PUBLIC RECORD OFFICE
Reference :-
6
TTINC.O. 882
wimmin
8 PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-
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securities would be inflated. A large claim will, therefore, be put forward on this
account.
3. The suggestion which follows is based on the assumption that the Govern- ment is not a purchaser at current rates and that our case will not be prejudiced by a rise in the value of the shares now (Section 13).
4. If instead of the compensation being paid at one time or within a brief period it were spread over a long period, and if, in addition, the date of payment were at the option of the shareholder instead of being an uncertain date at the option of the Government, the argument for a large allowance would be greatly weakened and I think to some extent would be destroyed.
5. Expropriation and the consequent payment of compensation being certain, we have only to consider the most economical means of effecting the payment, and I submit the Government is in a very strong position.
6. With diffidence and as a suggestion only, because I am probably not acquainted with all the points to be considered and because I can see that some objections can be raised to the suggestions, I would point out that if Government were to announce that it will be prepared to advance from, say, the appointed day, $240 per share (or £24 in London) on any share deposited as security to the extent that this were availed of there would not be payable any sum for cost of re-invest- ment of loss of interest pending re-investment on any sum so advanced.
7. Of course the taking of an advance would not prejudice the shareholder in the matter of amount of compensation; the advance would be deducted from the total amount to be paid and he would receive, meantime, his interest at the rate of 12 per cent. (Section 21) and would pay interest to Government (say, 4 per cent. on dollar advances and 3 per cent. on sterling advances on the sum advanced).
8. The state of the money market here is such that I believe advances would be availed of (but upon this point expert opinions could easily be obtained) and the arrangement would in that case be presumably to the benefit of the shareholders who could, therefore, have no claim on this portion of their compensation to the allowances under discussion and would be further precluded from claiming as a condition of the advance.
9. Government would get interest for the money advanced and the payment of compensation would be distributed over a longer period with consequent less disturbance of the market and greater opportunity for each party to make good arrangements and be less dependent on outside influences.
10. That the issue is important there can be no doubt. Suppose three months were allowed by the Court as the period during which interest would be lost and the rate were taken at 4 per cent., the sum per million dollars compensation would be $10,000. Add to this one per cent. for cost of re-investment, $10,000 per million; multiply these by the number of millions of dollars the total compensation will come to and the amount becomes a very substantial one. We cannot be sure what allow- ances the Court will make under the peculiar circumstances, the benefit of any doubt will be given to the shareholders.
11. Further it appears to me that the fact that $240 per share had been avail- able to each shareholder at call without loss of interest to him so that he could choose his own time for changing his investment would be a very good argument for urging the Court not to allow anything on account of this proportion of the compensation, for loss of interest pending re-investment, even if the money had not actually been taken. The sum left in argument would be 37,000 shares × $240 $8,880,000, less the amount of money actually drawn by the shareholders, as to which there could be no dispute.
12. You will notice that as the shareholder will draw from the appointed date $12 per year interest per share and would pay only $9.60 for his dollars advance at 4 per cent. he will have a balance of $2.40 per share until the balance of the com- pensation be paid. The balance of the sterling advances would be greater probably, depending on exchange.
March 31, 1905,
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153
No. 84.
COLONIAL OFFICE to CROWN AGENTS.
GENTLEMEN,
Downing Street, May 1, 1905. I AM directed by Mr. Secretary Lyttelton to acknowledge the receipt of
your letter of the 26th instant,* with regard to the engagement of an accountant in con- nection with the Tanjong Pagar arbitration.
2. It would appear from your letter that Mr. Maltby will not be able to go to Singapore before the arbitration proceedings begin and I am to enquire whether it has been found possible to arrange with Messrs. Deloitte, Dever, Griffiths and Company for the despatch, at an early date, of an accountant to undertake the necessary preliminary work.
3. If you cannot make satisfactory arrangements with that firm, I am to sug- gest that you might apply to Messrs. Turquand, Youngs, and Company.
I am, &c.,
H. BERTRAM COX.
13096
No. 85.
COLONIAL OFFICE to MESSRS. SUTTON, OMMANNEY, AND RENDALL. [Answered by No. 87.]
GENTLEMEN,
Downing Street, May 1, 1905. WITH reference to previous correspondence with regard to the proposed expropriation of the Tanjong Pagar Dock Company's undertaking at Singapore, I am directed by Mr. Secretary Lyttelton to inform you that the Governor of the Straits Settlements has recommended that the date on which the expropriation should take effect, should be June 1st next.
2. The Chairman of the London Committee of the Company desires that the date should be July 1st.
3. It appears to Mr. Lyttelton that it is a question of expediency. On the one hand, if the arbitration is to take place in October it is desirable to take over the property at the earliest possible date, since, until this is done, the Government has no access to the Company's books, and cannot therefore prepare its case or proceed to a valuation of the land for the purposes of the arbitration. On the other hand, if the Government refuses to meet the Company's wishes, it would be easy for the Company so to lengthen the preliminaries as to make it impossible for Mr. Balfour Browne to undertake the Government's case, while it is understood that they are prepared to give an undertaking that, if the date of taking over the property is fixed for July 1st, they will do all in their power to facilitate the hearing of the case in October.
4. In these circumstances, Mr. Lyttelton would be glad of your advice as to which date should be fixed in the interests of the Government.
15132
No. 86.
I am, &c.,
H. BERTRAM COX.
MR. C. H. OMMANNEY to MR. G. V. FIDDES.
(Received May 5, 1905.)
[Answered by No. 94.]
3 and 4 Great Winchester Street, London, E.C.,
Straits Settlements.
Tanjong Pagar Dock Company, Limited.
WITH reference to Mr. Collins's letter to me of the 2nd instant, and my
S. TOMLINSON..
DEAR Mr. FIDDES,
May 4, 1905.
• No. 81.