THE PERPETUAL TRUSTEES COMPANY, LTD.

Southland Times, Issue 25312, 15 June 1935, Page 5

THE PERPETUAL TRUSTEES COMPANY, LTD.

FIFTY-FIRST ANNUAL MEETING

SATISFACTION WITH OPERATIONS

Efficient Conduct of Business

The fifty-first annual meeting of the Perpetual Trustees Estate and Agency Company of New Zealand Limited was held in“he board room of the company on Tuesday last Mr W E Reynolds, chairman of directors, presided, and he was supported by the Rowing C Hazlett and James Begg, of Dunedin, R. J. Gilmour, o Invercargill, and E. G. Kerr, of Timaru. doctors of the company, and the general manager (Mr A. Ibbotson). The meeting was well attended and apologies were from C. R U K. Ireland, o£ Oamaru (directors of the company), also Messrs G. Benson and D. Phillips.

Chairman’s Address. The chairman in his address said: Gentlemen,—At our last annual meeting we celebrated our jubilee year, loday we halt for a moment or two at the first milestone on the road to our centenary, and I think when all the circumstances which surround u the present time are taken into consideration, that the results for the year as disclosed by the annual accounts now in your hands will be considered in every way satisfactory. You are all well aware of the difficult adverse forces with which all businesses have had to contend during the past few years, and if I may be allowed to express my own personal opinion, it is that the results we show to-day reflect great credit on both the management and the staff. ■ I will have some brief remarks to make later on concerning some of the recent enactments fashioned by the Legislature, but at this stage I would like to emphasize the extraordinary amount of work, care, and readjustipent of ideas which much of this legislation has called upon this company to undertake—work and care of which probably but a few of our clients have any realization, and for which no charge is made. This only once again emphasizes the advantages which are to be gained by appointing a companv such as ours as trustee, it is true that some few years ago we, in the Dominion, were riding on the crest of a wave of prosperity, while of recent years we have been wallowing in the hollow of adversity. It is equally true that bad times are usually followed by good times, and that we must take one with the other; but we should not forget it is when in the hollow that efficiency is put to the test, and the results, as placed before you to-day are, I think, sufficient and definite evidence of this. Taking a momentary survey of conditions generally as we find them in the Dominion to-day, I personally see no reason for pessimism. I am of the opinion that the worst of our troubles are behind us. Nevertheless, it would be inadvisable I think to minimize the uphill climb we still have in front of us before we can reach the summit of our new endeavour. It behoves us all to go forward with care and confidence knowing that our ability to reach the heights again should, and doubtless will, be enriched by the experiences through which we have so recently passed, and I am confident that this will prove to be the case. Legislation.

During its recent sessions Parliament was anxiously engaged in the passing of legislation 'designed to remedy or alleviate financial hardships which a study of the history of the depression has revealed to be lying heavily on a large portion of the primary producers of this country. The Mortgage Corporation of New Zealand Act, 1934-35, aims at securing for the farming community, by means of the issue of bonds, stock, and other securities to the general investing public, loan moneys repayable over lengthy periods on the table mortgage principle. Mortgagors will require to pay or have added to the amount of their mortgages 2 per centum of the amount thereof to assist in establishing a reserve fund. The Rural Mortgagors Final Adjustment Act contains elaborate provisions permitting mortgagors and mortgagees of rural properties to apply within one year from May 1, 1935, for “stay orders,” which involve meetings of all the mortgagors’ creditors and the appointment of trustees to superintend their financial affairs and living expenses. Provision is'made, for ascertaining the productive value of the mortgaged lands at the end of five years, and, should an adjustment be found necessary, mortgages may be reduced so that the amount thereof shall not exceed the value of the property as so ascertained. Only time can reveal what practical assistance this legislation will provide. The Mortgagors and Tenants Relief Act, 1933, which was to have expired at the end of this year, has been extended indefinitely, while the provisions of the National Expenditure Adjustment Act have been extended to April 1, 1937. The Trustee Companies Protection Act, 1934-35, which was passed at the end of last season, will enable trustee companies, by exercising control over voting and transfer of shares, to restrict their list of shareholders to resuonsible and bona persons, thus eliminating the possibility of undesirable interests obtaining an undue measure of control of the affairs of trustee companies. Rate of Interest

The rate of interest for first mortgage securities has, in sympathy with interest rates on securities of all kinds, shown a continuous tendency to ease. For a period extending over some months during the year under review a limited amount of first mortgage money was available in some quarters at as low a rate as 4 per cent., and a number of lenders in various districts accepted this rate for fixed periods of three and five years rather than having their moneys lying uninvested. It appears that the moneys available at this rate and from those sources have now been fully taken up, and the interest rate for money required on first mortgage has become for the time being stabilized at 4} per cent. The popularity of first mortgage investments, and especially those comprising farm mortgages, suffered a further rather serious setback when the additional restrictive mortgage legislation recently enacted became law. Now, however, it is becoming more widely recognized that farm mortgages can still be worth while securities if valued on the basis of pre-sent-day prices for primary products, and always provided the borrower is a reliable man and a practical farmer

with the incentive to work and improve his position. In all loan appn cations submitted to your Board o Directors these aspects are invariably given careful consideration. State Enterprises. It has been said of old that “the more numerous public instrumentalities become, the more is there generated in citizens the notion that everything is to be done for them and nothing bj them. Each generation is made less familiar with the attainment of desired ends by individual actions or private enterprise and more familiar with the attainment of them by Governmental agencies, until eventually Governmental agencies come to be thought of as the only available agencies. . Whilst it may be a matter of individual opinion as to whether such institutions as a State Bank and a State Mortgage Corporation are or are not absolute necessities to our business life, it does seem to me that the presentday trend is overmuch towards expecting the State to solve all our business difficulties instead of our finding the solutions ourselves. In my opinion, private enterprise should be cared for and at all times fostered in preference to State trading, as it is manifest that, with increased private enterprise goes, hand in hand, the ability of the people to bear the heavy taxation which seems to be unavoidable under present conditions. Branches. We may now fairly claim to have an organization of well-established branches throughout the South Island, each of them in charge of a competent and experienced manager with an efficient staff to help him in the work of caring for the many ana varied interests of our numerous clients. We know from the evidence before us how much our clients away from Dunedin and in the various districts in which we operate, appreciate the efforts of our branch managers and their staffs and the same can readily be said of our Dunedin branch. With the perplexities and uncertainties inseparable from business dealings to-day, it is considerably more difficult to give the same high standard of satisfaction and service as in the past, but I know that despite these difficulties, which I feel we shall pass out of in the course of time, the utmost efforts of the managers and members of our staffs are readily and constantly used in an endeavour to render service of the highest and most efficient type. From my knowledge of the company’s business as chairman of directors, I know something of the many difficulties met with in a many-sided business such as ours and the great amount of work done, in the interests of clients, much of which is done gratuitously yet very willingly. Once again we place on record our thanks to our branch directors, Messrs R. J. Gilmour, of Invercargill, R. K. Ireland, of Oamaru, E. G. Kerr, of Timaru, and C. H. Hewlett and C. J. Ronaldson, of Christchurch, for their continued interest and help in our work in their respective districts. It is with regret I refer to the recent demise of our Oamaru representative, Mr Walter Sumpter. Mr Sumpter has been our representative in the Oamaru district for many years past and our interests there were always given his utmost care and attention. We extend to Mrs Sumpter and the members of her family our deepest sympathy in the loss they have sustained. The chairman then dealt with the annual report and balance sheet and moved their adoption. “Sailing a Steady Course.”

Mr W. Downie Stewart, M.P., said that he had much pleasure in seconding the adoption of the annual report and balance sheet. The chairman had given a very interesting survey of the affairs of the company for last year and had offered some general observations on matters affecting its welfare. It was very satisfactory to know that, in spite of the unfavourable conditions that still prevailed, the directors were able to show in the report and balance sheet that the company was still sailing a steady course and that everything seemed to be shipshape. He had on previous occasions referred to the work that the company was doing by the service that it was rendering not merely to the shareholders but to the testators who had entrusted the management of their estates to it, to beneficiaries, investors, and borrowers, and to the many that sought its advice or assistance. It was unnecessary to refer to that again. Complexity of Work.

The chairman had referred to the great complexity and intricacy of the work thrown on the company by modern legislation, Mr Stewart added. It was true that in New Zealand, as elsewhere, the complexity of the modern economic situation had made the legislation, which was a reflection on it, more and more complicated. That, however, was not peculiar to New Zealand. He had been reading this week of the results of legislation that had been passed in England in connection with the marketing of farm produce and the control of its production. The account of the repercussions that had come about read like a chapter out of “Alice in Wonderland." No sooner was one matter set right than side issues arose that had not been foreseen. There was one other feature of the financial situation /that was worthy of reference. It was the growing intricacy of income tax assessments and returns, and he agreed with those who said that it was becoming impossible even for skilled business men to make up their returns with complete accuracy. He did not want to say too much on that subject as he might well be asked the question what he himself had had to, do with it, but it had to be admitted that the whole thing was becoming more and more intricate, and was rapidly reach-

ing a stage when those people who were capable of making up income tax returns were becoming like Chinese mandarins, a very exclusive class. He considered that a very necessary task that faced the Legislature was the simplification ofassessments sufficiently to enable average business men to know exactly where they stood and to make up their returns without, being placed under the necessity of employing a special staff of experts. Of course, their company was well fitted to undertake work of this kind, and it was continually being asked to do it, thus having the number and variety of its activities very much increased. Wise Administration. Referring to the annual report and the comments made with respect to it by the chairman, Mr Stewart said he was in full accord with them. They should satisfy shareholders generally. He thought that the directors had been very wise in increasing the amount set aside for the investment fluctuation account in view of the uncertainty of conditions still. Shareholders,-he said, must be very gratified at the growth of the company in other centres. In Christchurch and other places he had heard expressions of satisfaction on the part of members of the legal profession who greatly appreciated the facilities that were provided by properly constituted branches in their own centres. In conclusion, he wished the company continued success and pros-

perity. The motion was carried. Election of Directors. The re-election of the retiring directors, Messrs E. C. Hazlett, R. J. Gilmour and C. Stanley Smith, was moved by Mr George Black and seconded by Mr N. Paterson. The motion was carried. Mr Hazlett returned thanks on his own and on Mr Smith’s behalf for their re-election. It had been said, he added, that the affairs of the company had been well handled by the staff during the past year, and he wished to endorse that statement. The company had passed through a strenuous year, though he believed that it had passed through the worst times, and he wanted to say that, although the directors dealt only with matters of policy, they had been very much helped by the skilled staff in the manner in which matters had been put before them. Mr Gilmour also thanked the shareholders for the renewal of their confidence in returning him again. On the motion of Mr P. H. Power, seconded by Mr J. G. Patterson, auditors were re-elected as follows:—Messrs W/ Brown and Co. and G. Blyth and Co. (Dunedin), F. A. Webb (Invercargill), Leggott and Allport (Timaru), and W. E. Best and Wilkinson (Christchurch). Vote of Thanks. A very hearty vote of thanks to the directors and the staff for the service which they had rendered to the company during the past year was moved by Mr T. Somerville. All recognized, he said, that the times through which the company, with other businesses, had been passing had been very strenuous, but the state of the finances, as disclosed in the balance sheet and in the statements which had been made, reflected great credit on the directors and staff. From the remarks which had been made it was evident that the utmost co-operation existed, not only between the directors and the staff, but also among the staff itself. This was very desirable, and only in such circumstances could a business prosper in these strenuous times. The motion, on being put to the meeting by Mr Somerville, was carried by acclamation. The chairman, in returning thanks on behalf of the board of directors, said that, as he had mentioned before, the Perpetual Trustees Company was a 1 very harmonious body. How far that condition was due to the efficiency of the staff he left it to shareholders to judge. He did thank the shareholders, however, for the resolution that had been so readily passed. General Manager’s Reply. As the staff had been coupled with i the vote of thanks, said Mr Alfred Ibbotson (general manager), he desired to acknowledge the vote on its behalf. As the chairman had stated in his address, further legislation had been ’ passed since the last annual meeting, affecting a considerable part of the company's business. He did not say that that legislation was not necessary, ; but it had imposed extra study and ' work on himself and his colleagues holding important positions. What would be the result of that legislation ’ no one could yet tell. He noticed with . a good deal of interest how small was ' the profit of a trustee company as compared with the immense amount of work and the turnover. He supposed that that was right, because trustee ’ companies were inaugurated in the ’ early days for the purpose of safeguarding the assets of testators and of their ’ wives and children, not for the pur- ; pose of making undue profit. The chair- ' man had made reference to the work of 1 the company and its extension, and Mr Ibbotson said that it was very satisfactory to him and to those assisting ' him to see the business spreading the way it was. It indicated that the ser- ’ vice given with the best of intention and ability was being recognized. They i regretted the death of Mr Sumpter, their Oamaru agent, and the directors thought the time had come that in Oamaru, as in other places, there I should be established a branch, with a , fully-fledged staff under a competent j manager. He thought it was a step in j the right direction. The company had 3 its own premises, a growing connecj tion, and a number of esteemed clients t there, and it felt that the time had . come when, in its own interests and the » interests of its clients, a branch should j be established. , The meeting concluded with the t chairman’s intimation that the dividend . warrants were now available.