DRY SHAREHOLDER

New Zealand Herald, Volume LXXIV, Issue 22860, 15 October 1937, Page 16

DRY SHAREHOLDER

CLAIM FOR DIVIDENDS COURT ENTERS NONSUIT [by telegraph—OWN correspondent] TE Kurn. Thursday • The action -of John Bell, of Kiritehere, a dry shareholder, to secure a return on an investment of £SO in the Marokopa Dairy Company was unsuccessful in the Magistrate's Court. Mr. P. H. Levien, S.M., nonsuited Bell on his claim for £4B, which plaintiff considered was due to him as dividends, or return on his investment. Bell had in 1911 invested £SO in the. newly-formed Marokopa Dairy Company and with the exception of two years had not been paid»any dividends on his share capital, though he claimed that dry shareholders should have received, under the company's articles, a dividend not exceeding 6 per cent before 1 butter-fat bonuses were distributed. For Bell it was claimed that the action of the company in not dis-j tributing dividends when the money was available was ultra vires, and it was asked that judgment for Bell be entered under the equity and good conscience clauses. For the company it was stated that until they were declared dividends did not constitute a jegal debt. Therefore, as no dividends had been declared, Bell was not entitled to sue for a return on his shares. In his reserved judgment, Mr. Levien said that he could not give judgment for plaintiff, as no dividends had been declared, and although he mightJ have liked to have given something- to Bell under the equity and good conscience clauses, he was debarred from doing that by the provisions of the law affecting companies.