INTEREST IN ARREAR

Press, Volume LXXV, Issue 22796, 23 August 1939, Page 10

INTEREST IN ARREAR

MORTGAGE. HELD BY A STATE DEPARTMENT

PARTICULARS GIVEN TO - T tHGUSE

I From Our Parliamentary Reporters ' August 22.

Particulars of a case where a South Canterbury farmer', who ;had a Government Life Insurance Department mortgage, had been refused any further consideration by the department after extensive default in his payments were .quoted by the AttorneyGeneral '(the :H6n. .-.H. G. R.'Mason)' during the .'financial debate -in the House of .Representatives to-night, Mr Mason’s statement was made in reply to references made earlier In the - day by Mr T, D.. Burnett (Opposition, Temuka), who said a man was about to be Isold Up; because be owed £l6B in interest tb the department. “Orte does hot need to be in this world very long/’ the Minister .said, “to'learn that there is usually, another side to these hard luck stories. This case is no exception from the general rule, for there is more to it than we heard. from the letter referred to by the member for Temuka.” A lodn .of £3750 was granted in 1920. Mr, Mason said; but the interest had been overdue continually since 1930, ■ The Mortgage. Adjustment Commission had written off £753 of the arrears. It had ordered £228 to be paid in cash, and had decided that the balance of £9O should be capitalised. The loanhad been renewed at £3840 for 10 years from May of last year, with) interest at'4J per cent, for the first five years,' and then to be revised, but not to exceed 5 per cent. Actually the commission had been dubious about granting him any relief. “Although the department has had to wipe off that amount of interest,” the Minister added, “the man is again overdue with his interest payments of November last year, and May this year. The adjustment was made in August last year; but now, 12 months later.. he is 12 months in arrear with his interest. In view of the continuous trouble the department has had with him, the board of investment decided to call ; UP. the loan, and. if necessary to realise the security. He offered to pay six months’ interest, if payment of ,th«j were postponed for six - months; but this was refused, as he would still be 12 months in arrears. The department agreed to .withdraw, the: proceedings if he paid all the arrears; but so far nothing has

been paid. ! ■ “A few weeks ago,” Mr Mason added, “the department was advised that the bank had called up its securities, and was arrangifag for the sale of the stock. One of the mortgagor s difficulties was that he l?ad three other properties, totalling more than 1500 acres. A year ago It was stated .that the department’s security had riot .been cultivated for three years. Members ■will be able to judge whether the- department should exercise any more consideration of. that particular case.