Hartopp appeared in support of the motion, and Mr. R. N. Macleod, with whom was Mr. A. E. Seddon, appeared for the Shanghai Cotton Manufacturing Ca., Ld.
Mr. Wright. who read the notice of motion, said that in the ordinary ease he would ask his Lordship te order pleadings, but he thought it would probably be more convenient if his Lordship heard the motion for the interim injunction first, for if that were not granted it would be of no use to proceed further with the action. Consequently he would ask his Lordship to defer making any order as to pleadings until the motion had been dealt with, a course with which his Lordship agreed.
Mr. Hartopp then read the affidavit of Mr. F. N. Matthews which was in part as follows:—
"I, Frederick Newman Matthews of No. 3p Peking Road, Shanghai, a British subject, one of the above-named plaintiffs, make oath and say as follows "ithe defendant company was incorporated on December 5, 1908, with a capital of one million Shang. hai taels divided into twenty thousand shares of fifty taels each for the purpose of acquiring and taking over as a going concern the undertaking of the Shanghai Cotton Spinning Ca., Ld., incorporated in 1903 and of the Santai Cotton Spinning Ca., Ld., incorporated in 1906.
"On March' 10, 1914, the capital of the company was increased to two million Shanghai taels by the creation of twenty thousand new shares of fifty taels each.
"2.—The Articles of Association of the company provide for the management of the company's affairs by agents and general managers, The present agents of the Company are the Mitsui Bussan Kaisha, Ld., 2 Japanese Company.
"3.—In consequence of the publication in the public press on January 15 by direction of His Majesty's Minister of the China (Com-panics) Amendment Order in Council, 1919, I was approached by a number of shareholders in the company with the result that on February 9 instant I wrote and sent to the chairman and directors of the company a letter which omitting formal parts was in the terms following "I have been directed to proach you with respect to consequences of the Order in Council recently promulgated as a result of which the company cannot continue under the existing management.
"My instructions come from registered members having the right to vote, from registered members and from persons not at present on the register but who are equitably entitled to shares in the company.
"I represent at present approximately 9,200 shares and am promised and expect shortly to receive authority to act on behalf of persons holding rights in many more shares. My appointment is due to the idea that it is naturally easier for the board and the management to negotiate with one representative than to treat with a large number of shareholders individually.
"I am directed to inquire what steps the board prepare to take to carry out the terms of the Order: whether it is intended to transfer the company to British management or whether some scheme is being evolved, through which the shareholders will be given an_ opportunity to dispose of their holdings at the real value. In the event of the latter course being suggested I am instructed to request you to allow me to inspect and investigate the books, accounts and documents of the company and to obtain any information necessary to enable me to arrive at an opinion of the value of the company's undertaking as a going concern: this with the object to arriving at an equitable price at which my principals will be willing to dispose of their interests to the Japanese shareholders or others or to put same to the consideration of an arbitrator should it later be
Text read from the printed page and cleaned; old type leaves the occasional error.