POWERS QUESTIONED

Evening Post, Volume CIX, Issue 63, 17 March 1925, Page 11

POWERS QUESTIONED

EXPULSION BY BOWLING CLUB

THE SIEVWEIGHT CASE.

The hearing of the appeal made by the Wellington Bowling Club, Ltd., against the decision of Mr. Justice Ostler that the club could not expel James Dickson Sievwright because it had failed to comply strictly with its rules, was continued yesterday afternoon, Mr. M. Myers, ICC, and Mr. S. A. Wiren representing the club and Mr. A. W. Blair the member.

Mr. Myers continued legal argument covering the steps taken by the directors and the position of the company with respect to" its articles and its shares. He said the only thing against him in the Supreme Court judgment was that concerning compliance with the rules. He challenged the statement that the complaint was made, in accordance with the Article 23, on 18th March. Plaintiff knew as much as the directors knew and the directors did not meet on the 19th to consider the matter under Article 23. It was not until several days later that the directors decided to continue under Article 23. Mr. Justice Adams asked if a complaint must not be forwarded promptly. He suggested that this might be a conditional necessity to the matter being proceeded with under Article 23.

Mr. Myers submitted that the directors might desire to arrange things amicably, and would try to do so jj?ior to proceeding- under the expulsion clause. He submitted authorities to show that the term "forthwith" used in the articles was accepted in law to mean, as a rule, within a reasonable time. He also submitted that Sievwright had agreed to waive any breach of rules .by writing for a copy of the • complaint and accepting it.

This closed the argument for the company.

Mr. Blair said the position was somewhat Gilbertian. Mr.. Myers said he had argued the validity of the articles weakly in view of the authorities, but it appeared to him (Mr. Blair) that most of Mr. Myers's arguments were v.-eak._ (Laughter.) The position was that in the lower Court Mr. Myers said Eule 23 was intra vires, and the Judge agreed with him. Now he was embarrassed by the Judge having agreed with him. Mr. Myers had the second string that if one article was ultra vires so were others, and. Sievwright had never been a member. It was a rudimentary principle of law that a share could not be forfeited for any reason other than a-failure to pay calls. In so fay as Article 23 purported to have power to forfeit a share it was ultra vires, and that to his mind ended the case. This was the only article in which he was interested. He submitted that the fact that on the share register Sievwright was shown as owning share No. 162 was in effect an admission that he owned the share. Returns of shareholders showed Sievwright's name each year since his election. Mr. Myers said they had never got a share. They said they had been shown as a shareholder for. years. If the creditors came down on the club, he could not say he was not a shareholder.

Mr. Justice Adams: "I don't know. This share was originally the property of another man, and has never been transferred. Sievwright has never signed the register." Mr. Blair:- !'The thing is pretty rough. The secretary always dealt with these things." Mr. Justice Adams: "Here we have one man with share 162, and now Sievwright also claims it. How can we award him a share he never got, and to which he held no title?" . • ,

Mr. Blair: "I say that' Sievwright was a member by reason of the fact that he was always treated as a member, and by estoppel." If the company could raise this question with Sievwright it could raise it with its creditors. They would be able successfully to defraud their creditors. No shareholder could get out of his responsibility to the creditors.. Mr. Justice Adams said a shareholder could only get off a register by a proper transfer. ; Mr. Blair said the company had committed innumerable breaches, but he said the position would be accepted. Sievwright was shown as a member, and they were prepared to accept this. The company could not come along and rely on its misdoings. He relied on the doctrine ol estoppel for protection from such a procedure. He submitted that respondent had a right to be considered a member: If he was not a member then neither were the directors, and they had no right as representing the club to instruct the solicitors who briefed Mr. Myers. Mr. Justice Adams: "Carrying it further, you had no right to serve a writ on the directors."

Mr. Justice Sim: "They say that when respondent was elected there were 050 shares, and SB4 of them had been allotted. Where do you get yours? Mr. Blair: "We say they are estopped from raising;that submission." Legal argument continued throughout the afternoon, and the hearing was adjourned until this morning.