EXPERT ADVICE

Taranaki Daily News, 8 September 1934, Page 7

EXPERT ADVICE

FRAMING COMPANY LAW DEMAND BY COMMISSIONER UNRAVELLING- OF TANGLE CHART OF ACTIONS WANTED EVIDENCE NEARING ITS END By Telegraph—Press Assn—Copyright. Rec. 10 p.m. Sydney, Sept. 7. A suggestion that the assistance of experts should be invoked to advise the Company Commission regarding amendments that could be made to the company law was made when the Commission resumed to-day. The Commissioner, Mr. Justice Haise Rogers, said: “It seems thd Commission has reached a stage where the examination of witnesses will soon be concluded. This is a matter affecting the whole community. Expert advice is needed and I want to know whom the Crown proposes calling.” Mr. W. W. Monahan, K.C., who is appearing for the Commission, said he thought it would be necessary to call members of the stock exchange, the Chartered Accountants’ Association, the Bar Council and the Law Institute, together with any member of the public who was sufficiently qualified to make suggestions. The first witness this morning was Dr. J. G. Hunter, secretary of the New South Wales branch of the British Medical Association, who gave an emphatic denial that he had ever approved of the name or aims of the British Medical Investment Trust. Dr. Hunter said he had refused an offer by Major Jarvie that he should accept a position as a director of the company. Foster, the Melbourne manager, had later seen Dr. Hunter. “It is absolutely incorrect that the words ‘British Medical’ were ever mentioned, nor did I ever tell him that I had no objection to the use of the words,” said Dr. Hunter.

COST OF BUILDINGS. Questioned by Mr. Monahan W. C. B. Hewitt, solicitor to several of the companies, said that till June, 1934, £72,856 had been spent on alterations and improvements to the trust building. The Sterling Investment Company had paid £91,000 that was owjpig to the British National Trust by giving the latter £50,000 worth of shares and promising the issue of debentures for the balance. An undertaking had also been given that the Sterling Investment Company would not contract a debt of more than £lOO without the consent of the British National Trust. Hevyitt said the British National Trust was carrying debentures up to £400,000. There were four or five additional debentures signed and ready for issue. Before an officer of the Commission had taken possession of them they had been in the possession of J.W. S. McArthur. Mr. Monahan: Did you understand the process of issuing debentures was to continue up to £1,000,000. The Commissioner: The whole control of the operations was in McArthur’s hands. If he wanted £20,000 worth of debentures issued would they be issued?—l would have to issue debentures to cover the transactions. The. Commissioner: You had no power to investigate the reasons?—No. I issued the debentures. STATEMENT WANTED. After Hewitt had given evidence relating to various transfers of shares and debentures the Commissioner said he thought a statement should be prepared as to the why and wherefore of these transactions. He would like to have a kind of chart showing how the moneys passed from one place to another, and what was the net result. Mr. Monahan: Yes; something which would disclose what amounts of public money had been turned into debentures and what has become of the money. The Commissioner: Exactly. Dr. Louat (appearing for the companies): That would demand ingenuity. The Commissioner: Of course it would, because of all these ingenious transactions the position is tangled. I want it untangled and I expect it untangled. That is one of the purposes of the commission. If anyone thinks he can cloak it any further I hope he will be disappointed. Mr. Bryan Fuller (for the Investment Executive Trust and the Southern British National Trust): It can be untangled; it is very easy. The Commissioner remarked that he did not know where Hewitt’s responsiV bility began or ended. Hewitt: I am in the same boat. The Commissioner: That is as I thought. I should think Hewitt and Glasson in conference with McArthur could, however, prepare some of the statement I want. It will also be necessary for me to have a statement of the drawings of McArthur for the last two years, together with his private bank accounts and a statement of the property he has received in kind.

ALCORN RECALLED.

C. G. Alcorn, recalled, was examined , by Mr. Fuller who, addressing witness, said Alcorn had been asked questions by Mr. Monahan relating to a transaction in connection with motor-cars. “You were doubtful about what security was held,” added Mr. Fuller. “Do you know what security was taken with regard to that transaction?” Alcorn said he had communicated with New Zealand and ascertained that a trust deed had been executed prior to the advancement of the money. The Commission adjourned until Tuesday to enable counsel to confer with their expert advisers in the examination of the balance-sheets which have already been produced to the Commission.

INQUIRY IN MELBOURNE INVESTIGATION AGREED TO Melbourne, Sept. 7. The Companies Special Investigation Act received Royal assent. The State Executive Council approved of the order appointing two chartered accountants, Messrs. J. W. Ross and L. A. Cleveland, inspectors under the Act to investigate the affairs of the companies specified. The inquiry will commence immediately into the affairs of the Southern British National Trust Ltd., V. B. McInnes and Company (Australia) Ltd., and the Commonwealth Homes and Investment Company, Ltd. It was announced that the AttorneyGeneral was satisfied that a prima facie case had been established and it was necessary for the protection of the public and the creditors of the companies named that the affairs of these companies should be investigated.