Dairy Company Affairs

Northland Age, Volume 5, Issue 9, 29 November 1935, Page 9

Dairy Company Affairs

Sir,—Under the ambiguous nom de plume of “Fairplay”, a correspondent in your last issue indulged in what must have been considerable mental effort judging by the rambling result. As one of a committee selected by a large meeting of dissatisfied suppliers, to formulate and obtain signatures to a requisition calling on the dairy company directorate to convene an extraordinary general meeting, for the purpose of discussing the impossible situation which has arisen in our company’s affairs, I consider it only “fair play” to be allowed to publish the exact wording of the requisition. It is as follows. Memorandum to the chairman and directors of the Kaitaia Co-op. Dairy Co. Ltd. We, the undersigned shareholders of the Kaitaia Co-op. Dairy Co. Ltd., hereby request and call upon you to convene an extraordinary general meeting of shareholders for the following purposes — 1. To discuss and consider the affairs of the company as conducted by the board of directors since the last election of directors.

2. To discuss and consider, and if thought fit, to pass, the following resolution—That the board of directors be called upon to resign from office as the board as at present constituted does not enjoy the confidence of the shareholders. I had much pleasure in being the first one to sign the requisition, and I am proud to be associated with such a large body of honourable men who signed also. The fact that Mr. Michie, Mr. Kenny and Mr. Bird are willing and anxious for this opportunity to vindicate themselves in the eyes of the public, and their opponents just as anxious to avoid a public examination of the position, to my mind speaks for itself. At any rate they will all get a fair and equal opportunity to blackguard each other on the 6th December. So much for the “tactics of the insidious organisation” referred to by “Fairplay”. With regard to the sentenc*“personalities show a weak case in other respects”, I would like just to say that it shows a very weak personality indeed when a

person uses a nom de plume in writing on controversial subjects in the public press.

In conclusion I would like to remind “Fairplay” that one of the most important promises made to the suppliers by Mr. Reed and Co. before their election was to the effect that full opportunity would be given whenever possible to the suppliers to enquire into the working of the company and that at least 50% consider this necessary at the present juncture. Yours, etc., ARCHIE W. ADAMS. Sir, —Supplier’s letter in the last Age offers a very weak defence of the old board, saying if the old board did make a costly mistake over the lime contract, so has the new board over the butter selling. The two things cannot be compared. The old board had made promises that the establishment of the limeworks would entail no liability on the dairy company. They were to get the necessary guarantee from individual farmers to the extent of 2,500 tons per year for seven years before there was a contract made with Messrs Bellingham. If this is the case has not the board broken faith with shareholders and kept the matter secret ever since? It has been the work of the new board to give the information and get more favourable terms from Bellinghams. Even now the remaining old members, Messrs Bird, Kenny and Michie, voted against the shareholders being informed of the new or old agreement. More power to the new board for the way it is supplying information to shareholders about the operations of the company. Whether it be trading lime or buying a new car. The information is given and that is something commendable as]well as new. About the butter sales. —Is it possible those who are stirring the matter up have not given the whole facts? Judging from what one can gather and from the circulars sent out the butter sales committee do not seem to have erred much. The secretary seems to have been on the committee from the start. Why was his experience not available to guide the committee during the critical period if there ever was one. Why did he not assist? Also where were the high offers we have lost if the ooramittee never saw

them? Why also if the old directors were dissatisfied with the work of the butter committee, [did they not try to give advice or make a policy for the company when before the board?

If the old directors in the board meetings were asked to share in arriving at a butter selling policy and did not respond are they not to blame. If there were better prices offering were the older directors responsible for withholding them and if that is so was it trying to produce the downfall of the new directors. As to Supplier’s statement of what is paying out for October, viz. lid superfine and might have been lid is all many companies are paying even in the Waikato according to a recent paper. Since then one reads that Hikurangi is paying lid superfine, so Kaitaia is not doing as badly as malcontents would have us believe. Hikurangi over a lot of years always had a higher payout than Kaitaia. No doubt when the whole facts come out the butter committee will not come out second best. There is a suspicion that then it will be found the old members (and others perhaps) have been following a policy of non-co-operation to get the new directors into trouble. In that event it would be the old directors on whom most censure should lie. As directors they are there to assist not to frustrate the work being done by the board for the company. The new members have a mandate from shareholders—the old have lost it. Shareholders should remember that when they are told the old chairman should have been re-elected—no doubt to oppose the new men in their work—and when they are told the many things flying about concerning the new members. The latter are good men for their work and only need to be given a chance—neither frustrated nor misrepresented—to show their entire fitness. I am, etc., ANOTHER SUPPLIER. Sir, —Quite a lot could be written in reply to Mr. D. Kitchen’s letter in your issue of November 15th, but I will confine my remarks to his attack upon the chairman and those who elected him to that position. As one who voted for Mr. Reed as chairman I might state that at first I did not favour that course, but wished to put Mr. Bird in the chair. Very sound arguments were brought against that procedure, among them being that the overwhelming majority of votes cast in favour of the three new candidates was clearly a vote of “no confidence” in the old board. I now realise to the full what a mistake it would have been to have put kr. Bird in the chair and I take this opportunity of thanking those who saved me from having made such a blunder. When the deputation waited on the board of directors Mr. Kitchen criticised the board for having elected Mr. Reed who had never had any previous experience on a dairy board as chairman, and intimated that he thought it was a piece of impertinence on Mr. Reed’s part to accept the position, and as stated in his letter he said that had Mr. Reed shown any marked business capacity in his own private affairs or other transactions he had participated in he would not have been surprised, or words to that effect, then he states that he got a vicious outbuist from the chairman. Surely the words of Mr. Kitchen’s letter prove that the vicious outburst came from Mr. Kitchen and not from the chairman. Mr. Kitchen also tries to belittle Mr. Reed with his remarks about the latter’s cowshed, which made it appear that Mr. Reed was out to boast about his cowshed without having had any lead in the matter. The fact of the matter is that my friend Doug was out fora blow, and made it quite clear that in his opinion no one but a high class farmer like himself could possibly make a good chairman of directors of a dairy board. If in the end Mr. Reed beat him in.the art of blowing Mr. Kitchen should take his beating like a sport, instead of following in the footsteps of the defeated candidates at the recent dairy board election and their supporters now on the board. Yours, etc., DAN LEWIS. Sir, —What is the matter with our Dairy Directors? After years of general satisfaction in the way our directors have handled our business, there appears now to be a cuckoo in the nest that requires urgent removal. Has the general policy of our old directors been changed in any way, or are the new men on the Board dominated by vindictiveness or their desire’ to further the interests of the Company? Everybody expressed their approval on the balance sheet last annual meeting, and I fail to see why all this ill feeling against members of the old Board i should exist. Our annual meetings dur-

,ing the past 5 years have been very tame affairs, so much so that on reflection, one must come to the conclusion that the suppliers have had every confidence in the directors and therefore have had no serious complaints.

The letter by “Fair Play” in your paper seems to me anything but fair, and should call for emphatic protest from the suppliers. Sale of butter is mentioned as a centre of attack. When the new Board took over, they actually had the temerity to discard the experienced butter committee and replace them with two men without experience. Why ? The result is our October payment 10)4d, while a small company like Oruru with much heavier overhead, per lb, can pay out 122/-. We must not forget the fact, that the chairman told us at the last annual meeting, that he had sources of information not available to any other man, for the use of the Company. He appears to have had sufficient information to lose approximately £3,000 for us at any rate. Why was it necessary to change the chair, and then find themselves in such a quandary that the old Chairman had to he recalled on to the butter committee? What a splendid compliment for him from his opponents. It was evidently not possible to do without him. Advantage had evidently to be taken of his superior knowledge to cover up the Chairman’s deficiencies.

“Fair Play’s” sense of fairness appears to equal his sense of humour when he can see nothing but insults in a humourous sketch which includes the whole Roard in your November 15th issue. Why not give the old Board the same measure of fair play that he asks for the new men? The Chairman’s alleged statement that he is the Board between meetings and has the power to reverse any decision of the Board, is a very grave statement and points, in my opinion, to whore the cuckoo sits at the Board table.

The mentioning of the Secretary and Mr. Kenny, appears to imply a threat of removal in the one instance, and underground pressure in the other. However, both gentleman have plenty of support from suppliers, and no doubt with their support, be .able to counter any evil designs contemplated.

We have never had such a deluge of circulars before and it is to be regretted that the Chairman did not publish the whole of the lime agreement, and give the suppliers the true position, good, bad and indifferent, not only pick out the parts that suit his purpose. It is the writer’s considered opinion that the removal of the cuckoo and those members on the Board whose actions have denoted personal bias first, company interests last, is urgently necessary, and get back to a position where we can expect to get the best out of our directors for the Company’s benefit. Some straight talking can be expected on December 6th when suppliers should roll up in force and eliminate the sinister influences which now appear to be working against the best interests of the Company. Yours, etc,. COMPANY FIRST Sir,—Slinking behind the misnomer of “Fairplay”, a correspondent in your last issue makes the case for the actions of the new directors of the dairy company since taking control of the company. Unfortunately for him he is wrong in all his statements and inferences.

It is the plain duty of every new director to study and learn the job before taking executive responsibility. The business is large and intricate and the present sound position of the company is the result of the accumulated experience gained through the years. Based on that experience a policy has been evolved covering every department of this vast organisation, and this cannot be appreciated or fully learned in any short space of time. It is for this reason that most dairy companies (together \ with joint stock companies) do not elect directors all together, but a system of rotational retirement is in operation whereby a minority of the board retire each year, so that, generally speaking, a reasonable continuity of policy is assured. Unfortunately for the company Mr. Lewis has thrown in his lot completely with the three new directors, thus upsetting the balance and causing the present debacle. The natural result of the above fundamental blunder has been a series of mistakes which has been followed by propaganda trying to cover up those mistakes. Your correspondent is on rotten ground when he refers to opposition to the above dangerous position as a “factional squabble”, “tactics neither fair nor open”, and his reference to “personalities”. The sixth of December will show who is fair and open and whether the case cannot be dealt with on the important issues alone. I deny the truth of the statement that “the new men do not belong to an

active factional organisation” and further, I consider that one of the three is the most ardent “whispering campaigner” in the district, working on the street corner and dark alley style, but lacking both the courage and ability to put forward anything constructive at a general meeting. Your correspondent’s references to the secretary and Mr. Kenny show apathetic lacking of a sense of humour on the one hand, and on the other a crawling fear of what they are likely to do, and if only they could be intimidated or gagged into silence, what a relief it would be to certain parties! Whilst it is correct to say that the secretary is the servant of the company, he is still a man. The recent inferences against the secretary in circulars and elsewhere demand that he is given the right to reply.

I am confident that Mr. Kenny will conclusively show that he is serving the best interests of suppliers. The jeering reference to the lime business will be exploded at the proper time. The reference to the expenditure at the factory without advising suppliers is a clumsy effort on the part of “Fairplay” (?) to prolong a deliberate lie. At the annual meeting before last, the chairman, Mr. Michie, in his opening report, advised the meeting of the board’s intentions together with estimated costs, and this was approved by the meeting. My statement on this matter can easily be verified by reference to the files of either the Northland Age or the Advocate. I am, etc., E. R. BIRD.

Sir,— “Fairplay” appears to be a person with a prejudiced mind seething with a dislike for the old chairman, with an unveiled hatred for the secretary, and an apparent contempt for anyone who supports them. Being so obsessed, his mental equilibrium appears to be so distorted that he will stop at nothing in his endeavour to prove his case. He would, so it appears, be fully prepared to supply an opposition factory with prospects of less remunerative payouts than he would receive from his own factory. He would not hesitate, apparently, to transfer his custom from one firm to another, immaterial of any financial difference such transfer may incur, provided that the change would provide him with one who was in entire sympathy with his own peculiar views.

His attitude towards the course adopted by Mr. Michie, as a result of a demand from a number of suppliers to check certain petty and rather shady propaganda, marks him as one of the type whose limited intelligence is derived from and confined to street corner gossip and small talk. Fairplay’s suggestion that immediately the new board was appointed an organisation was set up to deter them from executing their duties, further reveals the befuddled state of his

very small brain. That the present board have defeated themselves will be definitely proved when the suppliers meet next week. If only “Fairplay” were not of that, unfortunate type who have no sense of humour, tragic though the situation was, he would appreciate its amusing side too 1

Speaking of the subtle propaganda designed to throw dust in the eyes of suppliers, Fairplay surely would not suggest that such propaganda compared with that initiated before Mr. Michie was unseated. Fairplay should fully realise that a seat at an election secured as a result of subtle propaganda will not be retained long, for sooner or later the truth will be revealed, and respect and confidence in that candidate destroyed. The matter of butter selling may be fully vented when the next balance sheet is presented. The main fight will be whether it was too risky to turn down a business deal whereby any factory, if they had knowledge of certain factors operating in the butter business at the time, could have sold their output three months ahead. In reference to Fairplay’s criticism of the secretary I would proffer him this brief and simple advice “get to know him”, and he will know why the secretary commands the respect and admiration of all sane, honest and unbiased men. The reference to Mr. Kenny is typical of one possessed of a nasty, sticky mind, who, it would appear, judges all men by the standards and principles maintained by himself. Mr. Kenny's one fault apparently is that his business ability is of such a standard and his conscientious interest in Dairy Company matters so keen that he has little of that precious grey matter left to waste on political likes and dislikes, a matter which apparently has certain members of the directorate well under its influence.

Now comes “Fairplay’s” final accusation which brands him as an untruthful person or seven kinds of an ass. He was there at the meeting when the late manager stated that he could not carry on without the expenditure of approximately £17,000. He voted with the meeting and passed it. On finding the manager was leaving the company solely on account of getting his children a better education, the old board went into the position further and decided that the expenditure of £17,C00 was quite unnecessary, the results being an up-to-date concern capable of dealing with a big increase for the next several years at £6OOO.

In conclusion I would like to say that no one, as far as I know, is out for a complete change in the directorate, a slight alteration to bring it back to a sound business footing is all that is necessary “Fairplay” will be more or le'ss satisfied, and the manager and staff will retain their characters. Yours etc. W. BARKER