THE WATER COMPANY AND THE CORPORATION.

Evening Star, Issue 3335, 28 October 1873, Page 2

THE WATER COMPANY AND THE CORPORATION.

The adjourned meeting of the shareholders of the Waterworks Company, to consider two resolutions submitted by the directors—one declaring, in view of the general rise and increasing value of the Company’s property, that the sum formerly offered, and recently renewed, by the Corporation, of Lls per share, did not represent the fair value of the shares ; the other, empowering the directors to refer the question of actual price to the arbitration of arbitrators unconnected with the City or Province, and to be mutually chosen—was held iu the lower hall of the Athenaeum last evening. About forty-five shareholders were present, and Mr Robert Gillies presided. The following resolution was carried without discussion s—r ‘ j,>esulv6 d, th»t ipcQriseqireilcgQf the general rise and increasing value of the Company’s property, the sum formerly offered by the Corporation, and recently renewed, of Lls per share, does not represent the fair value of the shares.” The Chairman then moved : —“ That the Directors be authorised to arrange with the Corporation to refer the question of the actual price to be paid for the shares to a competent arbitrator, or arbitrators, mutually chosen, of high social position, ami totally unconnected with this City or Province—both parties to be bound by his or their decision, subject to the cotidilk>ns-“formally 1 contained in ’.the tdmtyi Sgtedmeiit; ‘the’’ednsefit id Vmttrig ‘Of three 5 fourths of the shareholders iu number and value to be obtained before signing the submission.” Before making any remarks upon this resofu : fjou, he Ijaci to acquaint the shareholders til A since their last meeting t)ie Corporation had thought proper to hold' a meeting for the pur. pose of reviewing their proceedings on Friday, and had sent the following letter iu reference to them: — “ Dunedin, October 27. “ Sir, —I have the honor, by the direction of the Council, herewith to forward for the information of your Directors, in view of the adjourned meeting of the shareholders of the Dunedin Waterworks Company to be held this evening, a copy of a resolution passed by the Council this day ‘ Kesolved—That a final offer qf a'bonus of Lb iqr pack LiO■ charts,-as already issued by the Dunedin Company, be made by the Corporation; the .remaining conditions of the original contract agreement, as prepared by the Company and approved of by the Corporation, for the sale and purchase of the Company’s work and plant, to apply so far as applicable.’ It was further resolved that, in the event of the Company declining to accept this offer, the Council will positively refuse a settlement of the price by arbitration.—l have, &c., “J. M. Masset, “ Town Clerk.” This letter came before the Directors of the Company that day, and they came to the following resolution upon it“ Besolved—That seeing that the proposition to sell at Ll6 has already been indirectly negatived by the shareholders, and that-a resolution to lofer the question of price tp a cdivq.etfcnt arlfitratqf or arbi* trators is now under consideration by the shareholders, as recommended by the Board at last meeting, the Directors, while unwilling to view the letter of the Corporation as a threat to coerce the shareholders, still are surprised that the Corporation should hurriedly refuse a proposition not yet assented to by the shareholders, but only recommended by the Board; and cannot conceive that the Corporation have fully considered the fairness of the proposition tg

arbitrate, and therefore recommend the shareholders to adopt the proposed resolution, thus giving the Ctirporatitfn aii opportunity to reconsider their resolution refusing arbitration.” He might state further, that that resolution was arrived at unanimously by all those present at the meeting of Directors.—(A Shareholder: How many were present I 1) All were present but one—Mr Janies Smith—who, he believed, was engaged in Court at the time. He thought they would all agree with him that their course now was to follow the advice of the Directors, and discuss the proposal to submit the matter to arbitration. He could not conceive what objection the Corporation could have to arbitration, provided they were prepared to give a fair price for the property, and provided they wished to act with honnjides towards the Company. It might be said, and had been said, that the Corporation had everything to lose by going to arbitration. It usually was the case, and he was sorry to say that the Company had experienced it in more than one instance. Bfit “ what is sauce for the goose is sauce for the gander.” The Waterworks Company was a Corporation also, and they had as much risk to run as the City Corporation, After much thought and careful consideration, it did appear to him that the fairest way would be to refer the matter to arbitration. There were many influences which he could sec would operate with individual shareholders to cause them to ask a larger price, than otherwise they might deem prudent; and there were circumstances which could not be laid before a meeting of shareholders, so that it was an advantage to the Company to refer to arbitrators, who could judge of the whole of those circumstances. On the other hand the Corporation could see that they had a power behind them which they feared. There were men who desired to occupy their seats, and they might fear offering to increase the price largely. But if a price was to bo given for the Company’s property, and that he presumed was what the Corporation had repeatedly represented themselves as willing to give, he could not see their objection to going to a fair arbitration on (he subject. Th° Corporation gfiuhi nrptept themselves in regard to the terms of the submission, as could the Company. He regretted exceedingly that the Corporation had taken the view they had in respect to arbitration, and he felt sure that, on further' consideration, they would not be led by outside influences or any consideration to do other than they had hitherto professed—namely, to act fairly towards the Company by giving them a fair value for their property. It was all very well for Mr Fish in his speech on the last occasion to take up his (Mr Gillies’s) speech at a previous meeting, and make use of it with a view of showing that it would not he for the interests of the Offy to buy at all. 'Die time was ggnp past wh«u lie (Mi* Fish) could ride into ppwpr and fame on the top of the purchase of tjip waterworks, and consequently he no dpubt desirpil to decry the purchasing of these works ; lint }ct not the slaveholders be influenced, and ho Imped the Corporation would not bo influenced by any such clap-trap. He (Mr Gillies) was quite prepared to stand up to every statement he made twelve months ago, In the altered circumstances now existing. In Jact, in the remarks he made at the last meeting he called attention to what he had said in the previous year. It was quite time, and he was sure there could not be a doubt in any of their minds, that property worth Lls last year must bo worth a good deal more now. Property of every sort had risen, and money fallen. Mr Sutherland: It has gone up two per cent. The Chairman : It has gone up recently then. I believe that since then the banking institutions have been raising the price, Mr SUTHERLAND ; It was publicly notified. The Chairman said he would like to know if the Corporation was paying more for its overdraft now than it wn* thru. Oi'T.HEULANii : That's none of your husinets.'—(Oi'der.) ' ’Mr Gillies went on to state that he merely wished to mention the fact that money had fallen since the date of their fonder meeting. All those Aflat he and the other DirpctprsTiad been actuated by a spirit of opposition io the Corporation all along were utterly beside the truth. They desired all along to act' in consonance with the Corporation, but when they foqnd (heir pffur(.s iu that direction usp qt 'for the ‘ purpose of gaining advantage by the other side, they were compelled to place themselves on their defence. He could appeal to Mr Fish’s own words to prove tlpat the Directors had acted fairly. If the Corporation were so foolish gs to follow the lgf\4 of soph men as Afr Fish, the result would be that they would have to pay all the piorc for the waterworks. It was almost time the citizens of Dunedin came to know really what all this bombastic talk of Mr Fish’s had cost them. If the Otty had gone the right way to work at the first, the works could certainly have been bought for Ll2 per share ; but now by this offer the Corporation would have to pay LAG, 100 more for them. That was what the City was paying for the beautiful management of Mr Fish. If the Corporation went on in the same way as they were at present, there would be very little probability of their ever coming to an arrangement, or if they did come to an arrangement, it would have to be at a much larger price. Mr A. Livingston seconded the resolution.

Mr Johx Cargill moved an amendment, as he did not agree with the action taken by the Directors. The Corporation stated very distinctly that they rejected the proposal to go to arbitration, and he therefore thought they would be only wasting their time, and perhaps their tempers, in going on with the proposal. He thought last year, and he thought now, that Lls a share was a very fair remuneration for what the Waterworks Company had done. Whether Mr Fish >Was in the Corporation or pot, they would always ii*avb some bod/tpefb who would raifce a•qtiestiHri'of this kind; and trhen this sort of thing was continually hanging over theCqmpany’s operations he thought it was better to sell, and for that purpose Lls was really a very good price. From the correspondence that had been published and distributed, it almost looked as if the Company wished to seize a pretext to be off the bargain ; and, as one of the shareholders, he thought they occupied a shabby position. He blamed the action of the Directors throughout the negotiations, as well as the Corporation. He moved as an amendment, “That the offer of the Corpora* tion be accepted.” Mr H. F. Hardy seconded the amendment.

Pr Atk.vavdep drew the Attention of> the maetjngifco what had taken to the sale of the Berlin Waterworks to the Corporation of that city. The Company which sold the works was principally composed qf Englishmen. The shares were LlO each, paying ten per cent, interest. The sale had taken place at a little over 1/20 per share. Another instance was the ease of the Margate Waterworks Company. Those shaves were at the same price as those of the Dunedin (Company. but double the amount was refused when offered by the Corporation. Ido nr Lib per share was not at all like the real value of their property. Mr Cltten thought that if they looked upon this question as purely a matter of business — setting aside altogether any political influence that might be exercised by the Corporation--there could be no doubt for a moment that LIC per s|uup was not the value of the works at the preseht moment. ! ; > > >Mr E. -B. ■ C'AROll.ps objection to _t]ie proposal of the Directors was that it simply amounted to shelving the whole matter, and rejecting the sale of the wa f erworks. He did not see how the Corporation could submit tbe matter to arbitration in the way proposed, because he doubted whether they could legally agree to a sale upon terms, to be afterwards defined, that might commit the Corporation to a money obligation of indefinite extent. If they could carry out this sale upon something fairly approaching the terms already agreed to, they ought to do so. If he were a member of the Corporation he would not go to arbitration. Mr Cutten asked the Chairman if the Company really had ever agreed to sell. He believed that the number present at the meeting* wlrfcii aUtjuinaed tfip'sale tyas totally • insufficient, and therefore the Company did not sell. Mr (> Aim ill had" taken the published and accepted act of the Company, as communicated to the Corporation and the public at large. The Chairman said it was quite right the shareholders should know there had been no sale legally agreed upon. Mr Cargill : It is a pity that was not stated at the meeting. The Chairman : It was uot known until Botoe tinle afterward®.

After some further discussion, and Mr Gillies having replied, Mr Wilkik intimated that at the proper time he would move that Ll7 per share be accepted. His reason for proposing that sum was that his late father, who was one of the Directors, always considered it to be the proper value of the shares. Mr John Cargill’s amendment was then put, and the show of hands declared to be —for, 18; against, 25. The Chairman declared it negatived, and was about to put Mr Wilson’s amendment when Mr Sutherland rose to state that he had demanded a poll. In the course of a conversational and rather desultory discussion that ensued, it was ruled by the Chairman, who stated his ruling was supported by the opinion of two of the principal solicitors in the City, that a resolution, to be of any effect, or to bind the Company, must be carried by a majority of three-fourths in number and value of shares. As being likely to save time, however, a poll was taken, with the following result For the amendment there voted 17 shareholders —ls present and 2 proxies, representing 265 votes ; f)3 additional votes tendered were rejected ou the ground of their bcin" informal. Of them 60 were held by Colonel Kitchener, and the remainder by Mr P. Dunlop. Mr Eliott as representing the former, and Mr Logan as representing the latter, protested against the rejection. Against the amendment, 25 shareholders present and 10 proxies, representing 742 shares. The amendment was consequently negatived. Mr Wilkie intimated that, with _ the consent of his seconder, he withdrew his amendment. Mr J. Cargill had been taken by surprise, for he intended to vote forLl7, and against the Directors’ proposal. The Chairman : It is competent for Mr Cargill or any other shareholder to propose Ll7. Mr Logan, to test the question, and Mr John ( -argili, seconded “That the \\ orks bo sold to the Corporation for Ll7 per share, subject to tho conditions contained in the draft agreement so far as applicable, the offer to bo open for one month.” For this amendment there voted 22 against 16, but the majority rnt being sufficient, it was declared lost. The original motion, viz., tho resolution snbmitttcd by the Directors, was then put, and there voted fur, 25 ; against, 14, A poll was demanded, and was taken, with tho following result;—2s shareholders, representing 761 shares, voted in favor of the motion, and 14, representing 248 shares, against it. It was, therefore, earned.

A vote of thapks to the Chairman terminated the proceedings, which lasted a little over three hours.