UNPAID SHARE CAPITAL.

New Zealand Herald, Volume LXV, Issue 20075, 12 October 1928, Page 15

UNPAID SHARE CAPITAL.

COMPANY'S CLAIM DISPUTED. PROCEEDINGS AT WHANGAREI. [nY TELEGRAPH. —OWK CORRESPONDENT.] WHANGAREI. Thursday. A case of considerable interest to company shareholders was heard before Mir. J. H Luxford, S.M., in the Magistrate's Court, when W. L. Donohue claimed from John Boyd the sum of £25, ucpaid share capital in the Whangarei Daily News, Printers and Publishers, Company, Ltd. Mr. Trimmer appeared for plaintiff and Mr. Ziman, instructed by Mr. A. Marsden Woods, for defendant. The clai:m was in the nature of a test case, a number ol other claims for unpaid share money resting on the action. Mr. Trimmer said the company had been formed to run a newspaper, but could not carry on. He outlined events leading up to the passing of a resolution by shareholders to go int-o liquidation with Mr. Donohue as liquidator. A J. Murdoch, of Whangarei, a director of the Whangarei Da.ily News, and Gc-oige Singei Black Morrison, of Maungatapere. chairman of directors, also gave evidence regarding proceedings. Mr. Donohue was put in as receiver by the bank concerned on March 19.

William Lawrence Donohue, accountant. Whangarei, gavo evidence at length regarding his appointments as receiver and liquidator, and action he had subsequently taken. After referring to the procedure adopted Mr. Ziman submitted that it w.us clear that, the company v.'as not in liquidation and that, consequently, Mr". Donohue was not liquidator. It was obvious that the company not being in liquidation, Mr. Donohue could! not function as liquidator. A receiver had not power to make calls, although he could recover calls roado by a liquidator. The calls made by t'lio company were not validly set out in the minute book and wore, therefore, not collectable.

Mr. Trimmer said an action had to be brought, and it was as well to bring it now ns later. It was really only a question of formality or procedure. The magistrate reserved his decision.