A DEADLOCK.

Stratford Evening Post, Volume XXXI, Issue 77, 13 November 1911, Page 8

A DEADLOCK.

D TROUBLE AT THE WOOL SALES. OVERSEAS BUYERS WITHDRAW. Trouble arose at the opening of the first New Zealand local wool sale of the season at the Town Hall to-day with overseas buyers says the Wellington “Post ” of 'November 7th. Before the sales began there was an uneasy feeling that buyers would express in forcible terms their objection to the broker’s insistence on the “cash on delivers)* rule, which appears in tho conditions of sale. Mr. A. E. Alabin, chairman of tho Associated Wool Brokers’ Association of New Zealand when seen by a representative of The Post explained that the brokers of New Zealand asked for cash before delivery for wools sold, which was in accordance with: the conditions of sale, and was also a universal practice in the trade, “The rule has only been partially observed in New Zealand in the past,” he added. “Tiie speculator, fell monger, and local operator have bad to rigidly cornI ply by putting up their cash before getting their wool; but the English and overseas buyers have been allowed to remove or ship their wool before payment, so that they could obtain Dills of lading for the wool contemporaneously with the paying for it. This system has obviously an clement ol risk about it, and is one that has always caused brokers groat anxiety. Whilst it may have served its purpose when the wool trade was young and the interests comparatively small, now that the trade lias grown to largo dimensions some other and more businesslike method of protecting tho interest of the selling broker and the vendor must he adopted. The. old system suited the buyers, and provided as easy method for finance, as it saved them some interest outlay, but they must recognise sooner or I at-: r that tho system has to go, and wool brokers are determined to end it now. ft is much to bo regretted that overseas buyers objected, but wool brokers by giving ample notico(for buyers wore advised last season of the proposed strict adherence ,to the terms cash before,delivery), have clone their part, and surely as sellers of goods, they are entitled to ask for payment before giving delivery.” Mr. it. W . Waterhouse, chairman of the Wellington Woolbrokers’ Association, speaking with reference to the trouble, pointed out that clause 2 of the conditions of sale read:—“The goods to bo weighted by the _warehousekeeper taken away within II days (including Sundays and holidays) at the buyer’s expense and to be paid for in cash before delivery. Such payments to be made before 2 p.m. on .prompt day.” “This clause,” lie said, “is not a now thing, but it has appeared on wool catalogues from date of initiation of sales in New Zealand. Although it is specifically stated therein that wool is to be paid for before delivery tho brokers have allowed buyers a great deal of latitude, and as a consequence the former have had to take risks and incur expense which should not have fallen to their lot. The brokers therefore, consider themselves to he fully justified in asking to he relieved of the anomalous position they have been placed in, and arc determined that the conditions of sale which (through a too kindly spirit on the part of the brokers) have not been enforced should now be carried out in their, entirety. “In the past the wool has been delivered out of brokers’ stores, taken into the Harbour Board’s sheds for dumping placed'on board the carrying steamer and in some eases the carrying steamer has actually left Wellington before the wool lias been paid for. This fact has only to be stated in order that it may be appreciated how extremely generous the brokers have hitherto been. It is true that until payment is made by tlie buyers the wool delivered for shipment is recognised by tho shipping agents as being held to broker’s order, but/ that unfortunately does not do away with the risks carried by brokers through possible default of a buyer or through loss by fire or shipwreck. As a result, tho brokers have had to take out separate insurance covers to protect themselves from time of delivery from store until payment by buyer, i bis has resulted" in a considerable addition to the heavy charges already borne by the brokers, and has also placed the brokers in tho unfortunate position of having to take out an insurance cover for wool which in most cases had already been insured by tho buyer. '.! his duplication of insurance has produced a further possible complication by putting" underwriters in the position of lighting ■ any claim for loss during 3 the period involved. Altogether ’from'the broker's standpoint the position has been most unsatisfactory and the only equitable and reasonable solution apears to he in carrying out strictly clause 2 of the Conditions of Sale. “Tho buyers have tabulated quite a host of objections,” Air. Waterhouse want on, “such as the inability of brokers to deliver promptly inadequate storage accomodation etc.; but these are side issues which do not effect the essential point; and tho brokers are quite prepared to take the responsibility of shouldering such issues as relate to them, so far as they are called upon to do so. That the buyers themselvs do not consider them insuperable is evident from the fact that in March last they offered to agree to payment before delivery, on condition that a rebate of interest bo allowed to them for the unoxpired time of prompt, and that invoices were to be in buyers’ hands within three days after receipt of shipping and rebranding instructions.