DOMINION CEMENT COMPANY.

Taranaki Daily News, 1 August 1918, Page 7

DOMINION CEMENT COMPANY.

INVESTIGATION OF AFFAIRS ASKED FOR. Auckland, July 2!). The petition of certain shareholders to have the Dominion Portland Cement Company, Ltd- (in voluntary liquidation) eompulsorily wound up, came before Mr. Justice Cooper at tho Supreme Court this morning. The petition asks for a completo investigation of the company's affairs by official liquidators with particular regard to the alleged loss of share capital. The pstition alleges gross negligence on the part of the directors and officers of the com-, pany in connection with the manage- 1 " ment, and declares that the shareholders suffered lo=s through their alleged recklessness, neglect and utter disregard of tho duties and obligations imposed upon Ifcem. It declares that a public examination is required in the interests of commercial morality and business generallyThe petition proceeds to make a number of complaints as to specific incidents in the company's history. Regarding the issue of the preference shares, it alleges that preference shareholders were not given the option of withdrawing their applications when debentures for £llO,000 were issued, seeing that the debenture issue placed their shares at a discount. It also alleges that the articles of association were altered to allow de-benture-holders to attend meetings and vote similarly with shareholders; that there was delay in presenting annual reports and holding the annual meetings; that in connection with a certain issue of £38,000 worth of debentures fox the purpose of carrying on, the directors ought, to have known that the Issue would not provide sufficient capital for the purpose.

Petitioners also complain, that they acted on an assurance from the dliairman of directors that the debenture holders would not foreclose, recognising that the market was a. dead one and being prepared to face the position for a year or so, also 'that.' a reasonable arrangement had 'been made with the, de-benture-holders for carrying on. They allege that, the appointment of Mr. TC. Gerard as receiver was a breach of faith, and that the votes for compulsory liquidation 'were mainly those of the persona interested as debenture-holders as well as the debenture-holders would have been unable legally to exercise the right' of railing in their money, and that they adopted liquidation as a means of escape, from obligations. The liquidator, it is stated, was the nominee of the deben-ture-holders; that in the sale of assets the deben'hire-bolders were given credit while outsiders were compelled to pay cash; and that the sale was insufficiently advertised. The petition, it states, originated at a meeting of shareholders in C'hristchurcih, at which an inquiry into /the company's winding-up was asked for. Subsequent to this, it asserts, a conference was held in Auckland, at which a reconstruction scheme was'agreed upon, but not carried out.

Mr. Reed, for the liquidator, raised a preliminary objection on legal grounds. Tie stated that the petition did not set out facts which would justify the Court in acting. Hi r . Honor reserved the point. The sitting was occupied with an adiress bv Mr. Skerrett for the petitioners. *