A NEWSPAPER COMPANY CASE.

Grey River Argus, 10 July 1906, Page 3

A NEWSPAPER COMPANY CASE.

WELLINGTON, July 9- : The case of Cowlishaw and Posters ' v. Press Coy., Christchurch,' was resumed at the Appeal Court to-day. ' Mr H. Bell for the plaintiffs quoted authorities in support of the contention 1 that the profits made by the defendants from 1892 to 1898 should have been ' expended in paying dividends to the ordinary shareholders instead of being put into the business and converted ' into capital. Counsel quoted from the ' balance-sheets to show that between t 1891 and 1904 the assets of the-.com- * pany had considerably increased, and ' the increase had been built up out of ; the annual profits -after paying a dividend ■ dend of 8 per cent to the preference t shareholders. Plaintiffs wanted an account of the profits taken and a . declaration of the Court that the profits I which should have been used to' build up the business of the company belonged to the ordinary shareholders. Mr Stringer followed, addressing the Court on the question of the duties of the directors in dealing with the ' profits of the company. J Mr. -Stinger gave the history of the establishment of. the Press Coy, and said when : preference shareholders had received a "dividend of 8 per cent their deferred shareholders were to ♦ receive a dividend up to 8 per Cent, f if profits allowed it. If there was any ' surplus this^as to be equally divided 3 between the " classes of shareholders: I From 1892 .to 1898 a dividend of 8 per cent had been paid to preference shareholders, but none during that peroad to the ordinary shareholders, and the money available for them had been left in the business. .It was from this later money that the plaintiffs wanted ■ the Court to declare that- they were entitled to receive a dividend of 8 per cent. Mr Stringer quoted authorities to show that plaintiffs in agreeing t year by year to the balance sheets of the company, did not amount to acquiescence in the division of profits to. permanent assets." ;Mr Hosking for the defendant company contended that on the proper • construction of the articles of the As- : sociation of the company^the ordinary shareholders had. no right to ' a claim against the company for dividends that had not been declared by the directors, : and' that" the -articles of Association dealing with dividends were ambigur ■ ous, and the directors with' the assent of the shareholders bona fide had placed one consistent construction • upon them, that, the profit not t declared as dividends now being converted into carepita] of the -company, could; not now be distributed as dividends: The Court adjourned; till to-morrow.