The-Hong-Kong-Weekly-Press-1909-10-02 — Page 7

October 2, 1909.1

THE CASE AGAINST MR, BUTLER WRIGHT.

THE PROCEEDINGS AT CANTON: ACCUSED COMMITTED FOR TRIAL.

At H. B. Majesty's Consular Court at Canton on Monday, before Mr. Launcelot Giles, Vice- Consul, additional Judge sitting as Police Magistrate, William Butler Wright, chief accountant of the Canton-Kowloon Railway. was indicted on charges of embezzling the sums of $5, 00 and $13,000, the property of his employers. The information was laid by Mr. Frank Grove, engineer-in-chief of the Canton- Kowloon Railway.

Mr. H. W. Looker (of Messrs. Deacon, Looker and Deacon) assisted by Mr. W. C. L. Shenton, of the same office, prosecuted, and Mr. J. C E. Douglas, of Shanghai, appeared for the defence.

ferred for

CHINA CVERLAND TRADE REPORT. THE RAILWAY SENSATION. tions of the agreement which tended to set out

mentioned this because there were various por |

what the defendant's duties were, and in what way the proceeds of the loan were to be applied. Article 4 provided that the bonds were to be raised in England and kept in England, and from time to time in accordance with the re❘ quirements of the railway certain portions of the amount raised were transferred to Hongkong and placed in the Hongkong and Shanghai Bank to the credit of construction account for the exclusive purpose of constructing the rail- way. The last paragraph provided that account of monies spent from time to time in England, and the amount of money spent on construction the Viceroy for the information of the Waiwapu and for other purposes, should be reported to From the concluding paragraph of Article 4 it would be seen that it was provided by the loan agreement that accounts of money spent from time to time in England, and money trans- the credit" of construction and other accounts in China, should be submitted quarterly to the head office. Those accounts, in the ordinary course of events, were to be prepared and submitted by the British chief accountant. The prosecution would prove that although the defendant got out quarterly ac- counts of the construction account in the Hongkong and Shanghai Bank, he did not get out any other quarterly accounts, whereas he should have got out quarterly accounts of every account in China. Paragraph 3 of Article 6 provided for the duties of the British chief accountant. Account of receipts and disbursements on railway con- struction were to be kept in English and Chinese under the direction of the chief accountant, and all receipts and payments were to be certified to by the same person and authorised by the Man- aging Director. Under that clause it was provided that the chief accountant's duties were to organise and supervise accounts, receipts and disbursements. The only other document of this description in the case was the defendant's agreement. Under the loan agreement it was necessary to employ a British chief accountant to supervise and organise the accounts of the rail- way. Mr. Looker put in an original copy of defendant's agreement, which was signed by the defendant, the Chinese authorities, and by the British and Chinese Corporation. That agree- ment was made between His Excellency the Viceroy of the first part, the British and Chinese Corporation of the second part and the defendant of the third part.

Mr. Looker, in opening, said the warrant under which the defendant was arrested in effect charged him with fraudulent conversion of two cheques for $5,000 and $13,000. The statute under which the prosecution was brought was the Larceny Act of 1901. That was the Act which provided that any person who fraudulently converted to his own use or benefit any monies in his hands should be guilty of a misdemeanour. In the preliminary in- quiry he understood that it was in His Worship's province to frame charges with the view to the committal of the defendant for trial. He had made out and handed to His Worship the charges which the prosecution contended would be supported by the evidence, and the speaker suggested that His Worship should keep those charges in mind while proceeding with the evidence, as he would then be in a position to see in what way the evidence related to those particular charges. The charges were that on September 14th, 1908 the defendant was entrusted with certain property, namely, the sum of $26,218.04, money belonging to His Imperial Majesty the Em- peror of China, in order that he might apply the same to the payment of such accounts As were payable by His Majesty in connection with the Canton-Kowloon Railway. On the same day he converted a sum of $5.000, part of the said sum of $26,218.04, to his Own use and benefit. The next charge was practically the same in form that he converted an amount of $13,000 to his own use on January 3rd, 1909. The next charge was for converting a sum of $4,000 on February 3rd. Then there was a general charge of converting a sum of $21,326.44 during some period between December 7th, 1907, and May 2nd, 1909.

Mr. Douglas-Do I understand that the $21,000 between those dates is made up of sums represented in those three charges ?

Mr. Looker--No, it is a separate matter altogether.

Mr. Douglas-So that the total amount is $43,000 odd?

an

Mr. Looker-Something like that. Proceeding, Mr. Looker stated that for the purpose of con- struction of the Chinese section of the Canton Kowloon Railway the Chinese Government borrowed a sum of one and a half million dollars, through the agency of the British and Chinese Corporation, and a loan agreement was entered into which set out the terms of the loan and generally provided for the construction of the railway. Mr. Looker produced official copy of the loan agreement, which, he said, was made between the Waiwupu, under the authority of Imperial decree, of the one part, and the British and Chinese Corpora- tion of the other part. His Worship would see by the agreement that the proceeds of the loan were to be used for the construction and equip. ment of the railway. In Article 1, the raising and issuing of the loan were provided for. The speaker 'would show later on that a copy of this agreement was in the possession of the defen- dant, and necessarily so in the course of his duties as British accountant-in-chief. He

the fourth clause

was of some importance, in view of the events which had happened. It stated that the defendant should not, on any pretence whatever, absent himself from duty, without permission from head office. The defendant could have been under no possible misapprehension as to what his duties were regarding the disposal of monies which came under his control in connection with the railway. It must have been quite clear to him that he had no right or authority to pay railway monies to anybody except persons to whom, under instructions from head office, he was directed to pay such monies; to persons who were entitled to such monies by virtue of services performed or materials and goods supplied to the railway. It must have been quite clear to him that he had no right or authority under any circumstances to apply railway money to other than railway purposes. The next material clause was Clause 9. According to that the defendant was to be paid a salary at the rate of £600 a year sterling, payable in Hongkong currency, half at the rate of a 2/- dollar, and half at the prevailing rate of exchange of the day. The whole or any part of the defendant's salary was to be payable as he directed, in China or London and the speaker would show that out of a salary of £50 a month £40 was paid in London, so that the only portion paid here was the balance of £10. In addition to this he had his house allowance of $130 a month, until a house was provided. Up to the time defendant left Shameen recently no house was provided, and his house allowance was paid him. There- fore the actual amount of salary and allowance paid him here was £10 payable in Hong- kong currency and $130 house allowance, aud, roughly speaking, that would amount to $246 a month according to the rate of exchange. As a very large number of payments for work had to be made in local currency, His Excellency

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Wei Han, the managing director, decided as a matter of convenience to establish a railway account in Canton at the International Banking Corporation. That account was known gener- ally as an impress " account, a term well known in railway construction. This account was sub-divided into two other accounts, one of which was known as the Hong- kong currency account, and the other as the local currency account. The method of paying local currency accounts was for the defendant to issue the necessary cheques, get His Excel- lency to sign them, and then transfer the amount to the credit of the Hongkong currency account. The local currency accounts at the International Bank, Canton, were under the sole control of the defendant, and he was authorised to sign cheques on them in his own name. They were under

his

purpose of various accounts on the railway.

control to be utilised for the

The accounts came under various classes. First of all there were payments for purchases of land, then from time to time contractors and workmen on the railway had to be paid money for work done and material supplied. Money also had to be paid for stores, and in addition to the “impress" account at the International Bank in Canton each district engineer had to be supplied with funds to make his own local payments. Also from time to time various contracts were entered into for the supply of materials or labour, for which from time to time payments had to be made, and in addition to that there were the ordinary current expenses at the office. Mr. Grove, as engineer-in-chief, was the person responsible for the economical and efficient construction of the railway. As a matter of fact, His Excellency deputed to Mr. Grove the whole of the control of construction and equipment. The only thing His Excellency attended to in person was the purchase of Chi- nese land. The defendant had no authority to make payments unless the accounts were initialled by Mr. Grove. The only accounts he was authorised to pay on his own initiative were current office expenses. His salary was roughly $650 a month, £40 of which was drawn at Home and the remaining £10 was also remitted. Therefore, the only money he had to provide for current expenses here appeared to be his house allowance of $130, and even if at all times he did not remit the £10, the total would not be more than $240. The defendant's private pass book at the Inter- national Bank from December 7th, 1909, to August 31st, 1909, showed a total sum of $55,000 paid into his own account. He was in receipt of a salary and allowances, which, if he paid all of it into his credit, would amount to something like $650 a mouth, while his payments in on the average amounted to $2,300 a month.

Mr. Douglas-If the case for the prosecution rests on the defendant's private account it rests nowhere at all. I would suggest that unless it is absolutely necessary, this subject should not be opened up.

Mr. Looker said he was not resting his case on that. The exact payments were only part of the case. He was putting forward such facts, which in relation to other facts put forward, would have to be taken into consideration by whoever had to determine the question of defendant's innocence or guilt. The prosecu. tion found, after investigation of the railway accounts at the International Bank, that on three separate occasions the defendant had drawn out as he was authorised, from the International Bank Hongkong currency account, three sepa- rate cheques for $5,000 $13,000 and $4,000, and subsequently paid these cheques into his own private account. Later he paid practically the whole of this money away to parties who had nothing whatever to do with the railway. The speaker would establish that at this time the balance of defendant's private account was not sufficient to meet these cheques. Somewhere about the end of last year Mr. came to the conclusion that the accounts were not being kept in a regular manner and the result was that an audit yas authorised, The fact of this audit was communicated to the defendant on August 6th. It was to have started on the 10th, but the defendant stated that the accounts could not be written up till the 31st of that month. Consequently the starting of this audit was postponed until the date mentioned, when it was carried out by the gentleman in charge of Messrs.

Grove