UNUSUAL COURSE

Evening Post, Volume CXII, Issue 9, 10 July 1931, Page 9

UNUSUAL COURSE

PRIVATE BILL DEFEATED

A NEW ZEALAND COMPANY,

It seldom happens that a private Bill is opposed on the second reading stage, opportunity usually being given, to the promoters to state their case to'a Committee, but the Legislative Council-this morning refused to give a second reading to the Dominion Life Assurance Office of New Zealand, Ltd., Bill. The measure seeks to permit, the company to be registered under the-New Zealand law, whic,h at present debars limited liability life insurance companies from becoming registered in this country. The Bill was in charge of the Hon.. Sir William Hall-Jones, who, in moving the second reading, said that at present the majority of life insurance companies carrying on business in New Zealand were foreign, and their money was invested outside the country. He believed that there were only two New Zealand undertakings—the Government Life Office and a Dunedin company. Not very long ago a company called the Dominion Li fo Assurance Offico of New Zealand, Ltd., was formed in' New Zealand, and it was found that it was : necessary to become registered in New South Wales, despite the fact that the shareholders were New Zealanders and had their money invested in this country. The purport of the Bill was to enable the company to become registered in New Zealand. The Eight lion. Sir Francis Bell said he hoped the' Leader of the Council would not consent to the Bill. The Bill amounted to an extraordinary attempt to evade the' provisions of the Companies Act relating to life insurancecompanies. No limited liability life insurance company could carry .on in New Zealand under the present law, and for very good reasons. "No one knew the extent of the assets o£ the shareholders, and there was no guarantee that claims under policies would be met. The company was registered in New South Wales for the simple .reason that it could not be registered in New Zealand. During the whole of his Parliamentary experience he did not1 know of a similar attempt being made to evade the law. Sir Francis*said that he had entirely forgotten ho was interested in various mutual associations in New Zealand. Mutual life associations did not pay profits their shareholders. He was not at all influenced; by the competition by limited liability companies with mutual life associations. What he was concerned with was that there should bo an attempt to prevail upon the Legislative Council to .evade the law passed for the protection of the public. The Leader of the Council (the Hon. Sir Thomas Sidey) said he was having a report prepared in connection with the Bill, but it had not yet reached him. He,would point:out ', however, that it was rather an anomalous thing that they should permitl foreign companies to carry onbusinos in. New Zealand, despite tho fact that they were limited liability companies, while .they refused New Zealand companies permission to carry on euch businesses. The particular company concerned had been carrying on business for some years. Sir Francis Bell: "By pure evasion." The Hon. J. A. Hanan said that one hesitated to. Mil,a private.Bill, on its second reading.' He'thought that the mover would be better advised to allow the measure to go before the Statutes Revision Committee. - They were> asked to make a radical' departure from what he regarded as a sound public policy. The Speaker (the Hon., Sir Walter Carncross) said there was no provision for a private Bill to bo referred to a Select Committee 'of the Council. A private Bill w»s not trie property of the Council but the property of the promoter. In replying to the debate, Sir. William Hall-Jones said that he had been somewhat astonished at the attitude taken up by Sir Francis Bell. They permitted foreign1 companies to operate in New Zealand, 'but when New Zoalandors formed a. company they made them register in Australia. Sir Francis overlooked the fact that all,insurance companies \vere bound to deposit an amount as a guarantee for payment of claims under policies. If the second reading were agreed, to the Bill would go before a Committee;- of Selection and evidence for and against the measure could be heard. On a division the second reading was defeated by 16 votes to 13., The division-list was, as follows: — '■ Ayes (13): Sidey,- 'Buddo,y Fagan, Fleming, Garland, : Hall-Jones, Hawke, M'Callum, M'lntyre, Smith, Stevenson, Stewart, Witty. ~ ;■ -V Noes (16): Allison, Alien, Bell, Clark, Barnshaw,1 Gow, Hanan, Isitt, M' Gregor,Mitchelson, Moore, Ehodesj Scott, Sinclair, Thompson, Trigg3. ;-