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BRUCES'S OATMEAL COMPANY.

TIMARU, June 20.

Judge Ward gave judgment to-day in a case which has occupied five days in the hearing of evidence and argument. The liquidators of Bruco's Oatmeal Company (Messrs Sparrow and Hercus, of Dunedin) applied to have settled (1) list of claims against tho company, and (2) list of contributories (persons liable to pay up on shares allotted to them, and amounts they should be made liable for) putting in a list showing shareholders' liability to be L 4.000, while the claims on the estate were L 1,700. There were three chief classes of claims—(l) Persons not fully paid up on LIOO shares; (2) who had taken shares in payment for property and not registered the contract; and (3) had transferred shares within a year to men of straw. The most important part of the claims was against thirty persons, who, as holders of single shares paid up, agreed to double their liability by exchanging one paid up

for two half paid-up Bhares, this agreement being conditional on 73 per cent, consenting to adopt it. The directors notified that the condition had been fulfilled, and that the duplicated scrip was ready. The defence showed that 75 per cent, was not obtained, being one short even counting in four admitted bogus transfers for the purpose of making up the number, and also argued that such an agreement was ultra viren. His Honor ruled that the agreement was illegal, and relieved shareholders thereunder. Mr W. D. Stewart, for the liquidators, urged that the directors, all of whom transferred duplicated scrip, ought to bo held to have ratified the dealing, but the Judge said there could be no ratification of an illegal transaction. This process beiDg put in operation, shares were also offered to the public, as subscribers understood to be for LSO paid up. One was let off because his receipt showed this, but the others were retained on the list, as their papers showed that the nominal value was LIOO in cases of shares taken for property held over. A third name was struck off, as the non-registration of tho contract was not proved. The result so far gives the liquidators only L 491. Mr Stewart intimated that he would appeal in the case of the directors who transferred and in the property case.

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Permanent link to this item

https://paperspast.natlib.govt.nz/newspapers/ESD18890627.2.36

Bibliographic details

BRUCES'S OATMEAL COMPANY., Issue 7944, 27 June 1889

Word Count
387

BRUCES'S OATMEAL COMPANY. Issue 7944, 27 June 1889

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