MINING CASE IN THE S.M. COURT. Monday, July 24.

Otago Witness, Issue 2369, 27 July 1899, Page 24

MINING CASE IN THE S.M. COURT. Monday, July 24.

I (Before Mr E. H. Carew, S.M.) The Golden Mascotte Sluicing Company t (Limited) v. J. K. Simpson (Wetherstones). — Claim £50, being the amount due for application and allotment calls as the holder of 300 shares in the company. — Mr W. C. MacGregor appeared for plaintiff, and Mr Woodhouse (instructed by Mr Sim) for defendant. — Mr Ma^ Gregor said the plaintiff company was being wound up by voluntary liquidation, and they sought to recover the calls stated in the summons from defendant. Defendant's name^was on 'the register of shareholders, which was - priina facie evidence that he was a shareholder, and he (counsel) would further prove that tho defendant axithorised the liquidator to apply for 200 shares for him. He would also i,ut in evidence a telegram from defendant accepting tho position of director of the company, and wishing the company every success, and show 'that defendant occasionally apologised for nonattendance at the directors' meetings. Tho Dext heard from the defendant was an application from him to know the details about the 80 paid-up shares he was entitled to receive for accepting the^ position of director. A littlo • later on defendant wrote to tho late secretary stating that he could only see his way to take up 100 contributing shares, not 200. After the allotment notices had been sent out the defendant was drawn on by the office for ,£25, but he returned the draft. On January 21 of the , present year, and again later on, a notice of tho amount of moneys owing by defendant to the company was sent to him, but tho secretary received no answer to these notices. Counsel said the mere fact of Mr Simpson having consented to act as director made him liable for the number of shares which were necessary for a director's qualification. The defendant's name was published on the prospectus as a provisional director. It was not necessary for him (Mr MacGregor) to prove all this at tho outset, but the liquidator wished to act in all fairness in the matter and disclose all the facts. — George Neil gave evidence, and said the application for defendant's shares was signed by witness. He obtained authority to apply for 200 shares for defendant at ■Wetherstones. Witness told defendant ho would not put him • down for less than 200 shares, and defendant ■ said "It will be all right." Defendant meant what he said' at the time. Witness said: "I consider you are wise." The reason why Mr Simpson did not sign the application there and then was because the prospectus was not out until a week or two after that. In cross-exami-nation, witness was positive he had told defendant that he had applied for 200 shares in the company, and witness could not remember defendant making any comments in particular. He fancied that although defendant did not object he said he did not think he was taking

so many shares. At Miller's Flat witness spoke to defendant about Having dishonoured the ' draft. Defendant said he did not feel inclined to pay, and witness said he hoped defendant would get out. He told defendant he was quite right, too, as he had had nothing for his money. Afc this time defendant gave as his reason for not paying that the property was either belied or no good. It was agreed that all documents .in the case should be put in afterwards. — Mr Woodhouse said the main defence was that defendant never authorised Neil to apply for the shares. — Defendant gave evidence that the first he heard of the Golden Mascotte Company as affecting himself was on receiving George Neil s telegram, which was to this effect : " Will you allow your name to be placed on directorate Mascotte 75 promoters." The telegram gave the names of the provisional directors. He ; sent back the reply Mr MacGregor had inenj tioned: He did not see Neil for some consider- , able time, and he first knew that he had been i allotted shares when he was drawn on for £25 for -an application on 200 shares. He re- ' fused the draft, and wired to the secretary that he would communicate the number of shares he intended to take in the company. He never remembered having any conversation at Wetherstones about taking shares in the Mascotte. Ho never authorised Neil to apply for shares or put him down for shares. Neil had no authority whatever to act for him. Neil never mentioned the number of 200 shares .to him. H« never authorised anyone to take .shares for him in the Mascotte. To his knowledges ho never even received a copy of the prospectus. He consented to go on the directorate after looking over the names, and because he was going to get 75 paid-up shares. He had never seen the memorandum or articles of association in the company, and never received .any scrip of any kind. Tho first he knew he was down for 200 shares was the notice pinned to the draft which he refused to pay. He had never seen Neil about the company before the , draft was presented to him. He saw the secretary some time after he had received the draft, and asked who had signed the shares for him. The secretary told him Mr Neil. Defendant then refused to take the shares. He had given nc one authority to take 200 shares. He certainly had intended to take, some shares. He never attended a meeting of directors. He never told Neil anything about the draft, but had challenged him about taking shares for him. Defendant said he was not going to take the shares. Neil might take them himself. At Miller's Flat the only conversation he had with Neil was accusing him »of signing for the shares To his knowledge he never received any formal notice of allotment of shares in the company.— Cross-examined : More than once he had received notices from the company regarding the shares, and he had received notice of directors' meetings. He had apologised more than once for nob being able to attend these meetings. Ho must have received a letter which said that shares had been allotted and notices sent out. Even now he could not say positively whether or not he received a notice of allotment on September 8, or the " 9th of last November. The draft probably arrived a day or two after the notice was sent out, and he then wired that he would write stating how many shares he would take up, but he never wrote. There were papers — apparently receipts — pinned to the draft, bearing Neil's signature. His memory was very clear as to the whole transaction. What he saw attached to the draft on November 8, or about that date, was the first trace of who had signed- his name. He was "" almost positive that Neil filled in the receipt, nidging from tho handwriting. When he wired back he took no further notice, as he thought he was free of the 200 contributing shares. He admitted wiring to the company on Decem-

ber 15 about his paid-up shares. He received a reply: "200 contributing and 80 paid-up." He wired back again : " Cannot do with 200 contributing shares ; , will consider half number." He received a letter from the secretary of the company on November 18 giving him full particulars of what had been done up to that date. He did not reply to that letter. He had been connected with scores of mining companies, and had held plenty of 'shares, but it was a new thing for anyone" to sign applications for him. He positively denied the story that Neil had told about the conversation at Wetherstones. He was quite sure that Neil had invented the story, and had no authority whatever to sign for him. He had absolutely no conversation with anyone else re taking up shares in the Mascotte Company until after he had received Neil's wire about the director. Ho had known Neil in business for some time, but was not very friendly with him. He was quite sure that it was on the wire that he was to receive 75 promoters' shares. He never saw Mr Trythall about the shares. He would swear that previous to his becoming a director he had never spoken to Neil about the Mascotte claim. — At this stage the further hearing of the caso was adjourned until next Friday.