10, before Judge Sir Peter Grai the hearing was concluded of the action in which Messrs. Shahmoon, Reynell & Ca. claimed against Mr. G. H. Charleton for Tls. 91,100, alleged to lo dze in connection with transactions on the local Stock Exchange.
Judgment was given in favour Mr. Chatleton, with costs.
Of course, no one carrying a big position, such 2s myself, can afford to wait'in the present uncertainty: to the last minute to safeguard his position vis-d-vis his banks. I have' now made arrangements with my: bankers and others to safeguard my. position. This has proved costly} and will doubtless require a very [substantial sum from Mr. Fleming's Jeccount to avoid my giving you trouble on Monday.
You will doubtless recall that on It was alleged that a cheque for Tls. 333,209.14 negotiated by Mr. Charletoh had been dishonoured on December 23, 1929, that notice of such dishonouring had been given him, and that the sum claimed represented the difference between that sum end Tls. 242,209.14 paid The defence to the action was that the cheque had never been. presented for payment as claimed or. ae all; that it had never been aishonoured; and that no notice of such dishonouring had been given, Counsel: Mr. Tycho Wing for the plaintiffs; Mr. H. Lipson Ward and Mr. BIN. Reader Harris for the defendant.
Continuing his cross-examination of Mr, Reynell, My. Ward asked him whether a letter dated December 20, 1929, wont to the Committee of the Shanghai Stock Exchange by Mr, Charleton, had ever come to his Knowledge, On Mr. Reynell replying in the negative, Mr. Ward read the letter, which was as follows, the [cross-headings being our ov Shanghai. Stock Exchange, 16 Central Road, November 18, Mr. Master and myself met your Chairman and_certain representatives of your Stock' Exchange in re this matter of Mr. Fleming's position as it stood then.
was at that meeting on November 18, that not only did T disagree with your policy of letting Mr. Fleming linger on without his eredit= ors being legally protected, but Mr, David Judah demanded Mr. Fleming's suspension as a defaulter and reminded members of the Committee Present that Afr. Sydney Wong. had] factually written to your Com reporting Air, Fleming as a defaultter (one of his cheques having been' returned) and asking for his suspension, and Mr. David Judah pro-faceded to charge your Committee that, despite such " written request Jand the necessary evidence in their hands to give Mr. Fleming's clients. proper official protection, they had privately sent a member of—your:
umitttee to persuade Mr, Sydney Wong to withdraw his letter.
Both I and my lawyer were pre-at this particular meeting November 48, when Mr, Judah's charges were answered by: fan attempt to put expediency before principle; yet you had the effrontery to write to me on the 17th instant, futer alia, a8 follows: am farther instructed by Although my ace Fleming approximates for lakhs of taels it is even now (on the eve of the Settlement) impossible for me to calculate within @ few tens of thousands of taels what will be looming to me next Monday. This is partly due to your decision to hold a setting-off auction as late as the evening of the 20th instant, partly to my not having received your decision whether my claim for return of brokerage is going to be accepted, partly to the irresponsible attitude that is being taken up by several of Mr. Fleming's debtor fients and partly to the reported minute before disclosing what understand must have cen Committee to point out again thal as we have informed you previously, no complaint has been lodged regarding Mr. Fleming and that, according to our Rules, the Committee are not in a po to declare him a defaulter.
There is, If possible, story of sinister interference with the course of justice and your Axso-Jciation's rules in connection with the name of another of your brokers who also desired and had the neces sary evidence to report Mr. Flem= ing asa defaulter, but was prevent= fed (it is alleged on the statement, sible parties) by methods which, if accurately described, were nothing less than blackmail, ' How. lever, neither my lawyer nor myself obvious cash shortage on Inrge scale, thereby not onl ing Mr. Fieming's account directly bat also, no doubt, inconveniencing. other brokers interested in paying money into Mr. Fleming's account. There are, of course, other con stage from firsthand knowledge, as in the case of Mr.'
'Wong, bat will be able to reply on the evidence of responsible'
sot sour Exchange to get uth should subsequent ments make it desirable tributing factors ing to in-much as the setting-oft that has been adopted by at least two prominent. clients of Mr. Fleming's and the unanticipated refusal on the part of other important clients to contribute t" what is fast degenerating a Charity Fund. fe nee to be this same mee ovemnber 18, that Mr.
Mr. Master, myself and others expect a botter November as L 2 of being T have been told that the broker in question who thus del his idiselosure until practically the last minute must be a little crazy, but I prefer rather the description "lacking in a proper sense of responsibility", for which, to some extent, ho Kas my sympathy, as T hetieve I have good reason to charge is Committee with at least a very i {to the tune Tuels 23,000.—) in November bat faci, were nob suspe Committee would have wiliately sued for damages, 1 Judah told me, for mittee has been by hook or by crook to put the December Settlement tHrough prior to a proper and legal liquidation of Mr. Fleming's vast account. On the' cther hand, I have maintained from the beginning that if you are to avoid regrettable complications you every conceivable asset, have, as far fas possible, the wherewithal to pro-feeed with the December Settlement, But wor folk At that same and on several <ubsequent occasions Twas assured that} the Committee, while they would not suspend Mr. Fleming, would be most meticulous in guarding clients' interests, that Mr. Fleming. hud been] definitely: forbidden to transact further business on his own, that an appointee of the Committee and another of M 's own choos Your Comiittee have pleaded all along that they have not been fur nished ut any time with the legal fight to suspend Mr. Fleming and it is the purpose of this letter lia, to convince you of the impro-pridy and illegality of such a claim and of the serious damage that sour ing had been nominated to liquidate Mr. Fleming's position, and that in any case no transaction could be put, through without the scrutiny und approval of two independent members of the Committee.
This arrangement was not ly expounded at the meeting on Noi ently both by your Chairman and Mr, Lemarchand on other occasions Yet you are found writing to me as ate as December 17, as follows:— am also instructed to point out that no sub-Commiittee has been appointed to deal with Mr. Fleming's affairs, but that Mr. Victor Gensburger, at Mr, Flem= ing's request, was assisting Mr. Fleming in his business, So much dust in my eyes, I suppose; after all I was only a client, Dut a sheep to be shorn for his wool now that the icy blast of financial embarrassment. was threatening, I think I now detect in your letter jof December 17, quite understand able, if somewhat ridiculous, an tempt on the part of your Committee to escape from an extremely awkward posi Tt was partly on your Committee's assurance as above that "I finally agreed to forego $8,000, in November, but at the same time I was assured by Mr, Arthur Woods, in the presence of 'Mr. Lemarchand, that no November short payment by Mr, Fleming would be allowed to rank as a. Viability in December.' On the very same day Me. N. Lo Sparke, when the only received 20 per cent, of what was due to him for November, was asked not to make a fuss as he could put the difference in his December account; at riy rate that is what Mr. Sparke told me Mr. Lienard had promised him. Whether what Mr. Sparke has done in sett ing off his account with Mr. Meyer is legal or not is none of my business; the fact remains that on. Settlement Day he will have been, paid in full not only for December Dut for November as well, and the point I wish to record is that if cither by your Committee not having suspended Mr, Fleming upon receipt of Mr. Wong's letter in November taking loyal action at some later date in this particulne matter (and. it proving unsuccessful) will he obvious that the Jof my November compromise have not been caryled out, all of which would have been avoided if your Committee had been honest enough to act upon Mr. Sydney Wong's letter when it was rec Meanwhile the merry went on. No clients, either big or small, were informed by the Committee that in Mr. Fleming's case special permission was going to be granted to allow of the violation of the Conimittee's most definite rule that all transactions must be ported, with dates, quantities and ves, to keep the public, your clients, intelligently informed.
As a matter of fact, your own Chairman, after I had' written him on the 2nd instant with regard to 650 Docks which had not beow reported, told me that he knew of such permission and upon receive my Jetter he had made ime late enquiries and had action reported in Monday after= noon's business,
Text read from the printed page and cleaned; old type leaves the occasional error.