GREAT BRITAIN: Kylsant to Wormwood Scrubs

Kylsant to Wormwood Scrubs

Sir John Simon, the British Empire's august new Secretary of State for Foreign Affairs (see p. 19) toiled most of last week at the congenial task of earning $125.000 by his efforts to win an appeal in the case of famed Baron Kylsant of Carmarthen, sentenced to one year's imprisonment for sponsoring a misleading stock prospectus (TIME, Aug. 10, et ante).

Sir John, arguing for Lord Kylsant before Mr. Justice Avory of the Court of Criminal Appeal, lightly brushed aside the fact that some thousands of small investors bought British Royal Mail stock on the basis of the offending prospectus and lost most of their investment. "Surely it is a sad thing," cried Sir John, "if something economical in its information [the prospectus] is to be declared a falsehood. . . . Every word, every figure in the prospectus was accurate. . . . The average of ten years earnings by the Royal Mail which it contained was absolutely correct!"

In & out of Court, as the appeal proceeded, stalked Lord Kylsant, the appellant, one of the most impressive peers in Britain, a man more than six and a half feet tall, broad in proportion and fault- lessly garbed in cutaway and silk hat. Several times the Baron arrived at Court and departed from it in his twinkling limousine. But when the time came for Mr. Justice Avory to deliver his verdict on the appeal Lord Kylsant stalked to a cell, bent his massive head to enter and seated his great frame on the small cell chair to wait.

In Court the Baron's son-in-law, the Earl of Coventry, fidgeted and fumed while Justice Avory delivered his 55-minute verdict in the iciest tradition of the British bar. For fully 40 minutes it was impossible to tell whether he was granting the appeal or denying it. But at last Mr. Justice Avory came to his passionless point: "In the opinion of this Court there is ample evidence . . . that this prospectus was false in material, particularly if it conveyed a false impression.

"The falsity in this case consists in putting before intending investors, as material upon which they can exercise judgment as to the existing position of the company, figures which apparently disclose the existing position but in fact conceal it.

"The implication arises particularly from the statement that dividends had been paid regularly over a term of years, although times had been bad—a statement which was entirely misleading [since] the fact that they were not paid out of current earnings but out of earnings in the abnormal War period is omitted. . . .

"This appeal is therefore denied.

" Up jumped the Earl of Coventry, rushed to his father-in-law's cell and acquainted Lord Kylsant with the failure of his appeal. Lady Kylsant arrived sobbing. She and the huge man who had been called "Napoleon of the Seas" when he dominated the White Star, Royal Mail and numerous other lines (TIME, Feb. 23) had a last embrace. Then Lord Kylsant said to two warders who were hovering nearby, "My good men, I am ready to go with you."

This time no Kylsant limousine waited. The two warders, dwarfed in size by their charge, cried: "Taxi! Hi, taxi!" When the cab drew up Lord Kylsant entered and sat down with a crunch. Asked the taxi driver, "Where to?"