HIRE AND PURCHASE SYSTEM

Auckland Star, Volume XLIV, Issue 33, 7 February 1913, Page 2

HIRE AND PURCHASE SYSTEM

A BANKRUPT AND HIS FARM IMPLEMENTS. WRONGFULLY TAKEN POSSESSION OF. At the Supreme Court civil sittings today, Mr. Justice Cooper delivered his reserved judgment in the case in wiiieh the Official Assignee, under the Bankruptcy Act, 1908, applied for an order declaring that certain goods (a single-furrow disc .plough and a hoe drill) taken by the '(Mas3ey-Harris Company from the farm iof Thomas Wylie, a bankrupt farmer, of liongotea, were part of the property of the. bankrupt passing to the Official Assignee. The goods were purchased on the " hire and purchase" system, were valued altogether at £53 10/, and the sum of £20 6/8 had been paid on them. The principle governing cases under section Gl of the Bankruptcy Act, stated the judgment, was Urat when a man was in possession of goods which were appaTentLy his own, it was only right that, if the true owner allowed the man to have possession of hie goods under circumstances which might induce others to trust him, he should be stopped from coming forward and insisting that the goods were his, thus taking from the creditors a part of that which they looked to as being the fund out of which their debts were to be paid. The presumption of ownership, however, might be rebutted by evidence of a well-known —or, as some of the judges had termed it, & notorious—usage or custom that particular goods within such usa"e or custom might by by such usa»e or custom in the possession of persons who were not the true owners. The case appeared to be the first case in which it had been alleged before the Court that the usage exists in the Dominion Consequently the onus of proof rested upon the person setting up the usage. In his Honor's opinion, • the Massrey ilarris Company had entirely failed to prove that in the Auckland provincial district the practice of supplying a<ricultural implements on the hire-purchase system had existed so long, and had been so extensively acted upon that ordinary creditors of a fanner in the district might be reasonably presumed to have known of it. The affidavits filed byThe Official Assignee in support of the motion made it, to his Honor's mind, quite clear that there was no such notorious usage in this district. His Honor thought that any creditor dealing with the bankrupt could reasonably and naturally presume that his ploughs and drills were his own, property.. Persons parting with the possession of goods under a hire and purchase agreement could get absolute security if they registered the instru ment, and it might be wise for them to do so. The motion of the Official Assignee was allowed with costs.

His Honor remarked that although the amount involved was very small, a very important principle was involved, and possibly the Massey Harris Company might desire to appeal.

Mr. J. R- Reed, KjC., instructed by Mr. C. E. Walker, appeared for the Official, Assignee, and Mr. Fred Earl for the Massey Harris Company.