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The Pamphlet Collection of Sir Robert Stout: Volume 48

The New Zealand Shipping Company Limited, and The late General Manager

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The New Zealand Shipping Company Limited, and The late General Manager.


September, 1889. page break
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"The New Zealand Shipping Company.

"The New Zealand Shipping Company Limited, held their Seventh Annual Meeting yesterday afternoon. The Chair was taken by Mr. J. L. Coster, Chairman of the Board of Directors. The following Directors also were present:—Messrs. Aynsley, Anderson, Reeves, Turner, and Wilson.

"The Report and Balance Sheet were taken as read.

"In addressing the Shareholders, the Chairman, inter alia, said:—'The other item to which I have to refer is "the paragraph* in respect to the late General Manager. "I assume that none but Shareholders of the Shipping "Company are present. If there are any others, I ask "them to withdraw, because the statement I have to "make is a privileged one to the Shareholders alone."

"The Chairman, after referring in complimentary terms to the officials of the Company, both in London and the Colony, concluded by moving the adoption of the Report and Balance Sheet.'"

* This is not published, so it cannot be quoted.

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To the Shareholders in the New Zealand Shipping Company Limited.

Gentlemen,—I have lately received from some of your number copies of the Report and Balance-sheet presented to you by your Directors on the 12th ultimo, and the Lyttelton Times of the following day, containing an account of the proceedings at your late Annual Meeting, and in deference to the kindly expressed wishes of my friends, as well as in justice to myself, I venture to trouble you with a brief epitome of my introduction to your service, and the manner of my leaving it.

You are probably aware that I was for many years in business in Melbourne, and my first knowledge of your Company was acquired on the 12th July, 1875, when Mr. T. M. Stewart, Manager of the Melbourne Branch Bank of New Zealand, called on me and asked if I knew any one whom I could recommend as thoroughly competent to take the full charge of a large Shipping Company in New Zealand, and he enquired my opinions of two gentlemen who had been indicated to him as likely to be suitable for the appointment. He told me the Company was well subscribed—in its infancy, but certain to progress, and that the Directors were willing to give "a commencing salary of £800 to £1,000, to be increased as business went on." And finally he begged me to look through the list of Shareholders in, and of the ships loaded out by, your Company in 1874, and to write him suggesting any one I thought of for the management, and to say if, in my opinion, the proposed salary was inadequate.

And on the 14th July, 1875, I wrote to Mr. Stewart as follows:—

page 6

Thomas M. Stewart, Esq.,

Bank of New Zealand.

My dear Sir,—I return you the Share List of the New Zealand Shipping Company, and also the paper showing the magnitude of the agency operations under its auspices, during the year 1874; and in thanking you for your confidence in consulting me as to a fit and competent person to take the general management of the Company at Christchurch, I regret to say I cannot unhesitatingly recommend any one. I have taken the Directory beside me, and carefully considered the merits of * * * * * and * * * * * there are few who, in my humble judgment, would make good and efficient managers. Of the gentlemen you named to me, I can, with every kindly respect say, they lack every essential qualification. I have thought of two—one * * * * * and * * * * * lately of * * * * * a man of extensive though somewhat bitter mercantile experience * * * *.

You will pardon my adding that I think your friends hardly estimate the importance of the position of a General Manager of such a Company, or appreciate the value of such qualifications as he must be invested with, if he is successfully to conduct a concern, requiring, besides extensive general mercantile knowledge—which can only be acquired by years and years of experience—special abilities and aptitude of administration of interests which, ignorantly or inefficiently handled, would suffer irretrievably; or they would not expect to secure the services of a really competent man, at a salary which is not infrequently given here to managing clerks of large mercantile establishments, and which is not one-half of that accorded to men in such positions in England.

And I may not be trespassing beyond the confidence you have reposed in me, if I tender the advice to your friends to pay a good man if they can secure him, so well as to make interests and prosperity identical and identified. With such a proprietary, and such facilities and advantages as the N.Z.S. Co. has, there is a grand career before them, if only the right man is at the helm. The business It will be the duty of the General Manager of this Company to forecast, to initiate, to carry out all these schemes; to regulate and control the working at all the branches; to be responsible for all the details, &c.; and such a man should be efficiently paid. The necessary qualifications are the purchase of years of labour, experience, and care, and should be adequately rewarded. * * *

I am, &c.,

H. Selwyn Smith.

Shortly afterwards, a mutual friend, Mr. Robert Murray Smith, called on me, and, inter alia said, "Mr. Stewart is very anxious" that you should accept that New Zealand appointment;" and I replied, "He did not offer it to me, and if he had done so I should have told him I would not go for double the proposed salary."

On the 17th August Mr. Stewart again called, and at once referred to Mr. Murray Smith's conversation with me, and expressed a hope that I would accept the appointment at his disposal with "a commencing salary of £1,000, to be increased as the Company prospered." He read me extracts from letters he had received from Mr. Coster, your Chairman, written after his perusal of my page 7 letter of 14th July, and urged me very strongly to go over to Christchurch to see the Directors, and to take the post, in full confidence that I should be well treated by the Company.

I explained frankly to Mr. Stewart that my income was far larger than that proposed by his friends; that my business connection was an important one, and that in giving it up and breaking up my home I should incur heavy pecuniary loss, and that I therefore could not, and would not, entertain the idea of leaving Victoria unless very substantial and permanent advantages were held out, and ensured to me.

Mr. Stewart then begged me to write him fully as to my views, and the terms on which I would accept the appointment, and I did so as follows:—


Thomas M. Stewart, Esq.

My dear Sir,—When you were good enough to consult me a few weeks ago as to a suitable man for the position of General Manager of the N.Z.S. Co.'s business at Christchurch, you did not tell me that your wish and intention was that I should suggest myself for the office.

Shortly afterwards, our mutual friend Mr. Murray Smith told me your views, and during our interview on the 17th inst., I learned from the extracts you read from your New Zealand correspondent's letter how favourably you must have spoken of me, and I am deeply indebted to you for commendation, which has evoked so cordial a concurrence and such generous impulse as is manifested in the invitation to me to visit the Directors of the Company, with a view to the arrangement of terms on which I might take the charge suggested.

I would at once go over as proposed, but at the moment I am liquidating a large insolvent estate, and have under adjustment some important average statements and negotiations which forbid my immediate absence from Melbourne.

Under these circumstances, I presume and venture to trouble you with my views so far as I am personally concerned; and I do so with full confidence that my letter will be respected by you and your friends as private.

Your correspondents have so generously expressed themselves as to my fitness for the position of Manager that I need only say I have owned and successfully managed ships for twenty-five years; at the age of twenty I had full charge of one of the largest establishments in Sydney, and I have ever since presided over important and extensive business concerns—having the control of many clerks and more men. My colonial experience extends over thirty-five years; interim I have voyaged and travelled much, and always had extensive correspondence both East and West, and so have acquired a thorough knowledge of the commerce of the world.

Through heavy losses in the realization of advances on pastoral securities a few years ago, I was obliged to suspend payment temporarily, but on resuming my business I have been able, with my large connection of friends, to make an income of from £1500 to £2200 a year,* with the prospect of its gradual increase as my means enable me prudently to extend my operations, and I am sure you will understand and appreciate the serious consideration it is for me to decide whether it is right for me to throw up this and break ground in a new field.

* This was after providing for household and personal expenses.

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I frankly confess that the idea of a fixed income—if adequate to the requirements of my large family—has a great charm for me. I have too great faith in the future of New Zealand, a country whose importance is yet in its infancy, and which must afford good openings for men of enterprise and talent, and the invitation to me to stretch the cords of my tent there is so flatteringly couched that I am loth to say,—what prudence compels me,—I cannot, in view of the necessities of my family, give up what I have here, unless J am assured a commencing salary equivalent to the minimum I am now making. If this was conceded me, I would make early arrangements to join the Company's service, content that any increment to my salary should depend on the result of my management, and determined to devote myself wholly and heartily to the interests of the concern; and, let me add, I am no niggard at my work, nor am I afraid to cope with whatever may be presented to me. I have good plans for organizing and efficiently carrying out and administering business confided to me. My energy and activity are quite unimpaired.

I am, &c.,

H. Selwyn Smith.

On the 7th September Mr. Stewart asked me to call on him, and he read me a telegram he had just received from your Chairman, dated 30th August, in which he was desired to "Offer a commencing salary of £1,250—the payment of my own and family's expenses" and saying, "future remuneration may very safely rest on success of management, urging my going over at once."

On this a long conversation ensued. I declined the offer, and expressed surprise at its being made, if, as I presumed, the Directors had my letter of 20th August before them. I said I would not concede on the terms therein laid down, and that the matter was one of too much importance to me to be decided so hurriedly, or without preparatorily and clearly defining all terms and conditions.

I was then begged to write a final letter, stating the terms on which I would go down and join the Company's service, and I wrote to Mr. Stewart as follows:—


Thomas M. Stewart, Esq.,

Bank of New Zealand,

My dear Sir,—I am much indebted to you for so promptly intimating that the New Zealand Shipping Company have authorised you to offer me a commencing salary of £1250, if I will undertake the General Management of the business at Christchurch.

It is not quite clear to me whether this authority was sent prior to the perusal of my letter to you of the 20th ultimo, which you told me you had been good enough to forward. If the Directors had it before them, when telegraphing, I can hardly understand the proposal, for I had very carefully considered what I wrote, and determined on the minimum salary I would accept, if I entered on the service of the Company; and I pointed out to you the reasons which influenced my decision, and the hopes I entertained of adding considerably to the proposed salary, by a successful administration of the Company's interests, in which I expected to participate; and it would be unbecoming in me to deviate from what I then wrote and said to you; and the Company would not, I think, be favourably impressed, if I changed my mind, after making it up.

page 9

When you first spoke to me about a Manager for the New Zealand Shipping Company, I wrote you my views of the qualifications necessary for the office. I did so frankly; for at the time you had not informed me that you had me in view for it, and though the Company has endorsed your kind recommendation of me, my impression of the importance of the position, and of the remuneration which should be accorded to its faithful occupant, is not in any way modified. Indeed it is far otherwise, and while I cannot but feel gratified at the offer made, I must most respectfully decline it, on the simple ground that the pay proposed is not an adequate reward for the devotion of services and the experience necessary to the efficient fulfilment of the duties appertaining to the office. This I say without reference to myself or my requirements; but in case the negotiations initiated under your good auspices are re-opened, with a personal reference to me, I deem it due as well to the Company as to myself to say, I am prepared to adhere to my letter of the 20th ultimo, to which I would add that my idea of increment to my salary is that I should be also rewarded with a tithe of the profits accruing, after securing the proprietary an adequate interest on the capital employed, so that my advancement should depend on my successful management, the term, of which I presume would be positively five years, with the option of determining it at the end of three, on equitable terms and notice. I should beg also that a certain time should be allowed me to get rid of my own vessels, so that I might do so without unnecessarily sacrificing them;—of course they, or their working, would in no way clash with the interests of, or my duties to, the Company.

Pray accept my assurance that I highly appreciate the compliment paid me, and am greatly obliged to you for your contribution to it; and if ultimately I receive the appointment I will not discredit your recommendation, but I cannot sever my valuable connection here unless it is to my advantage to do so. Once I enter on new ground, my whole interest and energy will be at the disposal of my employers, and if I am not obliged first to sell my ships, I shall not require much time here to arrange my affairs and leave Melbourne.

I am, &c., &c.,

H. Selwyn Smith.

On the 29th September Mr. Stewart called and placed the following letter in my bands:—

The New Zealand Shipping Company Limited, Christchurch,

H. Selwyn Smith, Esq.

, Melbourne.

Dear Sir,—Referring to the negotiations which have been passing between this Company and yourself, through our mutual friend Mr. Stewart, and to an intimation received by telegram that you are prepared to accept the General Management of this Company, at a salary of £1500 per annum, for the period of three years certain, I am instructed by the Directors to state that they have appointed you to the office on these terms, and they hope you will be able to arrange to assume your management with the least possible delay, as the wool season is about commencing.

As previously intimated through Mr. Stewart, the Directors are willing to defray the necessary travelling expenses of yourself and family from Melbourne to Christchurch.

A complete and detailed agreement to be entered into when the Directors have the pleasure of seeing you in Christchurch.

Trusting to see you on a very early day, and requesting that you will afford the earliest information by telegraph of your movements,

I remain, &c.,

Joseph Gould, Secretary.

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This letter I answered as follows:—


Joseph Gould, Esq.,

Secretary The New Zealand Shipping Co. Limited, Christchurch.

Dear Sir,—In acknowledging your letter of the 18th ultimo, and accepting the appointment your Directors have been good enough to confer on me, I beg you will convey to them the expression of my full appreciation of the confidence reposed in me, and my assurance that nothing shall be wanting on my part to entitle me to maintain it.

By the next steamer I hope to advise you when I can promise to join the service, and no long interval will elapse. I shall leave my family here while making arrangements for their reception, sending or returning for them as may suit the convenience of the Company.

I feel certain, from the generous tone of the correspondence read to me by Mr. Stewart, that I shall, in the agreement to be entered into, be fairly treated, and the Directors may depend on my hearty and active zeal and interest in promoting and conserving the interests confided to my direction and management.

I am, dear Sir,

Yours faithfully,

H. Selwyn Smith.

page 11

Here I may mention that I sought from Mr. Stewart (through whom I sent the letter to Mr. Gould) as long a time as possible, to enable me to close up my business engagements and to try and dispose of some of my vessels prior to leaving Melbourne. But each mail from New Zealand brought letters to Mr. Stewart, pressing me to join the service at once, and your Chairman wrote me begging me to postpone an almost obligatory visit to Sydney, and thus I was hurried from Victoria and had to leave many matters unsettled, and some of these ultimated in serious pecuniary loss to me, which might have been avoided if I had had the time to adjust them personally;* and it is not out of place to say that the breaking-up of my home in Melbourne, and re-forming it in New Zealand, alone cost me upwards of £800.

I arrived in New Zealand on the 1st of December, 1875, and almost immediately assumed charge as General Manager of your Company.

On the 14th December, 1875, a Minute was passed by your Board—"That the agreement with Mr. H. Selwyn Smith, as General Manager, was to be prepared, &c., and, inter alia, that I was to find a security of £4,000 sterling,

Although this was the first, and indeed the only, intimation I ever had of the obligation to find security of £4,000, I completed ray arrangements to comply with the Directors' wishes in this matter.

I had not been long in charge when I saw that the conditions stipulated in ray letters of 20th August and 7th September might probably prove inconvenient to the Company, and I was quite prepared,—whenever the "complete and detailed, agreement" promised in the Secretary's letter of 18th September, 1875, and embodying the terms for which I had stipulated when agreeing to accept my appointment was presented to me,—to concur in any modification which might be suggested by your Directors on the basis of a certain instead of an uncertain addition to the commencing salary, referred to in my first letter.

But time went on, and the "complete and detailed agreement" never was submitted to me, and though I was anxious it should be implemented, delicacy forbade my pressing for its completion, and I certainly had no doubt that when it was I should "be fairly treated;" and, assured that thus there would accrue to my credit a considerable augmentation to my salary, I had no hesitation in directing the London Office to make certain quarterly payments of about £60 each (to relatives dependent on me), which have been regularly passed in the London monthly accounts (these were always seen by your Chairman and other Directors), and then through the books to my debit in the colony—so, too, with sundry other payments, and for some supplies I had from the Company's stores—everything was duly debited, and I had full and, I submit, fair expectation that the increment to my salary stipulated for would far more than cover the debits,—for the position of the Company was now vastly changed, and the balance of £14,000, to the debit of profit and loss in 1875, was altered, and in the interval up to the 30th June, 1878, the Reserved Profits, after securing the proprietary an adequate interest on the capital employed, amounted to £40,000, of which the tithe is £4,000.

I admit 1 was not satisfied at the long postponement of the completion of the promised agreement, and that in the latter part of 1878 I felt confident—of what I for some short time previous only conjectured—that my letters, and the terms embodied in them, on which I had broken up my business and home in Melbourne, and entered your service, had never been submitted or disclosed to your Directors as a body.

On the 3rd December, 1878, a Sub-Committee of your Directors, appointed to review salaries, brought up a Report in which the following passage occurred:—

In conclusion, your Committee have to state they did not investigate the agreement with the General Manager, as, in their opinion, the Directors did not delegate this to them, but as the term of his agreement must be drawing to an end, they are of opinion the Board should have all the papers connected therewith laid before them.

I confess I was somewhat surprised at this paragraph, because I considered that the three years having passed without the stipulated "equitable terms and notice of determination," we were mutually bound for the remainder of the full term of the engagement originally stipulated for; but I was not sorry that the question had at last been thus opened up, for I relied on the Board, as a whole, looking into and fulfilling the obligations of the Company.

The Chairman asked me to let him have copies of the letters I have hereinbefore set out, and I handed them to him the same day (3rd December, 1878); and I may add that he has kept them ever since, though I have applied three times for them; and there are, or were, other copies of them in the Company's safe. No word was said to me on the subject by any of your Directors, but on the 13th January, 1879, Mr. Coster handed me a pencil memo, of a resolution which he told me the Board had passed during the preceding week, as follows:—

The term of the engagement with the General Manager having expired, the Hoard appoints Mr. H. Selwyn Smith General Manager at a salary of £1,500, subject to six months' notice on either side,— saying he thought I would like to enter it in my own handwriting, and assuring mo on his honor that the Board did not mean anything by the terms and conditions of the resolution.

I at once demurred, and told Mr. Coster, "My engagement not having been determined, as prescribed, at the end of three years, went on to the end of the five years." He replied, "The Directors only feel bound to the three years,—you have in fact no agreement now." I remonstrated and said, "Then they cannot have seen the letters which have passed;" and he rejoined that "he had not read those I gave him on the 3rd December!" The next day I wrote to the Chairman as follows:—

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J. L. Coster, Esq.,

Chairman of The New Zealand Shipping Co. Limited.

Dear Sir,—The minute of the Board you yesterday showed me, and your statement that you had not road the letters which, in pursuance of the Sub-committee's suggestion I handed you last month, impress my mind to the effect that the Directors have not seen the correspondence which is the foundation of my connection with the Company, and that they are not aware of the inducements held out to me to throw up my business in Melbourne, and take the position I now hold.

And I therefore deferentially submit that your correspondence with Mr. Stewart, as well as mine, in reference to my appointment, should be considered by the Board, prior to entering on its proceedings a minute which, in my humble judgment, is not consistent with existing obligations arising out of the correspondence referred to.

I of course only desire that, as the Directors have now taken the matter up, the terms of my engagement may, after frank and fair discussion, be definitely and agreeably settled.

I am, &c.,

H. Selwyn Smith.

To this your Chairman replied in a note which I cannot set out because I missed it from my table shortly after its receipt. Its purport was, that "The Directors would defer recording the resolution, and would carefully consider my request, &c."

On the 17th February, 1879, your Directors held a special and private meeting—which I was summoned to attend for a short time; and after various questions by the Directors, I left the room. Subsequently, Messrs. Murray-Aynsley, and C. W. Turner, deputed by the Board, waited on me, and pressed me to say what would satisfy me, adding that they had thought of £1,750 as an annual salary, and that until that day they were not aware of the stipulations I had made prior to accepting the appointment. I promised to see them later in the day; but when I called on Mr. Murray-Aynsley, he was not in, and I went on to Mr. Turner, and told him that "although I never would have given up ray Melbourne business and joined the service on the terms which the Directors seemed to think I would or should accept, it was now too late to retrace my steps, and so, disappointed as I was, and embarrassed as I should be with the Company by the course proposed, I should draw whatever they determined on, and not again refer to money matters till the end of my engagement; but, if the Directors would make my salary £2,000 a year ah initio, they would have in me a satisfied servant, but not at any less rate or terms." At this time there was a large sum to my debt, which would have been more than cleared off if I had been credited retrospectively.

The Board then passed a minute stating, in effect, That the engagement with the General Manager having expired, Mr. H. Selwyn Smith was appointed General Manager at a salary of £1,750 (from 1st December preceding) subject to twelve months' notice, and that an agreement was to be prepared by the Company's solicitors.

Not long after this I was warned by friends that certain members of your Board were determined to eject me from the service; and I was informed, on most undoubted authority, that the coup détat was to be some day suddenly accomplished; but I heard nothing from any one of your Directors to indicate the impending proceeding, nor of the agreement. I was quite aware that the state of my account was fully known, at least to some of the Directors, and of course to your Auditors; and also that, notwithstanding the apparent existence of friendly relations, the contemplated proceeding was only deferred for reasons which were obvious to me.

On the 5th November, 1879, I received the following letter from the Company's solicitors:—

page 13

Dear Mr. Smith,—At the request of the Directors, we beg to hand you a draft agreement which we have prepared by their instructions; please peruse it, and see us further on this subject.

Harper, Harper and Scott.

The next morning I received a note from Mr. George Harper, the Solicitor, requesting me to return the draft agreement by the bearer, and to see him about it "at noon."

To this I replied on same day:—

In compliance with your note, I return the draft agreement, which I have hardly had time to read, and certainly not to consider; but, as requested, I will wait on you at noon.

Of the agreement I made a rough copy for future reference and publication, and, I may say, the original draft was fairly enough worded, if only the terms had been in pursuance of my letters, but the interlineations (which I state confidently were not originated by the Solicitors) were such as to prevent its subscription by any one of independent mind and judgment. I challenge the production of any completed agreement embodying such terms and restrictions, and I fully appreciated the purport and object of the document. I cannot set it out because the copy I made was taken from my table during my absence one day.

I called on Mr. Harper, as promised, and passing over much that transpired, which I am not at liberty to make use of here. I told him officially that I would defer the consideration of the agreement for a few days, until my return from Wellington, whither I was going that evening.

About the 14th November, 1879, I met Mr. Harper, and he promised to send me the Draft agreement again, saying that I might underline whatever I objected to in it. The document was not sent to me, but on the evening of the 25th November, Mr. George Harper called, and handed me the following letter, requesting me to read it in his presence:—

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Hereford Street, Christchurch, N.Z.,

H. Selwyn Smith

, Esq., New Zealand Shipping Company Office, Hereford Street, Christchurch.
Dear Sir,—We beg to bring under your notice the following copy of a resolution passed this day at a meeting of the Board of the Directors of the Company:—

"The Board having before it the letter of Messrs. Harper, Harper and Scott of the 7th instant, with the draft agreement prepared by them, but which Mr. Smith has declined to sign, the Board decides to terminate the engagement with the General Manager, in terms of resolution of the 17th February, 1879, and that the Solicitors be instructed to give the necessary notice." Carried unanimously.

In pursuance of the terms of the foregoing resolution, and acting under the instructions of the Board of Directors of the New Zealand Shipping Company Limited, we hereby give you notice that your engagement with the Company as General Manager thereof is to terminate at the expiration of twelve months from this date.

page 15

We are also instructed to give you notice that the Board of Directors require you forthwith to cease acting as the General Manager of the said Company, and that they do not require the continuation of your services as such during the said ensuing period of twelve months from this date.

The Board are prepared at once to pay or credit you with one years' salary in advance, subject to adjustment of accounts between yourself and the Company.

We are, dear Sir,

Yours faithfully,

Harper, Harper and Scott.

After my perusal of the letter, he left, and, in less than five minutes, returned with Messrs. Coster, Murray-Aynsley and Turner, and the former being the spokesman expressed a hope that I "clearly understood the position." I declined discussing it then with the Directors, preferring, as they bad communicated through their Solicitors, to address myself to them. But I of course admitted the right of the Board to suspend me, and said that I would remove all my private papers, and, on the demand of the Chairman, would deliver up my keys the next day.

The Directors considered my proposal reasonable, and in consecutive order stated that they desired to do "everything with the greatest consideration for me."

The next day I gave up my keys to Mr. Harper, in the presence of the three Directors already named. I afterwards saw Mr. Harper, and asked him to tell me the real reason for the action of the Directors, and he said it was "Because I refused to sign the agreement; that they were determined I should do so; that they did not admit that I had any claim for percentage of profits; and he added that there was no desire to inconvenience me; that my account was being made up, and would be handed to me; that it would be credited with £1,750, in lieu of 12 months' notice." I said "if there was any explanation wanted about any matter I would of course give it to him." He replied that "none was required; that my account was perfectly clear; but if he wanted further information he would ash me;" and he added, "that the Directors wished him to be the medium of communication from me."

The following day I had a long interview with Mr. Harper, who, inter alia, said that "If I would resign and leave myself in the hands of the Directors he thought they would give a certain sum for my family, provided I left Christchurch."

I told him, as indeed he already well knew, that I could not leave the place until I had made some settlement of my private affairs, which the action of the Directors had rendered very difficult;—and I offered to submit the terms on which I should leave the Company's service to the arbitrament of gentlemen page 16 selected in the usual way, or to receive—in addition to the acquittance of the balance to the debit of my account—a specific sum, which in the aggregate was very much within the tithe of profits accrued at June, 1878 (six months prior to the time I commenced to draw my salary at the altered rate.)

After conference with the Directors, Mr. Harper told me that they declined to refer to arbitration, but, he added, that if I resigned and left Christchurch something would be done for my family. Then he called at my house and told me the Directors were determined to put a notice in the newspapers, or to have a paragraph inserted, saying I had left the service, and that there was no desire to put anything in that would be hurtful to me, and that I might write it myself if I liked.

To this I replied,—"If I concurred in or wrote such a notice I should effectually bar any claim I have to the addition to my salary, for which I have throughout stipulated;" and Mr. Harper rejoined, "I will be your solicitor now, and tell you that no doubt you will lose any claim you may have, if you do so."

The notice appeared under the instruction of the Directors, and I then, on several occasions during December, asked for a copy of the proposed agreement and for my account, and Mr. Harper told me he was instructed not to give me the first, but the latter was being made up, and would be handed to me on completion.

On the 24th December I received a letter from Messrs. Harper, Harper and Scott, the purport of which will be gathered from my acknowledgment as follows:—


Messrs. Harper, Harper and Scott.

Re The New Zealand Shipping Company's Letters.

In reply to your letter of even date, I beg to say that I have not received or retained any letters which have come by the recent mails from England relating to the business of the N.Z.S. Co., either marked private, official, confidential, or otherwise.

After the attempt of the Chairman to intercept my letters at the Post Office, the Postmaster was good enough to call on me, and gave me two letters, one from * * * and one addressed to me personally by Mr. Strickland, the Company's London Manager. The latter I begged might be delivered to Mr. Gibbs, the Company's Accountant, on condition of his opening it in my presence, and if it was, as I apprehended, a private letter, giving it to me—if on Company's business alone, retaining it. Of this letter I have heard nothing further, and if it has not reached the Company it can at any time do so, on the condition I attached.

One or two colonial letters which have reached me by inadvertence, I have of course immediately sent to the Company, as I beg to do with the enclosed, through you. It reached me at 11 o clock to-day, &c.

H. Selwyn Smith.

A few days later I wrote Messrs. Harper, Harper and Scott as follows:—

page 17

Messrs. Harper, Harper and Scott,

Re The New Zealand Shipping Company.

Dear Sirs,—Referring to your letter of the 25th ultimo, and to my interview with your Mr. George Harper on the succeeding day, I have to request that you will be good enough to furnish me with a copy of the proposed agreement, referred to in the resolution of the Board of Directors quoted by you, and also with a copy of my account with the Company, embracing the credit of salary in advance.

I am, &c.,

H. Selwyn Smith.

And at the same time I addressed Mr. Coster:—

"Mr. H. Selwyn Smith requests Mr. Coster to return him the packet of letters referring to his engagement by the New Zealand Shipping Company, handed him on the 3rd December, 1878, and also a scrap book, containing the "Recollections of a Nonogenarian,' &c., and a paper on the 'Functions of the Brain' and some Newspaper slips."

On the 31st December, 1879, I wrote to Mr. Coster:—

"Mr. H. Selwyn Smith has received from Mr. Coster the two books and one manuscript, but the letters, lent to him on the 3rd December, 1878, relating to Mr. Smith's engagement with the New Zealand Shipping Company, were not in the parcel, and he will be much obliged if Mr. Coster will send them to him."

On the 3rd January, 1880', Mr. George Harper called on me with sundry letters, some of which had been detained for three weeks—requesting me to open them in his presence, and he then said, "I may as well answer your last letter verbally. The Directors instruct me not to give you a copy of the proposed agreement, but the copy of your account you are entitled to; it is made up and in my office, and will not take an hour to copy, and you shall have that at once."

I waited till the 30th January, and then I called on Mr. Harper and asked him for the account, in conformity with his promise, and he replied, "I know I promised it, but since then I have received instructions from, the Directors not to give it you, and now I mayn't."

From this time I had neither verbal nor written communication with Mr. Harper; and I do not feel at liberty to set out in detail the negotiations through a friend which were initiated by Mr. Harper, because, while I am certain that they were officially dictated and sanctioned, I appreciate the personal consideration for me which prompted much that I cannot here record without a breach of the confidence reposed in me and my friend. Suffice it, the whole tenor of Mr. Harper's instructions was to get me to leave Canterbury.

Very shortly after this the apprehension of a serious domestic family calamity made me determine on leaving New Zealand so soon as my private affairs enabled me to do so, and then negotiations were renewed and carried on between Mr. Harper, acting under the instructions of your Chairman, and a friend who most kindly and efficiently took the matter up on my behalf. The result was the interchange of "a Memo, of the Heads of an Agreement," one of which was, that I was to be paid a specific sum of money by the Company on my leaving Canterbury—and this part of it remains unfulfilled, though it is nearly six months since I left Christchurch.

Of course I have not had the advantage of hearing the "privileged statement" in reference to me which your Chairman made at the Annual Meeting, but I have fully and fairly laid before you every condition precedent to my entering, and circumstance connected with my suspension from, your service, and I believe that if the facts had been placed before you as you now have them, it is probable the stipulated addition to my salary would have been accorded to me; and if to this there was added the £1,750 credit in lieu of notice—vide Messrs. Harper, Harper and Scott's letter of 25th November, 1879—and I had been further credited a considerable sum debited to me, but expended for the Company—the balance of my account to be dealt with would have been largely in my favor."*

I do not think it necessary to say more than that, in my judgment, and in that of all friends whom I have consulted, my expectation of a large augmentation to my salary was well


In June, 1876, after paying 8 per cent, interest, there was placed to Reserve £20,000 0 0
In June, 1877, after paying 8 per cent, interest, there was placed to Reserve 6,250 0 0
In June, 1878, after paying 10 per cent, interest, there was placed to Reserve 13,750 0 0
In June, 1879, after paying 10 per cent, interest, there was placed to Reserve 15,000 0 0
£55,000 0 0
Of the last amount I do not claim per centage after 1st December, 1878, because I then accepted the altered salary, say 7/12ths of the £15,000 8,750 0 0
But I claim on 46,250 0 0
And that my account should be credited a tithe 4,625 0 0
To this should be added, vide the Solicitor's letter of 25th November, 1879 1,750 0 0
And also a credit of about 250 0 0
So that my account should altogether have been credited with about £6,625 0 0
page 19 founded; and further, that if the proceeding of your Directors was in consequence of the state of my account, it would have been more frank to have said so than to have based my suspension on my refusal to sign an agreement which, if implemented, would have effectually barred my rights, and utterly destroyed my independence.

It would be unbecoming in me (whatever my opinion may be) to impute other motives than the Company's interests, which are professedly so jealously guarded; time will probably justify me, and I am content to wait a while; but I cannot conclude without tendering my most grateful acknowledgments to those of your number who, in full knowledge of the facts, have expressed their sympathy with, and undiminished confidence in me; and I appreciate very highly the spontaneous testimony borne by many of the Company's most important constituents to my zeal and efficiency in conserving and promoting your interests, which I take leave to say I most loyally studied during all the time I had charge of your business.

I am, Gentlemen,

Your obedient Servant,

H. Selwyn Smith.

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