The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1883-05-16

e.
II will thus be seen that the Oriental Bell
Telephone Co. secured a majority Of the stock.
The subscribers proceeded to apply for a
Charter Of Incorporation which was granted
Dec. 3Oth, 1850, and the company organized
in due form, and have made a success Of the
business, having extended their system Of cx-
beyond all expectations. The stock
is now sought for at SO to SIS per share. Mr..
Hubbard left the Islands Dec. 2lst, lssO bui
before he left he had received intelligence that
the Oriental Bell Telephone had disposed Of
its property. II Subsequently transpired that
il had sold out TO the Oriental Telephone Co
(limited) of London, which company was in
corporated under the laws Of Great Britain Oh
February 18th, 1851. There is III evidence a
letter dated at the office of the Oriental Tele-
phone Go. limited, London, May 18th, lssl
from Samuel Hubbard, late special agent
Oriental Telephone Co. TO II. 4. Widemann,
President Of the Hawaiian Bell Telephone Co
requesting him to transfer the sos shares
standing in his name as Trustee for the Orien-
tai Bell Telephone Co. as follows: sos shares
to Oriental Telephone Co. limited and five
shares to Mr.. Berger according to agreement.
On the 9th June, 1881, during the absence
abroad Of II. A. Widemann, the President Of
the Hawaiian Bell Telephone Co, the Sccre-
tary Of the Company Mr.. c. o. Berger was
requested by Mr.. f. P. Adams defendant the
Agent Of the Oriental Telephone Co. Of Lon
don to transfer the stock to this Company.
And it was accordingly done a few days later
by the Secretary at the instance Of Mr.. Will
der the Nice-Presideut and it is now held by
Mr. Adams. The Secretary entered this allot-
ment Of stock in the stock-book of the corpur-
alton as Of january 9th, 1851 the date when
tho ,flrar Ill 70
ers. At a meeting of the Company held Sept.
llth, lss2, it was voted to charge the Oriental
Telephone Co. with $500 being for $50
shares at its par value of SO. Against this
action-Mr. Adams protested formally This
suit was commenced February 23d, 1883.
Objections are urged by the defendant
counsel that this bill is improperly brought by
the corporation, whereas it should have been
brought by aggrieved shareholders. But in
this case a fraud is charged as having been
committed against the corporation, in procur-
ing an allotment Of shares to be made ty
illusory and fraudulent representations and
think the corporation was the proper party 10
bring the bill.
The counsel for the defendant also urges
that as the power is not granted by the char
ter to the corporation of declaring forfeiture Of
shares, so the Court has no jurisdiction to de-
clare a forfeiture This may be good law but
it does not apply, for the bill does not ask for
a forfeiture Of the shares it prays that
they may he delivered up for cancellation, as
If they never had been allotted. / consider
this a very different matter from the forfeiture
Of shares for non- payment Of assessments.
l now pass TO the consideration Of the
alleged false and illusOry representations and
promises of Mr. Hubbard to the Honolulu
subscribers which, it is alleged, induced them
to allow his Company 20 take a majority Of
the paid up stock. | think the apparent con
Predictions may he reconciled without imput-
ing Intentional falsehood to any one. 1t seems
to me that Mr. Hubbard did use language
from which it might be inferred that no tele-
phone instruments could be brought or OBJ
tanned in Honolulu, except through the Orien-
tai Bell Telephone Co, but it cannot be
doubted that he meant the Sc Bell Hand Tele-
phone or Receiver and the Blake Trans
mitter," because these were the instruments
controlled by this Company and he says that
they then had bought up all the patent rights
Of other inventors in the United States. That
he had in mind these instruments is evidenced
by the name Of the company TO be formed here,
as appears by his prospectus j. e. O. The Ha-
waiian Bell " Telephone Co Some Of the
witnesses say that he said these instruments.
lie may have said "these instruments" mean
ing those he had brought with him l. e. the
Bell Telephone and Blake Transmitter and his
hearers understood the word telephone" to
be used in its generic sense aud to include al
telephones OF whatever pattern or invention.
The consideration he undertook to give for
this stock in the prospectus was the " Patent
Rights and concessions" This must mean
such as were then held by the Oriental Bell
Telephone Co. This Mr.. Hubbard said was
what he guaranteed There is no proof before
me that this engagement has been broken.
Some Of the witnesses understood that Mr..
Hubbard Undertook 10 protect the Hawaiian
Bell Telephone Co. from infringemonts in this
Kingdom Of the Patents held by his Company.
This is not at all likely. 1t is not to be light.
ly presumed that a person would make an
impossible undertaking. A slight enquiry
would make it certain that unless these in
struments were protected by Letters Patent in
this country, limitations OF them, equally eff
cient as those bearing the official stamp Of the
could be made abroad and imported
here or made in this country with complete
impunity.
Every one is presumed to know the law,
and must presume that the Honolulu sub
scribers knew that Mr.. Hubbard could not
protect them against infringements in this
country Of the telephones his company con-
irolled.
1t is evidence that few telephones Of the
Bell Patents were sold to residents here be-
fore the Company plaintiff was organized
but none have been sold since, except through
The Company plaintiff. 1t is proven in eyi-
lence that Messrs. W. e. Irwin q Co have
so or so instruments, but I gather
rom the testimony Of Cassidy and Hubbard
hat they were close limitations Of the Bell
Telephone and Blake Transmitters but do not
)ear the official stamp and were not manulac-
ured under the Bell Patents There was
10 evidence offered as the source from which
he Ililo Telephone Go. received its instru-
nents.
1t seems strange that the Honolulu sub
cribers were willing 10 part with a control |
ing proportion Of the stock in the contem-
lated company for consideration not |
by anything ut oral and therefore |
ot definitely remembered declarations. and an |
Unsigned, pencil memorandum Of prospectus. |
IN the other hand the Company plaintiffs does 1
0t seem to have voted, since its incorpora- |
ion, the stock to the company represented
y Mr.. Hubbard.
No evidence in the way Of an assignment or
therwise is shown to have been presented to
be company plaintiff to show that the Oriental
ell Telephone Co. had sold out its property
I'd rights to or had become merged in the
riental Telephone Co. Qimited). copy OF
he charter Of the latter Company exhibited
Court shows that it was not incorporated
ltil FEBRUARY eth, lssl. But the stock was
lotted and the certificates therefor have been
lssed to this company and are now held by
5 Agent Mr.. Adams. This transfer was