EX-SOLICITORS’ THEFTS

Hawera Star, Volume LI, 20 February 1932, Page 7

EX-SOLICITORS’ THEFTS

CLAIM ON LAW SOCIETY. ACTION TO RECOVER £1052. The first claim to be brought to Court under the Law Practitioners’ Amendment Act, 1929, commenced in the New ' Plymouth Court last evening before Hon. Mr. Justice Blair. The claim arose out of the conviction of H. J. M. Thomson and S. R. Darlow for the theft of moneys held in trust by the legal firm at Inglewood with which they were connected. 7 lie plainttiff is Nelson Ben Bishop, who asks the New Zealand Law Society ‘.o reimburse him by £1052 10s from the Socilitor’s Fidelity Guarantee Fund. Council for plaintiff said that the claim was divided into two blanches, the first relating to £IOOO, and the second to two sums of £35 and £l7 10s respectively. Dealing with the first branch, counsel said Bishop owned a freehold property, and a leasehold property. In 1925*he leased the freehold preperty to Mrs. Weston, with a- compulsory purchasing clause at a price or £BOO. About the same time he transferred to Mrs. Weston the leasehold property, and as part of the purchase price took a mortgage for £650. That meant that Mrs. Weston owed Bishop £l4so—£Boo in respect to the; freehold and £650 under the mortgage. Early in 1929 Mrs. Weston decided to apply to- the State Advances Office for a loan of £1450 to enable her to pay for the freehod and pav off the mortgage on the leasehold. This application was made by Thomson, who was then in practice as d solicitor at Inglewood. Thomson, or his managing clerk ,Darlow, had acted for both Bishop and the Westons in connection with these matters.

In September, 1929, the State Advances Office notified Mrs Weston that it was prepared to lend her £IOOO, not £1450; the security suggested was first mortgage on both properties. The Westons agreed to accept £IOOO. believing Bishop would accept a second mortgage for the £450. Thus Thomson was able to notify the State Advances Offices of the acceptance of the money offered, and in November, 1929, the money was received bv him from the State Advances. There was no doubt that the money was stolen before December 31, prior to the date from which the fund operated, said counsel. His Honour: How did Thomson get the ’ money ?

Counsel said that Thomson acted for Mrs. Weston in applying for the advance and she authorised him to receive the money, which came to the post office, was uplifted by him and placed in the trust account. The money when received was certainly not Bishop’s, but either the property of the State Advances or Mrs. Weston’s.

In November, 1929, Thomson held for Bishop various documents of title, comprising the certificate of title to the freehold (leased with a purchasing clause), a memorandum of lease, and a mortgage. Early in November Darlowprepared a transfer of the freehold from Bishop to Mrs. Weston, a mortgage on both properties to the State Advances for £IOOO, and a second mortgage for £450 on both properties in favour of Bishop. The authority to Thomson was that on receiving the £IOOO in cash from the Westons and the second mortgage on both properties for £450 he was to complete the transfer of. the freehold property to Mrs. Weston and obtain a discharge of the £650 mortgage. It was claimed—and it was the only question of fact in the case —that before January 1, 1930, Bishop executed no documents regarding this matter, and that anything taking place up till then did not affect him. The Court would appreciate that Bishop and Mrs Weston had agreed on certain things. There were documents held by their joint solicitor. In November" . when the money came from the State Advances Office, the transactions were in no way completed. To test the position, counsel said that if on January 1, 1930. Bishop had begun to distrust Thomson and had instructed another solicitor to take over all the documents, etc., from Thomson, he would have received all the money. A memorandum of transfer of the freehold may have been in existence, but was useless because it was not signed until February 5, 1930.

Counsel for tlie Law Society said the statment of facts by the other side concurred almost in every particular with his side of the case. The only point in doubt- _was whether Bishop signed the documents before the end of- the year. It was not doubted that there was a purported settlement by Darlow later on.