DAIRY INDUSTRY

Hawera Star, Volume XLVIII, 26 September 1924, Page 5

DAIRY INDUSTRY

AMENDMENT TO THE ACT. QUESTION OF SHARES. (By Telegraph—Special to Star.) WELLINGTON, Sept. 25. An amendment to the Dairy Industry Act, introduced by the Minister tor Agriculture, deals with interesting questions associated with dairy company shares. It has recently been held by the Supreme Court in the case MacDonald v. the Normanby Co-op. Dairy Factory Company, Ltd.,- that a co-operative dairy company has no authority, apart from an expressed contract with individual shareholders, to require its members by virtue of the provisions in the articles of association to accept additional shares in a company. By reason of this decision doubts have arisen as to the validity of certain past allotments of shares. One of the objects of the Bill is to validate the allotment of such shares. With two exceptions the Bill does not ''Verfere with the particular allotment of shares, which was the subject matter of the case above referred to, and does not validate allotments which were objected to in writing by shareholders if shareholders, on lodging their objection, ceased to supply milk to the company. It has recently been further decided in the Shalfoon v. Cheddar Valley Co-op. Dairy Co. that a co-operative dairy company cannot by mean’s of its articles of association require its shareholders to supply milk, cream, or other dairy produce ,to a company, but that.the suoply of such produce must be the subject matter of a. special agreement. It is provided by the Bill that the existing articles of association shall be deemed to he jahd. and effective. notwithstanding the judicial determination aforesaid, and further that a co-operative dairy •company may hereafter effectively provicle by their articles for the supply of milhj and other produce -by shareholders. Another clause enables companies whose principal object is the testing and improvement of dairy herds to be registered as co-onerative dairy companies. .