TRUSTS’ AFFAIRS

Southland Times, Issue 22473, 8 November 1934, Page 7

TRUSTS’ AFFAIRS

SYDNEY COMMISSION WIDE POWERS IN NEW ACT COUNSEL’S COMPLAINT (United Press Assn.—Telegraph Copyright.) (Rec. 5.5 p.m.) Sydney, November 7. Addressing the Royal Commission investigating the affairs of 31 trust companies this morning, Dr. F. Louat. who is representing several of the companies, referred to the legislation passed by the State Parliament. He said that it was based on the commission’s report, yet seemed to go considerably further. Although the Commission recommended certain action in the case of three companies the legislation dealt with 23. The Act also took powers to deal with matters which had been expressly reserved for consideration, after argument by counsel. The Commissioner (Mr Justice Haise Rogers) said that although the Act was wide in its powers it was only a temporary measure. The intention was to preserve the assets of the Southern British Trust and the Investment Executive Trust pending a further recommendation by him. It did not hamper him in any way as far as it concerned schemes or suggestions that might be put forward. The debenture-holders must be consulted, also anyone else who could devise a method of saving the assets. Counsel for a large number of de-benture-holders stated that his clients desired to co-operate as far as possible with New Zealand interests. The Commissioner said he did not intend to propound a scheme for the future of the companies. After hearing certain schemes put forward he might summarize them so that the debentureholders would be able to consider them. He might also make some recommendation to the debenture-holders. The Commissioner suggested that counsel should meet in a round-table conference and thrash out a scheme. This might be more fruitful than a discussion in Court. Dr. Louat characterized the suggestion as most valuable. In reply to counsel for one of the debenture-holders, the Commissioner said his present view was that it might be disadvantageous to the debentureholders to force the sale of the Trust Building, otherwise the old Daily Telegraph building, by winding up the companies. This would throw the building to the highest bidder, whereas the interests of the debenture-holders might be better served by some organization of the companies. If the rents from the building amounted to anything like what Hewett and other witnesses said the profit would go to pay the interest. On the other hand, if experts came to the conclusion that it was a false hope probably the debentureholders would think it better to get their money back as soon as possible. The Commissioner added that the parties should be prepared to put forward definite scheihes by Monday week, but rmless the proposals were concrete they would be useless. The Commission adjourned till November 19.