THE The Drey River Argus. PUBLISHED DAILY. WEDNESDAY, JANUARY 17, 1872.

Grey River Argus, Volume XII, Issue 1083, 17 January 1872, Page 2

THE The Drey River Argus. PUBLISHED DAILY. WEDNESDAY, JANUARY 17 , 1872.

It is surely the duty of every young community settled in the centre of a mining district to give the closest attention to the laws regarding mining which are passed by older and more experienced colonies. The majority of the miners on the West Coast come from Victoria, and as great alterations have recently been made in the mining laws there, we propose to give a resume of them, so that our readers may be kept posted up, as it is the frequent custom to say that "it is so-and-so m Victoria." For all practical purposes Frazer's Act, 1864, no longer exists in Victoria, for on the Ist of December last, every mining company in Victoria was brought under the operation of the lately passed " Incorporating and Winding-up Act," with which all directors, managers, and shareholders of companies would be well to become acquainted, as it is probable that somewhat similar legislation will speedily be introduced into New Zealand ; at least it is to be hoped it will be so, because surely it is the duty of New Zealand and its legislators to profit by the dearly-bought experience of Victoria, especially at a time like this when it is more than probable that we are on the eve of the development of an enormous extent of ' quartz-reefing country in the Inangahua district. As there is no doubt that the new Victorian measure will give a great impetus to legitimate enterprise, we condense it for public information. The main principles it contains are a distinct determination of shareholders liability, an improved method of notifying calls and forfeitures— thereby protecting shareholders' interests — the extinction of the mining dummy by rendering him unnecessary, and a provision giving free scope for the appointment of liquidators, which will go far to remedy the hardships and injustice of the winding process, as at present administered by official agento. We will now proceed to give a condensation of the main features of the Act, which are extracted principally 1 from the Melbourne Arrjns of the Ist December last. " The Act provides for the formation of three classes of mining associations, en titled respectively ' Limited,' * Prepayment,' and 'No Liability 1 companies. We shall, as briefly as possible, run over its principal provisions. All existing companies at once come under Part 1., which relateß to 'limited' companies, but, with the consent in writing of the creditors, they may be brought under Part IV. (no liability) ; which will, we think, be the popular portion of the measure, and the one to which the founders of new undertakings will chiefly resort. Postponing for the present consideration of Part IV., we proceed to analyse Part I. A shareholder is made liable for the subscribed amount of his ■hares, but for no more. The manager may make contracts for work or goods to the extent of £50, and may to that extent bind the assets of the company. The manager, should a company cease to carry on business, cannot recover more than three months' salary from last shareholders' or directors' meeting, except by special agreement. Directors must one week before a general meeting lodge in company's office, for information of shareholders and directors, full reports nnon the mind and prospects, with statements of account. Transfer of shares is prohibited after presentation of petition for winding-up, unless such shares be fylly paid-up. The clause relating to ordinary transfers ia novel. Upon lodging with the

manager a scrip certificate, with a transfer signed by the holder appearing on the register, and upon naming the intended transferee, the manager must give an official receipt for same, giving full particulars of numbers, &c. He must effect the transfer in the company's books within seven days (if no call be due), and if he does not then effect the transfer the receipt vests the share in the transferee, who can obtain a Judge's order to compel completion of the transfer in the company's share register. Amongst the offences which shall be considered misdemeanors rendering a manager liable to imprisonment, is wilful ' neglect to make in the share register of the company any transfer of any share which it is his duty to make.' Stringent as is this clause, it is required, as some exceptional persons who undertake management appear incapable of understanding that they have duties or responsibilities, and, instead of facilitating, throw obstacles in the way of transacting business. There does not appear to be any injunction in the Act as to how often general meetings are to be held at all. There is, however, power to make rules, and the omission can thus be remedied. If, for the purpose of evading responsibility, a shareholder transfers to some other person upon a secret trust or understanding to resume ownership, he is disabled from enforcing in any Court a retransfer. There is provision for surrender to the company of shares on which no calls are due, and the party surrendering is thenceforward free of any further liability. There are directions as to how the shareholders' register is to be kept, and such is to be at all times open free of charge to creditors or shareholders. True books of account must be kept, and half-yearly statements presented to the RegistrarGeneral, verified by statutory declaration. These accounts must be open to creditors and shareholders during office hours, and it is compulsory to furnish persons interested in either relation with copies upon payment of a fee named. Contracts may be made or varied under the company's seal. Extraordinary meetings must be advertised in the Government Gazette, a Melbourne, and a local newspaper, and to be held not earlier than 34 days from publication of first advertisement. In the absence of a rule to the contrary, shareholders may vote by proxy given for the special purpose oi such meeting. The capital of a company may be increased, either by a fresh issue of shares or by enlarging the liability on each share. But this can only be done by a majority of two-thirds number and amount, And a like authority must be obtained for power to borrow money, or to grant a mortgage. All notices of meeting having for their object to increase capital or borrow must have a place at least once in the Gazette. Dividends, must be declared out* of the profits only, and there are severe penalties for infraction of this regulation. One of the most valuable improvements in this Act relates to calls. Every call must be made in such time and manner that it shall first become payable on the second Wednesday in a month, and on that day only. This will produce a wholesome uniformity of practice. But still more important is the direction that every call made by any mining company must be advertised at least onco in tho Government Gazette. The discovery of liability, which has been heretofore most difficult, is thus rendered simple and easy. As a further safeguard, it is enjoined that the prescribed due date of calls (i.e., the second Wednesday in the month) shall be notified on the face of the scrip. No further call can be made for 14 days after maturity of that immediately preceding, the object being that one may be disposed of finally by payment or forfeiture before another is made. Fourteen days after due date, shares become forfeited for non-payment without any resolution of directors or other formal proceeding. The interest lapses. Forfeited shares must be sold by auction notified in Gazette, and there is provision for redemption up to the day preceding the sale. If sold, the proceeds are to be paid over to the late owner, less the call and the expenses incurred. Consideration of space will not permit detail of the directions for winding up. The directors appoint ' some fit person' to be liquidator ; they determine his remuneration, if any, and decide what security he must give. His nomination is made effectual by the Court of Mines confirming the appointment. The contributories are to be the persons on tho register at commencement of winding-up if their shares be not fully paid up, but no contribution is to exceed the amount remaining unpaid on each share. Contributions will only be to the extent of actual debts, and before settling a second list of contributories the Court must be satisfied that such is necessary, having regard to the prospects of recovering from non-paying contributories in the first list. The principal claims include liquidators' remuneration (if any), two weeks wages in full to laborers, if bona fide due when winding-up order was made, and rent lo extent of three months' arrears. Twothirds majority may voluntarily wind-up a company without debts. Prepayment companies forbid the discharge of any past liabilities out of a call, and provide for the calling up capital in anticipation of outlay. There are severe penalties for non-compliance, but this part of the Act may be summarily dealt with, as it is very unlikely that a single company will register under its provisions. In noliability companies the salient point is embodied in section 117. c The accept tance of a share in any such company, whether by original allotment or by transfer, shall not be deemed a contract on the part of the person accepting the same to pay any calls in respect thereof, or any contribution to the debts and liabilities of the company, and Buch person shall not be liable to be sued for any such calls op contributions ; but he shall not be entitled to a dividend upon any share upon which a call shall be due and unpaid.' In J such companies creditors must look to the assets of the company — its mine, its plant, its paid-up capit il inhand — but not to the shareholders. The effect will be that mining companies will be obliged to work upon the basis of their own capital. Prior portions of the 'limited' part of the Act as do not clash with the above principle are applied also to the 'no liability' companies. A clause embracing all kinds of mining companies forbids directors letting ground on tribute without the sanction of a general meeting of shareholders. Amongst the schedules of tho Act is a model deed of association, which may or may not be adopted a3 shareholders choose. Although it is not free from blemishes, the Mining Companies Act,

1871, marks anew era in the history of mining industry in Victoria, and it is to be hoped that our legislators in New Zealand will profit by the experience thus gained, and during the next session of •the Assembly pass a somewhat simi'ar Act.