ARREARS OF INTEREST

Evening Post, Volume CXVIII, Issue 14, 17 July 1934, Page 7

ARREARS OF INTEREST

IMPROVED MARKET PRICES

VARIATION QUESTION

An improvement in wool and ' stock prices is not of itself a ground upon which mortgagees are entitled to obtain rescission of (irders providing for remissions of interest. This decision was reached by Mr. Justice Blair in a reserved judgment given by him recently, .and it was concurred in by five 1 'other Judges of the Supreme Court. Tne case concerned an application on behalf of, a mortgagee that certain remissions of interest provided for in an order should be reviewed. On October 3 ? 1933, the Adjustment Commission iad made a report recommending (inter alia) the remission of arrears of interest totalling £3309 0s 9d, and that further arrears totalling £2000 should be held over free of interest till September .27, 1935. Mr. Justice Ostler, on; November 3, 1933, made an order in terms of the report, and reserved liberty to apply for discharge or variation of the order. ' The matter was dealt with by Mr. Justice Ostler before last year's wool sales, when the prices realised showed a marked increase in values, said Mr. Justice Blair in his judgment; but an increase was anticipated, and ho had no doubt that the possibility of such an increase was strongly stressed as an argument against ordering any remission. IMPROVED RETURNS. The returns from the property this season, Mr. Justice Blair continued, showed a - marked improvement. For the mortgagees it was submitted that because of the improved position this year the remission of interest provided for in tho order at November, 1933, should be reviewed with a view to rescission. His Honour said he had no doubt that section; 17 of the : Mortgagors and Tenants Relief Act, 1933, gave the Court full discretion to vary orders, but the question was whether this case was one.where that discretion should be exercised. Nothing had been suggested relating- to. the suggested rescission of that part of the order which remitted certain arrears of interest except the fact that wool and stock prices had materially increased. It was submitted that if that increase had been, known at the time of the making of the order of November 3, 1933, no remission would have been made. _ The Adjustment Commission, when it made its recommendations, was concerned not so much with tho future as withi the' past, and had before it the past results. The Commission no doubfri anticipated that prices might, and pro-' bably would, increase. His Honour said lie had made many orders for remissions of interest and other judges had done likewise. Speaking for himself, when making any order for remission he never overlooked the probability of increased prices; for farm produce in the more or less near 'future;'' Nevertheless he had thought it proper in many cases -to make . remissions. The making of the remission which _ Mr. Justice Ostler had made m this case Was no doubt strongly opposed, and he had no doubt that it was put to Mr. Justice Ostler, as it had been put to him on numerous occasions, that no remission should be made and that at most the question of remission should be deferred to see how the market > went. " In applications when remissions were recommended by -an Adjustment Commission there were other factors to be considered in addition to the probability of improved Markets. A Judge considering an application for remission had to view all factors and exercise ibis discretion in the matter" so «s to make whatever order "he might think consonant with ih& justice of the case'and with, the ■Sil4rit and intention 'of:!the"Legislature. ■ INSUFFICIENT GROUND. Some thousands of orders for remission of interest' have no doubt ( been made, since this power has been conferred on the Court, his Honour continued, ana if the fact that last ■ season's ; wool and stock prices have, greatly improved is alone to be sufficient justification for an application for rescission ; of any remission orders, then we .must expect to be inundated with1 such _ applications; The effect of acceding to the new proposition that ;',.; last year's increase is alone suf- . ficient^to found an application for rescission of remission orders will ...be:to'.treat all such orders not as re--7 mission orders but as orders merely ."^deferring payment of remitted interest until the market improves. ."There is no "suggestion that in this ease the Court, when it; made-the order v'as misled either by misstatement or nondisclosure. The sole ground of the application is that prices have improved since the order was made, and in my view that alone is not a suflicicnt ground to justify this Court rescinding the order already made. : ■"I may add that owing to tho importance of the matter as affecting the practice of the Court when administering section 17, I have conferred with five of my brother Judges and they cqnc ur the view I have expressed."