MUNGANA CASE HEARING

Taranaki Daily News, 1 August 1931, Page 5

MUNGANA CASE HEARING

PURCHASE OF THE MINES DETAILS OF TRANSACTIONS. STORY TOLD BY COUNSEL. Further details of the Crown charges of conspiracy in the Mungana case weie given by Mr. McGill, counsel fot the Crown, at the. second hearing of the claim by the Queensland Government for the recovery of £30,000 from four defendants, including William McCormack and E. G. Theodore, ex-Premiers of Queensland. ' • Mr. McGill said that when Peter Goddard was appointed manager of the Ghillagoe smelters he commenced work well, but was later corrupted. He also alleged that the day following the receipt by McCormack of £2615 for his shares, following the Government’s purchase of the (pines, he drew a cheque for £l6OO, which Theodore deposited to the credit of his account. The Government was tumbling over itself to buy mines/ continued Mr. McGill, just at a time Svheri the prices of metal were falling. The purchase price was £40,000, and Goddard recommended it. Goddard had 1250 shares in the company, which, it was alleged, came equally from the McCormack and Theodore interests. The jury would be shown all the cheques given by the Mungana Company from the proceeds of the sale of the mine to the Government. They would be shown cheques which were paid by Reid,- holder of the leases, and cheques paid to Reid’s “dummy.” They would be shown cheques paid to the McCormacks, and they would also be shown cheques which, immediately after being received by McCormack, went to Theodore. DISTRIBUTION OF SHARES. Dealing with the distribution of shares in Mungana Mines,: Ltd., Mr. McGill said t the Crown proposed to show that, after seven shares were allowed for seven persons signing the memorandum of agreement, the members of the late syndicate were left with an eighth interest each. The McCormacks’ shares we?e held as follows: Annie McCormack, 900 shares, Grace McCormack 900, Mary Ellen McCormack 880, and William McCormack 900. The Crown . proposed to show that the remaining 621 shares, accounting for the McCormack complete half-interest, were half of the shares held by Goddard, aud that the shares Goddard held he got equally from Reid and the McCormack interests. Continuing, Mr. McGill said it was a significant fact that Goddard’s shares in Mungana Mines, Ltd., did not appear in Goddard’s name as they should have appeared had they been free from taint. It was clear from Goddard’s interrogatories ■ that the'l2so shares appearing i t the name of Patrick Joseph Mangan were . Goddard’s, and all proceeds from these, on Goddard’s admission, were paid by Mangan to Goddard. The next question was, who gave those shares to Goddard ? At his bankruptcy examination, Reid said lie gave half the shares to Goddard. Who gave the other half? There • was only one other, the .McCormack interest, and Reid gave the shares to Goddard knowing that Goddard was the man who would negotiate with the Government for the sale of. the Lady Jane and Girofla mines. All this evidence had a bearing on the price for wiiich the mines w-ere sold, namely, £40,000. The Crown’s valuation of the mines hi the claim was £lO,OOO. Therefore, they would cease to wonder why Goddard was given 1250 shares. STATE’S PURCHASE OF MINES. Mr. McGill read telegrams that had passed between Theodore and Mr. Jones, Minister of Mines, showing that the purchase of the mines was being considered by the Cabinet, .Mr. Jones urging, on the recommendation of Goddard, that the purchase for £40,000 be agreed to immediately, and Theodore replying that the Cabinet was likely to agree. Eventually the Government took over the mines, under the tribute agreement, and the facts, said Mr. McGill, were that Mungana Mines, Ltd., drew handsome royalties, while the Government w'orked the mines and lost heavily on every ton taken from the mines. Under the tribute agreement, the Government spent a lot of money' on development of the mines. Twelve days after taking possession of the mines, Goddard reported a find of a rich ore body, aiid telegraphed Jones that Inspector Horsley considered it the most important find in the history of the mine. The tribute agreement was entered into on June 4, 1921, and provided payment of royalties to lessees at the rate of £4 per centum on all ore bringing up to £5 a ton, and under that agreement the Government had 12 months’ option to purchase the mines for £40,000, and, if it exercised its option in that time, all royalties paid to the owners would go toward the purchase price. By reading the agreement the jury would be able to see what a very fine agreement it was—for the owners of the mines. FACTS FOR THE JURY. Discussing the final stages of the purchase of the mines by the Government, Mr. McGill said that, from the first payment, McCormack received on shares in his name and the names of his sisters the sum of £2625 12s. On April 7 McCormack paid into his bank account the sum of £2615 155., difference being exchange. The next day, April 8, McCormack drew a cheque for £l6OO, payable to “No. 42, or bearer.” The next day that cheque was deposited in the Bank of New South Wales by Edward Granville Theodore to the credit of his account. The Crown put those facta before tlie jury, and asked them to draw the only really sensible conclusion.