Mercantile Financial and Agency Company.

Feilding Star, Volume XVI, Issue 81, 29 September 1894, Page 2

Mercantile Financial and Agency Company.

-■- - — -^^. . (Per Press Association). < HRISTCHDRCH, Sept. 28. At the Bupreme Court to-day, an application was made for an order removing B. Hall from the position of liquidator of the Mercantile Financial and Agency Company, Mr Fisher said the application was made on behalf of the holders of 3170 shares out of 10,750 in the Company. The liquidator had been one of the promoters and Directors of the Company, and his iatimate connection with his fellow promoter* and Directors in the old Company made it extremely inadvisable that he should continue in the office, seeing that proceedings were pending in which they were deeply interested. The statements of the petitioners were to the effect that at the time of formation of the new Company the old Company had a reserve fund of £1229 16s 2d, which had no existence except on paper. Some Directors of the new Company, of whom the liquidator Hall was one, paid over to themselves as Directors of the old Company the sum of £1229 1 6s 2d. On account of that reserve the Directors took over the whole of the debts of the old Company amounting to £37,909 at their full value without writing them down at all. In the teport by Hall and Russell, it was stated that on March 31, 1893, the total loss on account of the securities taken over from the old Company had been £1425, yet in May, 1891, Russell admitted that the losses on that account had been £3602. It was also asserted that the Directors of the old Company had paid a divident out of capital, and that misrepresentation had been made in the prospectus to the effect that the vendor Company had done a profitable business, had paid dividends at the rate of 20 per cent, after providing; for bad and doubtful debts and after carrying forward £1229, yet within two years afterwards the Company broke up with a loss of £25,000. All these matters certainly demanded investigation, and in all of them Hall was interested. &fr Stringer, who appeared to op pose, said the case was simply a fishing expedition on behalf of certain Insurance shareholders, and not for the benefit of the Company. After argument, Mr Justice Denniston said there seemed to be ground fur investigation, especially as to the alleged payment by the Directors to themselves of £1229, and he would adjourn the case in order to allow the other side to file affidavits in reply to that of petitioners.