MORTGAGE RELIEF

Evening Post, Volume CXV, Issue 106, 8 May 1933, Page 8

MORTGAGE RELIEF

VIEWS OF INVESTORS

GOVERNMENT APPROACHED

ADJUSTMENT WORK

A deputation representing the Investors Protection-Association of New Zealand waited upon the Prime Minister (the Et. Hon. G. W. Forbes) on Friday and placed before him the views of the association concerning various matters affecting the public generally and in, particular mortgagees and mortgagors. 'The deputation comprised Messrs. G. Shirtcliffo (chairman of . the central executive), 0. S. Watkins, 'E. L. Macalister, A. Ibbotson (Djinedin),. \V. M. Wright, S. Harcourt, A. Fletcher, E. Wylie, T. Buxton (Canterbury), and.l. J. Mackerscy.. Mr. Shirtcliff c, in introducing the deputation, pointed out that the association represented a large body of public opinion and had branches in the four main ' centres and other parts of tho Dominion. Ho emphasised the fact tljat it was not a political body, but was merely asking.'for .a1 fair deal between all sections of the community. The association Was well aware of the difficulties which faced the Government and the need fo y r some of the present legislation. It desired to point out anomalies and the need for various amendments to the . existing laws. Its policy was to be helpful and not obstructive in its requests. THE ADJUSTMENT COMMISSIONS. Mr. Macalister asked that the Government should give further consideration to the constitution-of the Adjustment Commissions. At the present time many people felt that these were not giving satisfaction owing to tho way in which they were constituted. The association contended that in fairness to both mortgagor and mortgagee each Commission should have as members a separate representative of both _ tho mortgagor and the mortgagee with a chairman appointed by the Government. This was the method of dealing with all other classes of disputes. Tho present members of Adjustment Commissions were merely elected from the general body of citizens and mortgagors and mortgagees alike would have more confidence if they were constituted in the manner suggested by the association.. Mr. Macalister asked that the Government do something to prevent tho delays now occurring in dealing with applications for relief. _ These delays were not so apparent in the cities but were the cause of grave complaint in some of tho country districts. MAGISTRATES' JURISDICTION. The association suggested that the Government give consideration to extending the powers of Magistrates which were at present limited to mortgages of under £2000. Magistrates were available in all the provincial towns and had intimate knowledge of tho conditions in their respective districts. The association felt that tho jurisdiction of Magistrates could safely bo raised to, say, £5000. It had been suggested to the association ' that Judges wero unable satisfactorily to deal with accumulations of applications in country districts. They had their other duties to perform and were fully occupied with them, and in some cases it had been reported that Judges had had to sit till very late in the evenings dealing with reports of Adjustment Commissions, and even then had not disposed of the lists before them. This was unfair both to tho Judges and the parties concerned. It had, been suggested in some quarters that an additional Judge should bo appointed' to deal solely with applications under the Act. The association was opposed to this,.as it would bring about the same complaints as wero existing concerning the Arbitration Court, which could not be in half a dozen places at once, and if an additional Judge were appointed the association, suggested . that his apointuicnt bo a temporary one, that he be available to deal with mortgagor relief applications only, and that whilst tho present Judges ibe not relieved from their duties in this respect he be made available to deal with urgent matters and accumulations which might rise in an.- district from time to time. Anyone appointed for the work should be a man who had expert knowledge in the particular class of work. REDUCED STAMP DUTY. Mr. Macalister asked for a reduction in the stamp duty payable on transfers from mortgagors to mortgagees. If a property had been sold under agreement for sale and purchase and the agreement had to be cancelled so that the vendor again became the owner of the property, the duty was Is 3d. 'In those cases however where the vendor had transferred tho property -to his purchaser and tho purchaser had to retransfer it back to the vendor the stamp duty' was £1 2s per £100 on the amount' of tho mortgages which often considerably exceed the actual value of the property. In the case of a property worth, say, £10,000, this meant that on a re-transfer in one case the duty pno man might bo called upon to pay was Is 3d, while on another property of, -tho same value he would be called upon to pay £105. This-was an obvious injustice, .which should be remedied. There was no new sale- involved in tho transaction, and it was unfair to burden the mortgagee with this expense, when he had probably already foregone interest and was faced with payment of arrears of rates and insurauco . premium.- '. The poundage fee payable to the Sheriff for obtaining possession was fixed at £10. This, the association felt, should bo fixed at a nominal sum only. ARREARS OF RATES. Mr. Ibbotson (Duncdin) quoted various instances of delays in applications being dealt with, and stressed the need for decisions being expedited. He pointed out that mortgagees on taking over property of the mortgagors wero being called upon to pay arrears of land tax and rates. In most of these cases large arrears of interest had been cancelled, by tho Court and Adjustment Commission, and it was grossly unfair to ask mortgagees to lose this,, and'ift the same time pay tho arrears of rates and land tax. Many mortgagees simply had not got the money, and there should bo statutory authority for the Court whore arrears of interest were written oJI to cancel .arrears of rates and land tax. Mortgagees who had to acquire property through the registrar should still be deemed for a reasonable period to bo mortgagees in possession only for the purpose of assessment of land tax, as they were not purchasers in tho ordinary way. Tho association desired to point out that stock and station agents in some cases were refusing to allow mortgagees to inspect the accounts between tlieso firms and the mortgagors. In many oases many mortgagees had to tako action in the Court in order to ascertain the position. Some ■of these firms wero also refusing to be bound by the Court orders which had been made concerning the distribution of mortgagors' income. Legislation was badly required to bring these firms under the Act so that Court Orders would be effective as against the owner,: tho mortgagee and the stock ani station firms. ' ■' ■ : ■ ■ SMALL FARMS ACT. s The association protested against the unfair provisions of this Act in §° la£ M jaortgagflea Wsr«-concerned.

At the present time a mortgagee was by virtue of, the Act deemed to have consented to any lease given in pursuance of the Act. It would be most likely that the best portion "of farms would bo dealt with under the Act and the mortgagee's rights should be given consideration before he was deemed to^ have consented to the granting of any lease under the Act. Mr. Wright stated that, the association was of opinion that, a statutory limitation should be placed on tho borrowing powers of local .bodies, .such limitation to be the fixing of the total borrowing to a reasonable proportion of the rateable value of the district or rating area. In view of the fact that continuous borrowing had prejudiced the security of the prior lenders who had no control over subsequent borrowing, some apprehension was felt in regard to the future payment of principal and interest in some cases, especially as there had been a request from some quarters for a general revaluation. Mr. T. Buxton (Canterbury) also spoke and supported . the previous speakers. The Prime Minister intimated ; that he was interested.in the matters raised by the deputation and would give the matters brought before him consideration. ' , \