PAYMENT OF SALARY

Press, Volume LXXII, Issue 21746, 31 March 1936, Page 7

PAYMENT OF SALARY

Question of English Or N.Z. Currency CASE BEFORE COURT OF APPEAL truss uiocunoi TSLiasui.t WELLINGTON, March 30. The Court of Appeal was engaged to-day in hearing the case of J. Ballantyne and Company, Ltd., v. de Bueger, of Christchurch. On August 2, 1932, Charles Francis Martin de Bueger entered into an agreement with the London agents of Ballantyne and Company to embark for' New Zealand and enter the company’s employment as a tailors cutter for three years. His salary was expressed to be at “the remuneration of seven hundred pounds sterling a year.” He came to New Zealand and entered the company’s service. The company paid him in New Zealand currency, though the respondent claimed payment in sterling. Action was taken in the Supreme Court at Christchurch, and, by consent, the parties stated a special case for the opinion of the court. In his judgment, delivered on November 13, 1935, Mr Justice Northcroft said: “I am of opinion that the use of the word ‘sterling,’' ih this contract, was neither accidental nor meaningless. Furthermore, I am not prepared to regard it as meaning merely ‘legal tender,’ as, in the result, that would be to assume it was used without purpose; for the same result would be achieved by using the word ‘pounds’ without adding ‘sterling.’ I consider the parties- usedthe , words ‘pounds sterling’ as meaning ‘pounds in English currency’.” The appellant company is appealing from that judgment. Mr A, W. Brown submitted for the company that the whole question was as to the precise meaning of the words "pounds sterling.” The contract was entered into, reduced into writing, and signed in England. Everything which de Bueger had to do under the agreement was to be done in New Zealand, except embarking on the boat, and everything to be done by the company was to be done in New Zealand also. Mr Brown further submitted that the question involved was one of legal tender. What was legal tender for a debt of £7OO under New Zealand law? Mr L. J. Hensley, who also appeared for the appellant company, dealt with the proper law of contract, which, he contended, was the law of the place of performance. There was no unit in law as the English pound, as opposed to the New Zealand pound, and the rate of exchange did not come into the matter. Case lor Defendant Opening the case for de Bueger, Mr H. F. O’Leary, K.C., said that on facts the case was different from other currency cases befor% the Court of Appeal and other courts. “The contract here under consideration was entered into after the decision in Latham v. Broken Hill Proprietary, in which case the difference in value between English currency and Dominion currency was discussed,” he said. “Further, this is the first case where, in addition to the number of pounds the word ‘sterling’ has appeared in the contract. If the present contract was to pay £7CJ a year, then on the decision of the House of Lords in the Adelaide Electric Supply Company v. the Prudential Assurance Company, the appellant company could perform its contract by paying de Bueger £7OO in New Zealand currency. If the contract had been made in its present terms between two New Zealanders in New Zealand, there might be a. difficulty in that one party would get more than £7OO in New Zealand currency. If it were made in England between residents there for performance in New Zealand, it probably would make no difference whether the expression used were ‘seven hundred pounds’ or ‘seven hundred pounds sterling’; but the present case is different from these. It is a contract made in England between a person domiciled or at any rate resident in England, and a New Zealand company having a representative in England to pay seven hundred pounds sterling in New Zealand,” The Word “Sterling” It was submitted that effect must be given to the word “sterling,” and this word, added to the amount expressed, meant the payment of seven hundred pounds in British currency. In this contract, interpreted according to English law, the measure of obngation was to pay £7OO in English currency every year. Sterling was the word of description or measurement. According to the general rule in performing a contract, the law of the place of performance applied, and therefore the monetary obligations were effectually discharged by paym it of that which was legal tender in the place of performance. However, the use of the word “sterling” took the present case out of the general rule. The contention that the obligation could be discharged by the payment of seven hundred New Zealand pounds robbed the word “sterling” of any meaning whatever.