TRUST ACTIVITIES

Otago Daily Times, Issue 22398, 20 October 1934, Page 13

TRUST ACTIVITIES

THE SYDNEY COMMISSION SITTINGS RESUMED (United Press Association.) (By Electric Telegraph—Copyright.) SYDNEY, October 19. (Received Oct. 19, at 10 p.m.) Allegations that attempts have been made to induce debenture holders in the Southern British Company to exchange their holdings for shares in another company were made by Mr Bryan Fuller when addressing the Royal Commission on Trusts, which resumed to-day. Mr Abrahams, K.C. announced that he had been asked to appear for certain debenture holders whose names were contained in a petition to the commissioner. They did not desire to disclose the contents of the petition at the moment, but they had combined to protect themselves from people who were opposing their interests. They wished the commission to circularise all debenture holders with the report of its findings before making a second report recommending alterations. It was desired to form a Debenture Holders Protection Association so that submissions might he put before the commissioner as to what he might recommend. Another counsel, Mr Selwyn Betts, said ho had substantially the same instructions from another group of debenture holders. The commissioner said that any help from people submitting the views of the debenture holders would be very acceptable, Mr Fuller said he had no objection to representatives of debenture holders appearing, but a frank statement should be made before counsel were allowed to appear. He had been informed that debenture holders had been approached in Brisbane with the suggestion that they should exchange their debentures for shares in another company controlled by a person who had appeared before the commission and that one of the directors of the company was an agent for M‘limes.

The commissioner said he would not support any suggestion that any company with which MTnnes had any connection should have anything to do with taking over the affairs of the companies. Mr Fuller said one of the directors of the company to which he had referred was Foster. The scheme was that the debenture holders of the Southern British should hand over their debentures in exchange for shares in another company and that the comissioner should value the debentures and get the debenture holders to hand them over to this other company. The commissioner: I am not going to do anything like that whatever happens. One of the main objects of this commission is to try to preserve the interests of the people who invested their money. The commissioner added that it appeared to be necessary to call debenture holders’ meetings, but be did not know who would bear the cost of circularising all the debenture holders with copies of his findings on the facts. Mr Abrahams stated definitely that he did not represent the MTnnes interests. “On the information I have at present there is bitter hostility to MTnnes. As regards Foster, I have never heard his name.

The commissioner said he thought the debenture holders should be warned to be very careful about accepting suggestions to put money into any company on the basis that it would be authorised by the commission to take over assets. It would not be competent for the commission to make such a proposal and there was very little likelihood of the Legislature adopting that method of settling the affairs of the companies. He would probably recommend to the Government that a receiver of assets, as far as they came within the jurisdiction of New South Wales, should be appointed so that during the time steps were being taken to ascertain the desires of debenture holders there would be no possibility of the assets being dealt with in any way. Mr H. S. Nicholas, who appeared on behalf of the New Zealand Government, submitted that the transactions which were the subject of cable messages between Mr Hampson and the commission should not be inquired into by the commission. Mr H. M. Hampson. a New Zealand solicitor, said he wished to contradict statements made in the New Zealand commission’s report. The commissioner said he could not accept the position of judge between the New Zealand commission and Mr Harnpson. Mr Hampson proceeded to make a statement about Redwood mortgages when the commissioner remarked that it appeared to have nothing Ho do with what he was investigating. “If you don’t choose to (five this evidence before the New Zealand commission it seems extraordinary that you want to give it before me.” The commission adjourned until Monday.