The Sun.
London, England, 1849-04-12 00:00:00

LONDON, TIIITRSDAY EVENING, APRIL 12, 1849.

neutralized our intentions, by defeating our object of
secrecy.

Mr. Love—Are you not aware that the directors are
required by Act of Parliament to cause notes, minutes,
or copies of contracts enter, d into by the directors, and
all orders and proceedings of the directors and commit-
tees of directors, to be duly entered in books, to be from
time to time provided fur the purpose, which shall bo
kept wider the superintendence of the directors?—We
are quite aware of this clause, and are quite aware, in
general practice, cannot be applied in strictness, and that
directors are very often obliged to exercise their discre-
tion independent of the Act of Parliament.
Mr. Prance—ln what consists, in this particular in-
stance, the difficulty of literally complying with the 92d
clause of the Special Act of the Newcastle and Darling-
ton Company?—lt would have defeated the object we
bad in view; the object being to save the money of the
shareholders.

Mr. Clayton—Did you think by recording the minute
greater publicity would be given to it?—Certainly.
Mr. Clayton—And did you deem publicity undesir-
able?—Unquestionably.
Mr. Clayton—Was it your opinion that the entry of
the minute of the proceedings would tend to give it pub-
lici.y ?--We think it would have that tendency.
Mr. Love—Did the directors at any time require from
Mr. Hudson particulars of the purchases he had made of
Great North of England shares on behalf of this com-
pany?—We never inquired.
Mr. Love—Did you examine the statement of Great
North of England Purchase Account to 25th January,
1849, as exhibited at the general meeting of proprietors
on the 20th February, 1249?—N0t minutely.
Mr. Love—Did the auditors submit that statement to
the directors, at a meeting of their bJard, fur their sanc-
tion prior to publication?--We are not aware whether
they did or did not. _ .

Mr. Love—Wero you present at a meeting of the
board on the 13th February, 1649? Mr. Tee—l was.
Mr. Wood—l was not.
Mr. Love—Did not the auditors on that occasion ex-
hibit the statement of Great North of England Purchase
account, above referred to, for the approval of the di-
rectors prior to publication? Mr. Tee—Not in my
presence.

Mr. Love —Then you cannot say you gave your ap-
proval to the average prices of the shares as there stated
being inserted in that publication?—Mr. Tee—No.
Mr. CLOSE Re-examined.:
Mr. Prance—Have you a rough minute book besides
the one now exhibited?—l have no other minute book
except the committee of management book.
Mr. Love—ls there in the committee of management
minute book any record of the proceedings of the whole
body of directors?—No.
Mr. Love—ls there a record of the board of directors
which met on the 13th February, 1849?—Yes; the paper
I now produce.
(Copied from the original, by Mr. Clayton, so far as re-
lates to the Great North of England Purchase Ac-
count.)
"YORK, FEB. 13, 1849.

"G.H. in the chair.—R. Davies, James Richardson,
N. Plews, C. Tea, J. Simpson. That this statement be
approved.
" Money.—Plews issue a circular at 41. per cent. Offer
4 per cent. for three or five years.
" G. N. E. Purchase Shares.—Parties—from the al.
tered state till nearer the time of completion of pur-
chase 4 per cent. in advance."
Mr. GEORGE HUDSON Re-examined.

Mr. Prance—At a special meeting of
1846,th d
to havecompany,
September 14, 1846, you are reported in a theai Railwayth that
the
Times, Vol. ix., No. 38, September lg
used these words The chairman ex
had not purchased a single share= "either in the Great
North of England or the Hull and Selby Line, and con-
sequently he had not made a single sixpence byas either
joint-
shareholder the purchases. He had no interest in the lines except
as the trustee for the interest of the shareholders over
whom he had the honour to preside, and
with them." Then, if so, how could you so
soon depart from the salutary rule which you had pre-
scribed for yourself, as the measure of your duty, by
placing your own individual interests in competition
with that of the company for which you were trustee?
I hive no recollection of the words which you quote from
the Railway Times. I have already given my reasons
why I felt justified in the course I took.
Mr. Prance—The first call on the Great North of
England Purchase shares became due 25th November,
1846, and your purchase for the company being 27th
October, 1846, you informed us that an advance of
money by the York Union Banking Company furnished
you by anticipation with the means of pa) ing such pur-
chase. What was the necessity for haste? Was the
then market price so low, relative to previous months,
as to make it appear desirable not to endanger losing a
favourable opportunity for investment by investing nearly
100,0001. over and above the proceeds of such call ?—I
thought that the prices would rise in the market, the com-
pany being purchasers, and I used the best judgment I
could in the matter.
Mr. Love—You said yesterday that 15,061 of the
Great North of England Purchase shares are unissued;
has not the difference in price of those shares been so
great that at one time a loss of nearly;6o,oooL would have
been sustained by their sale, and at,another time nearly
90,000 L profit would have accred by that operation; why,
therefore, did you not avail yourself of the very favour-
able state of the market to sell them at the latter period
for the benefit of the company, or else why not have ac-
quainted the shareholders, and left it to their discretion?
—To the best of my belief the shareholders were aware
of it; but Ldo not think it wise to issue guaranteed shares
of a large interest to a greater extent than is absolutely
diaLsoohyvaec
spAboreeeyso),
n-odujnu
therefore,
las are that these are not gua-
ranteed
shares as with stock guaranteed ranmlltierre:
the same extent. perpetuity?—Not y o to
eins—aml aemrt; rule
.atpo?ly to
N sucht

Mr. Love—What amount of cAll per share has been
made on the shares issued ?-8/.
Mr. Love—Does there not remain 171. per share to call
between the present time and the let July, 1850?—There
does.
Mr. Love—Should the calls not be made by the Ist
July, 1650, and the Great North of England proprietors
require to be paid on that day, what course could you
adopt to pay so large a sum of money on one day without
placing this company in great danger, you not having
made a provision for it?—That is a matter of finance
which I should have taken into consideration at the proper
time. lam not prepared to say at present what course I
may adopt; at all events, the holders of those shares
would be entitled to pay up their calls by 1850, if they
think proper; but in all prob Ability, as the time drew
nearer for the completion of the purchase, I should have
made arrangements satisfactory to both parties, as to the
calls and as to the payment.
Mr. Clayton—The committee find in some original
contracts of Messrs. Laurence, Cazenove, and Co., a rate
of brokerage is charged lower than the rate charged in
their accounts current; can you account for or explain
this discrepancy ? —lt is very well known by gentlemen
on the Stock Exchange that brokers allow bankers half
commission, and their being allowed in this as in all
other instances, allowe•l the bank half commission.
Mr. Clayton—To whom have they allowed the half
commission in this particular case?—To the York Union
Bank.

generally, and more especial
Mr. Love—How could that apply in Laurence's case
current, dated 24th to 28th January inclusive, when all
in this particular account
the original contracts were charged to the company at
the reduced commission charged by other brokers, and
when there is a difference in amount between the original
contracts and the account current of 63/. 17s. Bd.?—The
charge is not made to the Company, but to me, and the
half commission, as is usual inthese cases, was paid
all
by me to the bankers.
Mr. Love—Did you give the order as a banker, or as
chairman of this company ?-1 could not separate the
two capacities.
Mr. Love—Did not your duty to this comp3nY.render
it necessary for you to separate the two capacities ?—I
think I have done fairly in the transaction betweenth.
Mr. Love—What was your reason for
with tadopting
the same favourable terms of commission Laurence
large and Co., through whom you bought a amount of
shares, as with other brokers through whomyou bought
a small one.—Laurence and Co. are employed by
bank, and I thought it was a fair banker's charge.
Mr. Love—Have you any objection to authorise us to
the
inspect the books of the York Union Banking Company,
to see whether the half commission allowed by Messrs.
Laurence and Co., has from time to time since October,
1846, been carried to the credit of the profit and loss ac-
count of the bank?—l do not think it would be consis-
tent with my duty to do so.
Mr. Love—What have the bank to do with purchases
of shares, as they did not send the orders P—l transacted
that myself, as from the bank.
Mr. Love—Does not the bank charge for payments
made in town, independently of a charge made for com-
mission on shares bought?—No doubt about it.
Mr. Love—Are you aware that Laurence and Co. made
no mention of the York Union Banking Company in
their correspondence respecting the shares purchased by
the company, and does not the extract from their books
I now exhibit make it still more clear the bankers are no
parties to the transactions?
(Copy.) Extracted by Mr. LOVE.
" To Geo. Hudson, Esq., Newbyj Park.
Jan.
31,
1849.
We send to Mr. Close the account of the G. N. E.
shares bought for to-day amounting to 12,168/. Bs. 2d.,
and we shall want an extension of credit at Glyn's.

" To John Close, Esq. " 81st Jan.. 1849.
" We inclose the account of the G. N. E. shares
bought for this settlement, and advise the amount to Mr.
Hudson,"

Mr. Hudson—l am not aware they do not make any
mention of the bank. I know nothing of the extract
now produced,
Mr. Love-.4Y011 say halter and Son treated you
banker. Be so good as to look at their contracts; are
they not made out to the York, Newcastle, and Berwick
Company; if so, what have the bankers to do With the
transaction?—l apprehend if they had been ordered
through the company, full ectitlMlAZloil would have been
charged.
Mr. Love—l-tow tan "oil tic for, than then tt
"Ptes,ly §tily.s.d dies/ lire bougnt for the company r—l
was the party in the transaction on behalf of the com-
pany.

Mr. PRANCE Examined.
Mr. Love—lt has appeared in evidence before this
committee that in the month of October, 18.16, certain
Great North of England 151. shares were transferred
into your name at 19i premium or 211. per share; ought
this price to be taken as a measure of your opinion of
the intrinsic value of the share?—Most assuredly not;
it would, perhaps, have done so in the case of an ordinary
purchaser, but in my case as a dealer it would by no
means have justified such a conclusion.
Mr. Love—Have the goodness to explain to this com-
mittee in what respect a purchase by a dealer would
differ from that of an ordinary purchaser as a criterion
of his 05109,0-14 wall gie clearly Se L can; thQUgh I