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PUBLIC RECORD OFFICE

Reference :-

LLC.O. 882

8

PUBLIC RECORD OFFICE, LONDON

ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC-

COPYRIGHT PHOTOGRAPH-NOT TO

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What evidence should be called as to the cost of and loss on reinvestment. (3) On what basis should the accounts of the Company for the half-year

ending 30th June, 1905, be prepared; and

(4) What evidence should be called as to the possibility of competition by

places other than Singapore.

Upon the first point the contributions made to aiding members appear to be in the nature of commissions for obtaining business introduced by shareholders in the Company, and we are of opinion that if they were in the opinion of the Directors necessary payments to be made in the past they should be included in the business payments or working expenses of the Company in the same manner as payments to ordinary canvassers.

With regard to the second question raised by the local advisers of the Govern- ment, we think that the evidence should be confined to the quantity of investments of a similar nature to shares in this Company offering the same class of security available in Singapore, and that the Government should be prepared to offer u slightly higher allowance on the proportion of capital held by Colonial investors, owing to the restricted market in Singapore. It appears from the instructions that nearly 70 per cent. of the capital of the Company is held in England, and we think that the question of distributing such compensation between the English and Colonial shareholders is a question for the Company to determine.

In reference to the third question as to the accounts for the half-year ending 30th June, 1905; Section 6 of the Ordinance requires these accounts to be made up by the Acountants of the Company in exactly the same manner as if the business of the Company was to continue. The Ordinance does not appear to us to provide any jurisdiction in the Court to interfere with or regulate the audit of these accounts, except possibly by consent of the parties, but we are of opinion that if it should be found that the Government was not receiving proper credits in such accounts then a deduction would have to be made from the award.

Upon the final question as to foreign competition, we should recommend that the person deputed to proceed to the ports above indicated should ascertain, put in. evidence and prove the official tariffs of such ports, and place himself in a position to give evidence from personal experience as to the facilities prevailing at such ports, and the trade prevailing at each port. Evidence should also be produced of cases where ships have refused to repair at Singapore, or have been patched up at Singapore and have proceeded to other ports to complete their repairs; and the estimates made by the Company to the owners of such ships for executing such repairs and the charges actually made at the port where such repairs were executed should be put in evidence and compared.

29433

SIR,

We have, &c.,

SUTTON, OMMANNEY, AND RENDALL.

No. 234.

MESSRS. SUTTON, OMMANNEY, & RENDALL to COLONIAL OFFICE.

(Received August 16, 1905.)

[Copy to Governor, August 18, 1905, Confidential. L.F.]

[Answered by No. 241.]

3 and 4, Great Winchester Street, London, E.C., August 16, 1905.

Straits Settlements.

Tanjong Pagar Dock Company, Limited.

We enclose copy of opinion of Mr. F. Whinney, of the Chancery Bar, on a case we have recently submitted to him for advice as to the liability of the Colonial Government towards the Directors and London Consulting Committee consequent upon the service on them of notice pursuant to Section 4 of the Ordinance.

With reference to the concluding paragraph of this opinion, we should mention that we understand the Company's solicitors to contend that the Committee have not had any notice under Section 4 of the Ordinance, but on the other hand we have

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presumed, from the instructions contained in the printed correspondence before us, that the notice given to the Governor included the Directors, Officers, and Agents of the Company. If the contention put forward by the Company is not withdrawn, it is to be considered whether a further notice, without prejudice to whatever notice the Governor may have given in the Colony, should not be served on the London Committee as advised by Counsel.

We have, &c.,

SUTTON, OMMANNEY, AND RENDALL.

Enclosure in No. 234.

Straits Settlements.

Tanjong Pagar Dock Company, Limited.

OPINION of Mr. F. WHINNEY as to the determination of the Office of Directors and the London Consulting Committee.

I am of opinion that by virtue of the conjoint operation of the first part of, Section 4 and of Section 9 of the Ordinance the contracts with the officers and servants of the Company, including among them the Directors and Members of the London Consulting Committee, became binding upon the Government according to their tenure as from the appointed date, which I understand was the 1st of July, but under the proviso to Clause 4 it was open to the Government to notify to the Com- pany the names of any servants or officers, including any Directors or Members of the London Consulting Committee, whom the Government did not propose to employ, and upon such notification those servants or officers were to be dealt with as if their employment had been terminated or their offices abolished by the Company, and they were to be entitled to receive from the Company such compensation as they would have been entitled to if this had happened without the Ordinance having been passed. Under this clause the amount of the compensation is to be arranged by the Company, but subject to the risk that if it is more than the Government approves, the Govern- ment may require the Arbitration Court to determine how much of such compensation ought to be borne by the Government. It was, however, open to the Company under Clause 7A, for the purpose of the Arbitration and the winding-up of the Company, to retain the services of such officers and servants as might be agreed upon with the Government, and apparently the Government was to advance to the Company, for the purpose of paying such officers and servants, such sums as might be agreed upon between the Company and the Government. It is not expressly specified in this clause that the officers and servants whose services are so to be retained are to include Directors or the Members of the London Consulting Committee, and it may be that it was not intended that they should fall within this clause, but in Clause 10 the Ordinance obviously contemplates that the Directors will remain in office to repre- sent the Company in the ascertainment of the compensation, and in deciding how it is to be paid, and in Clause 17 the Directors and also the Members of the London Committee are authorised to give receipts for such part of the compensation as is to be paid in cash, and it is only after all the compensation has been paid that under Clause 15 the Company is to enter upon a liquidation of its affairs, and for the costs of such liquidation the Court is to allow a reasonable sum. Nothing is, however, said about payments to the Directors or Members of the London Consulting Committee between the 1st July and the winding-up of the Company, although under Clause 21 the costs of the Company incurred in and incidental to the Arbitra- tion are to be borne by the Government, and unless it can be held that the Directors and the Members of the London Committee are included in Clause 7A, in which case it is assumed by Clause 7c, that advances are to be made by the Government for the purpose of paying for their services. There appears, however, to be no express provision as to how the Directors and Members of the Consulting Committee are to be paid, and we are therefore thrown back upon the ordinary law to determine what their rights would be in such a case. In my opinion the principles laid down in Macdowall's Case 32, C. D. 366, really govern this case. The notification by the Government under Clause 4 practically operates as a compulsory termination of the employment of the officers and servants in respect of whom it is given, although there may be a question whether the notification takes effect as from the appointed