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solvent concern, capable not merely of meeting its obligations but of making large profits. These said directors were aware of the individuals who had promised their support. The shares of the Instone Trading Co. were fully taken up in theory, i.e. everyone of them had been asked for, there had been no allotment in the legal sense of the term, they had been allotted, in the point of being reserved for various individuals, but the Instone Trading was closed within one month after its inception and not before it started business. There are many letters which can prove the business of the Instone Trading did in fact start, correspondence with manufacturers will show that there was a genuine idea behind the Instone Trading, but before actual business could come into being, the Canton Government intervened in the affairs of the Instone Bank by closing the branches in Canton and Shekki on the grounds that we were not a British Company and that registration under the Hongkong Ordinance did not make us British.
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As a consequence of the closure of our branches the Instone Trading was unable to do effective business in fact, the whole structure upon which it had been built was cut away by the closure of these branches, because it was intended that Shekki, Canton and Kongmoon and other places should open up branches where the Instone Bank had branches, or was to have branches, and they would be in a position to mutually assist.
These points I adduce simply to bring out the fact that we supposed a debt from the Instone Trading Co. of $10,000.00 to be a perfectly good debt, and being a perfectly good debt, we were entitled to take it in account of Profit and Loss, as earnings it being the amount of Instone Brewer's earnings, who was employed with the firm, and therefore the firm was entitled to his earnings.
The question of the shares in the Instone Trading at one time belonging to Mrs Brewer of some importance. To get that clear it is necessary to go right back to Agreement A.
In Agreement A. the company cash certain contracts that contracts in respect of the
declared that it would purchase for had been entered into. They were sale of bonds.
After the company had been incorporated for some period it was felt by some of the directors that they had been unwise in pur- chasing an agreement in respect of Singapore. In consequence, I volunteered to refund the major part of the consideration money and that they should in turn give up all rights in respect of this Singapore contract. This was done. Although I would point out that I was under no obligation whatever to revise such an agreement. That in itself shows that I am capable of taking into consideration a moral consideration rather than a legal liability and also my act in making this refund necessitated taking $7,000.00 out of my own scanty savings.
The $55,000.00 thus refunded was put up to the directors. "What do you wish done with this" and the reply came back - "Of the $55,000.00 we want you to pay $7,000.00 cash to Li Yuk Tin because he has promised us he is going to Peking to dispose of certain shares. We want to give him $7,000.00 for his expenses and we want to pay him 10% when he delivers the goods." So they asked me to pay Li Yuk Tin $7,000.00 out of the $55,000.00 and to use the other $48,000.00 and hold the shares which Li Yuk Tin had promised to sell - because the date for closing the share list was near. They wanted these shares kept in existence. So they say $48,000.00 is 10% of $480,000.00. Mr Li wants to sell half a million ask Mrs Brewer to use $48,000.00 to pay 10% on $480,000.00 and hold the shares, paying Mr Li 10% when sold and 90% to the firm.
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