SIR JULIUS VOGELAND THE CONSOLIDATED TELEPHONE COMPANY.

Timaru Herald, Volume XLI, Issue 3251, 26 February 1885, Page 7

SIR JULIUS VOGELAND THE CONSOLIDATED TELEPHONE COMPANY.

(Pbess Association Telegram.) . : ; . Auckland, Feb. 5. Sir Julius Vogol forwards the following communication ' to the New Zealand Herald concerning Ma connection with the Consolidated Telephone Company : — ■ To the Editor.— Sir,— l am m roceipfc of the eecppd, report of the Investigating Com- ■

mittee of. tho' Consolidated' 'Telephone Company, and I send you a copy of it, together with one* of the first report. It was m reference to the second report that the telegram appeared from tlid Press Association m which it was stated that the . Company intended to sue me for the " enormous profits ". I had made. The malice of the telegram jb evident, because nothing appears m the report about "enormous profits," taking the extreme prices quoted, but which the report inferentially admits that I did not realise. As it states that sales took place over a long period previous to the high rates, the amounts could not bo designated enormous. As a matter of fact, though I i have not particulars with me, I am certain that the profits on the whole of my 3330 shares did not exceed 'or even amount to £700. The first report states that I was allotted j 1500 : shares, and second that I allotted myself 3330 shares. Both statements are incorrect. I did not allot, any shares to myself. I indicated my -wish, to take 3330 shares, and the Board allotted them to me. I was not, to the best of my belief, on tho Committee of allotment. I may have been, and probably' was at the Board meeting which confirmed tho Committee's -work. The shares m the Company were applied for nearly six times over, and when it was ■ decided not to allot pro rata, it was of course necessary to make the allotments by arbitrary decision. 1 had been engaged m lengthened negotiations for arranging terms of Gower's sale, and but that I waa going on the Board I would have been entitled to, and could have claimed, a large commission ; and tho Board, recognising my exertions, paid me the compliment of-allow-ing me to name those friends amongst the applicants to whom I desired allotments to be made; to an amount, including tho shares I took myself, of 1500. Ido not think I fully availed myeelf of the privilege j but, if I did, what : possible objection conld > there be ? Is it not a common practice for Directors to indicate those df their friends amongst the applicants to whom they wish allotments to be made ? The general complaints against Companies is that. .the' Directors' do not take a' sufficient interest' m them. I gave the best possible guarantee of my opinion of the Company's prospects, and surely out of 15,000 shares it was not excessive to ask that the .applications of my friends to the extent of less than 12,000 shares should be granted,' besides 3000 to myself. Thon it is alleged that the allotment to me was informal, because my application was only for 1000 shares. I believe it is a common practice for Directors not to semi m applications, but to indicate at meetings of tho Board prior to allotment how many shares they wish. The thing happens every day, application and allotment-money being -paid m one. I have no memoranda with me, but it may be that my initial application before . allotment was considered was for 1000 shares only,, but it is stated that the application number was altered from 1000 to 5000. I am : .quite certain that this was not done by my j directions, and it is evident that no one could havo made the alteration without an authority to warrant it. If tho application for the other 4000 cannot bo found it is probably mislaid. As I must have paid application and allotment money for-fche shares, -what object could I possibly have m uot signing an application? The report states that the Board are advised by counsel that they have grounds of action against me, but the fact 3 were not correctly stated, and I am. advised that they have no case, or if they had it would be a very technical one, and would involve the disturbance of many other allotments. The report makes a point of a circular sent out by the Directors m December, 1881, stating that they expected to be able to, continue to pay dividends at the rate of 10 per cent. At that time their prospects fully warranted the statement. There seamed to be five years of such dividends m view from several contracts, apart from tho ordinary business of the Company as solo licensed manufacturers of telephones m Great Britain. It would serve no purpose to inflict on your readers an explanation of how the, Postoffice most unexpectedly exercised a right to withdraw from the major portion of its contract, and how a second contract was compromised for a small payment. These disasters occurred duiing my last visit to Australia, and when I returnod to England the Company, which I left as I thought m a brilliant position, was surrounded with, difficulties. It appears now from tho report of the Committee that the Company has lost a quarter of its capital — about £60,000 — which is much less than tho value of tho contract with, the Post-office so unexpectedly upset, and for, which a largo consideration wag paid. It is proposed to write off 5s m the pound, but the shareholders have received 3s m the pound by way of dividend, so they lose only 2s m the pound, and interest up to date. It is expected that the Company will pay a dividend this year, but I cannot further pursuo this subject of the Company's affairs without unduly trespassing on your indulgence. I think I have said enough to show you that tho question between the Consolidated Telephone Company and myself is m the nature of a private dispute that does not concern the pubUc, and that it was a cruel tiling of the correspondent to telegraph about the report, knowing as ho did that until I received it I had no means of replying to his unfair representations of what that report contained. I am, &c., Julius Toqel. February 2nd, 1885.