Important Bank Case.

Evening Post, Volume XXXVII, Issue 111, 11 May 1889, Page 4

Important Bank Case.

(.BT TBIiKOBAPH. I IONITSD PRESS ASSOCIATION. 1 Wanganui, 10th May. At tho Supremo Court an important caae, tho Bank of Australasia versus the Patea Building Society (claim for J81229 6s sd), has lasted two days. Mr. Fitzhorbert appeared for the plaintiffs and Mr. Barniooat for tho defendants. In opening the case Mr. Fitzherbert Baid a oaßh oredit bond was tho subjeot of dispute The execution and claims were admitted, but the defenoe set forth oortain legal objections. Ho would put in the bond and admissions, and that would olose his case, except that he would have a right to call rebutting evidence. He put in the bond, and asked his Honour to note that the demand made as alleged for .£1192 13s 3d prinoipal and .636 12s 2d interest on the 13th August, 1888, was acknowledged to have been made, and the amount was still due and unpaid, with interest auoruing. His Hononr raised the point as to whether tbo defendant sooiety were sued as jointly and severally responsible, and though Mr. Fitzherbert claimed that he sued in both oapaoitieii the point wai not settled. Mr. Barniooat said the dofanoe was really that the bond was obtained under misrepresentations to the sureties at the time. It was principally to tho effect that the Bnreties in signing were not to incur any personal responsibility whatover ( that it was usual for directors so to sign, becauso the Bank required it. When the book was signed in 1883 tha Bank had a bond, but apparently wanted something better. Ono of the then bondsmen (Wm. Dixon) was a bankrupt, another was a. bankrupt, one (Haywoed) had no means, Kojs was dying, and one man had left the oolony. Mr. Norman, the Bank Manager, had this Inducement to get some more solvent gentlemen on tha bond, and it aeoraed impossible that they would have signed the bonds had they known what they ware doing. Only ono of tho signatories had ,£2OOO of interest in the sooiety, the other* boing only nominally interested, At » meeting of the dirootors Mr. Nprman attended and produced the now bonds, which he represented would not make them personally liable. The evidence of the signatories was taken, as well us that of Messrs, Norman and Webster, Bank managers at Patoa. His Jlonour took about two hours to sum up, •ad the jury then retired, returning to Court with the following answors to tha issues:— 1 (a) Did Mr. Norman represent to the defendants that they would inour no personal liability whatever by signing? Answer: Yos. (b) That the said bond was a mere matter of form? Answer: Yes. (c) That the defendants would never be called on to pay any monay under such bond? Answeri Yes. (d) That a bond in similar terms was always signed upon a change of directors of a ooiporate body owing money to a bank. Answer : Yes. (c) That if tho defendants signed the bond they would only do so as direotors of the sooiety, for the purpose of binding the said society, nod not for tho purpose of rendering themselves personally liable. Answer: Yes. 2. Were soon representations untrue ? Answer : Yes. 3. Were they untrue to tho knowledge of Mr. Norman? Answers No. 4. Were they made with tho objeot that they should Ira acted upon by the defendants by executing the said bond ? Answer : Yes. 5. Were the defendants induced by snoh representations to executo the said bond ? Answer : Yes. His Honour reserved judgment till to-morrow.