INCORPORATIONS

Te Ao Hou, March 1960, Page 16

Incorporations started as family enterprises on the each Coast before the turn of the century. Since the Native Land Act 1909, they provided a legal formula whereby the owners could work together on a block of land and share the proceeds from their work. Today there are more than 90 active incorporations on the East Coast farming properties extending from small dairy farms to large sheep stations, the best known being the Mangatu incorporation embracing an area of over 100,000 acres. At the Young Maori Leaders Conference in Auckland last year, incorporations were regarded as the best solution of the Maori land problem throughout the country today. INCORPORATIONS by MATIU TE HAU In the beginning, incorporations were communal enterprises. The owners, more often than not, were members of the one family who would meet and discuss and make decisions for themselves. Tribal authority and co-operation were manifest in all their undertakings. Today, however, incorporations resemble private companies far more than communal enterprises. The owners of the blocks no longer live in communities; the incorporations are big business, huge sums of money are involved, work is done by paid labour and the difficult task of management and keeping of accounts is in the hands of paid servants. The incorporations reach a high state of business acumen and ability with an intelligent grasp of the problems involved. Trading banks have financed the Maori Incorporations for a number of years. Many bodies Corporate have been set up to take over control of lands formerly administered by the Maori Trustee. In the Aotea district the 12,000 acre Morikau block has been released. Incorporations, as has been already pointed out, were made legal by the Maori Land Act of 1909. Subsequent legislation has consolidated their position bringing them more into line to conform with European business principles and practices. The Maori Affairs Act of 1953 (Part 22) tightened up many of the provisions. The Act provides for Incorporations of owners of Maori land where the beneficiaries in the estate number more than three persons. An application is lodged with the Registrar of the Maori Land Court to grant the incorporation and to state the purpose for which it is formed. Provision is made for enterprises other than farming. Not less than half of the owners must agree to the incorporation and once formed holds it in trust for the owners in accordance with their interests in the land. The incorporation can be extended to include certain other areas. There is power to exclude other areas and separate bodies corporate could amalgamate if they so desired. * This article is part of one of the “data papers” distributed at the Young Maori Leaders Conference and reprinted with the permission of the Organizers. The Act sets out how revenue is to be applied after administration costs, rates, taxes, repayments on loans and any other requirements for purposes that the body corporate may authorize are paid. The residue is to go to the shareholders. Money can be invested and loans granted but, only in the former, in Government securities or debentures or in local authorities, and in the latter in loans by mortgage in any real property. No loans are given to members of the Committees of Management or to one of the incorporated owners. Accounts are to be audited and lodged with the Maori Land Court for public inspection. Committees of Management are to be of not less than three and not more than eleven persons. They hold office for three years (one-third elected every year) and are appointed subject to an order from the Maori Land Court. Reasonable travelling expenses are allowed and any fees paid to the Committees of Management can only be authorized by a general meeting of the owners. Voting is by share interests, not heads. Proxy voting is allowed but no committee member may be proxy for another member nor can a proxy holder be elected to the committee. The Maori Land Court acts as registrar of the body corporate, holds the lists of owners, assets and all other particulars as well as fixing a quorum for general meetings. The Maori Incorporated Owners Regulation 1955 lays down the rules for elections of Committees of Management, the dates of the elections, the conduct of general meetings and proxy voting. The register of Incorporated owners includes the names and sexes of the equitable owners, trustees for any minors, relative interests in the land and the addresses of the owners.

The shareholders in the body corporate are the collective owners in the land. It is clear that the Act safeguards their interests as any fees or any distribution of profits is only possible when authorized by a general meeting. It appears that the Maori Land Court can withhold the appointment of committees of management as the members are subject to its approval. It appears also that members of these committees of management need not be beneficiary owners within the block. The shareholders in the land who make the decisions concerning any distribution of the profits in this respect have a different function from those in a joint stock company in which the directors recommend a dividend which the shareholders may adjust only downward. The Act, by providing for enterprises other than farming, by stating the purposes for which it is formed has opened the door to other pursuits connected with the land. The Puketapu Incorporation which is engaged in large-scale timber milling operations shows the extent to which incorporations can enter into propositions other than farming. It is envisaged in this case that as the timber is worked out the land is developed for farm settlement and any land unsuitable for this purpose can be utilized in a scheme for re-afforestation. The Maori character of the incorporations is being preserved. The family or tribe are the shareholders, their shares are their relative interests in the ancestral lands they have inherited. The continued use of the Maori Land Court, instead of the Registrar of Companies, keeps alive this Maori character. Under the 1953 Maori Affairs Act, the Maori Trustee may buy what is known as uneconomic interests. These shares are of a value of less than £25, but he is bound to offer these shares first to the body corporate as a whole. If the body corporate does not want to buy them the Maori Trustee may sell to any owner in the incorporation but the law does not allow him to sell to outsiders. Incorporating Maori land ensures that it always remains within the family or tribal group, nor can there, so far, be any possibility of alienations. Lands, owned by communities and administered by incorporations, are used to a great extent to provide amenities for their shareholders. Housing for their shareholders is one of these. A large Wairoa Incorporation provides houses for its workers who are also beneficiaries. A settlement has sprung up dependent upon the work on the Incorporation which has its own school. Special rates for timber for housing purposes are provided by another Incorporation. They cater for and foster the education of promising youths and girls. A group of Incorporations in the Wairoa district have inaugurated a Farm Training Scheme whereby selected youths are sent to an accredited agricultural school. They are assured of employment after training, on the incorporated blocks. Any particular abilities they have shown during their training is noted. Thus a youth showing aptitude in animal husbandry or another youth in farm machinery could well take over the control and application of these highly specialized aspects of farming. While there is close co-operation with the Department of Agriculture and the veterinary service it is hoped that more young Maoris may take up veterinary work and it would appear that the Wairoa incorporations are prepared to finance such a step. There is no reason to prevent incorporations engaged in other propositions from providing finance to further any specialized knowledge in the industry in which it is engaged. The provisions of education grants looms largely in the activities in the incorporations. There is little doubt that they recognize the importance of training and education of their people to take up responsible positions. A cluster of Incorporations in the Wairoa district has evolved a system whereby one of the blocks operates an imprest account for works which might be called Maori welfare. These include education grants and the support of the marae complex of the Maori social system. Each of the other blocks pay into the central one their share of the moneys required for these purposes. (A schedule of the month's accounts, which shows the extensiveness of the undertaking, will be available at the Conference.) A bulk store is also operated which provides the blocks with their larger requirements such as fertilizers and fencing materials. Group buying of stock replacements and requirements is carried on extensively. There does not appear to be as yet any large-scale attempt to develop a breeding farm for this purpose. This is a highly-skilled and long-term operation and, although the Mangatu Incorporation has started on something of this nature, (a bull bred by this incorporation was Supreme Champion of the Poverty Bay Agricultural and Pastoral Association Show a few years ago) it will be many years before well-bred stock replacements can be produced in sufficient numbers to satisfy all the demands of the incorporations on the East Coast. Meanwhile the stock-breeders in the Manawatu and other parts of the country find a ready market with the incorporations. There is to be found today a large number of Maoris who are absentee land-lords. The money obtained from their shares in the blocks are insufficient to keep them. As a result they are forced to do other forms of work and tend to move away from their home districts. A relatively small number of the owners can be employed within the framework of the incorporations. Perhaps some consideration may have to be given to the provision of finance for small ventures in trade and business for the beneficial owners. But there does not seem to be any provision in the Act for loans of this nature. Nor does there seem to be any attempt to attract large industries to ⋆ ⋆ ⋆ (continued on page 52)