'File 14/115 VII Annex (B 9) Abu Musa oxide: collected background material on the case' [‎94r] (198/1904)

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eXprii effeSy ^ COmiection8 ' and would not be in a position to organise the
r As n r ' ; Vi *' ' t C 'i agreed ^P on > ^ roust be considered as auite sufficient. It must
be recollected that ^ July 1902 Malcolm, acting on behalf of Strick and Co., offered
7s. bo. per on, i.e., less than half the price here stipulated.
.. to noted thiat the company is not bound for ever by the
d, ' h eei "" ^ i er ie expirniion of lour years Wonckhaus has only a prior right to a
new agreement on the same terms as the old one, or on the terms offered by compe-
iIij0IS ' 0 " ^ omp a ny m any case has a chance of obtaining higher prices in
consequence of competiuion, while on the other hand it cannot in any circumstances be
forced to continue the agreement at lower prices than before. It is true that the
^ompaii} c^unoL P^ 0 t hy momentary rises of price, but as matters stand it is very
doubttul whether the company could in any case utilise such momentary rises ; on the
ovifci rani i, it is in a position to derive the full benefit from a rise in the average price,
^ can on -y be estimated at intervals of considerable length ; while if, at the end
ot ■ e tour years, tae average price is lower than the price stipulated in the agreement,
the company regains complete freedom.
' what has been stated above, the conclusion must be that the agreement
' ' f, ! ' ' ,1 . ICa 18 advantageous to the company, and that the disadvantages arising
lium a certain limitation of freedom of action are considerably outweighed by the
advantages presented by a certainty of selling for several years at adequate prices,
xiassan bamaih was acting entirely in the interest of the company when he concluded
the agreement with Mr. Wonckhaus ; if he had neglected this opportunity doubts as to
his business capacity would have been fully justified.
The result of the above examination, then, is that, assuming that Sheikh Sakar
had a right to decide the matter as a judge—which is disputed—his decision could not
possibly be to the effect that the lease agreement should be cancelled. Taking the most
liberal view of his powers, he could only deal with the
ana pronounce judgment on the question whether Hassan Samaih ought to pay com
pensation to the plaintiff partner on account of the conclusion of this agreement. It
has been proved, in the first place, that the partners gave their approval to the agreement ;
m the second place, that their approval was not necessary, because Hassan Samaih, on the
strength of his powers as manager, had authority to conclude the agreement indepen
dently, whether such authority was expressly granted him by the Memorandum of
Association or whether it is to be considered as having been admitted in practice by his
having been allowed to exercise it without dispute for many years. This disposes of
the fiiSu ground on which a decision unfavourable to Hassan Bamaih might have been
given.
It has further been shown that the agreement with Mr. Wonckhaus is advantageous
to the company, and that by its conclusion the interests of the individual partners have
been secured as completely as circumstances admit. It follows that, from this ooint of
view also, a decision unfavourable to Hassan Samaih could not be given, especially as
evidence is produced showing that the partners approved of the agreement, which
approval would preclude them from claiming any compensation, even if the agreement
were really disadvantageous.
Accordingly Isa's complaint is entirely unfounded, and there was no legal ground
f or Sheikh Sakar to give any judicial decision unfavourable to Hassan Samaih. The
decision pronounced must therefore be regarded as entirely contrary to justice.
2. Could Sheikh.Sakar cancel the Lease Agr
of the administration
I he various letters from Sheikh Sakar to Hassan Samaih, in which he pronounces
the cancellation of the lease agreement and orders the cessation of the work, as well as
certain letters from Abdallatif, show clearly that Sheikh Sakar was induced partly bv
political considerations to take steps against the mining company.
Looking at the matter from this point of view, the objections which Sakar has to make
to the agreement with Mr. Wonckhaus are the following : He regards this agreement as a
sub-letting of the oxide mines to third parties who are not British subjects, but subiects
of a foreign Power, whereas, he argues, according to the terms of the original agreement
the partners have to work the mines themselves, and may not lease them to others.'
Sakar fears that now that a foreigner is one of the parties interested in the mines, the
* See p. 15, and annex 43.
[2574 c—l]