Mr. Hughes this morning concluded his opening statement on behalf of his junta, in the course of which he protested against charges of fraud or misrepresentation being made against the defendants of which no trace was to be found in the pleadings. The question at issue was whether the memorandum of February 19, 1901, was binding upon the company, and, if it was, what was the.
medy or th consequence.
fondant Moreing had always taken the view that that memorandum was intended to be carried out, and should be loyally carried out, and he had used every effort from then until now to got it carried out to the fullest extent that could be done. And Mr. Hoover had done the same. Then another case was made against the defendants. [t was said that under the original arrangement of 1900 a company should be formed with @ capital of £1,000,000; that'375,000 shares should be issued to the Chinese shareholders, ai that no other fally-paid ed. shares should be issued at all. In other to get 375,000 shares in the new company and that no profit was to be made by aly one. So far from that being the contract, it was now clear that both the plaintiff and Mr. Detring knew. that other fully-paid shares would have to be issued. The business was one of great risk, and Mr. Moreing did not profess to go to hina as a philanthropist. The old company was in the condition of a ship in extreme peril, and the salving of it involved great risk, which had to be paid for. Asa mat of of fact half a m of money was raised for the com upon debentures, which could not have been done without giving some profit on them. Nor had the old shareholders suffered any loss. They had done well, for their property was immensely increased in value. Putting the old shares at their highest possible value at the time of the bargain they were worth about £7. They were now converted into shares in the new company to the value of about £28. Mr. Moreing had come forward to save the company when its position was desperate, and both the plaintiff and Mr. Detring knew that those who found the money should have some inducement to do it, and the only practical way was by issuing fully-paid shares.
At the conclusion of counsel's address, Mr. Hoover went into the box and was examined by Mr. Hughes. He said he was a mining engi Ho had been a partner in the firm of Bewick, Moreing and Ca. since November, 1901. He went to China in 1899 and made tour of inspection round the mines. The plaintiff told him that he hoped to got capital from England through Moreing. Witness was then taken through the whole of the transactions relating to the carrying through of the negotiations with the plaintiff and the signing of the documents in question. He understood from Detring that the deed of July 30, 1900, had been approved had: explain to Detring bout the division of the pr ion, andiwas under the impression that Detring had accepted the 50,000 red shares. raised difficulties about signing the transfer of February, 19, 1901, witness thought that he was being thrown over. After the Russian troops had been displaced by the British at the mines there was an appar-out difference in the tone of the negotintions; Witness had an interview with Chang, and spoke very plainly to him, and there was avery extol argument, Chang said witness was causing him to "Jose his face"—i.e., insulting him. After an apology, Chang's requirements were discussed and the memorandum was eventually drawn up, with the transfer, was eventually signed. Witness never thought it would be called in question, and had always insisted that it should be carried out. The greater part of it had been carried out." Asa director of the company he had always urged that the memorandum should be carried out.
In cross-examination by Mr, Lovett. he said he did not know until he arrived back from China late in 1901 that the company had paid the whole of its 1,000,000 shares for this property. He had written to Moreing in 1899 that the property was worth "vastly more, than £300,000." Assuming that adequate en pital was provided he thought it was worth £1,000,000. His idea was that the existing loans should be re-financed, £100,000 cash should be found, and that imernational control should be obtain-thought the financial part of the transaction was a purely technical manner
Text read from the printed page and cleaned; old type leaves the occasional error.