The Press. TUESDAY, JANUARY 7, 1879.

Press, Volume XXXI, Issue 4195, 7 January 1879, Page 2

The Press. TUESDAY, JANUARY 7, 1879.

A CHANGE haa just taken place in the law respecting the assignment of debts, the precise nature and extent of which requires some consideration. In order to make oar meaning perfectly clear we must commence a little way back. According to the law of England it has always been technically impossible to make a valid assignment of a debt, and tiie conveyancers of the mother country have been in the habit of evading the difficulty by adding to the formal assignment a power of attorney enabling the assignee of the debt to sue for it t_ the name of the original creditor. It'was but a roundabout proceeding at best, and, inasmuch as the. power of attorney in question had- to "provide for all the possible incidents of litigation, as well as to include such ancillary matters as giving receipts aad otherwise releasing ihe debtor, the assignment of a debt, we need not say, is according to English practice a somewhat lengthy doeasaent-. While, however, this was the ease at law, it was possible in equity to obtain a valid right to a debt without resorting to this cumbrous operation. Any writing by which the creditor purported to assign the debt was held sufficient in equity, if the purchaser of it gave notice to the debtor that the debt was bow assigned to himself. In a general way it was desirable that the debtor should also accept the notice. But strictly speaking wa think we are not incorrect in saying _hat without thia formality tha Court ot Chancery .would enforce aa alignment in writing of which notice had been given to ihe debtor. This proceeding was ©Wioasly simple enough,'and perhaps the only objection to it was, that it required a Chan--4sgrr suit to get the benefit st it J5_M& has always been, the state o£ thoogs ia Iv _iew £eaiaod

the matter has rested upon an entirely different footing. A short and simple enactment in the Conveyancing Ordinance got rid at once of both the legal and equitable difficulties which at home we have seen to be incident to the assignment of a debt. By the ninth sectiop it is provided that every debt " may "be conveyed or assigned by deed;" and, for the past five-and-twenty years, it has been the every-day course in the legal profession to prepare deeds assigning for the benefit of their clients either some specified debts, or not --frequently all the debts, which then were due, or even should become due, to the party executing the assignment."

This has been the law of New Zealand from 1842 to the present time. It is law no longer. By the recent Act the .ipctment we havo' jiisfc cited is repealed, and in place of it a - new provision is inserted into the statute book which is practically tantamount, we take it, to the adoption of the English equity system. Instead of a deed being necessary, any writing is now to bo sufficient. But notice must in all cases be given to the debtor. The Act farther provides that the assignment is to be subject to any equities which would have been available under the former law, and that if the debtor has notice that the assignment is disputed he may interplead and leave the assignee to fight it out with the contending claimant.

It is not all at once that we recognise the necessity of the new enactment. The law hitherto in existence has been in operation, as we have said, for a quarter of a century, and certainly there has been, no general complaint of ill effects having arisen from its operation. As regarded the immediate parties it was impossible to find fault with its simplicity or its effectiveness. It gave the purchaser of tho debt, by means of a concise and clear form of words, an absolute right to require payment from the person who-owed it, and it vested in him, moreover, precisely the same legal remedy which had belonged to the origin_P creditor.' -As regarded the debtor, however, it was obviously more open to objection. It was possible that the debtor, to whom it was not legally necessary to give notice of the assignment, might innocently pay his debt to the wrong person, and thus, as he wonld not obtain a valid receipt, might have to pay bis debt twice over. Such an objection, if practical, would, of -course, be fatal, and it is impossible to say that it had no existence. No doubt, it was considerably modified in practice. The purchaser ,of the debt, without being i legally bound to inform the debtor, did so in common prudence for his own sake.

-, It cannot be denied that the Ordinance of 1842 does, by its unguardedness, leave an opening to the danger we have suggested, and that put abstractedly it goes the full length of making it unsafe at any time for a debtor to pay his debt, to any body. He eohld not know to whom his j debt belonged at the moment of his being ! called upon to pay it. An assignment of debts comes neither within the Act for | the registration of deeds nor within the Acts for the registration of bills of sale !or mortgages of stock. It was an absolutely secret document. Its existence was not necessarily known to anybody beyond the original creditor and his assignee. And it might easily be;part of the arrangement that the deed should be kept secret. Assignments of debts are usually resorted to as a means eof postponing the claims of inconvenient and pressing creditors. Those who gave them would feel that their ■ credit was' gone if the, fact were once made public, and those who taka them would be anxious if possible to uphold the credit of their assignor, with whom probably they would be having other dealings, and would, therefore, have a motive for concnrring in the desired secrecy.! This considered, it is impossible not io feel that the third party, whose liability was thus being dealt with, needed at least the protection of being informed of what was done. We. __ink, therefore, that the Act has --footed . a change sufficiently called for, and that the provisions by which it is accompanied aro judicious and wellconsidered.

"We trust that the remarks of his Honor Mr. Justice Johnston, on the prevalence of the crime of forgery and uttering, will not. be allowed to pass altogether unnoticed. As was pointed out, this great crime will- never be fully ■ eradicated until the awake to a just sense of their responsibilities. If opportunities are afforded—nay, invited— to the commission of this crime, men will be found to risk the consequences" of detection and punishment for the sake of present gain. It is quite true, of course, that it is .almost impossible to conduct business in these colonies without accepting cheques in payment for goods.; But it is surely, possible io do so _ without running the risk attendant upon receiving such- documents from entire strangers. Yet this appears io he constantly the practice among ; some j of our tradesmen.. As His Honor justly remarked, it is very difficult to draw the line between the culpability and stupidity of such persons. That they are more than stupid in many ii_.tance#„_ew will deny. It is not only that they suffer themselves by their set; they impose a heavy burden upon the colony. \ The apprehension and conviction of jevery criminal involves a considerable expenditure out of the public treasury. That expenditure might be largely reduced were tradesmen to exercise more caution and prudence in their dealings with customers. bLet them forego the small profit attaching to the sale of an article when payment for it is tendered by a stranger iv the form of a cheque. By so acting they will be gainers in Ihe long run, they will save the colony a; considerable expenditure, and they will avoid the possibility of some day being publicly charged, with being participators inbthe crime of forgery.