H.—3o

30

Farther down the page :— Mr. Johnston : Has there at any time been any offer by the company to sell to Yesteys ? —Never at all —not one scrap —nor to Armours. So that neither Yesteys nor Armours have anything in writing at all from your company, indicating an offer to sell ?—No. I will say that the minute-books show no record whatever of anything authorizing any dealings with Armours or with Yesteys. Mr. Coop, one of the directors, knew that there were negotiations. He says he heard they had been to see Mr. Tolerton " for only one purpose—with a view to selling the works." Incidentally Mr. Coop was asked, at page 1081 — Your feeling against the Minister is not because he consented to the sale, but because he consented to the sale at a price which you consider too low : that naturally follows, is that not so ? —Wo reckoned that they gave our works away —made a present of them to Vesteys. Mr. Field, at page 1101, was asked, in connection with the three directors going to Auckland— I ask you if you knew at that time that they were going to try and negotiate the sale ? —Yes, it was with that object. In view of the attitude taken up by Mr. Lysnar that there was no offer on the part of his directors, it is interesting to note that the following appears on page 1054. Mr. Witters is asked— Did you three meet the directors on or about the 24th February and report the result of, or the incidence of, your Auckland visit ? — I think that would be right, but I have not looked into the matter at all. I do not want to pin you down to any dates, because that would be an undue test of memory. —Yes. Conclusion. We are of opinion that there were negotiations between Mr. Lysnar, Mr. Witters, and Mr. Matthews on the one part, and Mr. Rowlands on the other part, on two occasions, and between Mr. Lysnar on the one part and Mr. Rowlands (on at least one other ocasion) on the other part, relative to the sale by Mr. Lysnar's company to Vesteys, of the works of Mr. Lysnar's company. We think that if the price by Vestey's had been high enough to coincide with Mr. Lysnar's views he would have been quite prepared to advise his co-directors and his shareholders to have accepted Vesteys' offer, and that he would have been quite prepared to sell to Vesteys if the price had been what he thought was high enough. As mentioned before, we believe it was Mr. Lysnar who invited Mr. Rowlands to the works, and we further believe that the reason why Mr. Lysnar was so desirous of getting your Commissioners to believe that he did not desire to sell to Vesteys, and that he did not negotiate with Vesteys, was because he knows that a desire on his part to sell, or a negotiation on his part in respect of an offer to sell to Vesteys, whom he described as a " vicious trust," is not consistent with his protestations that his actions, in connection with this inquiry, in connection with the sale, and in connection with his charges against the Minister, were wholly and solely in the public interest. We are of opinion that, notwithstanding Mr. Lysnar's suggestions about individual efforts without authority of directors, and isolated acts of individual directors, that the directors did know of the journey to Auckland of Messrs. Lysnar, Witters, and Matthews ; that they did know of the purpose of that visit; that they did know of the negotiations with Mr. Rowlands ; and that a meeting of directors was called for the purpose of hearing the result of that visit. We have inspected the minute-book of Mr. Lysnar's company, and we are prepared to accept as true the statement made by Mr. Lysnar that the minute-book does not show any record of anything authorizing any dealings with Armour or with Vesteys, as mentioned at page 398. There certainly appears to be no record of the meeting of directors spoken of by Mr. Witters, which was held to hear the result of the trip to Auckland. We are also of opinion that Mr. Lysnar was either more acutely optimistic than usual, or that he had no sincere belief in his ability to arrange finances for a purchase of Vesteys' Taruheru works. We think that Mr. Lysnar had no real expectation of being able to arrange for this money, even if Vesteys had evinced a desire to sell, and we think his actions were —to use the words of his " co-director " —his " way of doing business."