A COMMISSION CLAIM

Taranaki Daily News, Volume LIV, Issue 46, 16 August 1911, Page 3

A COMMISSION CLAIM

\ WALTER niAVLIiV v. THE TARANAKI ! PETKOLKI'M COMI'AXV. The const ruction Lo be. placed upon a letter sent by the Taranaki Petroleum ■Company, Ltd., to the Taranaki Slock Exchange is being settled by the Slipi-n----idary Magistrate, Mr. 11. (s. Fitzherhert. who gave the matter hisalleiitio.n yesterday morning, Walter Bewley, .ilia rebroker. of New Plymouth, suing the. company for £.57 los for the work and journeys and attendances of the plaintil!' performed for the defendants at their request as a. sharebroker in the sale of the shares of the defendant company, namely, a commission at the rate of L 5 per cent, on applications for shares procured hy the inn 111. ill'. Mr. 1). Hutchen appeared for plaintiff and Mr. .1. 11. \.,,..iiain tor 1 :ie defendant. ■ Duncan MeAllum. sharebroker, of New Plymouth, and sierctary to tlie Taranaki Stock Exchange, depo.-ed to the receipt of the following letter from the 1 company: "The secretary, Taranaki Stock Exchange.- lam instruct!d to inform you that my directors have decided to olfer the balance of the recently en at ed shares to the public. Applications will be- received from members «rf your feciange on the following terms:* (1) .Ail application monies to be remitted to the company in full, free of exchange; (2) the company will pay to the broker forwarding applications a commission of five per cent, on the nominal value of the shares as allotted by the directors; (3) applications, with cash, to be remitted daily to the company; (4) the company will not be responsible for any advertising expenses incurred by the brokers. —1\ A. Dobell, secretary." This was handed to him by the company's secretary himself, and they discussed its terms together. He communicated its contents to all the then members of tho Stock Exchange. Mr. Bewley was a member of the Exchange, and at that time was its chairman. The witness was not cross-examined. Walter Bewley. sharebroker, the plaintiff, said that the letter of August 2fl from the company was shown to him, and in consequence of it he advertised ] at his own expense and endeavored to secure applications for tho shares. The j advertising continued until some time in June of this year, when notice was received that no further shares would he allotted. From time to time 110 had sent in applications and the application monies, and lip till April 8 of this year the shares were allotted, and he received his commission. Subsequent to April (5 he sent in applications, 011 at least three of which the secretary hud assured him he was to receive his commission, lie did not receive payment of it. About the other applications he heard nothing. He had discussed the matter with Mr. Carter, the chairman of the company, asking that gentleman when the sharebrokers were likely to receive notice of the directors' intended discontinuance of allotment. Mr. Carter replied that he did not know, as the company was in a peculiar position, hut he advised the plaintiff to put in his applications daily as received, the inference being that these would be allotted.

To Mr. Quilliam: He forward his applications with a list, of t!i • applicants. The secretary had definitely promised him payment of commission on three of the parcels of applications. Witness admitted the correctness of a receipt produced, and said that his claim must now be reduced by £6 os accordingly. I-Ie had omitted to credit the company with that amount. He was nware that the Taranaki Petroleum Co. was negotiating for the sale of its undertaking to an English company. Had that sale taken place it wouid necessarily have followed that a large increment would take place in those shares. He was -aware of the negotiations as early as April last, but it had no influence on the sharemarket. To Mr. Hutchen: The value of the company's shares on February 14 was 14s, and there was no move till May 19. '

Mr. Quilliam: It seems to have increased the activity on the part of the brokers.

Edward IT. Tribe, secretary to the company, deposed tliat Die last allotment of tlie preference shares by the directorate **9 on April 21. The applications put in by the plaintiff from April 8 to May 20 were dealt with by the directors on May 27, 1011, when tiiev decided not to allot them.

To Mr. Quiiliam; He had received a letter from plaintiff on June 9, asking for a cheque for his commission on applications for 1155 shares. Re-examined: The directors held several meetings in May prior to May 27. This closet! the .plaintiff's ease. Mr. Quiiliam said he did not propose to adduce evidence. He submitted that it was not in evidence that the plaintiff was a licensed sharebroker, and only licensed sharebrokers could sue in this way. There was ample authority, he said, for his contention that no person could act as a sharebroker unless he had a sharebroker's license. The Court did not "know Mr. Bcwley to be licensed. This was a case in which the onus of proof lay with the plaintiff, and he submitted that the plaintiff had not discharged the onus laid upon him that a contract had lieen entered into and that he had suffered by the non-performance of it. The plaintiff evidently relied on the company's letter of August 2fi to the Taranaki Stock Exchange, and an attempt had been made to twist that letter into an offer. It was not an oner, but merely an overture, an invitation. In effect, the company said to the Exchange, "We are prepared to receive applications from you. . . . We suggest that we pay commission on shares onl\ if we allot tliom." Xo reply was vouchsafed to this invitation or declaration of intention. Even construing it as aii offer, the letter did not form the first step to a contract, for there was no evidence of its being accepted. Plaintiffs case was that in pursuance of the company's letter he sent in applications, and contended that this was an acceptance of the offer which he considered to be contained in the letter of August 26. The company never received any application for shares purporting to come from the plaintiff as a member of the Taranaki Stock Exchange, and to this dav the company was unaware that the members of the Taranaki Stock Exchanoe were prepared to submit applications on the terms proposed to them. Assuming that an acceptance was necessary, that acceptance should be in writing, and it should have been accompanied by a list of members of the exchange. The company wroto to an exchange, and a private person, the plaintiff, sent in applications for shares and sought to set this up as an acceptance of the letter to the exchange. Absolutely no connection had been shown between the letter of August 26th, and the defendant's applications sent in for allotment. His \\ orship asked if the payment to plaintiff of commission at the rate of 3 per cent, had not been an admission of acceptance of the offer.

Mr. Quilliam said that plaintiff liad been paid only ■ as an ordinary broker, and thn.it the allotment of shares \v<is a condition "precedent to payment of commission; To liable plaintifr to recover it must lie shown that the share*! Imd .been allotted by the directors whereas the positive evidence was lli.-il thev had not been so a Ho tied. Mr. Quilliam also pointed ouit that the offer,

if it was an offer, was imwk r.n Ait&tKi 2ti, and there was no <ll•fi/i<evidence' of acceptance of any kind April s—eight months Inter. Is i? ! authorities to show that the , -n-ptaiiii'. ! if 'it was an acceptance, , ' ..ei I•' i . I Mr. Hutchen replied to ta ;.i;-aii:e! t.s | regarding delay in accepting v.mi 1 ing the allotment of share-', » a. ••on.iition precedent to the pa 7... ;i of commission, and also quoted ens- mi both points, lie submitted ll.al ;>ai*_. entering into a contract mual. | lform il so that the other parly olmlf receive full benefit, from its perfoi inn aci. Mr. Quilliam had said that lb" 'iettci of August 2(i was not an oti'er i;..; an over ture. He (.Mr. llntchen) Mibmiltod, however, that a business letter of thi< kind must lie read in a way. The letter'had laid down dif.a.te terms on which the company wo':'.l receive applications. As ;01 awj-V • :liei« was nothing in the law k ~i acceptance to he in writing. ",' : v better acceptance could there lie tl; \ ,he fact, that the conipauv had dealt ■.,i::i laintill' on the terms ijiioled m | anil iiaid him coinmi-sio:i : J ratej mentioned in it. Ordinary i.nu.ml.l I not be entitled (0 5 pel -i'.. commission on application for see: j Air. Quilliam: Thev would a'^d'e!.) His Worship remarked t: , ' K 1 \s:k I not quite sure, but he was ;•> to disagree with Mr. Otiilliani n ,i ' oiat. Continuing, Mr. Hutchen sa'.i 'hat the performance of the terms o,' ;he contract was sufficient evidence o r th» i'mtract and its acceptance by <i:c rnrtie--. He pointed out that the comn.i:i\'< olTer was not to the F.xchange, > et '.n 11>" members of the Exchange, ant ? thai Hi" secret ary to the Stock I'acl, • not bind all the members e' tac Exchange to I be terms of the ]i ' was a small place, and the (Hrrcturs of the companv must have known , ho | members of the Exchan'/e. !-i'■!•• . those members with whom thee had h id j dealings The company had rcver eng. 1 gested that it did not'know Mr. Bcwlm was a member of the Exchange It wis a mere quibble. As for the point, that none hut licensed .shareibrokers were entitled to commission on the sale of shares, these transactions had not been buying and selling shares, but simply applications to the companv to allot j shares. There were no shares until allotment was made. He (Mr. Hutchen) had not been prepared for this point; to be raised, but he would point out that Mr. Bewley could not have Ikm ;i a member of the Stock Exchange vnlcs he 1 were a licensed sharebroker. His Worship said that there was no evidence before the court that he was a licensed sharebroker. What was the I section of the Sharebrokers' Act referred to?

Mr. Quilliam said he himself lwd not been prepared for the point until the case had started, and he did not have the Act before him. but ho could jive his Worship the niunbcr of the section. After a, little further discussion. Mr. Hutchen said he would like to lool; into this non-suit point and address bis Worship later on it. It was then decided that the case should be adjourned until Tuesday next, when argument on this particular point will be heard. The case of L. M. Monteath v. the Taranaki Petroleum Co., on similar grounds of action, was then adjourned until after the above case has been decided.