HOCHSTETTER CASE

Grey River Argus, 3 August 1937, Page 6

HOCHSTETTER CASE

CLAIMANT’S WITHDRAWAL Of Allegations Against Solicitors Adjourned from July 7th, the hearing was continued in the Warden’s Court at Greymouth, yesterday morning, before Mr Raymond Ferner, Warden, of tiie claim for £25,000 for alleged fraud and conspiracy to defraud. At.the previous hearing, John Wilson, miner, of Ahaura, proceeded against Sarah Ellen Campbell, of Wellington, widow; Bridget Monica Bayne, of Christchurch, widow; Mrs Theresa Margaret Goldsmith, of Greymouth; Gerald T. Joyce, law clerk, of Greymouth; Thomas Francis Brosnan, solicitor, of Greymouth; and the Golden West Sluicing Coy. Ltd. Plaintiff claimed £25,000 damages for alleged breach of agreement by Campbell and Bayne; fraudulent conspiracy and false and fraudulent misrepresentation by the five first-named defendants; wrongful acts and omissions leading to the forfeiture of the minimum privileges. He also claimed that the deed of mortgage be declared null and void, that the sale or purported sale be declared null and void, that the agreement be declared null and void, and that‘he be awarded the costs of the action.

Mi’ L. K. Wilson, of Wellington, with him Mr E. H. Brooker, of Wellington, appeared for plaintiff. Mr C. J. O’Regan, of Wellington, represented Mrs Campbell; Mr J. W. Hannan appeared for Mrs Bayne, and Mr W. D. Taylor appeared for Joyce and Brosnan.

Two further claims, each for £25,000 damages were made by John Wilson and the Golden West Sluicing Company, Ltd., against Joyce and Brosnan; and against Mesdames Campbell, Bayne and Goldsmith. Mr Wilson said that, before the case started, he was not in a position to amend the statement of claim so that the allegations against Messrs Joyce and Brosnan would not come before the Court. Since then, in the light of all the information available, he had intimated to Mr Taylor that he was prepared to amend the statement of claim, withdrawing the charges against his (Mr Taylor’s) client, save that evidence given against Joyce, was that he procured the execution of a document not understood by Wilson. Mr Taylor, as he was perfectly entitled to do, wished, since the matter had been commenced in the way it had, to remain in the proceedings. Therefore, he would not press the application to amend the proceedings. Mr Taylor said he was wanting an unqualified withdrawal of allegations of fraud. Did he understand from his friend that he was now prepared to give that withdrawal? Mr Wilson, plaintiff’s counsel, said he was prepared to make an unqualified withdrawal of the charge of deceit against Messrs Joyce and Brosnan. He did not suggest there was anything in the nature of fraud, in law.

Mi - Taylor expressed thanks for Mr Wilson’s remarks, and said that as the suggestion was still that John Wilson did not understand the document he signed he would prefer to remain in the case. The Warden referred to the fact that other proceedings were mentioned.

Mr Wilson said it might well be that they would not come before this Court.

The plaintiff, John Wilson, then continued his evidence, under crossexamination by Mr Hannan. He said that he told Mr Joyce that he wanted a copy of what he had since found out was a mortgage. On the second day he went to sign the papers nothing was said about interest or costs. He did not remember saying, after signing the papers, that there were now only himself and Mrs Goldsmith interested in the matter, and that he was pleased to be rid of the others. He did not think he discussed Becker’s application for forfeiture of the water rights, with Mrs Goldsmith at that time. He was of the opinion that. Joyce and Brosnan and all the others were all working hand in hand to get the property from him. He did not tell Mrs Goldsmith that if she ever got anything out of the property, she had to work with him. He had told Mrs Goldsmith that “they nad tied my hands behind my back and now I can do nothing.” He did not ask Mrs Goldsmith to say that the word mortgage was never mentioned in Joyce’s olfice. He admitted signing certain documents in Mrs Goldsmith’s presence in Joyce’s office. Mi' McFarland came down irom Wellington to attend a meeting as a shareholder to discuss what was to be done with the property. He did not remember saying previously in the Warden’s Court, that he placed the greatest confidence in Gerald Joyce, but he might have. He did not recall saying that he owed £4OO costs to the Joyce Estate, and that they had to be cleared before he could get titles. Witness said he had asked for the title but had not received it yet. When he took over the titles of the Hochstetta Coy., in 1933, after it had gone into liquidation, he paid Mr Miles a small amount. He owed Mr Miles £3OOO for the titles, which was to come out of the process when he sold the property. He did not think it was a five pound note that he had paid Mr Miles. He spoke to Joyce about protection for the titles, and Joyce told him a company could not get protection. He did not try to get protection for the titles after the mortgage was signed. He consulted Mr Patterson, a Reefton solicitor, after the mortgage was signed. He did not consult anybody, except Mr Joyce regarding the protection of the titles. He certainly knew the titles would be liable for forfeiture if they were not being worked. It would not be more than six weeks after the mortgage was signed that he had known it was a mortgage. He later obtained a copy of the document. Questioned why he had been so long in bringing the present case, witness said that he went to every solicitor on the West Coast and two in Christchurch, but they would not act for him, as he had no money. He was still without money.

“If you have no money now, who is financing, you?” asked Mr Hannan. Witness said that there were people behind him in these proceedings, and he must not divulge their names. He did not have much money when he tdfik over the property from Miles. Up to the .time of Mesdames Bayne and Campbell coming in, he had not bor-

rowed money from anybody other than Messrs Lee and McParland Since the mortgage was signed in November, 1933, he had borrowed about i £2OO. He could not say how much he owed Mr Truman in connection with the property, but he could say he owed him money. He did not know if he had borrowed money off Mr Rubbo, Grey Motors. He got £7 from Mr Mitchell, of the Albion Hotel. Witness was also asked if he had borrowed money from Mr G. Paul, hotelkeeper, Ahaura. Mr McParland had put in £5OO and was to get an interest in the shares accordingly, a company was to be formed al Wellington, and was to be such as would put the property in working order, but the whole thing fell through. McParland was to get one-quarter interest in the company. He did. not promise other people from whom he borrowed, shares in the company. They were just personal loans arranged outside of himself, so far as he knew, nobody but McParland had any interest in his shares of the Golden West Sluicing Coy. Mrs Goldsmith had not complied with the contract. The reason why the company was not formed was because Mr McParland, senr., died. For the next three years, witness lived on the property, trying to hold it. From 1929 to a year or so ago, witness was trying to interest people in having the water brought in, and was prepared to give an interest to do so. He had other people interested besides Mesdames Campbell and Bayne. Mr Hannan: But they were the only lambs you could nail? Witness: Mr Hannan, I am verysurprised at you talking like that. Continuing, witness said that he had obtained about 135 ozs. of gold from the claim. This covered a period of two and a-half years. He could get six ozs. a day at times, but could not get water. He recalled having interviewed a Mr Donaldson in Christchurch, in an endeavour to get him to put money into the property. He did not remember telling this man he could not give an option as he first required money to pay off the mortgage. Witness could not succeed in raising money owing to the mortgage. Witness said that Joyce paid him over £5 after he had signed the mortgage. Mr Hannan said that Joyce denied that, any payment of this nature was made. He understood that an offer had been made to transfer all the property back to witness, and that £1,500 was to be accepted in settlement of the mortgage, but where was the money to come from, he asked, surely not from himself? Mr Hannan then concluded his cross-examination.

Mr Taylor then proceeded to crossexamine plaintiff. Witness said that he supposed he signed an assignment of his rights to the Golden West Sluicing Coy., in November, 1933, but he did not remember. He did not remember , signing a memoranda of the articles of association of the Companj\ He signed everytning that Mr Gerald Joyce asked nim to sign. He did not recollect ever signing the minute book of the Company. Witness recognised his signature in the minute book produced by Mr Taylor. Witness gave an option to John Becker, and when Mr A. Smith asked witness if he was free to deal with the property himself, he wanted some document to confirm this, so he went to Joyce and Brosnan’s to get this. If Mr Brosnan or Mr Joyce asked him to sign a document he' signed it. Mr Taylor: We are tired of that chorus!

Continuing, witness said t hat, if he had known that the document, which proved to be the mortgage, was a mortgage, he would not have signed it. McFarland had not advised him to sign a mortgage. He had made his mind up that he would not sign a mortgage. After he had found out that he signed the papers which he later found out were a mortgage, he had no confidence in Joyce and Brosnan. He went to see Mr Isaac Patterson, Reefton, on August 7, before the mortgage was signed, and it would probably he about the 4000 shares that he had not been paid for by Mesdames Bayne and Campbell. Witness had paid Patterson fees which would be over £2O, in connection with the Hochstetter claim. He might have consulted Patterson again in January, 1934, after the mortgage had been signed. He would be prepared to allow Mr Patterson’s records to be produced in this case. Witness said that he agreed to give Joe Joyce a mortgage over the place for any money he spent on the claim. He gave Joyce an option for a period of three months, from April, 1934, and for this he gave witness £l. It was agreed that Joyce pay a further £lOO after three months to renew the option. However, the property was advertised for sale before the option had expired, by Campbell and Bayne. He did not know anything about a subsequent option from the Golden West Sluicing Coy. to Joe Joyce. John Becker did not exercise his option, he stating to witness that he could do nothing as witness had signed a mortgage. He believed that Joe Joyce, Becker and Smith were all together in one big combine, as Joe Joyce went out to peg the water right for Becker. It all looked very suspicious, and that they were trying to take witness down. Becker’s option 'was for £12,500 cash and for 12,500 shares. He mentioned these figures to Mr Brosnan when he went I to get the documents. Smith told him that there was nothing in the document to affect him (witness), and he took Smith’s word for it. Smith did not tell him that it was pretty stringent. Witness . did not understand the document, and he thought that he would take it to Mr Hannan for his advice. Witness complained to Mr Brosnan that the document was pretty stringent. Brosnan said it was pretty stringent, but that it was the only way that he could save the other people. Joe Joyce acted for witness at the auction sales, and spoke up for witness, saying that the property could not be transferred without John Wilson’s signature. There was no bidding. He did not think Joe Joyce threatened a law suit if anybody bid. Mr Truman told witness “that if they are. trying to put a dirty one over you John, I will buy the claim myself. Mr Taylor: Was he prepared to put up the £2,500? Witness: There was no bid for the property.

Witness denied that he had given an option to the ladies for the money lent by them. He had never borrowed a sixpence from them in his life. Mr Truman told witness that he would pay Mr A. H. Paterson to biing an action to set aside the “jumping” of the claim. Joe Joyce asked witness to give him a power of attorney at one time, and witness i efused. He did not know what Mr Truman’s in-

tentions were When he walked down to the sale with witness, but witness knew that Mr Truman did not want to see witness “beat.” Truman was prepared to pay Mr Paterson’s costs for appearing in,the “jumping” action in Court, when Becker applied for cancellation of the water-rights. The Court adjourned at 5.20 p.m., until after the disposal of civil Court business this morning.