SUPREME COURT-CIVIL SITTINGS.

Hawke's Bay Herald, Volume XXII, Issue 7607, 2 December 1886, Page 3

SUPREME COURT-CIVIL SITTINGS.

Wednesday, Deohmiiku 1. (liefore his Honor the Chief Justice.) His Ilonoi' look hisseatatlO.nOo'clock. THOMAS AND OTHERS V. MIIPH. Mr Let, with him Mr Slieatli, for plaintiffs ; Mr Laseelles for defendant. This was an action to recover £36 Os from the defendant Uirch, who is Registrar and Slieviir of tlie Supreme Court in Hawke'B Bay, on the ground that the plaintiffs had sufl'ercd loss to the extent of the claim, owinf,' to default of defendant in his ollieial capacity. At the sittings of the Court at. Napier in December. 18S1, the plaintiffs sued one James Hansel' fiheppard, and obtained n, judgment against him for j:29ii 11h 3d. That amount, less .{J3S On, \va.s jjaid by tlie defendant ttheppard. On the 12th of November, 188."), plaintills caused a writ to bo issued for llio recovery of the rrnnaiuiiifl moiety by distress, the execution of the writ !min« cut rusted to (he defendant as Sheriir, who returned tho writ milla bonu on the 23rd of December, 1885. At the lime the writ was issued tho defendant Shoppard possessed {;oods and chattels, described in a schedule to a bill of sale hold by Thomas Tlitchings as security fpr tlie repayment of four promissory jiqteo, as fjf the value of over £200. The promissory notes fell due at intervals of six months. One of the notes had been paid in May, 1885, and a second was duo

at about the time of the issue of the writ. The plaintiffs urged that at this time (here was, a saleable interest in the goods in the possession of Sheppaid, seeing that part of the debt for which they were included in the bill-of-sale had been paid, and that, therefore, if the Sheriff had executed the writ and caused the goods to be sold, plaintiffs would have received the value of the interest remaining after satisfaction of the holder of the bill. The validity of the bill-of-sale at the date of the issue of the writ was admitted. The defendant replied that the fact of the goods being hold under bill-of-sale rendered them not seizable by the Sheriff, as they were the legal property of the holder of the bill until the consideration advanced by him had been fully repaid. Thomas Hitching* deposed that in 1885' he was the holder of a bill-of-sale from James Hanser Sheppaid, to secure the payment of four promissory notes for an advance of £200 at 12i per cent. The first note was paid in May, ISSS, and the second on the 13th of November in the same year, the day after the issue of the writ referred to. The bill of sale was over goods and chattels possessed by Sheppard, a schedule of which was furnished to witness. He held the bill of sale 'as collateral security, as lie would not have advanced the money but for the fact that the promissory notes were endorsed by a person considered by witness financially good. James Hansev Sheppard deposed that in December, 1884, he was defendant in a civil action, Thomas v. Sheppard. The plaintiff got.judgment. Witness borrowed £200 from Dr Hitchings on a bill of sale prepared by Mv Sheath. After witness signed the bill of sale he did not remove any of the goods. The books produced contained an inventory of the goods included in the bill of sale. He did not know what the goods cost when purchased. In cases where values were set opposite entries in the list, the amounts would be the cost prices of the goods. Could not say what* the goods were worth at the time they were mortgaged for the advance of £200, 'but lie did not suppose (hat they were fully worth that sum. They were insured for £300, By Mr Lascelles : Witness did not make the list produced, nor did he compare the goods in the house with the entries in the list. Witness effected the insurance through Messrs Banner and Liddle. Re-examined by Mr Lee : It was some years ago when the insurance was effected, and he thought that the goods were then worth £350. Walter Newman, cabinetmaker, deposed that in January, ISSS, he sold to the witness Sheppard between £5 and £6 worth of goods. Paul Adolphus Frederic Birch, llegis-' trar of the Supreme Court in Hawke's Bay, produced the writ delivered to him on 'the 12th of November, ISSS. Witness made a nulla bona return on the 23rd of December. In pursuance of the writ witness saw Mr Sheppard and demanded the amount of the money due. By his Honor : That was on the evening of the day the writ was issued. By Mr Lee : Witness entered the premises occupied by Mr Sheppard, and oxamincd the goods and chattels there. He heard that there was a bill-of-sale over the goods, and upon enquiry found that such a. bill was registered, and was then unsatisfied. Considered that the property in the house would not have brought £200 if sold. Saw Mr Sheath, the plain-, tiff's' solicitor, and ho told witness to seize a horse belonging to Mr Sheppard. The horse was not seized as it had already been sold. Witness was then instructed to take possession of Mr Shoppard's interest in the grammar school reserve, but found that it was mortgaged to the fullest extent. On the 22nd December witness saw a statement of assets and liabilities prepared by Mr Sheppard for filing in the Bankruptcy Court, and on the following day made a nulla bona return of the writ. Did not give to the officer of the Court a warrant to seize the goods in the house, because ho believed there was nothing that could be seized. The warrant produced was prepared in readiness for seizing if there had been anything to take possession of, but it was not addressed to anyone. There was an application before .the Judge in to determine whether the writ should be issued, and a 'stay of the proceedings resulted while application was made to the Judge. • Major Porter gave an indemnity to witness in reference to the proceedings being stayed. By Mr Lascelles : Witness examined the goods in the. house very carefully. When Mr Sheath knew that Mr Shoppard's horse was sold, he instructed witness to make a nulla hona return of the writ. lie-examined by Mr Lee : When witness first had the writ in hand, Mr Sheath pressed him very much to execute it, ami wrote about a dozen letters urging prompt action. Most of the letters were written when witness was absent in Ancklancl on leave, It was about the 18th of November when Mr Sheath was pressing for the execution of the writ, and on the 22nd of November ho desired a nulla bona return to be made. The sole ground why witness refrained from executing the writ at first was in consequence of the proceedings in Chambers before the Judge, as to whether thewrit should be executed. This concluded the plaintiffs' ease. Mr Lascelles said that in addition to his contention that seizure of goods under a valid hill of sale could not lie effected by a judgment creditor, the defencj would rely upon the fact that the interest of Mr Sheppard in the goods under the hill of sale would not have realised sufficient if sold to satisfy the holder of the bill. Thomas William Porter deposed that he was the brother of Mrs Shoppard. He had been frequently in her house. He paid oft" the bill of sale to Dr Hitchings. Witness originally advanced the money to purchase the goods scheduled for the bill. They were then worth about £200. v Mr Sheppard was utterly useless in any matter of business involving worry. In November, 1885, when Mrs Sheppaid informed witness that the writ was issued, he went carefully into their affairs and found that Mr Sheppard was hopelessly bankrupt. Witness advised him to file his schedule. There were a great many creditors, the debts being between £SOO and £900. Mr Sheppard took proceedings preparatory to filing in November, and iiled in the following January. Witness secured Mrs Sheppard's bills to the creditors, and they became possessed of the goods and chattels in the estate. Witness also paid off Dr Hitohings, and paid £110 through Mr Lascelles. Witness held a mortgage at present over the goods, and £180 was due to him. He made these payments because Mrs Sheppard was his sister, bnt he wonliV not have anything to do with Mr Sheppard. By his Honor : The goods would not have realised £100 if sold at the time of the writ lieing issued. They were partially worn out, and only cost £200 originally. By Mr Lee: Mm Shoppard had always carried on the school on tier own account. She paid the receipts to Mr Sheppard. He became bankrupt owing to his connection with the linn who issued the writ against him. He mis-spent her earnings iv connection with his own business, and the result was that she could not pay accounts incurred in connection with the school. Before the writ was issued Messrs Blythe and Co. and Dinwiddie, Walker ami Co. had respectively obtained judgments against Mr Shoppard in the Resident Magistrate's Court, but the distress warrants were returned tuiHa bona. This concluded the evidence on bohalf of the defendant. Mr Lascelles urged that the action must fail on the grounds stated by him, and quoted largely from recorded cases. Mr Lee contended that the rules of procedure must be construed as forming part of the Act of Parliament, and that according to those rules tho defendant had neglected his duty. In delivering judgment, his Honor said that ' although Iho rules were not drawn so well 'as they should be, the only fair inference from thorn was that drawn by Mr Leo, namely, that the Sheriff had to' seize chattels although he might know that a security had been given upon them. If he did not seize them, and it turned out that tho execution creditor bad an interest in them beyond the payment of tho security, the neglect was at the Sheriff's peril. That made a manifest difference to the law as administered in England, where the interest of a creditor in chattels assigned by bill of sale could not be seized under a writ of// /«, although in the case of a partnership the partner hud a legal interest (hat could be seized. In respect to the other points raised, his Honor was in favor of the defendant. It seemed quite clear that the Sheriff's position was such that if thewrit had been issued, no fruits of the execution couUl possibly have gone to the execution creditor. Thero were at that time existing distress warrants against Sheppard in the Magistrate's Court, one for over £70, and onu for over £23, and in both cases the warrants had been returned nulla bona. It was trno that under tho circumstances the chattels could not have been seized mulct warrant from tho Magistrate's Court, but it was a very important fuel that Mi Sheppard was' unable to pay the amounts sought to be recovered l>y warrant. Further than that, his position was such that judgment summonses had been taken out against him, and he had been ordered to pay tho amounts !iy instalments or tc suller imprisonment for failing to pay. If a creditor had moved in the matter and had licen able to jivove that he had go( any properly out of which he might have paid, bnt would not, he could have sent dim (o prison. That gave an idea of hit position at the time. It was quite cleai that lie had no very friendly feelings towards Thomas, who had caused the wrji to be issued, and it seemed certain that il the writ had been executed he would have gone to the other creditors and laid the position before them. They, if they felt that any good would result fjrom so doing, would no doubt have

caused him to be declared bankrupt, ami have brought about an equal distribution of any property among all the debtors. Further, in addition to that view of the case, his Honor felt far from satisfied that the property held under bill of sale would, if sold, have resulted in more being obtained for it tlian the amount secured to the holder of the bill. There was nothing at all to lead his Honor to believe that the property could have been sold for anything over the interest of the secured creditor, and there was therefore nothing to show that any damage had accrued to the plaintiffs tlirough failure to execute the writ. Judgment would consequently be for the defendant, with costs on the lowest scale. The Court was then adjourned till 10 o'clock this (Thursday) morning.