SUPREME COURT Lottery Winner Loses Claim For Return Of $2OOO

Press, Volume CVIII, Issue 31681, 17 May 1968, Page 8

SUPREME COURT Lottery Winner Loses Claim For Return Of $2OOO

The winner of first prize of $24,000 in a Golden Kiwi lottery in 1962, Earl Sydney William Constable, has been refused a claim, made in the Supreme Court last August, for the return of $2OOO lent, be said, to a friend travelling to Guernsey, in the Channel Islands, to buy him a property there. Mr Justice Macarthur, holding in a reserved decision that the transaction was a breach of the Finance Emergency Regulations, 1940—in that Mr Constable had not obtained the permission of the Minister of Finance to send the money out of New Zealand—said that it was a well-settled principle of law that a cause of action founded upon an illegality could not succeed. The plaintiff’s claim—against Francis Louis Rault—must therefore be refused, his Honour said.

That the plaintiff knew nothing of the Finance Emergency Regulations, nor intended a breach of them, was no help to him, said bls Honour, for ignorance of their provisions was no defence.

His Honour resolved the original dispute between Mr Constable (Mr B. J. Drake) and Mr Rauit (Mr R. J. de Goldi) —the former saying the $2OOO was repayable in that their transaction had not been carried out, the latter saying that the $2OOO had been a share of the lottery prizein Mr Constable's favour.

"I accept the plaintiff’s evidence as being more reliable. I reject altogether the defendant's statement that he received the $2OOO pursuant to a bargain between them regarding either of them winning the lottery,” his Honour said.

But pointing to evidence given by Mr Constable that “it was fashionable to have money overseas,” and that he

had paid Mr Rauit $2OOO to buy a property in Guernsey—for the latter to occupy during a trip home to Guernsey, and on his return leave it in plaintiff's name—his Honour said that this clearly indicated a sending of money out of New Zealand by Mr Constable, Mr Rauit acting as his agent. Mr Constable, having done so without the consent of the Minister of Finance or the permission of the Reserve Bank, clearly committed a breach of the Finance Emergency Regulations, 1940 [section 3 (la)]. Further traversing the evidence, his Honour noted that on deciding to leave Guernsey to return to New Zealand in May, 1963, Mr Rauit sold the property he had bought in Guernsey and brought back a car with the proceeds—without repaying Mr Constable the $2OOO. “The defendant’s conduct towards the plaintiff was no doubt reprehensible,” said his Honour, but an English judge, in 1961, in an exchange-con-trol case in which illegality was found had declined to assist a claimant even though the conduct of the other party bad been “despicable in the extreme.”

He could not have regard, said his Honour, to the relative merits of the parties in the present case. It was governed by a well-settled principle of law—that a cause of action founded upon an immoral or illegal transaction could not be upheld. His Honour accordingly gave judgment for Mr Rauit, but without costs.