COMPANY CASE.

Star (Christchurch), Volume LXVI, Issue 20283, 18 April 1934, Page 7

COMPANY CASE.

Important Action in Wellington. STATUS OF COMMISSION. Per Press Association. WELLINGTON, April 18. The Full Court commencecUjj'he hearing to-day if what has coffiS to be known throughout the Dominion as the “ company commission case.” The plaintiffs are the Timberlands Woodpulp, Ltd., Maurice Vincent Bates and Tung Oil Securities (New Zealand), Ltd., and the defendants are J. S. Barton and others. In a statement of claim, plaintiffs detail the appointment as commissioners of John Saxon Barton, Horjke Belshaw and Frank Edward Graham by the Governor-General, acting under powers conferred by the Commissions of Inquiry Act, 1908. They describe the plaintiff company, Timberlands Woodpulp, Ltd., to be a company incorporated in New South Wales, having its principal place of business in New Zealand, at Auckland; Maurice Vincent Bates is a public accountant and licensed sharebroker of Auckland, and a member and secretary of the Stock Exchange Coroporation of New Zealand; and Tung Oil Securities. Ltd., are described as a New Zealand company having its registered office at Auckland. They allege that at the date of the ppoiptment of the Commission, no legislation had been proposed or contemplated by the Government in respect of the matters set out in the appointment of the Commission and that consequently the Governor-General had no power or authority under the Act to issue a Commission. The appointment of Professor Belshaw is objected to on the ground that he has, in the course of statements publicly made in writing prior to the date of the Commission, shown bias or prejudgment in his criticism concerning the promotion, financial methods, control and operation of companies and other corporations which seek to raise capital in this country. Defendant Francis Edward Graham is alleged to have pecuniary interest in the operation of the present statute governing stock exchanges in New Zealand and is likely to be biassed against the Stock Exchange Corporation of New Zealand because he is a member and shareholder of the Christchurch Stock Exchange, and for many years until February, 1934, was president and director thereof. For these reasons the defendants Dr Belshaw and Mr F. E. Graham are said to be not fit and proper persons to act, and a prayer is made that the commissioners appointed, or alternatively, one or both of defendants Belshaw and Graham may be prohibited by writ from inquiring into taking evidence or reporting upon the matters set out in the Commission. In support of the allegations so contained in the statement of claim various affidavits had been filed dealing with the alleged pre-judgmentor bias of the two Commissioners and the absence of any intention on the part of the Government to introduce legislation dealing with the matter to be considered by the Commissioners. Allegations Denied. The defendants, in a statement of defence, deny the allegations of the plaintiffs concerning lack of intention on the part of the Government to introduce legislation on the question, and, whilst admitting that Professor Belshaw has publishedarticles dealing with the matters stated, deny that he has shown bias or pre-judgment. They admit, furthermore, Mr Graham’s connection with the Christchurch Stock Exchange, but deny the other allegations made against him. Affirmatively, they contend that the Commission was calidly constituted and consequently has full power and authority to act. In addition to the affidavits filed by Dr Belsham and Mr Graham defining their positions, an affidavit has been made by Mr J. G. Coates stating that the matters to be considered by the Commissioners has been receiving the attention of the Government for some time and that it was intended that suitable provisions dealing with the evils thought to exist should be incorporated in the Companies’ Act of last year. This was not done, as it was considered that the form of the proposed provisions wouuld depend upon a detained examination of the structure and methods of the companies then under review, and it was decided to defer the itroduction of the proposed legislation, the matter nevertheless Ueing kept actively in view. Messrs Richmond and Hampson (Auckland) are appearing for the plaintiffs and Messrs Callan and Rose (Wellington) for the Commissioners. The case is proceeding.