LOTTERY PROJECT

New Zealand Herald, Volume LXXII, Issue 22145, 26 June 1935, Page 14

LOTTERY PROJECT

DANZIG CONCESSION COMPANY'S OPERATIONS CLAIM ON LIQUIDATOR COURT RESERVES DECISION Some aspects of the affairs of International Concessions, Limited, were brought before Mr. Justice Callan in the Supreme Court yesterday, when Iran Towers sought an order of the Court to compel the liquidator of International Concessions to recognise his claim for £290. This sum, ho alleged, was the balance of £3OO due to him for services rendered to the company in September, October and November, 1933, relative to securing a lottery concession from the Government of the free city of Danzig. He had been paid £lO, and the .liquidator refused to recognise any further claim. Mr. Henry appeared for Towers and Mr. Goldstine for International Mr. Henry said the claim had been rejected on the grounds that no services had been rendered in securing the concession, or if they had been, there was no obligation to pay. Prior to his approaching J. 11. Hetherington, chairman of directors of International Concessions, Totvers had been on a visit to Europe, where he had investigated a concession of a similar nature. As a result of the interview, counsel said, connections were established which led to one Saxon obtaining a Danzig concession through one Maxwell, an agent of International Concessions. The total expenses involved in securing the concession were £7462. The concession was subsequently sold for £25,000 worth of shares in an Australian concern. Counsel submitted that £3OO was a reasonable claim. Different Companies

Ivan Towers, accountant, cross-exam-ined by Mr. Goldstine, said he had approached J. R. Hetherington to ask him if he could find witness a position in International Concessions, Limited. Witness had previously been secretary of British and Foreign Concessions, but immediately prior to that he had been secretary to the British National Association, a company registered in Danzig. The second company, was subsidiary to the first. He was dismissed from it ' because the first lottery was a failure and a new executive was put in to see if they could do better. Witness said that in March, 1934, Hetherington had advanced him £lO personally against money that would come to him after a meeting of directors had been held after Easter. He had not hinted to Hetherington that he was in any need of money. He was quite certain a receipt was given. He made his first claim for the money on March 26, 1934, and did not make any further claim until November, because he understood the company had not then actually got the concession. He had not indicated the amount of his claim, but left that to Hetherington. ' . Reason for Liquidation His Honor asked how it came about that the company went into liquidation. Mr. Goldstine said the report oi: the Companies Commission referred to lottery companies and suggested that lottery companies were undesirable. The directors feared that there would be certain legislation following the Companies Commission. They thereupon decided to put the company into liquidation and go to Australia. His Honor: I see. We cannot draw the inference that the concession was valueless. Mr. Henry: It was merely a matter of shifting the assets beyond the control of the New Zealand Government. His Honor: Moving to an atmosphere more hospitable to the gambling spirit. Witness said he had gone to the liquidator, A. L. Stedman,' to tiy and get a settlement, but he had not mentioned any sum other than £3OO. He had never offered to take less. Mr. Goldstine said the liquidator claimed that the claimant was not entitled to have his claim accepted, and that nothing was due to him by the company. In any case, if he had been of any service, it was siifficiently rewarded by the £lO he had received. Negotiations With France J. R. Hetherington, cross-examined by Mr. Henry, said that Henry Max- ' well had been sent to England in 1933 at £3O a week for salary and expenses to obtain a concession. It might be that by September, 1933, a sum of £I6OO had been spent to obtain a concession, without success. He thought when Towers approached him that they had a concession, but he knew it was not finalised. They were negotiating with the French Government. Witness remembered a circular sent to shareholders on October 16, 1933, stating that the objects for which the company had been formed were now on the verge of fruition. They had a French concession actually promised then. He did not remember advising shareholders that the French concession had fallen through. "Tangible assets" referred to in a circular turned out to have claims on them that Maxwell had not succeeded in discovering. Mr. Henry: Here are two circulars Btating that tangible assets had been obtained. Is there any circular correcting that? Witness: I am not aware of any.

Proceeding, witness said' he was not aware of the issue of any shares in Provident Bonds that were not disclosed. Towers had not said anything about making a charge. Towers came to him asking for money, as he was hard up, and the question of payment for services was not then raised. His Honor said he would take time to read the affidavits again carefully and consider his judgment.