TO-DAY'S PROCEEDINGS

Evening Post, Volume LXXXVII, Issue 76, 31 March 1914, Page 2

TO-DAY'S PROCEEDINGS

When the Court resumed to-day, William Francis Mander, member for Marsden. was called, and stated that while H>de owned the Advocate, he held a mortgage on the property, and a week or two before Hyde's death ho had to take possession. He had previously ottered to take 10s in the £ for his 'utcrest in the paper, approximately £31600. He underytood that Heyes was forming ,i company to take over the paper for the protection of Hyde's interests ; and a considerable time afterwards a company was formed. When lie handed over the propel ly .ho delivered the moitgage for about £815, and also an insurance policy on Hyde's life for £500, which had been included in his security. Heyes had some diiticulty in raising capital, and witness agreed to take 250 shares in the coinpuny. The company was, lie was told, to bo founed on a capital of about £4000 : but not much was said to him ahouL it, or about what was to be done with the capital, lie understood that iin arrangement was made, to take over Hyde's debts at 6s 8d in the £, but ho did not know whul they amounted to. Tho assets were the plant of the Advocate and the PrcbS, ami the liabilities, he understood, included £1500 due to one of the banks, resulting from a debt of Hyde's to the bank, backed by Heyes and somebody else. Of this debt he had been told by the manager of the bank. The price of tho shares ho took was deducted from the money due for the plant, and he had some difficulty in get' ting tho nione,\. He also advanced Heyes £130, and for this and £113, the balance of the puichase money, he had later on to sue. Ho was one of_ those who joined in an application for an inspection of tho company's alfaiis, because ho could not understand what had become ot the capital. Tho application was quashed as described by the plaintiff. He did not remember ever getting notice of any general meeting of the company. Tie purchased Cox's shares for 2s 6d. They were not really woith anything, but he bought them because lie wanted the prepondeiancc of the shares. He ultimately acquired control of the paper and of the books of the company. The share legistor, ledger, cash book, jourmil, and minute book were iv Court.

Subsequently he had relinquished the business altogether. To Mr. Pelhciick : Witness agreed to carry on the business for Jfeyes till the plaintiff took charge, lie had noOrecollection of having discussed the debl of £1500 to the bank with Heyes. Mr. Pctheiick ; How long had you known Mr. Heyes? — About twenty years. And what was your opinion of his ability and honesty . His Honour : tfow, I can't take that question. Surely you know that. Discussing with the witness the method of dealing with certain money, Mr. Petherick said nobody made anything out of it. Mr, "lleyes made nothing out of it. His Honour : But the other side says that be made a great deal out of it. Witness said he came to Wellington with others to see the books. He was shown them by Heyes ; and while ho was unable to sec what had become of thu money, he went away satisfied by Ileye3 that the books wore regular. Ho was not quite clear now what had been done with all the capital, and hoped it would be brought out. lie was reluctant to believe dishonesty. He knew debentures had been issueel, because he puichased Sicvwright's holding. Ho never got the shares ho bought fiom the plaintiff, nor did he know why. Cox had not signed a transfer, and he had not paid Cox for them. He understood there was a lien on them, and that might bo why he never got them at the time he would have been glad to get them. Mr. Petherick : Then it is incorrect that Cox sold his shares to\ you, as he says, for 2s 6d? — t never got them. J\lr. Petherick asked, after witness had been re-examined, if his Honour would ask him if he knew anything about M'Cluggage. His Honour : No, certainly not. M'Cluggage has not been introduced into the matter at all, and Heaven forbid that he should be. Arthur Thomas Clarke, public accountant, and member of the English Institute Chartered Accountants' Society, now in practice in Wellington, stated that he was asked by Mr. Morrison to report on the books of the company. This report showed at 30th .September, 1912, tho whole of the capital had gone, except £298 10s, this balance depending on tho full realisation of tho assets. He could not make head or tail of many of thu entries; nnd a number of them were not substantiated by any other documents. The books showed £100 as having been paid on account of calls by M'Gluggagc, but nothing from Cox or HeVes. Only £1400 was shown as having been received in the capital account. Part of this, £910. went into the bank, and £500 was paid out in cash. Of tho latter amount, £425 was paid into the National Bank nnd £75 into the Bank of New South Wales to "Hyde's account." In the bank account, £128 9s went into the National Bank and £600 into "Hyde's account" in the Bank of New South Wales. Only about £300 seemed to have been used for ordinary newspaper purposes, but tho books give no information from which he could judge accurately. Nor did they indicate why the amounts were paid into the bank. John Alfred Plinimer said he was a shareholder and director of the Northern Advocate, holding 250 shares, for which he had paid. He was at the first meeting of directors. He understood the capital of the company was £4000. An agreement to issue £2500 fully paid up shares was produced at the first meeting. He understood that lleyes had spent £2500 on the business, and that the shares were to be issued to him to reimburse those who had provided the money. In March, 1912 he had objected to 500 shares being given to Heyes without payment. That was the first time he had heard that anyone was to get shares for which he had" not paid, and his objection was that he ftid not think Heyes, who claimed the shares under the deed, had any right to them. Cox had been complaining about the whereabouts of the capital, and he had asked for a statement showing who had received the shares, and what had been paid for them. There was no amount shown as paid by Heyes for his 500 shares ; and nobody else was in the same position ; and he wished for a solicitor's opinion as to the validity of Heyes's claim. The 2500 shares were mentioned in the agreement, but he never read it, simply accepting the explanation given. Everett Hales, clerk in the Public Trust Office, said that the Public Trustee advertised for claims against Hyde's estate and a number came in and were handed to Mr. W. J. Napier, of Auckland, who arranged for a composition at 6s 8d in the £. The total claims were, ho thought, £5220. The documents were in the hands of Mr. Napier. This concluded plaintiff's case. PLAINTIFF NON -SUITED. T|ie case ended with dramatic suddenness 1 this afternoon. His Honour asked iMr. Blair whether, in view of Mr. Plimmer's evidence regarding the mention of the paid-up shares at Lhe first meeting, he was prepared to go on. Mr. Blair said he would take a. nonsuit as. affecting the defendant M'Clug* gage. His Honour said that he would be nonsuited as against both defendants, and judgment was entered accordingly. With costs according to scale.