THE WATERWORKS AND THE CORPORATION.

Evening Star, Issue 3175, 24 April 1873, Page 2

THE WATERWORKS AND THE CORPORATION.

The following correspondence was read at last night’s meeting of tho City Council : b April 15th, 1873. IBir r -■ •Referring to your letter of date as per piarg.uj (20th March) intimating that your directors had p.assed a resolution to tho effect that the negotiations for the sale and purchase by the City Corporation of the Dunedin Waterworks Company’s works arc pit an cj;d, I have now the honor, by the direction of the Council, to ask that your directors would be good enough to say definitely whether, in the event of the General Assembly of New Zealand passing at the next session an amending Act to enable the Council to issue fifty years’debentures under t)ie Municipal Corporation WaterWorks Act, ISV2, t),ic company will complete the bargain for the safe of the works oil the basis of the recent arrangement with the Corporation, as embodied in tho draft agreement already prepared. The Council has some time since applied to the Government for an amended Act, as above indicated, and the Colonial Secretary has promised to submit tho necessary Bill to the Assembly. L am, Ac., J. M. Mahsev, Town Clerk, Tims. Dick, .Secretary Dmmdi.ij Water Works Company.

April 21st, 1873. Sir--! am instructed by my dhectors to acknowledge receipt of your letter of the 15th April, asking for a definite reply as to ‘‘Whether, in the event of the General Assembly of Now Zealand passing at (he next session an amending Act to enable the Council to issue fifty years’ debentures,” “the company will complete the bargain for the sale of the works on the basis of tho recent arrangement.” In reply, I have to state that it is oh vionsly impossible for the directors to say definitely what tho company may do six or nine months hence. The P«rg«w befwewj the com-

pany and the Corporation has been broken by the Corporation, not the Company; and it is impossible to say how the shareholders mao again view the question, as the majority m favor of the sale at the last meeting was very small My directors feel constrained to point out that the attempt of the Mayor, as reported in the Times of the ll.th inst., to shift any blame there may be in the matter on to their shoulders, is neither fair nor wise : seeing it was no part of their duty to ascertain or instruct the Corporation what were, or were not their powers, and seeing also that the time originally proposed for taking over the works dates as fnr back as October last. My directors, whilst regretting that the Corpor.itiou found themselves compelled to break the bargain, fully exonerate them from any intentional mistake ; but as the interests of the com■puiy, in regard to various works winch, greatly to tiie injury of the company, have remained in abeyance ponding the sale to the ('orporation, require that no further delay shall take place, they must decline any further correspondence on the subject till the Corporation are in a position to give legal effect to any further offer they may wish to make. -I have, Ac., Thomas Dick, Secretary. J. M, Massey, Town Clerk.

The Mayor said the letter was no more than he expected, though he hoped a definite answer would have been given. He looked ou it as a mere subterfuge. Had the directors wished to deal bona jide with the Corporation, they would have answered in the affirmative. Were all the negotiations sent in to the Government, they would say there was a sale by the company, and now the latter tried to repudiate. The best thing for the Council to do would be to alter their tactics, and call on Parliament to reduce the company’s rate of interest to 10 per cent. He thought it was time for all negotiations to cease.

Cr. Merger agreed with the remarks of the Mayor, and believed the directors were not carrying out the wishes of the shareholders, most of whom were favorable to the sale. Cr. Thoneman said he was informed that 840 new shares were to be issued. Tnis was only done to throw more obstacles in the way of the Corporation. Only one call had been made on the last issue, ami if the money was wanted, a fresh call could be made on them. Cr Merger wished to contradict Mr Thoneman ; the last issue had been paid up, Cr. Ross both asr thought the only legitimate way would be to go in for erecting new woi ks, as the money offered to the company would almost erect new works. The company had got the upper hand, and consequently had treated the Council very shabbily.

Cr Wai.ter thought it would not be going out of the way by getting the Council to call a meeting of the shareholders, and lay the matter before the n. Cr, Ramsay believed that there was a great deal iu what Mr Kossbotham had said regarding the erection of new works. Or. Neale considered that the Corporation had now a good chance of withdrawing from a bargain that only wanted a seal to make it binding. The splendid oilers made by the Corporation had' so enhanced the value of shares that the Company thought they would be still able to draw the land sharks into their bait.

The Mayor held, with regard to going to Parliament for new works, that the Council’s position was better at the present time than before ; as the Company, through a little bond which had been overlooked by the Corporation and the Company (Cr. Thoneman : And the Corporation’s solicitors), the latter had turned round ou the Council, and had acted very shabbily and despicably. He considered, if Parliament was consulted, and all the negotiations set before it, they ■would cither sec tiie sale carried out, or else take away the company's compulsory powers. The matter was again referred to the Waterworks Company.