IMPORTANT MERCANTILE DECISION.

Auckland Star, Volume XVIII, Issue 270, 16 November 1887, Page 5

IMPORTANT MERCANTILE DECISION.

AN AUCKLAND APPEAL CASE,

The Court of Appeal has just given judgment allowing an appeal from the decision of Mr Justice Ward, given here on the 17th August last, upon a special case stated by the P.M. afc Whangarei for Mr Justice Ward's opinion. It will be remembered that the Bank of New Zealand some time ago sued Mr Harrison, at Whangarei, as maker of a promissory note for £53 9d, and upon the hearing before Mr Clendon, R.M. afc Whangarei, he gave judgment for the .bank. Mr Harrison then appealed to the Supreme Court here, and upon the argument Mr Theo. Cooper appeared lor Harrison to support the appeal and Mr Button for the respondent, Bank. Mr Justice Ward allow c! the appeal with costs, and the bank then carried the case to the Court of Appeal. We now learn that the Bank's appeal has been allowed, and Mr Justice Ward's decision reversed with costs. The circumstances of the case were these : Burt and Harrison made a promissory note in favour of Pritchard and Co. Harrison then endorsed it and delivered it to Pritchard and Co. The note was then insufficiently stamped. Pritchard and' Co. then endorsed " Pritchard and Co. without recourse " above Harrison's signature, and simply below that signature Pritchard and Co. put a proper stamp on the note, bufc did not cancel it. The note was paid into the bank. The manager then cancelled the stamp, writing the date, August 17. 1886, on it. The question was whether the note was properly stamped. Mr Bell appeared for the appellant. Mr Travers, for the respondent, having addressed the Court, His Honor the Chief Justice said: lam of opinion this appeal must be allowed. I have no reason to be dissatisfied with the judgment, McLaren v. Walker (quoted in the case), namely, that; the endorser of a promissory note may affix the stamp. The real question here is whether the holder can swear to this note,. it being admitted that the stamp was affixed but not canselled. ■ I think he can. I think any person who becomes the holder can do so. There is a distinction between stamping and cancellation. In some cases no doubt cancellation is a component part of the stamping, that is unless you can prove that the stamp was duly affixed, the cancellation is a component part; but if you can prove that the stamp was affixed by the proper person afc the proper time, then cancellation is not necessary. It is said that the penalty imposed by section 73 prevents that rule applying to a bill of exchange, there being a penalty imposed on a person who-does not affix and cancel a stamp. Section 62 also has a penal clause for not cancelling It is manifest that in some cases it is nob necessary that the stamp be cancelled, otherwise tjhere would not be this provision to section 61. Then section 78 is said to prevent tho application of 61. If I have not erred iv thinking that cancellation is nofc inherent in Stamping, section 78 does not render this note incapable of being used in evidence if it was stamped, though the stamp was nob cancelled. I conclude thafc section 61 enables the holder to rely on the stamping if the stamp be affixed by the right person at the proper time. lam nofc satisfied thafc a promissory note is within the extending clauses of the Act, 1385. Mr Justice Gillies : I agree with his Honor thafc the provisions of section 61 enable a promissory note to be stamped without cancellation, and to make it available any endorser, and not only the first, can affix the stamp. Mr Justice Williams : I am satisfied we are bound by the decision in McLaren v. Walker. It is highly important where the highest tribunal gives a decision on an important point of mercantile law that the decision shotild be adhered to by all the Courts of the colony. According to McLaren v. Walker the stamps were affixed by the proper person afc the proper time. The question resolves itself into this, does section 61 apply to promissory notes? No reason has been given to us why it ib should nofc apply to all instruments stamped with adhesive stamps. The main argument — that the first sub-section of section 61 does nob apply—is that by section 73 a penalty is imposed on persons who fix and do nob cancel the stamps. That, does not convince me that; section (il does not apply. There is a similar provision iv section 72 affecting other instruments. Looking at the mode in which these Acts ought to be construed, I am satisfied the stamping in this case was sufficient. The person who affixed the stamps may be liable to a penalty, and yet the stamping be sufficient. Judcrment reversed, with costs in the Court of Appeal aud the Court below.