DISPUTED GUARANTEE

Dominion, Volume 17, Issue 288, 22 August 1923, Page 5

DISPUTED GUARANTEE

GISBORNE SHEEPFARMERS’ CLAIM COURT ASKED FOR VOIDING DECLARATION Mr. Justice Salmond was occupied at the Supreme Court throughout the whole of yesterday in hearing a dispute concerning a guarantee in connection with a Ifeasehold property in the Mangatu district. Poverty Bay. The plaintiffs were Lawrence Boyden Tullock and Charles Leonard Tullock, both of Gisborne, sheepfarmers (as executors of tlie will ot Emma Boyden Tullock. late of Los Angeles, California, now deceased), and Eunice Arnold, of Gisborne, wife of Charles Ellithorpe Arnold and the defendants wtere Dalgety and Company, Limited. Sir John Findlay, K.C., with him Mr. J. S. Hanna, appeared for the plaintiffs, and Mr. C. P. Skerrett. with him Mr. L. B. Burnard (Gisborue), for tho defendant company. The plaintiffs asked for a declaration that the guarantee executed by Charles Leonard Tullock in the name of Emma Boyden Tullock in favour of the defendant was unauthorised by his power of attorney and void; that if it were held that such guarantee was authoi ised and otherwise valid. then the fcxecution of the guarantee was procured bv a false representation made on behalf of the defendant and may be rescinded; that the memorandum of mortgage and instrument by way of security taken by the defendant were subject to the agreement to mortgage contained in the agreement of June, 1906. The defendant company denied that it was aware of tho existence or terms of ths agreement referred to; or that the agreement was even carried into effect or acted upon by the parties; and contended that the agreement had been rescinded. It was further alleged in defence, that in lieu ot effecting the purchase Contemplated Emma Tullock purchased a two-thirds interest in thio leases, stock, and business of Charles Leonard Tullock and Harold Robert Tullock, and entered into partnership with Lawrence Tullock. ” The mortgage was duly registered under the Lahd Transfer Act against tho title of Emma Tullock. without fraud and without notice of any estate or interest of Eunice Arnold. It was contended that the agreement ot June 26, 1906. was wholly void hs to tile live stock therein referred to or as to any live stock sold by tho defendant company. It was further claimed that the causes of action arose more than six years before the commencement of this action, and were barred by the Statute of Limitations.

Eunice Arnold, of Los Angeles, daughter of the late Emma Tullock, stated in evidence that she had always considered that £lOOO invested in the Mangataliu station was hers. She considered that she had a separate account at Dalgety’s in her own name, and had drawn three separate sums on this account.

His Honour: Did you know that Mangatahu was mortgaged to Dalgety’s? Witness: Yes. _ ' Did it ever occur? to you. if there was not sufficient money to pay both your mortgage and Dalgety’s, which would get paid first?—“l am afnaid that I did not think very much about it.”

You thought there was plenty ot money to pay everybody?—“Yes.” Can you tell me, Mrs. Arnold, just exactly - what it is you complain of that Dalgety and Co. have done against your interests?—“They have taken my money and used it. They may have paid themselves; I don’t know what they have done with it.” You don’t suggest that you should draw profits before the debts were paid, do you?—“I thought my £lOOO could not bo touched.” Charles Leonard Tullock, stationmanager for tho East Coast Commissioner, said that he had been in partnership with his brothers in the Mangatabu property. His mother had then bought out his brother and himself, and had carried the property on in partnership with his brother Lawrence. In 1918 witness became manager of Mangatahu for his mother. When his mother left for California in 1918 she gave witness power of attorney. Dalgety and Co. sent for witness and told him there was a guarantee for him to sign. He said he did not think he should sign the document, but Mr. Hockley, accountant for Dalgety and Co., said it was all right as witness's mother had agreed to give a guarantee of £ll,OOO to back his brother Laurence’s account in connection with the purchase of Waitawata. Hockley said they wanted the guarantee to make tlie account look better at headquarters. Hockley had also a second mortgage for witness to sign as attorney for his mother over Mangatahu, but witness refused to sign this. When witness signed tho guarantee ho wan not certain whether anyone else but Hock lev was present. The hearing was adjourned until today.