MORTGAGORS AND TENANTS.

Press, Volume LXIX, Issue 20790, 25 February 1933, Page 14

MORTGAGORS AND TENANTS.

UNJUST FORECLOSURES. preventive legislation PASSED. [From Ocfk Parliamentary Reporter.. WELLINGTON, February 24. Further relief to mortgagors and lessees with the object of protecting them against 'unjust foreclosure and of preventing them from contracting themselves out of the benefits of the Mortgagors Relief Act is provided iu the Mortgagors and Tenants Relief Amendment Bill which was introduced into the House of Representatives to-day, and put through all its stages. The Bill was rushed through by the Government to forestall a court action affecting a farmer which is set down for next Tuesday. The Minister for Justice (tho Hon. J. ft. Cobbc) explained that immediate action was'necessary to prevent other injustices.

| Moving the second reading, Mr Cobbe said provision was made that where a mortgagee had obtainod authority to exercise a power of sale, but had "slept" on his right for at least three months, the mortgagor might make further application for relief at any time before tho powers of the mortgagee had been fully exercised. Tho corresponding right conferred under tho Act of 1932 had been limited in its application to cases where the right of the mortgagee to sell mortgaged property had accrued before the passing of that Act. As soon as an application for relief was mado under the Bill at prsccnt before tho House, the mortgagee's power of sale would bo stayed until the application for relief had been disposed of. Where an application for relief had already been made but had been dismissed by the for want of jurisdiction, the application was revived by the Bill, and the powers of the mortgagee were stayed until tho application had been/disposed of on its merits. Another clause in the Bill provided that no mortgagor or lessoe could contract out of the benefits of the Act, and any existing covenants to forego the benefits of the Act were rendered inoperative. "Though a tenant may apply to the court for a reduction of rent," said Mr Cobbe, "there is nothing under the existing legislation to prevent a landlord while an application for relief iB pending suing for und getting judgment for the amount due. In practice, *f the court were informed of tho application for relief it would probably adjourn the action for debt until the application for relief was disposed of. Tf. however, judguent was given for the rent claimed, there is nothing to prevent the landlord from enforcing hi? judgment." Bill, he went on to 'say, made provision dealing with an anomaly of this nature by setting out that a lessor should not be entitled to obtain, or execute a judgment for rent while an application foi relief by the lessee was pending.

Farm Properties. In dealing with farm properties it was a common practice to form a pool comprising the stock and station agents, mortgagees, and others concerned, the profits being divided among those financially interested. Unfortunately there were < certain stock and station agents who refused to participate in such arrangements or who did so under such a condition that any attempt to reach an equitable arrangement concerning the properties was rendered abortive. Representatives of the Government would be interviewing financiers during the next day or two to deal with this problem, and it was hoped it would be unnecessary to introduce legislation to bring stock and station agents and financial institutions under the Bill. At the same time the Government liad to protect farmers whose stock was under lion to certain concorns. The value of the stock had depreciated considerably, and the amounts certain firms were claiming were out of all proportion.

Protection of Workers Advocated. Mr J. A. Lee (Lab., Grey Lynn),said he wanted to know why relief was not being given to distressed workers whose furniture was being seized. The Bill had too much of a rural bias. Mr A. M. Sfemuel (C., Thames) said the Bill was only another argument in favour of a farmers' moratorium. He trusted it would apply to Government Departments, and hoped it would have a softening effect on the State Advances Department and other institutions which had taken advantage of present'day circumstances. Mr W. E. Barnard (Lab., Napier) suggested tjiat the Government might consider helping people in cities as well as farmers. It should pay some attention to the plight of workers. The Leader of the Opposition (Mr JT. E. Holland) said any legislation which came down should have general application. He did not object to. the farmer being protected, but he thought city mortgagors should receive protection.

Mr 11. G. Dickie (C., Patea) said that while tho mortgagee was being allot af< from all aides the banks ajjd auction* eering firms wore escaping. He considered (hat the general rate of interest should bo scaled down. Sir W. J. Poison (C., Stratford) advocated an all-round reduction of interest rates, which he considered was long overdue. Mr A. J. Stallworthy (Ind., Eden) said the relative position of rural and urban mortgagors was the same. Labour members generally appealed for an extension of the protection of tenants and mortgagors in cities. Mr Cobbo said something might be heard of an amendment to the Distress and Replevin Act in tho course of the next day or two. He pointed out that the Act was not administered by his Department. The Bill was road a second time. Motion to Add Olauao Ruled Out. ]n Committee Mr W. Nash (Lab., Hutt) moved a new clause to extend the rights enjoyed by tenants under agreements of lease to tenants oo a weekly or monthly basis.

The Chairman of Committees (Mr 8. G. Smith) announced that lie would have to rule the amendment out of order on the grounds that it was ineffective. Mr Nash asked for the ruling of Mr Speaker and moved to report progress, but tho motion was defeated by 34 vote? to 23, and the Committee stages were completed a few minutes later. Speaking on the third reading, Mr P. Fraser (Lab., Wellington Central) detailed what the amendment had proposed, but said that as Mr Smith had given the matter careful consideration, his ruling on it was entitled to be treated with respect. Mr Nash also detailed the action he had taken and said tho action of the Government in refusing Mr Speaker's

ruling had left a doubt }n the minds of many members. Mr Samuel said a request for .'Mr Speaker's ruling should never be questioned, and added he was surprised at the action of the Prime Minister in taking up an attitude against it, Mr Forbes said Mr Smith had given the matter careful consideration and was quite certain that his ruling was sound. '

The Bill was read a third time and passed.