LOOKING FOR OIL.

Taranaki Daily News, 17 September 1920, Page 8

LOOKING FOR OIL.

I COMPANY PROMOTERS' TROUBLES., Parties involved in court i CASE. I Before Hja Honor Sir John Salmond, at | the New Plymouth Court yesterday, i there was ventilated a much-involved case concerning transactions arisingfrom the efforts of certain people in boring for oil in Taranaki, and the promo-* tion of companies to carry on the work. The tangled nature of the transactions may be guaged from the remark of His Honor that the agreement between the parties was the most extraordinary piece of legal drafting he had ever seen. The action was one by the Bonithon Freehold Petroleum Company against P. Hadley, of Auckland, the claim being , for £I2OO damages for the wrongful conversion by Hadley of certain machinery to his own use. Mr. A. W. Blair (Wellington) appeared for plaintiff. Hadley, who was represented by Mr. A. H. Johnstone (Auckland), filed a counter claim for £1422, being money spent in connection with the promotion of a company. Mr. Blair said that the matter would depend upon a deed entered into by the parties in September, 1915. The plaintiff company claimed that they were interested to the extent of one-third in certain plant. The defendant had taken away that plant, or at least certain portions of it, and utilised it for purposes of his own in collection with a contract he had with another company. The defendant, however, denied the Bonithon Company's right to one-third, alleging that he owned the lot. As an alternative he alleged that with regard to certain items which admittedly had been remoyed were l is sole property by virtue of certain arrangements. Counsel said there was a question as to what was the proper remedy where one of two joint owners converts the property to his own use. It appeared that, strictly speaking, there was legally no such thing as conversion unless the converting owner had so disposed of the property as to make its recovery impossible. It appeared ,that a proper method was to take an account between the parties.

The arrangement between the parties wa9 that the Bonithon Company's machinery and plant was to be removed to a property called Grooby's Farm in connection with which a company was to be promoted. After trips to Melbourne, and other negotiations, however, Hadley did not succeed in floating the company. Later lie promoted the British Petroleum Company, from whom it was alleged he received £6OOO for providing certain plant. The plant he gave them was taken from the machinery in which plaintiffs were interested, and they claimed a {Proportion of the money he received from the sale. George William Minter, retired indent merchant, Auckland, said he was a director, and also acting-secretary of the plaintiff company. He said that the plant, was removed to the property called Grooby's Farm, and Hadley and the chairman of directors went, to Melbourne io see some influential people in the endeavor fo float a company. Three visits ••vere made, but the company was not floated. The plant, therefore", remained idle on Grooby's until last vear, when Hadley began to take it away piecemeal against their wishes. They took out an injunction to endeavor to prevent him, but were just too late. Witness was also a director of the British Petroleum Company, to whose land the BonitSjnn plant was taken by Hadley. After the company's case closed, Mr. Johnstone moved for a non-suit on the ground that under the agreement the Bonithon Company did not receive a one-third interest. His Honor reserved decision on this question. Ive statement filed by the defence denied the allegations. Tn reference to the rcTtwival of easing, he claimed this was bis own property, and if, in to the oilier. the Court held that plaintill' had a one-third interest, the defendant contended that he did not deI prive i lie company of their interest or convert the machinery to his own usePercy Arthur Hadley, company promotor, f-aid he resided in Auckland. In 11)011 he acquired certain lands to bore, for oil between New Plymouth and the Ksiiijke range. He formed the Standard OH Company oi Nexv Zealand in 100(1. A bore was put down to 3'24(! fret, but: the company subsequently went into liquidation, and lie acquired the plant. He entered into negotiations with the Bonithon Company in IHO.'i, and the outcome was the deed before ti.e Court. On Grooby's place he erected a derrick, wOi'k-dmp, U-roomed house. Rtore," and office. The moneys received and expended wore put through a, tiust account at a local bank. Owing to war conditions the promotion of the company was not possible. In connection with the work' mid erection of plant, however, lie had expended a good deal of monev. Later the British Petroleum Company wsw formed to work Petch's property, which was near Grooby'.s. The company let a contract to him for .-EfiO'H) to erect certain plant. Part of this came from Grooby's, and he claimed ( if under an option which he held. Tie also leased a portion of the plant at £7 per week^ Lengthy cross-examination by Mr. Blair followed. Hadlev admitted receiving .CGOfIO from the British Petro'"iim Company in addition to reimbursements of money he had expended on their behalf in America. The Bonithon Company received no part of the £(1000. as he did not think they were entitled to any. The contract was for supplying a complete plant to bore to ijOflft feet. Decision was reserved.