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DISTRICT COURT

r ASHBURTON—SATURDAY. | IN BANKRUPTCY. (Before his Honor Judge Ward.) In re Joseph Clark. Motion' for admission of proof qf debt of. Bank of New South Wnles.' In tliis' case his Honor gave' fiie following decision : —lt appears that a guarantee to the above Bank "was givenby the bank-' rupt (with' others) m the words fojlo wing: —" In consideration of {he Bank'of New South Wales' allowing the Ashburtoh Cheese and 'Baitter Factory Cftinpany, Limited, a current overdraft, or otherwisje advancing moneys on their account toi the extent of three) thousand pounds sterling, wa jointly and severally guarantee' the repayment upon demand of any seem due by the said Ashburton Cheese and Butter Factory Company; Limited, not exceeding three thousand pounds aforesaid, arid a further sum equal to one year's interest thereon. This undertaking to be a continuing security ■ to' the said' Bank until withdrawn m writing notwithstanding any ■■settlement oi account, intervening payments or any other matter or thing whatsoever to the contrary, and to be irrespective of any other security the Bank may hold. Dated at Ashburton this twenty-fourth day of August, 188 G." Sundry; p'4y&ehtft, made by f .{;li| "guarantors to £lie Bank, reducing the total ■ amount due to the sum of £207 9s 7d ; the whole of which—as among the guarantors—was due by the bankrupt, Joseph' Clark, and by-Wheeler, who had not pliitl hip fcheu 4 cbhtributions on the guarantee. Clark became bankrupt on i the ninth January, 181)0; and on the 28th April then next ensuing the Bank ppt m a proof on his estate for the above sum of £207. Prior to this last date, on tie; 13th March,, 1890, the Bank issued a wriifr against I'riedlander (one of the guarantors) for the above amount. A defence was raised to the action : and ultimately, on 3rd July, the Bank accepted from-Ftied-lander the sum of £105 m full settlement of their claim* releasing Friedlander altogether, and giving uj?> the' ; guaranteed jb is alleged by Mr Wilding that an agree-* ment was .made between Friddlandeif's solicitors and himself as solicitor to the, Bank, that the Bank should be allowed toil prove on Clark's estate for the full amount dile >oii the? guarantee! prior to the payment m settlement of the action, ;(£2o7)»iand should:*recfeive* the dividend thereon. This agreement was denied lay Friedlander, and contradicted by the letter from Messrs Harper annexed to his affidavit; but no affidavit was made by the latter. Even admitting the perfect correctness of Mr Wilding's statement, I cannot see how he can succeed m the present motion. According to the old case Chutham v. Ward, 1 Bos. and P. 630, the discharge of one; joint and several surity dischargetfallhisco-sureities. Therefore the discharge of Friedlander by the Bank discharged the bankrupt or rather the official tu^ignee who stood m his place from all liability to the Bank on ,the guarantee, of course leaving Friedi lander to prove on Clark, estate for the contribution due by him on the amount paid to the Bank for obtaining, such discharge. No agreement between, Friedlander and the Bank affiacts the' official assignee. Had the Bank's proof bepn admitted, they Avould not have been entitled to receive any dividends declared after Friedlinder's release ; though they might of course have retained any paid prior to it. Section 130,,0f the Bankruptcy Act does not apply to the case ; ncr so far as I have been able to ascertain do any of the numerous authorities cited on either side. Motion dismissed with costs.

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Permanent link to this item

https://paperspast.natlib.govt.nz/newspapers/AG18901025.2.18

Bibliographic details

DISTRICT COURT, Ashburton Guardian, Volume VII, Issue 2553, 25 October 1890

Word Count
583

DISTRICT COURT Ashburton Guardian, Volume VII, Issue 2553, 25 October 1890

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