PURCHASE OF ISLAND

Sun (Auckland), Volume III, Issue 703, 1 July 1929, Page 10

PURCHASE OF ISLAND

SHELL DEPOSITS QUESTIONED COMPLETION OF CONTRACT WANTED The value of shell deposits on Trahene Island, lying in the northern waters of Auckland harbour, just off Whau Creek, was in dispute before Mr. Justice Kennedy in the Supreme Court today. The island comprises 16£ acres. A small area of two acres on the mainland was sold by Ernest Tasker, of Avondale, to Alan K. Duthie, as agent for the Dale Shell. Lime and Sand Company, Ltd., in May last year, but the purchasers did not complete the deal. Tasker, therefore, sued both Duthie and the company, seeking an order for specific performance of the contract to buy the properties. Misrepresentations concerning the quantity of shell available for commercial purposes for which the company required it were alleged by the defence to have been made during the negotiations. This was the ground on which the deal was not completed. Mr. Cocker appeared for the plaintiff and Mr. Inder represented the defendants.

Evidence to prove the existence of a contract was given by Ernest Tasker, vendor, who declared that Duthie had signed the contract to purchase the island as trustee of the company. The title was taken to the island, but not to the area he sold on the mainland. He had arranged a £3OO mortgage and had called on Duthie to complete the deal. Two days after signing the agreement the company had taken possession of the island, and the purchase money was paid. Arthur Goulding, solicitor. said that the company was registered on May 4, 1925. The shareholders were Leonard Earl Bayliss, who had 500 preference and 750 ordinary shares, and James Dale who had 750 ordinary shares. The title to the island was transferred in May last year, £2BO being paid in cash and a mortgage of £350 taken. “INEXHAUSTIBLE SUPPLY” The allegations of misrepresentations were then submitted by the defence. The shell deposit proposition on the island was submitted to him by an agent, Rackham, in March, stated Alan K. Duthie, solicitor. Rackham represented that the reefs adjoining the island, extending many hundreds of yards, had an almost inexhaustible supply of shell, which was eight feet deep. He added that the owner, Tasker, who was working the shell in his spare time, was making a good thing. As Tasker had no capital he had to sell the island. A conference with Bayliss and Dale, and Rackham and Tasker followed. Rackham made similar representations and to these Tasker assented. After inspecting the island it was put to Rackham and Tasker that the island was not a commercial proposition, but that £SOO would be put up by Bayliss to form a company if tho representations in regard to the supplies of shell on the reefs could be relied on. Tasker claimed to have taken 20 yards a day and had sold it at 15s a yard delivered. The company was formed, but after working the island, found in June it was not a commercial proposition, and he notified the defendant it was not proposed to proceed with the deal. After the company took possession Rackham worked the deposit and landed St* yards of shell, most of which was obtained from an adjoining island. “It was a put-up job; it’s not worth working.’* Rackham declared. The company decided to make their first loss over the island the last, and did not claim against Tasker for misrepresentation. James Dale, a City Council employee, to whom the shell proposition was introduced by Rackham, on behalf of Tasker, was told that the supply of shell was inexhaustible and a goldmine. Every succeeding tide filled up spaces from which shell was taken, Rackham declared. (Proceeding.)