LAW REPORTS.

Dominion, Volume 1, Issue 275, 13 August 1908, Page 4

LAW REPORTS.

SUPREME COURT.

SEQUEL TO THE IZARD FRAUDS, FEIST AND OTHERS v. JUDD. DISPUTE BETWEEN INNOCENT PARTIES, JUDGMENT FOR THE DEFENDANT. Judgment was delivered yesterday by Mr. Justice Chapman in thp ease of Arthur Chas. Feist, Wm. Richard Parker, and Thos. Parker (trustees and executors of tlio will of William Parker) y. John Judd.

"This dispute is pup of those which inevitably arise between innocent parties when a solicitor or agent has been guilty of fraud," observed • his Honour in commencing his judgment. Continuing lie stated that plaintiffs claimed that tlioy had paid off a mortgage to the defendant by piying tho money to Henry Stratton Izard, when} they ullegecl to have been defendant's agent to receive the : moneys. Izard mado away with the sum and other trust moneys for which lie was sentenced to a term of imprisonment. Tho facts were as follow:—Oiv Npvenjber I, 1004, the deceased Parker borrowed £700 froifi -.defendant on mortgage. Izard acted as solicitor jn the matter under instructions from the mortgagee. On May 21. 1906, Parker contracted to sell to Feist, who was now one of his executors, a bakery for £1300, the agreement being prepared by feprd for both parties. Parker then' applied to Izard on tho assumption that ho was Judd's solicitor to bp allowed tp pp.y off before' tl(e due date tho mortgage for £700 out Pf tho purchase -money of t)|e bakery, Parker died before the pale was completed, and his wijj was proved by the plaintiffs. Shortly after Parker's de&tij Izard tjie plaintiffs that the dofpndant IVas willing to accept mpnt of tjip £700, and plaintiffs iiironnet] Izard that tlipy ivould accordingly makp the payment, On Jtmp 26, Fpjgt paid ts tjie plaintiffs said '' as part payment of the purchase money payable by him for the purchase of tl)p bakery shop, and also as a payment o|i belialf of, and at the request of, the trustees of Parker in reduction of the mortgage the sum of £500 to Iznrrl, acting as the authorised agent of the trustees and of tlio dofpndant," On July 31, Foist paid ;Iwd £800, tlm balance of tile £1300 tq cbmplotc his purchase pn thp understanding, ps plaintiffs alleged, that tjie balance of the amount owing on the mortgage was to hp paid gut of itj and Izard, acting as the autho-rised-agent of the defendant, apcepted tho sum of £200 being psrt' of tho sum of £800. viz., the sum of £000 was received by Izard as the agent of the trustees, and Izartl forthwith handed to plaintiffs as trustees- for Parker his cheque for £600 out of tho sum .of £1300, retaining the sum of £700 as tho agent pftlje defendant in discharge pf tho niprtgage. The plaintiffs claimed that tho whole of these proceedings wero with the authority pf tho defendant, and upen thp qiipptipii whether .'that was niatfe out thp Tfhole case turned.

The evidence was, his Honour continued, of a contradictory nature. Izard's evidence was rolied on .as proving his authority to receive the money, Reference was made by hard to several particular instances in which lie had received payment of principal for defondant. Cross-examined, Izard had stated that he'could only'recall one instance in which ho had recoivod, without first obtaining fondant's signature to a release, repayment of the whole sum.' With regard to the sum in question Izard said ho did not think the quostion as to who was to receive it was discussed. One of the witnesses stated that Izard had told him that he had no specific authority, but a general authority acting as defendant's solicitor to receivo the money, Defendant was closely cross-examined, but hp adhered to his statement that Isjard had no general authority from him to receive principal sums, and that ho. had no authority to receive the sum in dispute, The question then was did the pvidenca preponderate in plaintiffs' favour? None of the circumstances now relied on as proving Izard's authority were known tp tho plaintiffs, and they could not have been in the least relied on by them. Plaintiffs relied on Izard's reputation for integrity a? no doubt defendant had done, and they made no inquiry whatever as to lija authority.. . As to Izard's impression as to his belief as to his authority Ids Honour spjd that it bad to bo borne in mind that about the time in question 1)0 wns in ft state of mental stress, and was subjected to pressyro from all sides. He must havo bean financing in a desperate way, presumably using one client's money to stop another client's clamours after the manner of a person in such a position. When at last ho was driven to become bankrupt and fnco the consequences lie devoted considerable caro to the preparation of his schedule,, which showed the existence of about seventy creditors. Of these, it was pretty evident that .nearly thirty were trust creditors, whoso claims amounted to £25,000, while his total dobts outsido tbeso worn under £700. 11l the eircumstaneos it was not surprising that there should bo somo confusion in his mind as to what ho had actually done. In making out the schedule Izard liad not originally mentioned Feist, but had put | down defendant-for £1260. Then apparently on reconsideration he interlined Feist's namo as a creditor for £700, and .altered defend, ant's figure to £560. B.v his evidence ho went back to his original figures. His weak and_ perhaps biased evidence had to ho set against tho positive though interested ovidenco of tlip defendant, corroborated as. it was by several witnesses. Tho point of defendant's caso was that Izard had no general authority to receivo principal, and had no particular authority in any caso savo in connection with a release. "Taking overythihg into consideration," observed his Honour in conclusion, "I cannot find affirmatively that plaintiffs havo discharged tho onus which lay on them of making out that Izard had authority enduring at tho timo of tho transaction or relating to tho particular transaction to bind the defendant. Thoro is a presumption against tho party who hands over monoy without taking a roloaso and without seeing that tho agent is regularly authorised to receive it, and thoro is equally a presumption in favour of tho party who keeps his monoy in his pocket, or as in this caso keeps his title ijnrolcasod, Tho plaintiffs on whom tho onus lies have to rely on tho ovidpneo of a witness who cannot bo implicitly relied on, and who has vacillated in his statements. In these circumstancps I think that their caso must fail, Judgment will bo for tho defendant with costs." Mr. Skorrott,'K.C. (with him Mr. Luclcio), appparcd on behalf of plaintiffs; and Sir. 8011, K.C. (with him Mr. Ostlor), for tho defendant.

CIVIL SITTINGS. CLAIMS FOR SPECIFIC PERFORMANCE. Tho caso of Sir Kenneth Douglas, solicitor, %. Edward John Falkiner, telegraphist; and that of Jacob M'Eldownov, warehouseman, v. John W. Thompson, paintor—two actions for specific porformanco in- regard to land transactions were called oh before Mr. Justice Chapman yesterday. On tho application of Sir Kenneth Douglas, who stated that it was probable the cases would bo settled, thoy wore adjourned sino die. ALLEGED BREACH OF AGREEMENT. The only other caso dealt with was that of Lcvicn, Shallcrass, and Co. v. tho Palace Co., Ltd., a claim for £389. Mr. Menteath appeared on behalf of the plaintiffs, and Mr. Blair for tho defendants. It was stated that plaintiffs, who carry on tho business of auctioneers, lease a portion of tho Windsor Hotel buildings, which are the property of tho defendants. One of tho conditions of tho lease was that plaintiffs wcro to obtain reasonable oflico accommodation. The claim was in respect of fitting up' the premises in'ardor to provide tho 'acconiniodation. No dofonco was filed, defendants pot disputing liability to pay what was reasonable. 1 His Honour was of opinion tliat an amicable agreement might bo arrived at. Mr. Blair said that there appeared to have been somo differences between members of the defendant Company, and in conseauence.

ho had not received instructions as to what were their iutentions. He would, therefore, apply for an adjournment of the case. Plaintiffs wcro permitted tp add 7gs,, being architect's fees, to the amount of their claim, and defendants wcro granted an adjournment until Friday week, upon payment of 7gs. costs and disbursements.