THIS MORNING'S PROCEEDINGS

Evening Star, Issue 25032, 26 November 1943, Page 2

THIS MORNING'S PROCEEDINGS

On the resumption of the proceedings this morning Mr Adams continued his examination of the witness Gerkin, the case for the Crown concluding at 11 o'clock. Mr Thomas intimated that he did not intend to call evidence for tire defence. Touching upon matters which counsel for the defence had introduced in his cross-examination, Mr Adams, addressing the jury, said that it had been suggested that the purchase of the ' Sun ' building had been a good speculation, and that a higher valuation of that building had Been made. Counsel asked the jury, however, to keep their eyes fixed upon what the accused had actually done. He had, for the purpose of acquiring the option on the building, raised the necessary £I.OOO by a loan on the security of that option and upon Christchurch mortgages. Subsequently shares were sold to the public which did ,not represent capital by which Burns and Co. could finance the building named, but which were already invested in Burns and Co.. and represented paper profit. CASE FOR THE DEFENCE. Mr Thomas, addressing the jury for the defence, said that in the Crown's address there had been introduced a number of matters which had nothing to do with the 12 charges p against the accused, and that there had been a lot of evidence put in "to prove that Burns was a bad man." Counsel asked the jury to ignore that evidence.

In regard to the charges of so-called fraud in respect of the balance sheets and profit and loss account, said counsel, it would be. contended that the charge of making and circulating these documents should not be sustained, for the reason that Burns was only one of a board of directors. He was admittedly the chairman' and the head and front of the concern, but being only one of a board, he did not personally " make and circulate" the documents. If guilty of anything, he was guiltv of concurring in the making and circulating. Mr Thomas went on to analyse the transaction involving the purchase of the ' Sun' building, which, he said, had been put on the market by its original owners during the days of the depression in 1935, and two years before it. was sold to Burns and Co. for £II,OOO. Burns and Co., said counsel, were company promoters, and their business was to buy properties which they considered would turn out profitable. The company Organisers (N.Z.) Ltd. had bcou taken over by Bums and Co. from W. H. Carson. It was alreadv an incorporated company, and thus Burns and Co. were saved the expense of organising a new company. There was nothing improper about that, said counsel, nor was there anything improper about the agreement which had been romo to by which the property had been shown at a little more than the fost price, in Organisers Ltd. balance sheet. The witness White, in giving evidence for the Crown, had valued the nroperty at between £IO.OOO and £II.OOO at a time when the country was at war and when property values were unfavourable.

Counsel went on to sav that what must be considered was: What was the mind of Burns at the time, these transactions took place, 'and whether it was a guilty mind. The ' Sun/ building had been valued by the original owner at £21.000; it stood on the books of the Sun Company at that figure, and, presumably, also on the balance sheet. Burns was entitled to take this fact into consideration when fixing his price. The witness White had said that ho considered the land alone to be worth £7 920, and that the insurance on the buildings was £10,900. The Government valuation was £14,370. White had also said that the present value of the property, after £5,000 had been spent upon it, was £20,000. When the property was bought by Burns and Co., therefore, it was bought with a view to the future value, based upon its earning capacity, and, had the company's finances permitted, everything would have come out all right. Mr Thomas was addressing the jury on aspects of the other charges against the accused when the luncheon interval intervened.