SUPREME COURT ACTION.

Hawke's Bay Tribune, Volume IX, Issue 80, 19 March 1919, Page 2

SUPREME COURT ACTION.

MACFARLANE v. BROWN AND LOGAN. ALLEGED DEFAULT OF EXECUTORS. , At the Supreme Court yesterday, before His Honour the Chief Justice (Sir R Stout) the hearing of evidence in the case of Amelia Charlotte Macfarlane, wife of J.thn A. Macfarlane, sheepfarmer, of Napier, against John .Vigor Brown, merchant, and Francis Logan, solicitor, of Napier, joint executors and trustees of the will of the late Edward W. Knowles, was concluded. Mr. M. Myers, and .with him Mr. H. B. Lusk, appteared for the plaintiff, and Mr. C. P. Skerrett, K.C., with him Air. A. Neave, for the defendant.

George Wright, recalled* said the land at the Hastings-Dickens street corner when it was taken by Proclamation by the Government had a capital value of £6,125, unimproved £5026. and improvements £llOO. He took into consideration when valuing it the £ll,OOO paid to the Motoi Company for their land and allowed £2OOO for this.

To His Honour: The Knowles' estate was paid £3,300 by the Government,

To Mr. Skerrett : Witness had nothing to do with the fixing of compensation to the Motor Company. He knew the Company were carrying on their business when the land was taken by proclamation. Referring to Dr. Edgar’s property in Tennyson street, he said it was possible Dr. Edgar would pay a highei price for the adjoining section than anyone else. McLernon’s property in Hastings street had a right-of-way to Tennyson street opposite the Alasonic Hotel—this was the soleaccess to the billiard room above Cox’s. As to Duncan’s motor garage in Herschell street, Duncan had been a partner in the Duncan ano Lowe garage. After the dissolution of partnership Air. Duncan started a garage next door. Witness saw nothing exceptional in this. Tint, land was purchased in May. 19D R-ferring to Carlile Ale Lean’s old site in Emerson street adjoining Blythe's premises—the latter premises extended along the back boon, dary of Carlile McLean’s. Th* was apparently urgently needed by the purchasers as they nnlEd down a valuable building worth £6OO.

Asked if the frontage values in Emerson street went up because of this one sale witness said it was probably the proof he required at the last revision. It was evidence of the increase in value. Witness valued every one equitably. Witness did not know there were two purchases made for the Macky Logan property in Tennyson street. Witness had collected a number of purchases for the 11.8. Larimers. Business people usually desired frontages to the streets as was evidently the object in this case, where they desired frontages to Emerson. Dickens and Dalton street. This showed that Dickens’ street was go ing up in value—it did not ironic diately effect Tennyson street, M'hcn making valuations witness was not always precisely concerned with the buildings on the properties He was always as jircci.se as possible. Witness did not know of any furthci sales of business places in Tennyson street since 1910 and r9ll beyond the sale to the Public Trust. To His Honour: There were no other retail shops in Tennyson street beyond the urgent medicine dispensary and the fruit mart. The mam retail shop porLons in Napier were Hastings, Emerson and Diekem-

I streets. Witness had made no al I terations in general valuations sinw | 191.3. except in special valuations ; There was an increase in value ti,.-m • 1003 to JCI 3. There was an in j crease of £'600,000 in the un.’mprovi cd value in that period. j lI.IL MOTOR CO S DIRECTOR. | John Tnunnis Harvey, managing , Uircctur ui iuu 11. if. Alulur voiupaii)' ’ bu.u. that Company owikU tile pioI petty m Dickens ott<<ft, adjoining i -iir. Hnowies' ptupeity, and which j was taken by me not eminent, ihc ■ agreement was made on iwbruaiy : itidii., 1916. Tins was tlie same daj ias lite i-ruc.aniauoii was gazetted. ; eguiiations were carried on with ! witness and the Govermueut as to : the price—these negotiations were ' gu.iig on for about 12 months, the ' pr.ee ultimately being agreed upon--or ratine! the sum paid i>y the Government was £ll,OOO. They also had rent free fur 12 months* from tae date the money was paid on April 16th., 1917. From February 16th., 1916, trie company had continuously occupied it till April 1917. \V itness practically conducted these negotiations himself. A specific amount for the disturbance of business was mentioned at about £2,060 and this was included by the company in the aggregate price. Witness had never been consulted by Mr. Brown or Mr. Logan, trustees to the Knowles’ property adjoining. Witness did not know the amount paid for Ihe latter. To Mr. bkerrett: il ls company had been carrying on business Here for about 10 years prior to this. Tin, property had two frontages, one to Hustings street and one to Dickens stick. Tile I'limpany had to shift ■ Imsaicss whim the property was

tak !i. They bought another place and made alterations. For dislocation of business they asked for the £2,000 mentioned. They did not Take legal advice on the matter but as directors, decided tn do this. They also consulted Air. Ta.bu.tcau, (he agent in connection with the transaction. He knew all about ii. Witness thought, the latter had received a commission from the company- for the transaction. Witnesst knew Mr. Tabuieau to.be - mart of the highest reputation and one who would not give a 'clue advantage to anyone in his valuation. Edmund M. SI ad don. solicitor at Carlile McLean's, said he had investigated the titles to certain properties in the vicinity of Dickens street. John V. Brown was rn»o>rn.fd m the ownership of these.

His Honour: "What are you talking about? ■Mr. O’Neill: We are giving this evidence to show that Air. Brown, being concerned in properties in that vicinity, was therefore interested in the acquisition of the Dickens street corner property as a .Post Office

IL* Honour: I don't see that this has any bearing on the ease. Ii- i.. not adm is sable. Jit this stage certain documents — the statement of cash receipts for the year ended April 29th.. ]917. also figures agreed upon between Messrs MeC'uilceh and Findlay •*. reference to the account in the E. AV. Knowles’ estate, were put in bv' Mr. Myers.

HUSBAND OF PLAINTIFF.

John Archibald Alacfarlane, sheepfarmer, said he was the husband of plaintiff, who was a daughter of the late Air. Knowles. No income from the residue of the estate had been paid. He first became aware of the sale of the “Telegraph” propertyon the 16th June, 1917. That was the first he had heard of it. Witness was asked the last time he had had a conversation with Air. Knowles, but Air Skerrett objected to this being taken as _ evidence, stating that the witness did not have the confidence of Mr. Knowles. Witness, continuing, said in conversation with Air. Knowles, Air. Knowles valued the “Telegraph” property at £lO,OOO. He knew Air. Brown ‘and Mr. Geddes were personal friends. „ To Air. Skerrett: He wds cut- out of the will because Air. Knowles thought he had enough. The value Air. Knowles put on the Hasting,, street property was £4,500. He disavowed making a statement about Mr. Logan, Air. Logan was an honourable gentleman. To Air. Myers: No son could have been on better terms with Air. Knowles than he (witness) was. This concluded the case for plaintiff.

CASE FOR THE DEFENCE. Air. Skerrett, in opening the case tor the defence, said he would only address the court briefly, as he desired His Honour to hear the case from Air. Logan’s own lips. The cast lor plaintiff, he contended, possessed very little merit, Supposing plaintiff gets what he claimed, the trustees would still remain responsible for the trust. The estate could still be put to greater cost on every aet of administration. At the very

moment of the issue of the writ the trustees were making arrangements to hand ovr tile trusteeship to Airs. Macfarlane to administer herselt. The suggestion of fraud, framed in paragraph 10, was a baseless insinuation, but this had been wnndrawn by plaintiff in a half-hearted manner, and no regrets had been made for the charge. Air Brown had been charged in the same paragraph with being impartial in thi matter, and had been described as a dominating factor in selling the property. It was a baseless charge. The negotiations were conducted by correspondence and not- by personal interview. The building was erected and adapted for a printing ano

publishing office. It was necessary to buy that site or go elsewhere. Mr. Geddes would say that the price asked for in the first place

preposterous and they would have had to seek elsewhere for anothci site. It was a constant, experience of life that a valuer generally put •m a higher value on properties. Mr. Tabuteau’s valuation was £B.-

854. The trustees would not have been doing their duty- had they not accepted £7,000. There was no evidence to show that a puichasei ■ould have been found on the price put on the propcity originally. The buildings were put- up in 1901 at a total cost of £2,300. No reliability

could be placed on the evidence of Mr. Wright as to the value lie hao placed on the property. Under th« laU Air. Knowles’ will there wai a limited time of investment, the

only discrimination was in regard to land and such other goods. Il vas a matter for regret that more regard had not been shown in reyard to the action. EVIDENCE FOR DEFENCE.

Tiie first witness called was Ivan Kight, solicitor, who said ho had earched files of newspapers from i [teniber 1915 to September ISlti. hs search was with the effect, of i-certaining how many .business -:tes were advertised for sale and in .hat, period one site was advertised, and a few days later this advertise is nt was withdrawn, and presumprion being that it was not sold. H•>nly looked for auction sales and properties for private sale. Francis Logan, one of the trustees I’nder the will of the late Air. Knowles, said he had known .Mr. Knowles very intimately for many years and his firm of solicitor:I Logan Williams and White) did his business for many years. At the .-me of Air. Knowle's death Mrs Knowles was incapable of transacting any business. The Daily Teic graph lease expired in July 191 S. Tim building had been designed and used as a printing and publishing house. In December 1915 Mr. Geddes asked witness in the street one day what was the trustees’ )>osi>ic>> in regard to the Daily Telegraph. Tne s;J sian-i'e of the con-vei-'-alion was as to wli.-lher the tru-ier:; had power to deal v.iih iln V’roj/.'-i’ty. Witness told Air. Geddes to bring the mat'.-T bei'oie . h; 1 rttsl< cs at t.:<ir next meeting. The u-yiLa ions with Air. C.-ddes .asted iver a period of five months, ar.d as all ck-tic l>y cutrespoudeni <■. Witness brought the matter >jp at the next meeting of the trustees >.’hieh look pdace in December 1915. Witm-.'.- here read t<: the Court all

he vorrespemlimce ami minutes .hat ha I pass'd between Air. Gciiles ami too '.rnst'-es in connection .vith tim r,eg<;i mtiom. re the ; a!e ef me Teh'grap!'.. which wrre as ollow : - On December ll’h., 19:5, tlie folowing minute was made: -"Mr. .'eddes having asked as to the msition of tlie executors in respect ■f the piemises occupied by tim laity Telegraph Co. Lid. : Resolved

hat the compan.v be informed that f it will make the h.?st offer if. can

■or the purchase of the freehold the offer will be considered.” The next step was the following letter, dated December 13th. 1915:The Manager, Dail.v Telegraph Company. Ltd., Napier. Dear Sir,- -E. W. Knowles, deceased. Referring to Mr. Geddis’ conversation with the writer, Mr. Logan, we have seen the executors of the late Mr. E. W. Knowles in reference to the premises in Tennyson street which :ir-> ■tm.Lr lease to your company. The lease expires on the Ist. July, 19)s. Notwithstanding the fact that tlie lease Has still some little time to run the executors, instruct us to say that if it. is tlie intention of the eomixmy to purchase tlie freehold of the premise- they will !>e prepared to consider the best offer that the company can make for the property.--'tours faithfully, Sainsbury. Logan and Williams. To which tiie following reply was received :■ — •Messrs Sainsbury. Logan and Williams. Tennyson street. Napier. Dear Sirs, —E. W. Knowles estate. In reply to yours of the Kith. December, inviting the Daily Telegraph Company to make an offer tor the premises in Tennyson strr.t now under lease to the cotnpanv. my directors consider twit it worn t, facilitate negotiations if the effet came from yourselves. They sag gest that you should obtain a i.'ilu?.-. tion to that end, and they will be glad to- consider any offer you may make. As the lease is nearing an end, it is necessary that we should

make a permanent provision for the future, so that the alternatives before us are those of purchase or finding other premises suitable for our business. Therefore I would be glad to receive an early answer.— Yours faithfully (signed) W. J. Geddis, managing director. The executors did not meet til! March 17th., when the following minute was agreed to : — “The Daily Telegraph Company’s letter of the 23th. December last was read and it was resolved to obtain Air. Tabuteau’s valuation of the property and that another meeting of the executors be held as soon as the valuation came to hand.” All the executors were present at the meeting. Air. Skerrett: Who was Air. Tabuteau. —He was one of the soundest men in Napier for advising on town and suburban properties. He was a-man of the highest integrity and was frequently engaged by my * firm and its clients for making j valuations. ’I had full confidence ini iiim. He died just before the issue | of the writ. Witness wrote Mr. j Tabuteau »s follows: —

Napier, ATarch 2Sth., 1916. W. J. Tabuteau, Esq., Najiier. Dear Sir, —Re E. W. Knowles’ > deed, would you kindly inspect and j value for us the premises in Tenny- I son street under lease to the Daily Telegraph Co. Ltd. If you will call, ! the wrirtjr can give you a description ; of the land, and the buildings you | will of course sec for yourself. For; your own information we. may men- j tion that the executors are selling • the p/roperty, and they require your 1 advice as to the price which they • should ask for it from the present ' occupiers. When replying please let as know whether, in the event of the premises not being used at the ter-1 inflation of the lease for a printing’ and newsjiajw’r office, the p/remises! could be readily adapted for any ■ other purpose without a great deal i of expenditure. It would lie useful i if you could indicate what expendi- i tiire would be required and whether j the premises at the end of the lease ' are likely to command a ready j j market. In order that you may help • the executors with yo-ur best advice | : n the matter we may mention that | the present tenants hold a lease and! that there are still two years to run. ’ —Yours (faithfully, Sainsbury, Logan and Williams. Air. Tabuteau sent- his valuation on Al arch 31. 1916: —Messrs Sainsbury, Logan and Williams, solicitors i Napier. Dear Sirs, —Estate of E. W. Knowles, deceased. As request'd by your favor of the 29th. inst., I ; attach as under my valuation of the • freeholds of the premises in Tenny- j son street now under lease to the ) Daily Telegraph Company, Ltd., j being all that piece of land con- I taiuing thirty-eight perches, being i part of Napier town sections 127 and ! !2S having a frontage to Tennyson ' street of 63 feet and bounded to- I wards the north-east by a riglit-of- ( ray G feet wide 157 feet towards the _ south-west .and towards the north || west by other portion of town! section 127, by a right-of-way 8 feet! -ide, 63 feet ; connecting with right-! if-way to Church Lane, together j -vitli a substantial brick building.' and outbuildings occupied by the Daily Telegraph Company as a news- j oaper and printing establishment | uid offices. The structure was i erected 15 years ago and is in first- | Mass order and repair. ! VALUATION. | .Land, 63 feet at £35 jier foot £5355' liuilding £3500!

Total £8855 J at which price I consider the execu- ‘ tors -should ask i'?r it to the present ! occupiers; and in the event of the J proji?rty not being sold to th - pre- J sent, occupiers and the jiossibility I of the premises not being sold at the I termination of the lease for a print ! mg and newspaper office it could | lardiy be adopted for other pur-1 noses, and, in my opinion, a cost. | not exceeding £l,ooo by making j Inree business frontages to Tenny-! son street and office frontages i.<> rights-of-way fronting north-east i and north-west portions of the said I allotment. There is permanent light! ,>n three frontages which is a great-J acquisition to the value. 1 also eon- i .rider that at the end of the lease, all i Laings being equal, the freehold; would command a ready market, 1 I hereby certify that I have this day! made a personal inspection of the j property described in the foregoing i particulars and that to the best of! my knowledge and belief the sum of i eight thousand eight hundred and ‘ fifty-five pounds is a true and < correct appraisement of the lands and buildings, and I also declare | that I was employed to value indo- i pendently of the lessees thereof.- j Yours faithfully, W. J. Tabuteau. ’ aj-praiser. I

Witness explained that he had t been asked to state the positi,.ll o f | Jie right-of-way, which formed the ’ •übjcct of a fitter to Air. Tabuteau. s The letter set out the right-of-way I could not be built over. ' ” j On April 3rd. the executors adopted the following minute : —| "Air Tabuteau’s valuation was read. I Resolved that the solicitors write toi the Daily Telegraph Co. J.td.. offering to sell at the amount of the v.iiuation ami to say that j>art of tiie jHirchase money could remain on mortgage.”

i The company then wrote to the .'Telegraph as follows:--W. J. Geddes, Esq., Managing Director, . Daily Telegraph Go. ’Ltd., Napier. Dear, Sir,—E. \V. Knowles, deceased. The exevufors have had a vahi- ; ution made of the premises in Ten-j nys<..'i s.reet oceujyed by jour com- I puny. The valuation is .£.SA‘>5. Tuci executors would be prepared to sell! at that price. Would you kitjdly let us know as soon as possible whether | your company would be prepared to! purchase, and in such event. <erms can be discussed by the executors | and yourself. The executor* would !not of course require the whole hunount in cash and would I. pre pared to allow a considerable pari of the purchase money to remain on I mortgage.- Yours faithfully, Sains .’bury, Logan and Williams. | Mr. Geddes replied a* follow*.: iDcar Sir*. - 1 beg io acknowledge ' ;yours of the 3rd. i:ist.. in which yon ' say you have had the Daily Tele!graph property valued at L'ssy.-,. a;il | ; offering to sell to nty cnmpiiiii at j ( that price. In reply I regret ('’it j (there is sm’li a wide discrej m■■ Ihi'lw.'im th:* value am! the \a’m- ■ :we place on the property thiit we • .are compelled to decline the offer. I I may add that we might have pur- , 'chased from the late Mr. Knowk-s lat a lower figure than you are now . i offering it a'.-- -l remain, yours * ( faithfully. W. J. Geddis. | Tim trustee* met on Api'd kith. !a'u! adopted the following minute: • ■ -"Mr. Geddis' letter of the sth. , ■ April was read. Resolved t:mt a , letter be written asking the com- ; ■panw to mnlm it* best oifer fw- the ■ purchase of the premises. The tcdiowmg letter was then sent to Mr. Gedd's:—Dear Sir.- E. W. | Knowles, decem-i’iL Your Jotu rof the sth. inst. was read to-day at ; a meeting of the executors of the

MACFARLANE v. BROWN AND LOGAN.

late Mr. E. W. Knowles, and they instructed us to say that if the company would make an offer for the freehold of the premises such offer would be considered at the next meeting of the executors.—Yours faithfully, Sainsbury, Logan and Williams. In reply’ Mr. Geddes wrote to the trustees submitting an offer of £7,000 for the freehold. The trustees then wrote acquanting Mr. Tabuteau of the company’s offer and asked his advice whether it should be accepted or not, adding: “If you are of opinion that the offer should be declined we should be glad if you would advise the executors what minimum price they would be justified in accepting, having regard to the fact that they could not legally expend moneys in converting the premises into shops or other purposes in case- the lease to the Daily Telegraph Co. Ltd. was not renewed and the executors were unable to find another tenant who could use the present premises.” On the sth. May, 1916, Mr. Tabuteau replied as follows:—

“Having regard to the fact that the executors could not legally expend moneys in converting the premises into shops or other pur poses materially alters the position as a revenue producing asset. Should the present occupiers vacate the building it would be difficult to know for what purpose it could be used the structure being erected solely as a publishing edifice.

Considering the present uncertain state in the commercial world I consider that the executors would be justified in accepting the offer of £7,000 for the reasons above men tioned.”

The trustees further received from Mr. Tabuteau in answer to the request a letter dated 9th. May, 1916, in which he stated :— “I understand that it is the duty of the executors to realise the estate of the late Mr. Knowles and I could not advise them to refuse such an offer as they have received from the Daily’ Telegraph Company Ltd. because I cannot see any prospect of a better sale being effected in the near future, nor can I advise them of there being any certainty of getting a better price even if they apply to the Court and got permission to expend a sum of £l,OOO or thereabouts in converting the present premises into offices or shops. 1 ’ Thereupon the trustees resolve.l on the 9th. May, 1916, at a meeting of the trustees “That the offer of the Daily Telegraph Limited should be accepted and that if agreeable to the company the purchase should be completed at the end of the present lease and that the trustees would, if desired, be prepared leave a portion of the purchase money on mortgage at current* rates.” Continuing his evidence and in ivply to Mr. Myers who asked: What is your opinion of Mr. Tabuteau as a valuer! Mr. Logan said: Mr. Tabuteau was one of the soundest men in valuing property. He was a man of the highest integrity. He had the fullest confidence in Mr. Tabuteau. Air. Tabuteau died just before the issuing oi the writ. His firm carried out the instructions of the trustees in writing to Mr. Tabuteau asking him to value the “Daily Telegraph'' property. Witness proceeded to deal witu ths correspondence, which subsequently passed between his firm the executors, and plaintiff’s solicitor. On March 31st the. valuation by Mr. Tabuteau had not been received, but when the trustees met again on April 3rd., the valuation which they then had was read. On April sth 1916, the trustees (witness. Mr. Brown and Rev. Dodds) again met. On May sth witness and Rev. Dodds wepe present when the ■ Daily Telegraph’s” offer was received, and it/was decided to ask Mr. Tabuteau’s advice.

Mr. Skerrett: Did you form, any opinion as to the suitability of Tennyson street for shops and offices at that time? —Yes, I didn’t think it a street adapted for shops at all and there were a great many more offices available at the time than there was a demand for.

Continuing, witness said the various matters dealt with in the correspondence was discussed at the executors’ meeting and it was decided to keep a full note on record so as to show their reasons for accepting the offer in view of the latters’ original valuation. At all the meetings, with the exception of one—at which this “Daily Telegraph” sale was discussed—the Rev. Dodds was present. Mr. Brown was absent from one meeting also. The Government valuation at that time was £5,900. In connection with the preparation of death duties it was customary to write to the Valuer General to ascertain the valuation, and that is put in. _ This was done in this instance. Witness did not know there were any measurements on the certified copy until Saturday last when he discovered that there had been a mistake in the measurements of frontage. He had communicated with the Govern-or-General but had so far received no reply. Asked if he knew whether Mr. Brown had taken any part in the negotiations for the sale of the premises to the “Daily Telegraph” witness said not as far as he was aware of.

Mr. Skerrett: Mr. Myers suggested that perhaps Air. Brown dominated the trustees in the transaction. —I would not allow any one to dominate me in what I considered the proper transaction of my duty. Mr Brown did not take any special interest himslf in the sale.

Continuing, witness said owing to the condition of the Empire at that time he considered the market for town property would be pretty cteau. He had no doubt they wouict nave had difficulty in letting the premises if the “Daily Telegraph” company left it. As 'to the statement that, the trustees had plenty of funds in hand without selling the “Daily Telegraph” property, up to December 1915. assets realised amounted onlv to £1.073 S/ j

Up to December, 1915, they had £1073 18/3 in assets realised from the date of death to the opening of the negotiations with the “Daily Telegraph.” After the death duties were paid there was a credit balance of £7OO 5,6. In August, 1916, War Bonds were taken up. He considered the trustees would have been courting disaster to offer the “Daily Telegraph” property by public auction, as the premises were suitable for one purpose only. When he found he had been charged with being the company’s solicitor he sent for a copy of all costs of his firm against the company. There was one item in the Magistrate’s Court

in 1909 conducted by Mr. Murdoch, and another in 1908, an item for drafting the articles of an apprenticeship. He had not personally done any work for the company, neither had any’ of his firm done any work for them since then. At the end of 1914 the business of the firm Mr. Brown represents went I from witness’ firm elsewhere. They j may have done some little business ' for him since then. As to the sug-1 gestion that witness should ha,., consulted Mrs. Macfarlane, witness* quoted the letters sent to his so-! licitors which showed that the exe-i cutors were justified in realising without consulting the beneficiaries to make a division of property be- j tween plaintiff and Mrs. Knowles. A letter was sent to her solicitors that witness’ firm had no desire to! slight her and pointing out that she i did not become a beneficiary till the | decision of the Privy Council. In ; February, 1915, t<he executors asked. Mr. Tabuteau to value the Dickens street property as they intended to make a claim on the Government* for taking the land. The property ( was subsequently valued at £3,300, including £3OO for the buildings. ' This amount was put in the claim for compensation and paid. Plain-1 tiff’s solicitors wrote stating that the sum of £36,400 in securities or cash was Mrs. Macfarlane’s share. ! Witness’ firm later replied that this} share was £32,400. The former ask- i ed for a copy of the valuation on i which the Tennyson street sale was • based. In September, plaintiff’s solicitors agreed to a conference in j reference to the distribution of the ; estate. Before the conference plain- ' tiff’s solicitor asked for a copy of' the accounts, which the latter con- i sidered unnecessary, but'the accoun- ! tant was instructed to prepare it. 1 In November plaintiff’s solicitors in- 1 timated that they* were instructed to take proceedings for compulsory declaration of accounts. The ac-, counts and balance sheet were subsequently’ sent to the witness. In January a copy of all correspond-: enee passing between the executors ( and the “Daily* Telegraph” company was sent to the plaintiff’s solicitors, : and in May the latter informed them ' that they intended to institute pro- ■ ceedings for administration by the > Court, of the estate. In May Mr. . and Mrs. Macfarlane agreed to the division of the residuary estate of Mrs. Knowles between Mrs. Macfar-! lane and the executors of the late J Mr. Knowles. The writ was issued , on May* 14, 1918. Witness from the beginning of the correspondence was anxious to facilitate the division of the residuary ’ estate with plaintiff when the estate owed plaintiff £5OO, Mr. and Mrs. Macfarlane owed £963 rent to the estate.

Continuing, Mr. Logan said it was at the meeting on May 9th. 1916, that the trustees decided to a cept the offer of the Daily Telegraph. He had seen Mr. Brown and Mr. Geddes together, but he could say nothing as to their friendship. No enquiries were made privately to ascertain if there were any buyers for the pro petty. No suggestion was made as to a lease to I he Daily Telegrapr. He had read Mr. Tabuteau’s three letters and it was difficult to reconcile the first with the other two. Witness’ own office was in Tennyson street. He had not placed any value on it. It was his own property and he was not a seller. It was not desirable to ask anyone else’s opinion other than Mr. Tabuteau’s. The probability of the Daily’ Telegraph giving up possession was taken intv consideration by witness when considering the offer of £2,000 He had trust in Air. Tabuteau as a valuer, and his valuation was £B5. There was one meeting at which Mr. Brown was not present. He had occasional conversations with Mr. Brown as to what- was done at the meetings. The meeting at which they decided to accept the £7,000 was a lengthy" one (about half an hour), and the matter was fully discussed. He never found Mr. Brown to tell him anything that was not correct. In 1915 witness was in tolerably good health. He did net know of the Daily Telegraph having any solicitors in Napier, but he knew they had solicitors in Auckland. Mr. Brown owns some property’ near the Dickens street corner. The real estate market, so far as auction sales of town properties were concerned was “dead” in 1916. Country land was sold at good prices generally speaking, during the war period the sales of country lands were less than before the war. Mr. W. J. GEDDES. William John Geddes, managing director of the Daily Telegraph (Napier) and manging director and editor of the New Zealand Times, said he was a resident of Napier. The legal business of the Daily Telegraph was done in Auckland. Mr. Knowles was very’ angiy at the end of the first year because he would not exercise the option. The lease expired in July 1918. In the conversation he had with Mr. Logan, he said to him he hoped he would give the Daily Telegraph a chance, of competing for the property. He

concurred in the opinion that theprice the property was first offered to him was absurd. His working days were spent in Wellington. He had made enquiries concerning a number of properties. A newspaper reallv wante.d to be in the cent> o of traffic. £7,000 was the utmost limit j they* would have given for the Daily i Telegraph property. He had not ' spoken to Mr. Brown on the subject. | Mr. Brown was a friend of w'tness, I the same as many more business ' men in Napier. Mr. Brown paid for his' advertising etc, in the Daily Telegraph the same as any other person. 'He was a member of Parliament and probably paid more (laugliter). There were three staircases in the building, and one was used by Mr. Knowles privately. It liad a small window from which he could see if the men were working. Mr. Knowles gave witness the impression that he would sell for a substantial amount less than £lO,OOO if witness would take over the property. The Auckland directors were satisfied, with the .price, £7,000, but he, (witness), was not. He thought they could get a better stand. He did not discuss his business with Mr. Brown —only politics. The Daily Telegraph did not necessarily support Mr. Brown. If he was right they supported him, and if he was wrong they condemned him. . Charles Herbert Gould, manager of the National Bank of New Zealand, said Mr. Tabuteau’s reputation was of the highest. Mr. J. VIGOR BROWN. John Vigor Brown, merchant and M.P., said he remembered the negotiations between the trustees of Mr. Knowles, and the Daily Telegraph. He agreed with Mr. Gould’s evidence as to Mr. Tabuteau’s integrity and business ability. To Mr. Grant: There was no reason why Mrs. McFarlane should not be on good terms with witness.' Mr. McFarlane , had no friendlyfeeling towards witness. He saw the correspondence Mr. Tabuteau and the trustees, uh ere was a difference between the values. It never entered witness’ mind to take the opinions of the McFarlane’s. He aid not know why- it did not enter his mind. He did not know he was an astute man. He had implicit confidence in Mr. Tabuteau. No interview took place between witness and Mr. Geddes in : connection with the sale of the Daily j Telegraph property. 1 To Mr. Skerrett : Mr. Knowles never discussed with witness matters regarding to his will. This concluded the evidence in the first action.