INFLATION ALLEGED.

Star (Christchurch), Issue 17215, 5 December 1923, Page 1

INFLATION ALLEGED.

BALANCE-SHEET OF WELLINGTON FARMERS’ MEAT COMPANY. PETITION TO SUPREME COURT FOR WINDING-UP, ORDER. Pmb Press Association. WELLINGTON, December 5. Allegations of an unusual nature were levelled at a former Managing-Director and other Directors of the Wellington Farmers' Meat and Manufacturing Company during legal argument before the Chief Justice in Chambers, when a petition for an order for the compulsory winding-up oif the Company was being heard. It was stated by the petitioners that the Company went into liquidation in August last, and since that date its freezing works had been sold by the Bank of New Zealand. The petitioners represented themselves and certain other persons who had lodged money on deposit for the Company, and they petitioned for an order for compulsory liquidation in lieu of voluntary liquidation on the grounds alleged in the petition. The petition included a complaint that shortly before the commencement of the winding-up. there was an error of £26,000 in the balance-sheet of July, with the alleged result that the Company’s balance-sheet and profits were inflated by that amount. It was stated that although the error was pointed out to the Managing-Director before, the balance-sheet was published, nevertheless, the error was allowed to remain, and a dividend was declared on the balance-sheet.' Allegations were also made that an expensive motor-car was purchased for the use of the Managing-Director without the authority of the other directors, and that in 1919, the Company launched a scheme for the erection of woollen mills, expending £40,561 on the plant and building, but subsequently abandoned the scheme, causing great loss. For the defendants, it was stated that they were opposed to the making of a compulsory order, and generally denied the allegations. In his affidavit. J. C. Cooper, former Managing-Director, admitted that there had been an error in the balance-sheet, but declared that it was not pointed out to him until September, two months after the balance-sheet has been published. After considerable legal argument as to the conflicting statements in the affidavits. Sir Robert Stout reserved his decision.