BONUS PAYMENTS

Evening Post, Volume CIX, Issue 74, 28 March 1930, Page 13

BONUS PAYMENTS

DAIRYING APPEAL FACTORY AND SUPPLIER A principle of considerable interest to the dairying community was involved in a case which came before the Court of Appeal to-day. The appellant was the Eltham Co-operative Dairy Factory Co., Ltd., and the respondent was William Johnston, farmer, of Ngaere. Associated-tin the Bench with his Honour the Chief Justice (Sir Michael Myers) were their Honours Mr. Justice Herdman, Mr. Justieo Blair, Mr. Justice Smith, and Mr. Justice Kennedy. My. A. H. Johnstone, with him Mr. J. L. Weir, appeared for the appellant, and Mr. A. Chrystall, with him Mr. A. J. Mazongarb, for the respondent. The facts, briefly, were that the respondent in 1911 acquired 76 shares in the company on the basis of one share for every 300 gallons of milk or 1081b of butter-fat supplied during one year. In 1912 the articles were altered to provide that suppliers should take one share for every 150' gallons of milk or 561b of butter-fat supplied. Another alteration was made in the articles in 1917, a bona fide member being defined as one who held a certain number of shares, and who supplied the company with all the milk ho received from the particular herd of cows he had for the purpose of supplying milk except for such a reasonable quantity as he might require for his own use. Article 55 was altered to provido that all milk or butter-fat supplied by a nou-bona fide member should be deemed to bo purchased by the company at tho prico paid to members, and such non-bona fide members should not be entitled to any further payments which might be made to bona fide members. The respondent supplied the whole of his milk to the company down to the end of the 1923-24 season, and in tho following season he supplied all his milk until 4th November, 1924. From that dato until February, 1925; he supplied only half of tho milk, and during this period he was told by officials of the company that unless he supplied the total quantity he would not bo entitled under tho articles to share in the bonuses. After 28th February, 1925, he ceased to supply milk, and was accordingly treated as a non-bona fide member, and was not paid any bonuses. Last year he brought an action against the company claiming that he had supplied butter-fat, and had not received bonuses allowed to other suppliers. .. . Mr. Justice Ostler held that article 55, which was regarded as an act of legislative authority by the companyover its shareholders, was ultra vires; and, further, that the company had failed to provo a contract with tho respondent in terms of amele 55. Judgment was given for the respondent for tho sum claimed .'(£ 101 16s 7d). The appeal was from that decision, Legal argument is ■prnr\flßflin£.