FARMERS' FINANCE

Press, Volume LXIX, Issue 20772, 4 February 1933, Page 16

FARMERS' FINANCE

WORK OF ADJUSTMENT COMMISSION. CHAMBER OF COMMERCE PLAN WIDELY USED. Of 667 applications which have been filed to date, tho Mortgagors' Adjustment Commission for the Canterbury and Westland district has dealt with 470. Thirty-six cases have been dealt with since the Commission resumed its sittings on January 23. Most-of the applications relate to farm properties. Mr J. E. Cuningham, chairman of the Commission, said yesterday in reply to a question that the farmers' finance scheme prepared by the Canterbury Chamber of Commerce was, with certain modifications, used widely as a basis of adjustment. The scheme provided for a pooling of the revenue from a farm over a period of 12 months, and a distribution of that revenue between mortgagees and stock firms according to the debts owing to those P "we have found the Chamber _ of Commerce scheme as a basis of ad3ustment to be of real value in our work, said Mr Cuningham. "In Canterbury it is used very generally, mo only difficulty about it is that it operates in each case for a year, so that, unless the interested parties are prepared to make a private arrangement among themselves, each case may have to be reviewed at the commencement of tne next farming season." Division of Profits. Mr Cuningham explained that at the end of tho farming year the first payment from revenue, was to the stock firm which had advanced the money for the farmer to carry on for that year. The revenue then remaining was snared, on a pro rata basis among the Urst mortgagees or lessors, as the case may be, and the stock firm on its fixed account, which had been held in abeyance during the year. . -,, The general application of the Chamber of Commerce plan was confirmed oy a director of a stock and station agency firm. The scheme, ho said, was designed to keep the farmer on his farm under conditions that were as fair as possible to him, to the mortgagee, and to the banker. In where a farmer applied to the Courts for relief, some division of profits was ordered on the basis of the Chamber of Commerce plan. The Mortgagors' Adiustment Commission frequently altered adjustments to the terms of the scheme, and the PubUc Trustee used it very extensively. , , , t "It has been recently suggested, he -continued, "that under the scheme the land mortgagee has been getting a fair share of the profits. Last year was not a fair year on which to judge the scheme—the mortgagee did not receive interest under the prontsharin* arrangement because, owing to the drought and the low prices, there were.no profits to share, the farmer barely making expenses. This year, when" "we are expecting heavy crops, mortgagees wiU find the scheme working admirably, especially in respect of agricultural farms, from which m many cases full interest will be forthcoming." ■.-•■'■■ A member: of a legal firm which is closely acquainted with farming and mortgage business said the Chamber of Commerce jscnefb* had parked very well r indMd:-- : ltf Mortgagors' Adjuß*4hent w«rc set up, and in "many if iad been accepted voluntarily by the parties concerned. The principles.: of adjustment that had been first enunciated by tho Chamber had been extensively used. .Following the presentation Chamber of-Commerce plan, sonie firms had brought forward pooling ■ schemes of their own; but these schemes were, in general, similar in their nature to that of the Chamber of Commerce. Mortgagee's Position. "On the whole," he said, "I think tho land mortgagee has been fairly treated under the Chamber of Commerce plan. A very considerable number of stock and station agents in otner parts of New Zealand do not subscribe to the scheme in its entirety; but the basic principles of the scheme are generally accepted." It has been suggested by one stock firm that the divisible : revenue, should be distributed not on a basis of capital debt but on one of interest, which would- place the- stock firni on better footing. The idea is advanced'in view of the fact that such a firm's security—stock, farm equipment, ctc.-r-is> a wasting one, differing in that, way from tho mortgagee's security of the land itself. ■*'.'■■ ■'■■'";' -•■■■■