PETITION DISMISSED

Timaru Herald, Volume CLIII, Issue 22478, 13 January 1943, Page 4

PETITION DISMISSED

Reduction Of Capital Not Permitted

(N.Z.P.A.) AUCKLAND, Jan. 12. Judgment has been given by his Honour Mr Justice Blair, dismissing the petition by the Taupo Totara Timber Co., Ltd., which sought a confirmation of the resolution to reduce its capital. The New Zealand Forest Products Ltd. opposed the petition. The resolution, for which confirmation was sought, was for the reduction of the petitioning company’ • capital by £34,203 by the return out of the surplus assets of the company of a 5/- share to the holders c» 136,813 fully-paid preference shares of a nominal value of 15/- each.

The petitioning company operates a light railway or tram line, the route of which traverses a large part of the forests of New Zealand Forest Products Ltd. His Honour said that the evidence established that a serious fire hazard existed. It seemed probable that in the event of a disastrous fire the greater part of the petitioning company’s assets might disappear, or become valueless. Confirmation of the company’s resolution in such circumstances, said his Honour, would, it seemed to him, amount to the Court sanctioning the company conducting its finances without retaining adequate provision for contingent liability for which it was roBsonable to require provision to be made.