SEIZED CAR.

Auckland Star, Volume LXI, Issue 219, 16 September 1930, Page 9

SEIZED CAR.

IMPORTANT TEST CASE.

GENERAL MOTORS SUED.

HIRE-PURCHASE AC

QUESTION OF OWNERSHIP.

(By Telegraph.—Otto Correspondent.) H AMILTON, this day. In September of last year the agents of General Motors Acceptance Corporation seized a large number of motor vehicles in and around Taumarunui that had been purchased through the agency of Bishara Brothers, who shortly afterwards became bankrupt. J. M. Bishara and his accountant, Geoffrey A. Trayhurn, later were sentenced to terms of imprisonment for "double financing" frauds.

To-day, at the Supreme Court, before Mr, Justice Smith, the possessor of one of the seized cars proceeded against General Motors Acceptance Corporation. He set out in his statement of claim that defendant had wrongfully seized a car belonging to him and sold it to a person unknown. He sought judgment for £250, the value «f the car, and £100 damages for wrongful seizure.

Defendants' Denials.

The defendant corporation admitted that .plaintiff had possession of the car on September 19, 1929, but denied that the car was worth £250. They also denied that plaintiff was entitled to possession of the ear, and said they had no knowledge of arrangements between plaintiff and the Trades Finance Corporation. Ltd.

It was admitted that the car was seized and sold, but defendants denied that the seizure was wrongful. Thcv stated that on April 23, 19*29, they entered into a customary hire-purchase agreement with Trayhurn, whereby the latter became conditional purchaser ot the car from defendant. The agreement entered into with Trayhurn provided that property in the far should not pass to Trayhurn until the completion of payments due. At the time of the seizure of the car Trayhurn had not completed the payments due. Defendants further contended that at no time had plaintiff anv title in the car as against the corporation Prior + o September 19, 1929, Trayhurn had made default in payment of moneys payable to the corporation, in that -i n instalment due on August 23 had not been paid at the time of the seizure. Defendants contended that Travhurn, in breach of a provision of the'agreement with the corporation, had purported to sell and parted with possession of the car.

Case for Plaintiff.

Mr. Cordon, of _Taumarunui, said the plaintiff was a painter and builder. The defendants were an American corporation carrying on business in various parts ox the world in connection with the financing of sales of motor cars, primarily those .manufactured by General Motors. Prior to September last a firm Known as Bishara ..Brothers traded as motor agents in Taumarunui. Lr April, 1929, plaintiff agreed to buy a car from Bisuara Brothers for £250. Two days later he paid £50 deposit to J. J£ Bishara. He signed a conditional purchase agreement, under which he was to pay the balance by instalments to Bishara Brothers. This agreement wn assigned by Bishara Brothers to the Traders' Finance Company of New Zealand, a company engaged in financing the sale of motor cars. Plaintiff took possession of the car and held it until September last. He garaged it at his nome. While it was parked on a vacant' section in the town it was seized by defendants. He had only run the car about 400 miles, and had kept up his monthly payments to Bishara Brothers. On .learning the car had been seized he immediately saw Vincent, the agent of the defendant company, and demanded to be told by what right it had been seized. He was told the vehicle belonged to the defendant company. He made efforts to get the car back, but was unable to do so. Defendants later sold the caT to a dealer for £175. Plaintiff considered the value of the ear at the time of the seizure was £240.

Relationship of Agents. ■ The defence, said Mr. Gordon, was that . the car was the propertv of the defendant company. Samuel Bishara father of ,T. 31. Bishara. was an j auctioneer residing in Taumarunui. For a short time Samuel Bishara, Ltd., acted as distributors for General Motors products in Tanmarunul. His sons eventually went into the business, and J. M. Bishara started as Bishara Bros., although he had no finance. Samuel ' Bishara, Ltd., was regarded as financially strong. General Motors was anxious to retain the guarantee of S. Bishara, Ltd., and all agreements effected by Bishara Bros, were expected to be backed by S. Bishara, Ltd. Where goods "were not paid for in cash they were consigned to S. Bishara, Ltd. Counsel said the exact relationship between S. Bishara, Ltd. and Bishara Bros had never been properly defined, but counsel contended that the car in question was the property of Bishara Bros., and had nothing whatever to do with Samuel Bishara.

Constitution of General Motors. Mr. H. F. O'Learv, of Wellington, for the defendant company, contended that the car was tile property of the corporation and at fie time of the purported sale irom Bishara and Trayhurn to O'Reilly "was subject to the customary hire-purchase agreement, and the title eonld not be taken away from the defendant corporation. The ease arose oat of a fraud. Bishara and Trayhurn were "double-financing," first, by dealins with Genera] Motors Acceptance Corporation, and. second, with the Traders Finance Co. Explaining the constitution of the Acceptance Corporation, counsel said the parent company was in America and was known as General Motors Corporation. One subsidiary company was General Motors Export Corporation, and another was General Motors Acceptance Corporation. One was a trading cdmpanv and the other a financing company. The* export corporation established companies in various countries, and in New Zealand the trading company was General Motors (XZ), Ltd. Wherever one of these assembling companies became established an acceptance corporation also went. The assembling company was entirely a separate concern from the acceptance corporation. General Motors (3LZ.), Ltd., traded only for cash, the idea being that the assembling company must be" entirely free from jnancial worries- In the "first place deals took | place between distributors and the assembling company. If a dealer could pay cash he did so. If he could not do so'the assembling company turned him over to the acceptance corporation. The acceptance corporation, whilst financing'

all credit sales, never had lent and would not lend money by way of loan. This system operated extensively in Britain.

Counsel said. Samuel Bishara was appointed distributor for General Motors 3 products in Taumarunui. After a time J. M. Bishara entered the business and was assisted largely by Trayhurn, who at one time had -worked for General Motors at Petone. Although there had been correspondence "with. Bishara Bros., Samnel Bishara had always guaranteed any purchases, and General Motors always believed they were dealing with Samuel Bishara. (Proceeding.)