TAKAPUNA FERRIES.

New Zealand Herald, Volume LXIV, Issue 19621, 27 April 1927, Page 14

TAKAPUNA FERRIES.

DISPUTE OVER OPTION. VARIOUS LEGAL OPINIONS. CRUX OF TO-DAY'S POLL. To-day's Mayoral and Borough Council elections at Takapuna will be fought mainly upon the question whether the council shall go on with its proposal to purchase the Takapuna Tramways and Ferry Company's steamers and tramway, with a view to electrifying the latter. U the present Mayor, Mr. J. D. Morison, is re-elected, with a majority of his supporters, the proposal will be pursued. If the opposition wins, it will be dropped forthwith. A great deal hinges upon the validity or otherwise of the new option secured by the council from the company. This is still in dispute, and various conflicting legal opinions have been given upon it. However, even if the option proves to be invalid, the ratepayers will not have lost the opportunity of establishing a publiclyowned transportation system. The Devonport Ferry Company has purchased the Takapuna Company's two steamers, subject to any rights the borough council may possess over them, but the steam tramway has not changed hands. If the ratepayers give their consent at a future poll tho tramway may be purchased. It is not essential that the council should exercise its option and secure a revocation of the sale of the steamers to the Dovonport Company. It may take steps to build steamers of its own and establish a new service between Bayswatcr and Auckland. Powers ol a Municipality. In the proceedings for an injunction to restrain the council from exercising its former option to purchase the entire business ol the Takapuna Company, it was argued the council was barred irom establishing a municipal ferry service by section 214 of the Municipal Corporations Act, 1920, which states, in part:—'"ilie council may establish ferry services between termini within or partly within and partly without the borough, and may purchase or hire steamers and other vessels for that purpose, and may fix the fares and generally regulate the, services. Mr. Justice MacGregor granted the injunction on the ground that the council had exceeded its powers in agreeing to purchase not merely the steamers, but also the whole business as a going concern, including the tramway. His Honor did not discuss the argument that tho section prevented tho council from establishing a ferry with a terminus in another body's territory. In any event, it is considered tho tramway track, which as from to-day will cease to be used, will not deteriorate much if left in its present state for a year or more, and that in the meantime the borough council stands* a good chance of having the law amended if the section referred to debars it from establishing a ferry. In the proceedings before the passage of the Motor Omnibus Traffic Act last year, Parliament showed itself sympathetic to public ownership of transport services, and endeavoured to protect the tramway business of the Takapuna Company, which tho borough council proposed to acquire. Conflicting Opinions. Regarding the council's new option to purchase the ferry steamers, Mr. A. St. Clair Brown, chairman of directors of the Takapuna Company, stated yesterday that the document constituting the option was clear and unequivocal. "It was ex<v»W by mo as chairman, with the knowledge, concurrence and authority of all the directors," he continued. "It was given for valuable consideration, and it was intended to be, and I believe is, a valid and binding contract. Debentures are in their nature a floating charge, and a receiver, when appointed, must accept his position as ho finds it. The receivers in this case found the assets subject to an option of purchase in favour of the Borough Council, and their sale of +he ferries has been made expressly subject to existing rights." Mr. E. Blampied, solicitor for the debenture holders, said the latter throughout the negotiations had treated the option as valid. He was not prepared to set his own opinion against that of Mr. Northcroft, but he had advised the debenture holders to conduct the negotiations as if the option were valid and to provide for the possibility, of its being exercised by the council. Clause in Agreement. For that reason, the following clause had been inserted in the agreement with the Devonport Company: — "This offer is made, and must be accepted, subject to the legal rights, if any, vested in the Takapuna Borough Council by virtue of two memoranda under the hand of the chairman of directors of the Takapuna Company, affecting, inter alia, tho assets included in this offer; and it is an express condition of this offer that in the event of either of the said options being exercised and carried into effect by the said council, there shall, upon receipt of the purchase money payable by the council under such option, be'a refund made to the Devonport tympany of all purf-Vt«4e moneys paid by it in terms of this offer, with an additional sum of £15,000, provided that the Dsvonport Company shall accept in satisfaction of such additional sum debentures of the Takapuna Borough Council of the face value of £15,000." The last proviso, Mr. Blampied explained, meant that the Devonport Company would receive £15,000 out of the payment made by the Borough Council if it purchased the ferries. Mr. E. H. Northcroft, senior counsel for the "relators" in the injunction proceedings, furnished the Devonport Ferry Company yesterday with an opiuiou on the question, and stated that in his view the documents did not constitute a valid option, being too loosely and vaguely worded to ba enforced. He also considered that they did not remedy all the defects in the original option, which the Court had held to be invalid! In particular, it was a condition that before the steamers could be purchased the council must have bought the tramway The Takapuna Borough Council yesterday obtained an opinion from its leading counsel, Mr. G. P. Finlay, who considered the option to bo valid and binding. HARBOUR FERRY SERVICES. FEWER TRIPS TO BAYSWATER. NEW TIME-TABLE APPROVED. The proposed time-table of the Devonport Ferry Company for the service between the city and Bayswater, acquired from the Takapuna Tram and Ferry Company, came before the Auckland Harbour Board yesterday. Mr. E. W Inder and other members directed attention to the public pronouncements by the Mayor of Takapuna, Mr. J. D. Morison, concerning the transaction, and the view was expressed that the board might approve a timetable and later find the two companies were carrying on. "That will make another feast for tho lawyers," Mr. Campbell Johnstone said. It was decided to approve the timetable subject to confirmation of the sale being received from th© Takapuna Company. The chairman, Mr. H. R. Mackenzie, said the new time-table provided for elimination of three trips to Bayswater on week-days, and five on Sundays. Against that, however, the service to Devonport was being arranged to fill in the gaps, and as the company intended to make* a uniform charge, irrespective of the route followed, the people of the North Shore would be better served.