WEST TAUPO TIMBER

Taranaki Daily News, 21 August 1930, Page 12

WEST TAUPO TIMBER

PROJECTS THAT FAILED OFFICIAL DOCUMENTS. A CHEQUERED HISTORY. A few days ago a statement was laid on the table of the House of Representatives relative to the claim’s, exceeding half a~ million pounds, n-ya.de in respect of the West Taupo timber lands involved in the affairs of the Tongariro Timber Company, Ltd. The chief claimant was the'Tongariro Timber Company itself, the amount being £330,000. According to the Aotea Maori .Land Board, which by the Act of 1929 was made the lawful agent for the natives' for the recovery of the lands, most of the other claims were made by creditors of- the company and could not be considered with' the possible exception of that of the Egmont Box Company for £31,000. The brief precis of the statement which was referred to the Native Affairs Committee conveys no. idea of its scope. The present purpose is not to discuss the pros and cons of what looks like a first-class legal tangle, but to give some idea of the strange history of. the whole affair, which was launched about 1908. “AS A SPECULATION.” Possibly* at the outset the following extract from the report of the president of the Aotea Maori Land Board should be given: “It certainly looks now as if the company had acquired the rights to the timber merely as a. speculation and without having any reasonable means of carrying out the agreement. It clearly had not the necessary capital at its command and, judging from the claims made, it .was compelled to hawk the rights around at considerable expense. ...” Some light on this “hawking” is supplied in the letter of Mr. IV. H. Grace, who claims £4500. “In 1919,” says Mr. Grace, “the company renewed its efforts to carry out its undertaking, and to that end it entered into successive negotiations with the Egmont Box-Com-pany, Messrs. Armstrong-Whitworth, Messrs. Camuiell-Laird, Mr. Bertram Phillips and finally, in 1927-28, with the Duncan, syndicate.” ■ After the Armstrong-Whitworth, and Cammell-Laird negotiations had fallen through, in 1924, the local Hope Gibbons syndicate appeared in the field. Of it, Mr. Grace, under agreement with the Heuheu-Grace party, and some other owners, became assistant-organiser. This syndicate, says Mr. Grace, was a particularly strong one, and undoubtedly would have succeeded in its venture but for the intervention of Mr. BertramiPhillips, who “came on the scene in March, 1925, and in a very short time induced the company to give him an option over its rights.” The statement of claim shows that Mr. Phillips belongs to Salisbury, England. AIR. PHILLIPS’ FAILURE.

Proceeding, Mr: Grace says that Mr. Phillips failed to carry out his undertaking, but succeeded in tying up the company until 1927, when the company finally got free of him by paying him some £29,000 and interest. It is interesting to observe in the list of claims one for £29,700 by Air. Bertram Phillips. Returning to Mr. Grace s narrative, we find that the .Hope. Gibbons syndicate was dissolved in 1925, and that after Air. Phillips disappeared from the affair Air. Grace became associated with the Duncan syndicate, which proposed to float a new company. This syndicate, states Mr. Grace, did everything necessary to ensure the successful formation of the company, and was only prevented from carrying outfits project by the ■refusal of the Government, at the end of ID2D, to approve. All Air. Grace’s charges in connection with these schemes are included in his present claim. Further interesting sidelights upon the later developments are given by Air. K. D. Dunean, of the Duncan syndicate, which claims £13,800. This syndicate was formed as a result of Air. Duncan’s securing an option over the Tongariro Company’s rights and- concessions, and as a result of overtures made to the Native. Alinister in February, 1928. THE DUNCAN SYNDICATE. The new company was to have a working capital of £300,000, to be raised by a series of 10 per cent, debentures. Air. Duncan was manager, Air. W. H. Grase assistant, and undertook the organisation" of the native side, and Mr. Rl W. Smith, ex-AI.P., of Ohakune, understock the organisation of the milling side. Guarantors and underwriters were:—Afessrs. B. H. Edkins, D. AL Findlay, J. G. Duncan, A. D. S. Duncan, lan Al’acEwan, E. O. Hales, G. Magnus, A. Pirie, R. B. Alartin, George Ross, B. W. Smith and K. D. Duncan, who guaranteed £84,000. By the «md of October, 1928, says Mr. Duncan, the syndicate had arranged for £240,000 capital and had secured the consent of the native owners to a modification of the standard of the railway line (which was to have run from Kakahi to Taupo). But for two consents outstanding, it was ready to proceed. The two consents the formal consent of the Government to the whole undertaking, but from correspondence it was anticipated that this would follow as a matter of course; and the consent of certain English creditors, which also would have been forthcoming.

Such was the position in November, 1928, “But,” proceeds Mr. Duncan, “in that month there was held the general elections, which resulted in the Government of the day being replaced by the present Government. As the latter was not a party to the negotiations of Feb-' ruary, 1928, it was considered that fresh negotiations would be necessary, and overtures were made to the Native Minister.”

RESULT OF NEGOTIATIONS. These negotiations culminated at a meeting at Waihi, Lake Taupo, in February, 1929. Tie ’ syndicate’s project was submitted with two modifications, one being in the direction of giving the owners of the timber territory £120,000 in fully-paid shares out of the share capital of £300,000, which must not be confused with the working capital of the same amount, and in the direction. of making it mandatory on the Tongariro Company and its creditors to accept the provision made for them. hn-Thej meeting, at - which the Native Minister presided, approved and author-

ised the project and granted a period of six months for consummation, lhe real intention, says Mr. Duncan, was for the six months to run from the time the Government gave its consent. The syndicate was in a position to give effect to the project as soon, as the resolutions were carried, but as an ordinary business . precaution refrained Irom so doing until the Government gave its consent. The syndicate expressed repeatedly and continuously for this consent,” says Mr. Duncan, “but without avail, until finally the Act of 1929 came into force and rendered it impossible for the syndicate to proceed.” ' ! ’ The final claim is from the TOngariro Timber Company, the secretary of which is Mr. George Ross. The sum of £330,000 is made up of £60,000, the company’s capital, and £2i 0,000. repiesenting claims of creditors. ’ , In regard to the Duncan syndicates claim, the president of the Aotea Maori Land Board remarks: “The syndicate’s proposal amounted to an entirely new project, and the moribund Tdngariro Timber Company was simply used as an instrument to enable it to get hold of some timber. For.this it was prepared to pay something like £lOO,OOO to the company’s creditors. This £lOO,OOO was to come out of the timber and was reflected in the price offered for it—that is, the native owners would have had in the end indirectly to pay the company's creditors.”