BACKING A P.N.

Auckland Star, Volume LVIII, Issue 150, 28 June 1927, Page 8

BACKING A P.N.

CITIZENS OF MORRINSVILLE.

ONE GUARANTEE CALLED UP.

APPEAL TO SUPREME COURT.

(By Telegraph.—Own Correspondent.)

HAMILTON, this day.

An interesting appeal from the judgment of Mr. F. W. Platts, S.M., at Morrinsville, was heard by Mr. Justice Herdman. The original action was one in which W. J. Enyon, contractor, of Morrinsville, proceeded against R. G. Vivian, a well-known business man of the town, for the payment of £40, the amount of a surety given in connection with a promissory note which he had backed in respect of a loan of £220. The loan was made by Enyon to P. C. Warner, formerly a picture theatre proprietor at Morrinsville, and now of Tauranga. The case in the Lower Court was in the nature of a test case, as a series of six promissory notes was given by various people in Morrinsville. In October, 1924, there was about £240 owing by Warner to Enyon for advances made since 1923. In October Warner was out of a job, and he approached Enyon to obtain money to buy a motor truck. Warner was already indebted to Enyon for a considerable sum, and Warner said he would be better able to pay the old debt if he had a truck. Enyon agreed to advance the money provided the promissory note were backed by six approved citizens, and that the first earnings from the truck were used for paying off the old debt. Payments Met at First. The promissory notes were backed by defendant (A. G. Vivian), A. Beange, S. Bain, J. Bain, £. McGregor, and Dr. Seville. Warner made his payments regularly up to April, and it was recognised that none of the backers would be called upon unless he defaulted. Warner later left Morrinsville and went to Tauranga, and frequently rang up from there asking that his notes be not presented, as he would try to pay the amounts himself. This went on for a long time, and Enyon ultimately presented the notes, which were all dishonoured. Since then, however, Warner has made payments, one of £10 and eleven of £5. Secret Agreement Alleged. The magistrate gave judgment for the plaintiff for the amount claimed, with interest. Against this judgment an appeal was lodged. Mr. Northcroft, for the appellant, alleged that there was a secret agreement between Enyon and Warner not to present the demand note for payment until the expiry of six months from December, 1926. This was not disclosed, to the guarantors.

(Proceeding.)