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Charge Over Car Protect

CANBERRA. Sent. 25.

By failing to honor tne terms of a contract, the Com monwealth Engineering Co., nf which three of the five

directors were appoiniea ay the Commonwealth, had probably killed the Hartnett all-Australian car project stone dead, Mr. Watkins (Lab., NSW) said .in the House of Representatives to night. He said that in May, 1950. the Hartnett Motor . Co. placed an order with the CEC for complete sets of panels. CEC provided a Common wealth Bank guarantee of performance for £14,400. In return the Hartnett Co. provided CEC with a letter of credit. By June, 1952. the Hart nett Co. had not received a single unit. The more the company complained to CEC about the non-performance of the contract the more dilatory CEC became. Finally the company col lected the amount of the guarantee and placed it in trust. CEC then went to the NSW Supreme Court and placed an injunction against the Hartnett Co.. which sealed its bank account, and demanded arbitration. ! This virtually brought the Hartnett Co. to a standstill. The company would now have to face an expensive case which would take months to determine.

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