FACTORIES AS MONEY LENDERS.

Dominion, Volume 2, Issue 594, 24 August 1909, Page 8

FACTORIES AS MONEY LENDERS.

: I NEW COMPANIES'ACT MOOTED. ; TARANAKI FARMERS' AIEWS i ' The desire of-cooperative dairy factories for legal power to borrow money to lend out' ; to: dqiry farmers .was'discussed, at a Taraliaki provincial meeting of the Farmers' ■ .Union last Thursday; j.:' ''. Mr. J.vG.Harkness,. secretary of. the National Dairy Association, :wroto acknowlcdg•mg .the receipt of. the executive's resolution,' that the National Dairy' Association W.\irged-' to press for the passage of ,a new Companies' .Act. suitable for dairy'and-, other, co-opera-tive companies, or to have the present Act amended in various directions as.required.by • co-operative companies. The secretary .stated that twfo years ago; his .executive promoted. . and passed through the : Legislature a Co-, operative [Dairy Companies Act, amending, tlie, pi mcipal Act and giving increased pouor to co-operative dairy companies. • This ; Act^romoved, oertain, 'disabilities .'-that-' such i companies .had; to.ymeet unuer the . original statute.:. Before the executive, could cousider the advisability of .again; asking for .amendments:it would be necessary, to .knowwhat, anfendmehtsj are considered essential by the l'aiauaki executive. Mr;. Harkness if the executive could .supply him with" ■further .information' he wouldhavS pleasure in placing the- matter before- tlie executive of tte NaiionaiiDaify' Assbciatioii, who.'would give Vevery>. assistance in furthering.^if considered necessary. '; ■. v Mr. *; Sim . said, that - ho had forwarded 1 tlie foregoingi- letter . to the secretary, of. the.' Awatuna Dairy. Company, and had received' the following :m reply :■ i "I will endeavour to givo youa full,: and .satisfactory account of the .jwsition as taken -up .by- our executive; "In doing:, this ;1 ;must" iirstv premise' that our. position , is a dual one. : Our-execu-tive consists: off directors and sh'areholdera.of. ■tho. Awatuna Co-operative' Dairy Factory' Company,, and I myself am also secretary to the company.:.i Eromfthis ybu'will at once seo ; ' matter is of y vital importance ta. our. district. 'ihe.Awatuua' Dairy Company somo . twelve. months. ago, .after .going: through; tho necessaryformalities' incidental to the matter, approached the Supremo Court to have added to the; Memorandum: of Association a: •clause.enabling the'directors to.borrow money to ;lend to suppliers to increase either the S'uantity,; or, quality of '..their . milk.. Judge lennis'ton-f .the' 1 application,.' thbiigfr we havo been given to understand Judge Edwards /had previously favoured a similar one from the Cape Egmont Company. The Awatuna Dairy Company,. w£re advised that tboy get ..the fneededf'power,.fbvf going into, liquidation M iind re-forming the company. This, the directors think /would bo an illadvised proceeding, for not only , would the expense be unduly hoavy, but tho probability is , that; tho. share . capital- of 'the - contpany might -bo , seriously reduced by shareholders refusing;to taktj'up their quota of-'shares in [the new: company; A - resolution, asking • for a short Empowering Act, was' thereforo 'Brought fbefore., the -'(annual meeting 5 of' the ■ : National 'Dairy:: Association. m .Palmerston fin': Junevlastf wordedvexactly'as,the memorahdum in Cape , Egmont Company. This: was thrown out by, I, believe, a ■ misunderstanding of the; representatives;. who l thought the : i Awatuna -Dairy were ■ trying : to put the . National Dairy . Association to the ex.ipenao of the Bill, which actually , the Awa-, ,tuna: Dairy Company Tyere ready, and .willing to bear; As, you are: no doubt , awaro,; tho imattfer, r of ..lending money'.'is.' of. great 'import-, ance to .many dairy companies, and the Awatuna iDauy .Company,': ns. . well as| many .others,.have"been:-'.-doing so far years past > /Without:liaving-;thq ; ■ oWhat -would like is a clause addedto-tho •' Companies' ,Act, ;;1908,*<enabluig-co-operative - .compamos, to alter their Memorandum of • As'sociation, ,in' this; directipnf if ■[they f should' 'think'-, fit. . We are l 'furtlierf of opinion that • J.tlm 'timd-has now-come'that a new Act for co-opcrativo dairy-factories should hei passed imbodied . from ■ tho- Companies' : Act,' '-'1908','the .Dairy Industry -Act,, and the yMpmoran.ArticlfiSjOffAssociatipn: ofesonife up-to-dato co-operativo dairy ■ factory companies, as the Companies'' Act, 1908/ is!essentially' ' an : Act -only • suitable for 1 joint/; stock: com- ' panies." ' , . The - following- resolution: .moved -' by:.-: Mr;' ; Maxwell: and. seconded by , Mr. Laml)ie, was carried; /''Thata copy, of .letter ifrom ~ : tion, ,and that it be. suggested to them-that a : new Act, or very: considerable amendment of, the present Act, is required to meet,the needs of co-operative companies, : especially ■ dairy companies.: .'lt-would be, well to set up 1 ; aV .strong-committee to go into tho matter ' thoroughly'so: as 'to meet the! present ""needs ' of tho companies and: to provide for probable requirements in -tho-near future and so obviate tho need of the repeated amending-of the law; and that it be : added:: ,The desire' of . companies to suppliers by advancing ' money, : and also to go _in - for co-operativo stores in-conjunction - with the dairy com- • panies, 1 opens,ground 'not contemplated at the •timeJof; passage ■ Companies'; Act." : ■