WOOL SALES SUSPENDED

New Zealand Herald, Volume LVIII, Issue 17843, 26 July 1921, Page 4

WOOL SALES SUSPENDED

THE BILLS OF LADING.

BUYERS AND THE BANKS

QUESTION OF PROCEDURE. [BY TELEGRAPH.—OWN COKBESFONDEXT.] WELLINGTON. Monday. The wool sales in New Zealand are suspended pending the adjustment of a difficulty that has arisen between the wool buyers and the banks. The first sale affected is the Dunedin sale, fixed originally for to-morrow. It has been postponed owing to the refusal of the buyers to bid at any sale until the difficulty has been settled. The trouble relates to the bill of lading. The practice of buyers in the past has been to deliver wool to the shipping companies, delivery being completed at "prompt" (within 14 days of sale). The shipping companies on delivery of the wool have issued bills of lading which the buyers have negotiated through the banking institutions under their letters of credit. This practice has been in vogue in New Zealand for at least 30 years. During the year 1915, in consequence of some litigation in England, the validity of a bill of lading issued prior to the goods having been loaded on the ship was questioned, and the banking institutions then notified woolbuvers that the banks would not accept bills of lading unless they were issued after the vesse] that was to carrv the wool had actually arrived in port. Some negotiations between the buy. ers and the banks followed this notification, and an alteration in the wording of the bill of lading was agreed upon, ~the shipping companies merely acknowledging receipt of the wool for shipment by par" ticular ships. This new bill of lading had not been brought into force when the Government requisition of wool took place, and the matter was then left in abeyance during the period of the Imperial contracts. When auction sales of wool were re sumed this season, the old system was continued, and the banking institutions negotiated bills of lading in the same manner as prior to 1915. Recently, how ever, the banks notified the wool buyers that the conditions stipulated in "the notice of 1915 were to be. enforced. The shipping companies have since agreed to issue an amended bill of lading, but the banks have declined to commit themselves to accept the document until they receive further advice from London. The buyers consequently have declined to attend any more sales in New Zealand until a settlement is arranged. The dispute is between the buyers and the banks, and the question is one of procedure, not of financial capacity. The brokers and shipping complies are doing their utmost to assist in effecting an amiable settlement. The shipping companies have indicated that they are prepared to bring an altered bill of fading into operation at once and they have also met the position to some extent by giving the buyers a month's free storage. The parties hope to be able to reach a settlement quickly, since interference with the limited wool sales under present condi tions is highly undesirable. Representatives of the banks, the brokers, and the shipping companies are to meet the Acting-Prime Minister, Sir Francis Bell, to-morrow, in order that the difficulty may be discussed.