THE OLD AND THE NEW

Northern Advocate, 12 August 1935, Page 2

THE OLD AND THE NEW

HOKIANGA SHAREHOLDERS PIONEERS DESIRE TO ASSIST. A LENGTHY DISCUSSION. Following the enumeration of the different points of a special resolution tendered by Mr George- Harding, which was adopted at the Hokianga Dairy Company’s annual meeting, the placid flow of dairying discourse was slightly ruffled for a time. The resolution was that clauses 12 and 13 of the articles of association be amended 1 by deleting 130 lbs where it appears, and substituting 200 lbs. This related to the original basis on which the shares of the company had been issued' at its inception. Mr Harding thought that it would be a wise move on the part of the shareholders' if they adopted the resolution. This brought the company in line with what had been done by other companies in New Zealand and would assist new shareholders. Mr J. N. Cauty, representing the Omahuta settlers, said that new shareholders were placed at a serious disadvantage compared with the old shareholders who had fully paid-up shares. In some cases, these old shareholders were able to supply an unlimited amount of cream to the factory on a share basis, which was much less than new suppliers who had more shares and! who had only onerhalf the output. This had taken place through the old suppliers having paid up their shares on a small herd, and their outputs having increased over a period of years. He had been behind Mr Harding in the suggestion that the poundage basis be altered. Mr Cauty also thought that the articles of association of the company shouldi be altered to put old shareholders on a similar basis to the new. He suggested that when the chairman had been approached about the matter, he had displayed reluctance to have anything dons about it.

“You pointed out to the meeting this morning,” said Mr Cauty, addressing Mr Grounds,, “that the dairy legislation was a series of patches.” In his opinion these patches were also in the constitution of the company. The chairman: “I think Mr Cauty has been distinctly unfair. I have always been ready to show consideration. In the course of his remarks he has drifted far from the subject in hand.”. Mr Grounds said that if Mr Cauty had kept to the original proposal it would have been a different matter. When it came to altering the articles of association it had in many cases led to litigation, and the finding of the Court of Appeal had been that companies were not entitled to alter these without the complete agreement of all concerned. Many companies had chopped a'nd changed, and had been no better off. When the company had been formed the question of what shares were to be issued had arisen. These had bean issued with’ a view to assisting suppliers. The fundamental basis of shareholding was to operate the company. A basis had been made, and a cow and its output hadi been that basis. The alteration of the poundage would assist the new suppliers. In answer to a question regarding the share payment deduction. Mi Grounds said that this rate of a halfpenny had been sanctioned by the shareholders themselves; Mr R. K. Harris said that the articles of association were at fault, and not the directors.

“I am clear of share payments,” said Mr J. McKenzie, “and I feel that it is unjust for new shareholders not to be assisted by the pioneers.” His own sons were paying more than he was. He knew of one old shareholder who was milking three herds on his original paid-up shares. “The old shareholders had to 3ign a bond of guarantee to the bank.” said Mr R. Hawkem “and they had carried this on for yelfrs.”

Mr Fell: “This statement that the old shareholder got off lightly is wpiig. The pioneers had many things to put up with.” However, if there is any way in which the old shareholders could assist, he as one would support it. “I do not want it thought that the old suppliers are old-age pensioners,” said Mr White. He thought that there should be a minimum number of shares for all and sundry. Mr Harding remarked that all appeared to be in favour of his- motion. The trouble appeared to be that it did not go far enough. Mr Harris: “The pioneers with fully paid-up shares have signified their willingness to share the burden. The company had been saddled with the articles of association for 28 years. The next development took place when Mr Harris, seconded by Mr E. D. Jones, moved that the directors obtain full legal information' regarding reconstruction of the company under new articles of association, and report to the shareholders by circular. This would practically form a new company, and the present fully paid-up shareholders could be allotted their present amount and a fresh start made with allotting. It was moved as an amendment by Mr R. Hawken that the matter be left in abeyance until the next annual general meeting- This was adopted by 36 votes to 32. Mr Basford moved that a recommendation be made to the directors that a deduction of one-eighth of a penny be made, instead of one half-penny. This was also adopted. Mr Grounds said 1 that this would give the suppliers the increased l income which was desirable a( the present time.

Mr Harding added that (he last motion was only a temporary measure. Mr Canty said that lie wished placed on record appreciation of the spirit of the pioneers in ottering to take up extra shares.