A KNOTTY QUESTION

Timaru Herald, Volume CXLIII, Issue 20763, 25 June 1937, Page 8

A KNOTTY QUESTION

MAGISTRATE’S ANSWER By Telegraph-—Press Association WELLINGTON. June 24. If the debenture holders take over a firm and appoint a receiver who carries on the business, who is responsible for a breach of an award, the firm, the debenture holders or the receiver? This question was discussed by MT J. H. Luxford, SM., in a reserved judgment in the Magistrate’s Court. Mr Luxford answered the question by asking another “who is carrying on the business?” “If the receiver is carrying on the business on behalf of the debenture holders,” Mr Luxford said, “either the debenture holders or the receiver would be subject to the award by virtue of section 89 (3) of the Industrial Conciliation and Arbitration Act 1925. The receiver is prima facie the agent of the debenture holders, but the conditions of the debenture may declare (as in this case)) that the debenture holders shall be the agent of the company, consequently the business in this case was carried on at all material times by the company which alone is responsible for the breach of award.” The case was one In which the Labour Department proceeded against Te Aro Bakeries (as the first defendant), Stoupe and Sons, Ltd. and H. Baldwin and Co., Ltd., debenture holders (as second defendants) and V. N. Beasley, receiver (as third defendant) in respect of a breach of the Motor and Horse Drivers’ Award.