STANDARD EXPLORATION.

New Zealand Herald, Volume XXXIX, Issue 11986, 7 June 1902, Page 5 (Supplement)

STANDARD EXPLORATION.

MORE LITIGATION".

ACTION AGAINST MR. WHITAKER

WRIGHT.

"UNDER WHICH THIMBLE':" [from ovb OWN roaEESyOXDEXT.]

London*, April 25. Oxck more the name of the Standard Exploration Company lias been heard in the Law Courts, This week the hearing of the action MeConnel versus Wright, which was interrupted nearly a fortnight ago by the illness of Mr. Justice Kekewicb, was resumed by the learned judge in the Chancery Division. The action was brought by Mr. John W. McConnel. of Prestwieh Hall, .LP., against Mr. Whitaker Wright, who ; had been the chairman of the Standard Exploration Company, now in liquidation, to i recover damages in respect of 600 shares I which he had taken in the company, as alleged by the plaintiff in consequence of misrepresentation and non-disclosures in the prospectus of the company. Mr. Warrington, K.C., Mr. Powell, K.C., and Mr. Higgins appeared for the plaintiff; Mr. Gore Browne, K.C, Mr. G. A. Bonner, and Mr. Stewart Bean for the defendant. * The defendant's case was opened when the hearing was adjourned, and Mr. Gore Browne in resuming his argument on behalf of Mr. Whitaker Wright, contended that it had not been established that there had been misrepresentation in the prospectus of the company in question, and that so far as all matters which might be supposed to have affected the plaintiffs mind were concerned, there had been no concealment of material facts. Mr..Whitaker Wright was then examined, and he said that he was the managing director of the London and Globe Finance Corporation, and the general object of that corporation was the flotation and formation of the Standard Exploration Company. In answer to a question whether in bringing out that company he had made any promoters' profits he emphatically replied that he had not. Nothing whatever was made in respect of the deferred shares. He gave no instructions whatever about the Austinfriars contract, and he did not say whether the contract was to be included or left out. In cross-examination by Mr. Warrington, K.Q., the witness said the signatories to the memorandum of association of the Standard Exploration Company were clerks in the office of the London and Globe Finance Corporation. The negotiations with the amalgamated companies were conducted by the directors of the Standard Exploration. He was one of the directors, and he took part in the negotiations. He presumed he was appointed a director of the Standard Company at the same time as the other directors. Mr. Warrington: That is not quite correct, Mr. Wright. Was it true when you made a speech in January, 1901. that, the Standard Company was not going into liquidation, and that there was no petition against the company? The Witness: It was true so far as lam concerned. Was it true that there was no petition against the company? I understand that the petition had been withdrawn. And yet a winding-up order was made two days later? Yes. Why did you not tell the meeting about that petition? One cannot remember everything at a public meeting like that. Were you correctly reported at that meeting in saying that the Standard was a philanthropic institution, and that was the object for which" it was-formed? I do not admit these newspaper reports. Do you say that you did not make the statement? , I said that so far as the London and Globe was concerned it was a purely philanthropic institution, as it was done without profit to the Globe. Witness said, in answer to further questions, that the Standard Company was formed for the purpose of carrying on business and earning profits, but there was never any active market for shares. Did the company carry on business? Yes; and the first thing it did was to make a profit of £150,000. _ • Some other evidence having been given Mr. Gore Browne summed up the evidence for the defence. Mr. Justice Kekewicb, in the course of the learned counsel's address, said : If you ask me to believe that I do not know half the facts lam with you. I must, however, do the best I can with the material at my disposal. lam convinced that I have got but a very small portion of the facts of this case. Mr. Justice Kekewicb subsequently remarked that it would require a very shrewd man to say under which thimble the pea was. Mr. Warrington afterward summed up the whole case. At the conclusion of Mr. Warrington's reply upon the. whole case Mr. Justice Kekewich held that not only was the prospectus misleading, but actually false and fraudulent. He therefore gave judgment for the plaintiff, but directed van inquiry as to damages which the plaintiff had sustained. He also gave the plaintiff the costs of the action, except so far as they related to a claim for shares in the Standard Company which had been bought in the open market. Mr. Justice Kekewich declined to stay the inquiry pending an appeal.