receiveJd (letters from him and from my agents stating what had taken place between them. Parenthetically I may say that Mr. Jones always entertained the most exaggerated notions as to the value of hin i.iterest in the property in question and especially of the minerals — coal, limestone, and clay — which it contained, and often stated that he had been offered large sums of money varying from £25,000 to £50,000 and upwards fcr ifi, which he had refused. I have now strong reasons foe/doubting the truth of these statements/and certainly it appears strange if such offers had been made that he should have found so much difficulty in raising k-us than half the amount of the lowest.of them, on security of the property. It is necessary also to bear in mind the fact that in April 1893, nearly ten years of <the term of Go years granted by the native leases hart run out, thus materially reducing the value of his interest. When Mr. Jones left for Sydney, his family, consisting of his wtife and some nine or ten children, were li\* ing on part of the block, on which he had erected a house and farm buildings, but j were left without any means of support except the produce of the few acres of land which had been brought into cultivation during the previous ten years. Such was the condition of things whan Mr. Joues first made acquaintance with Messrs. Flower and Nussey, except thai before he left New Zealand, Mr. Johnston (the second mortgagee) had been pressing for payment of the money owing to him, and had threatened to sell the equity of redemption unless it wus forthcoming within a short time. From correspondence in my possession, I gather that Mr. Jones, after giving a glowing description of his property, and especially of its mineral resources, induced my agents to procure for him from MV. Hopkinson the loan of £2000, of which £1600 was to be remitted to me to pay off Johnston's mortgage, and the balance was to be paid to Mr. Jones for his personal use ; but this loan was only ob tamed on Mr. Jones's positive statemeni and assurance that Mr. Plimmer, the firsi mortgagee, was perfectly contented with his security, and would not press for the money. Accordingly the £WOO was ad vanced by Mr. Hopkinson and applied a? above-mentioned, the £1600 having reach ed me and been paid to Mr. Johnston or the 28th of January, 1893. Immediately after Mr. Plimmer had heard of this pay ! ment, he determined to realise on his firdt mortgage, and, without any notice whatsoever, advertised the property for sale on the Bth' April, 1896, under the power of sale contained in his mortgage. This was a complete surprise to me, and. I communicated the fact to Messrs. Flowei and Co. by cablegram. This placed their in a position of considerable difficulty as regards Mr. Hopkinson's investment, the result being that Mr. Flower was compelled, in order to protect Mr. Hopkinson's security, to become himself the pur chaser of the property at the sale — a contingency which he had never dreamt of looking to the positive assurances given to him by Mr. Jones. Acting under hk instructions by cable, I sent my managing clerk to New Plymouth to attend the sale, and he purchased the property for Mr. Flower for £7652, the amount necessary to pay Mr. Plimmer's claim in full, and in due course on payment of this sum the property was absolutely transferred by Mr. Plimmer to Mr. Flower. After this the relations between Mr. Jones and Messrs. Flower and Hopkinson gradually became strained, Mr. Flower claiming to be the absolute owner of the property, bui expressing his willingness \o admit Mr. Jones to a share of it on reasonable terms, whilst Mr. Jones claimed that Mr. Flower had purchased the property as a trustee only, and was bound to transfer it to him on being paid his outlay with interest. Ultimately a suit was commenoed on behalf of Mr. Joues against Jiessrs. Flower and Hopkinson, claiming the righ J to redeem. In this suit it was, in the first instance, decided by Mr. Justice Kekewich that Mr. Jones' had no such rights as he claimed ; but on appeal to the Court of Appeal from this decision a. -lecree was made on the 26th February, 1396, by consent of all parties, by which it was adjudged (I now quote from the deore?) " that upon Mr. Jones paying to Messrs. Flower and Hopkinson, on or before the 15th June, 1896, the sum of £11,544 9s .(being the amount due in reijpect of principal and interest calculated ' ,-3 up to that day, and ascertained in accordance- with the agreement for comproipisn dated the 12th .February, 1896, and signed by the solicitors to the' parties, bui without any such bonus as therein mentioned), together with the amount pay- ■ bla by the plaintiff George Thomas Bean and the defendant Joshua Jones for costs (such amount to be ascertained in accordance with the said agreement for compromise, and to be verified by affidavit), and also the amount (to be likewise verified by affidavit) of all sums of money necessarily or reasonably expended by the applicants, or either of them, for rent of tht ostate accrued subsequent to the 4th December, 1894, or for rates or other outgoings in respect thereof, subsequent to tho month of August, 1895, or upon pay /.lent by the defendant Joshua Jones on or before the said 15th June, 1896, to the applicants at the place aforesaid of ( the sum of £2750, and into Court to the credit of these actions as directed in the lodgment schedule thereto of the further bum of £2250, and upon payment by th,e defendant Joshua Jones on or before the 15fch January, 1897, to the applicants at the place aforesaid of the further sum of .09544 9s (being the balance of the amount uloresaid after the payment of the said turns of £2750 and £2250), together iviih ihc further sum of £381 9s Id as an ngreed .•.mount for subsequent interest, together with amount of the costs aforesaid and the mounts of the said expenses up to the •Jjlh June, 1896, for rents, rates, or other outgoings, and the amount (to be verified l>y affidavit) of all expenses likewise incurred as aforesaid after the 15th June, 1896, in respect of such rents, rates, and outgoings (is aforesaid, the applicants should assign and convey the Mokau Es-

tate to the defendant Joshua Jones, or as he should direct. And it was ordered that in default of the defendant Joshua Jones paying the several sums aforesaid by tho respective times and in manner aforesaid the plaintiff George Thomas Bean and the said Joshua Jones respectively should from the 15th June, 1896, or the 15th January, 1897 (as the case might be) stand absolutely debarred and foreclosed of and from all right, title, interest, and equity of redomption of, in, and to the said Mokau Estate, and every part thereof.' ' Whilst this litigation was in progress, Messrs. Flower and llopkiiuon had taken steps to turn the property to account, acting, in this respect, with the sanction of the Court. They caused some 24,000 acres to be surveyed infeo convenient lots for occupation, and cut a road for about ten miles along the Mohakatino River in order to give access to the sections laid off with frontages to that river, expending about £1300 in these works. In conjunction with Messrs. Scrimgeour and Co., a firm of brokers of high standing in London, they formed a syndicate which undertook to obtain an expert report upon the mineral resources of the block, with a view to the formation of a company to work the minerals should the report be favourable. The expert employed was specially recommended to this syndicate by Mr. Forster Brown, the adviser of the Board of Trade on matters relating to coal mines in England, lie came, out to New Zealand, and made a most careful examination .of the deposits of coal upon the grouud, and then visited a, large number of the coal mines then being worked in the colony, the result being that he came to the conclusion that he could not recommend the syndicate to embark in the proposed undertaking, and so reported to Mr. Forster Brown, who, on perusal of the report, and after careful consideration of the data upon which it ■was founded, came to the same conclusion. The expenditure incurred in connection with this matter amounted to nearly £2000, no part of which, however, was charged against Mr. Jones. Notwithstanding the easy terms piven by the decree of the Court, Mr. J*mes never offered to pay any part of the moneys mentioned in it, the consequence being that on the 26th June, 1896, a decreo of foreclosure was pronounced, and Mr. Jones was declared from thenceforth to be " absolutely debarred from all rig Tit, title, interest, and equity of redemption in and to the Mokau Estate and every part thereof." Mr. Jones was present by coun* sel vhen this decree Avas made, and offered no objection to it. These are the main facts of the case. Mr. Flower was, naturally, very much vexed at finding himself suddenly callei. 1 upon to find the sum of £8000 to pay on" the first mortgagee, in the face of Mr. Jones's positive assurances that "that geu tleman was quite content with his security, and would allow it to stand until the property could be turned to profitable use, and it was not surprising that when Mr. Flower found how he had been misled, he should have lost confidence in Mr. Jones. But amongst other statements made by the writer in Truth, and repeated witL somewhat aggravating comments by your special correspondent, was one to the effect " that Mr. Jones's wife and family had been turned out of 'their house, and were with difficulty maintaining themselves b> any kind of drudgery." As a fact nothing of the kind ever toolc place. On the contrary, Mrs. Jones and her family are still living in the house, and Messrs. Flowe. and Hopkinson, in consideration of Mr. Walter Jones '(eldest son of Mr JoshuJones) assisting them in the management of the property, transferred their interest in the nouse and 894 acres around it to Mr. Walter Jones for the use of his mother and her family, subject only to the payment of a proportionate share of the reni. payable to the natives and of the rates and taxes imposed upon the property. From the foregoing statement, which i.3 'accurate in every particular, I submit that there was no justification for the allegations contained in your special correspondent's communications, and that very grave injustice has been done, and is still being done, to Messrs. Flower and Hopkinson by those allegations. I say " still (being done," because their immediate effect (which still continues) was to create n feeling of distrust on the part of persons who might otherwise have been willing to occupy the land in question as underlessees, but who, naturally enough, did not care to do so with the fear of a law-suit hanging over them on the ground of defect in the title of their lessors. It is in the hope that a plain statement of the truth will dispel this feeling, that I have asked you to publish this letter. — I am, etc., Wit, Tnos. Locke Travers. Wellington, 26th January, 1899.