YACHT MOREWA DISPUTE

Poverty Bay Herald, Volume LXIII, Issue 19099, 21 August 1936, Page 8

YACHT MOREWA DISPUTE

REPLY EY McARTHUR COUNSEL GIVES OUTLINE DEBT OF COMPANY (Per Press Association.) WELLINGTON, this day. An outline of the defence was given by Mr. 11. F. O’Leary in the Supreme Court this afternoon to the application made by the Pacific Exploration Company, Limited, and the Sterling Investmets Company (N.Z.), Limited, both in liquidation, who are seeking a declaration that J. W. S. McArthur was liable to pay either £10,535 4s 4d or the value of the yacht Morewa at the date of its acquisition by McArthur, together with interest at 6 per cent, and an inquiry as to riie value of the yacht at the date of its acquisition and all necessary directions as to the holding! of such an inquiry. Mr. Justice Johnston was on the bench. Concluding his statement on behalf of the plaintiffs, Mr. G. G. Watson described the Morewa as probably the most luxurious and extravagantly-built yacht ever constructed in New Zealand. No detail of luxury or extravagance had been omitted in the construction. The vessel ostensibly was constructed for exploration of the Pacific, but in reality the yacht was the luxurious pleasure toy of a wealthy man. After referring to some of the appointments of the yacht, Mr. Watson contended that they showed that the Morewa was unsuitable for exploration of the Pacific, if there could be any part of the Pacific still available for exploration. Evidence in support of the plaintiffs’ case was given by Arthur Eric John Anderson, accountant at the Public Trust Office, Wellington, who dealt with the complicated transactions. AGREEMENT CLAIMED In the statement of defence it was contended, inter alia, that on or before December L 1933, it was agreed by and between Pacific Exporation Company and defendant ttiat the yaciit with all equipment and stores should be sold to deienelant in consideration of assumption by the defendant of the liability to the Sterling company for £8931 9s owed by the Pacific company to the Sterling company in respect oi the construction and equipment of the yacht. On or about December lb, 1933, tbe defendant took over the yacht. Between December, 1933, and February 28, 1934, the defendant owned debentures of the Sterling company of a nominal value of £60,000. On some date prior to February 23, 1934, the defendant, in pursuance of the. agreement, assumed the liability of the Pacific company and became 1 liable for the sum of £8931 9s to the Sterling Company. On February 28, 1934, as a result of the agreement with tlie Sterling company 1 the debentures of that company held by the defendant were cancelled, in consideration of which certain assets \vere, at the request of the defendant,, assigned by the Sterling company to Wymvood Investments Limited, and to the defendant. Included among assets' so transferred were “all accounts owing by the Pacific Exploration Company. Limited,” including £8931 9s, whereby the liability of the defendant for this amount became satisfied and discharged. PERSONAL INTENTIONS

. Mr.' O’Leary said that McArthur formed the intention of personally taking over the yaciit, after it became evident irom the spreading of his business to Australia, that the original project of exploring the Pacific and building a boat for the purpose would have to go by the board. Toward the end of 1933, it was decided that he should purchase the yacht from the Pacific company. Sterling Investments, which were the creditors of the Pacific company, owed McArthur £60,000 over debentures representing his profit on the deal with the Trust building in Sydney. He realised the debentures over the Sterling company and, in return, got assets which included the yacht by wav of the amount that was owing to the Sterling company from the Pacific company. Counsel claimed that tile item in the Alcorn receipt of “accounts due by the Pacific Exploration Co., Ltd.,” covered the amount which would mean that, when McArthur got the yacht and realised the Pacific company, he became the owner of'it.

The court adjourned for the day