COMPANY SHARES.

Auckland Star, Volume LXIV, Issue 145, 22 June 1933, Page 5

COMPANY SHARES.

APPEAL COURT CASE. MORTGAGORS' RELIEF ACT. MODERN MEANING OF « CHATTELS." (By Telegraph.—Press Association.) WELLINGTON, Wednesday. The Court of Appeal to-day considered an important legal question, whether or not the Mortgagors' Relief Act, 1931, and amendments, applied to mortgages on shares in companies. An application was filed in the Supreme Court, Wellington, under the Mortgagors' Relief Act, 1931, and the Mortgagors and Tenants' Belief Act, 1932, on behalf of a mortgagor for relief in respect of a mortgage executed in July, 1930, over three parcels of bank shares, securing repayment of £3000 and interest. The question whether the Act extended to cover such mortgage presenting some difficulty, the matter was heard by the Full Court, consisting of the Chief Justice, Sir Michael Myers, Mr. Justice Herdman, Mr. Justice MacGregor, Mr. Justice Blair, and Mr. Justice Kennedy.

Counsel for the mortgagor, after referring to tile section of the Mortgagors' Relief Act wherein a mortgage is defined as "any deed, etc., whereby security for payment of moneys or for performance of any contract is granted over land or chattels, or any interest therein respectively," submitted that the word "chattels" should be given the modern meaning, which was "any type of property except real property." He submitted that the history of the mortgagors' relief legislation clearly showed that the Legislature had adopted the word in the widest and most modern sense. Such meaning would be sufficiently wide to cover clioses in action, such as shares in a company.

Counsel for the mortgagee contended that the Court should adopt the older and narrower meaning of the word, which restricted the term "chattels" to tangible personal property. He dealt at length with difficulties which would arise in connection with local body loans in the event of choses in action being held to be chattels within the meaning of the relief legislation.

The Court reserved its decision