RESIDENT MAGISTRATE'S COURT.

Cromwell Argus, Volume IV, Issue 174, 11 March 1873, Page 6

RESIDENT MAGISTRATE'S COURT.

Thursday, March C, 1873. (Before W. Lawrence Simpson, Esq., R.M.) NON PAYMENT OP CALLS. IMPORTANT CASE UNDER THE MINING COMPANIES ACT. The adjourned case, Nil Desperandum Quartz Mining Company, Registered, versus Thomas Hall, was resumed, and the hearing occupied the Court for a considerable time. The plaintiffs (represented by their legal manager, Mr Colclough) sought to recover from defendant—whom they allege to be a registered holder of 200 shares in the company —the sura of £34 3s. 4d., being defendant’s share of a call made by the directors on the 23rd of January last. Defendant, when asked to plead, repudiated any liability whatever in connection with the company, and disputed Mr Colclough’a right to act as legal manager. A set-off amounting to £163 12s. was put in. [Shortly after the commencement of the case. Mr Wilson intimated that he had been instructed to appear as counsel for the defendant. ] Mr Colclough, who conducted the case on behalf of the company, was then sworn. He produced the certificate of registration of the company, and read extracts from the minute-book to show that the call sued for was duly made by the directors at a meeting held on 23rd January. He also read minutes recording the election of directors on the 26th of July 1872. The directors then chosen were appointed for six months; and before the expiry of that term—namely, on the 22nd of January 1873 —another meeting of shareholders was convened to appoint new directors. Neither on the 22nd or the 23rd was there a quorum of shareholders in attendance ; consequently, in conformity with the provisions of the Act, and under rule 40 of the company, the old directors remained in office. (A copy of the rules was here put in.) Witness continued : Defendant was one of the original shareholders, and was the first chairman of directors. He was present at a meeting of directors—the first meeting after incorporation—held at the company’s claim on the 16th March last, and on that occasion acted as chairman. I produce the share register, which shows that defendant is the holder of 200 shares in the company, and that he has not paid the call made upon him. 1 delivered 200 scrip to defendant. Cross-examined by Mr Wilson :—The first meeting of directors was held on the claim —in the open air. After the formation of the company, defendant wrote to me stating that the proceedings were illegal. Not withstanding that, however, he took delivery of his scrip, and subsequently applied, through a solicitor, for more. He afterwards returned the 200 scrip to me for safe keeping. This was all the evidence for plaintiffs. Mr Wilson, for the defence, said that the case bristled with nonsuit points. He would, however, confine himself to five, and these were—--Ist, No evidence had been adduced to show that Mr Colclough is the present manager. 2nd, That the minutes making the call were not confirmed. 3rd, That publication of notice of call is not proved. 4th, No evidence of compliance with section 16 of the Mining Companies Act of 1872. sth. That the call is bad on account of inequality. In support of the first point, the learned counsel quoted sec. 125 (last clause) of the Act of 1872, which provides that “ every company must, within thirty days after this Act shall come into operation, send to the Registrar of the Supreme Court at the place where the

memorandum of application for registration would have to be lodged if such company were about to apply to be registered under the First Part of this Act, a notice of the name of its maI nager and of the situation of its registered office. ” The defendants had not fulfdled the requirements of that clause ; therefore, he submittted, the company had no legal existence. Mr Colclough argued that it was impossible, for reasons he would state, to comply with the requirements referred to. Section G provided that ‘ ‘ if. there be more than one Supreme Court office in the Judicial District within which it is proposed to carry on operations, then such memorandum shall be lodged at such one of the said offices as the Governor shall from time to time appoint to be the liegistrar’s office for such district, for the purposes of this Act.” He contended there were two Supreme Court offices in Otago, and that the Governor had not defined at which office companies incorporated in Cromwell j should be registered. Mr Wilson pointed out that by section 21 of i the “Otago and Southland X T nion Act,” Cromwell was included within the bounds of the Judi--1 cial District of which Dunedin was the headquarters. After some further argument, . His Worship said there was evidently a slight j discrepancy between the various Acts relating to ; judicial districts, and he entertained some doubt . as to the force of the objection taken by defenl dant’s counsel. i Mr Wilson then passed on to the second point raised--viz., the non-confirmation of the minutes. He argued that no minutes wore complete unless confirmed.

In answer to his Worship, Mr Wilson said he was not prepared, at the moment, to bring proof as to what would constitute a complete minute. In support of the third point, (no proof of publication of call), he read section 50 of the Act of 1872. The fourth point he would abandon, and pass on to the fifth : in-

equality of calls. He submitted that the directors had no right to make a call of 7s. Ccl. upon shares numbered from 1 to 1200 and at the same time call up only 2s. 6d. on those numbered from 1201 to 1400. His Worship said he would require to have clear legal proof before he could be convinced that the objection was tenable. Mr Wilson: There is another point arising out of the one last mentioned : the wording of the advertisement referring to the call is not in accordance with the minute authorising the call. The minute refers to " new scrip," and the advertisement specifies " shares numbered from 1201 to 1400." Mr Colclough explained that the contractors for the crushing-mill were to get 200 scrip in part payment. They were not to be liable for any debts incurred by the company before the mill started, but were to bear an equal share of the expenses on and after the 26th of October last—the date on which crushing operations were commenced. Thomas Hall, sworn, said : I am a miner, and defendant in this case. I took up tee Nil Desperandum claim. Montague, .Russell, Hoffman, Edward and James M'Nulty, and myself, were the original shareholders. I protested against the company being registered, unless the thing was done upon a sound footing. Mr Colclough offered me scrip, but I refused to have it. I know nothing of Alves as a shareholder. Cross-examined by Mr Colclough :—I did not act as chairman, and do not recognise anything that is stated in the minutes you have just read. So far as T know, the minutes are false. Mr Wilson said this was all the evidence he had to produce ; but he might possibly raise one or two additional nonsuit points before the close of the case. Mr Colclough asked his Worship whether the set-off could be entertained ? Mr Simpson said the amount of the set-off placed it beyond his jurisdiction, therefore it could not be entertained. But the fact of defendant having served the plaintiffs with a set-off might possibly be regarded as an admission of defendant's liability as a shareholder. The defendant repudiated all connection with the company as a registered company, but had nevertheless filed a set-off against it as such. To enable the Court to satisfy itself upon some of the points raised, the case would be adjourned for a week. Several other cases of a similar kind, and involving the same questions, were also adjourned for a week. OWEN O'NEILL V. G. KENDALL. Claim, £35 2s. 4d. for wages. Defendant fded i a set-off for £33 6s. Bd. The case was partially I heard, and, on the application of defendant, was adjourned for seven days for production of a witness. W. SIIANLY V. WRTGHTSON AND BINGE. The hearing of this case was adjourned, by mutual consent, till the 10th April. JESSE ALLEY AND ANOTHER V. E. LINDSAY. Claim, £5. Judgment for £2, with costs and witnesses' expenses. SAME V. SAMUEL MATHEFS. Claim, £4 17s. Judgment by default for amount, with costs. Friday, March 7. Two cases of "drunk and disorderly" were disposed of, the delinquents being each fined lGs. with the alternative of twenty-four hours in the lock-up.