MINING COMPANIES.

New Zealand Herald, Volume XXXVIII, Issue 11799, 31 October 1901, Page 5

MINING COMPANIES.

ALLEGED COMMERCIAL IMMORALITY. PARLIAMENTARY INQUIRY. LEGISLATION RECOMMENDED. [BY TELEGRAPH. —PRESS ASSOCIATION'-] Wellington, Wednesday. The report of the joint Goldfields and Mines Committee on the petition of Herbert E. Easton, of Dunedin, \\a3 laid on the table of the House to-day. Petitioner asked that legislation lie passed in order to prevent what lie alleged were acts of commercial immorality in certain mining companies known as " tho Cook Group." The committee, in its report, summarises the various charges made, and says soma have not been proved, and others are matters that should be dealt with by the law courts. In regard to certain charges made in. connection with the flotation of the Golden Grey Company, the committee says the part of this charge which concerns it is the formation of a company merely for speculative purposes on the sharemarket. This is against public policy, and is purely a species of gambling. and should be stopped by legislation. All parties knowingly entering into such a transaction are " partioeps minis." The cam' mittee, thinks legislation is necessary to prevent the occurrence of such a case as that alleged to have taken place in regard to the forma! ion of secret rings for speculative purposes by promoters and directors. The committee suggests that the law should be altered to the effect that where any money for application, allotment, or calls is due upon shares, then the same should be noted on the transfer of those shares before it is completed. The committee recommend that proceedings should be instituted bv the Crown to test the legality of certain companies which had been formed by less thai! seven shareholders, as required by the Companies Act. The law should also be amended to prevent the " safety"' clauses of the Act being over-ridden, and to ensure that all shareholders should bo treated alike when calls are sued for. In regard to thccharge of "shareholders voting and directors acting when their calls were unpaid," the committee found that Mr. Cook, acting a? director for several companies, had actually passed to himself large sums for brokerage, while he was still owing large stuns for. allotment charges. Tho committee says the law certainly requires amending in tho direction of depriving a .shareholder of the right to vote or act as director until ho has paid his allotment money. The commit too found that Mr. Cook had paid for his and Mrs. Cook's shares in the seven companies, whose books were put in evidence, the sum of £214-0, but Messrs. Cook and Gray rewived £1341 bade from the companies tor brokerage, secretary's salary, and directo-s' fees. The committee recommends that the law be altered on the lines it has indicated, and to provide that all mining companies sh?.H be registered under the Alining Companies Act. The House, on Mr. Seddon's motion, decided that the report of the committee should be published in Hansard.