LAWYERS' ADVICE

Evening Post, Volume CVII, Issue 26, 31 January 1924, Page 4

LAWYERS' ADVICE

END OF MORATORIUM

(BI UIigfiEAPB.—SPECIAL 10 THi fOST ) e AUCKLAND, This Day. An inquiry was made in legal circles to-day regarding the reported statement of an Ashburton lawyer as to the effect of the expiry of the moratorium. One tiling seems to be quite clear—that tj>- ordinary mortgages upon which interest has been paid regularly, the state--ment does not apply. In resp"ect to mortgages upon which interest lias not been paid regularly, the lender- has had power to recover, v and in any case the term of the Statute of Limitations is .not six, years, but twenty years, in case of Jiabihty under mortgage. If the mortgage was in existence in 1914, there would bestill eleven years to go before the Statute of Limitations would apply, even supposing no interest had b'een paid in that time. If the interest on a mortgage has not 'been paid regularly, ' the law provides that the lender can give- two months' notice of his intention to close. The borrower is then entitled to lodge an objection, and the matter has to go to the Supreme- Court, which may take into consideration the whole position, including the'question of hardship. If it is shown that the borrower can go on the, open market and get monev at a reasonable rate of interest, lie "may be ordered to do so. If the Court, having taken all points into consideration, deems it advisable, an order may be made for the lender to close and sell the property. The position with regard to deposits, according to a leading lawyer, is quite clear.-Under the Mortgages and Deposits Act of 1921, where the Wrincipal sum does not exceed £1000. the due date was fixed as the 31st December. 1922.In cases where the sum exceeded £1000, the^due date was fixed at 30th June, 1923. "I can find no farther extension of time in either instance," said the lawyer. "Therefore, it seems to me that the danger referred to in tile message from Ashburton does not exist. In any case, the effect of the Act was merely ;to extend the due-date, and the Statute of Limitations does not begin to run until after that due date.""