APPEAL FAILS

Hokitika Guardian, 11 August 1930, Page 7

APPEAL FAILS

. money-lender, ordered TO ACCOUNT. PURCHASE OE A LIFE INTEREST, WELLINGTON, August 7. With the allegation that Thomas Richardson, money-lender, of Welling■fon, had taken advantage of his pecuniary position and haR purchased a life interest for a gross undervalue, Thomas Harris a farm labourer, of Martinborough, took proceedings in the Supremo Court last August asking the . transaction should be set aside. Mr J.ustice Herdman gave judgment in favour of Harris and Richardson appealed against the decision,. The ■ case was heard in the Court of Appeal before Mr Justice Reed, Mr. Justice Adams, and Mr Justice Ostler. The judgment of the Appeal Court, ■which was, delivered to-dav by Mi Justice Adams dismissed the appeal with, costs .on the highest scale. Costs in ; the , Supreme Court action were allowed- to the plaintiff (Harris) according .toy the scale in that Court as om a claim/for £IOOO.,

Harris, under the will of his father, who died in 1913, was entitled to a life interest in the sum of £7250. In 1916; Harris had been adjudged bankrupt, aiid : the income’coming to him from his father’s estate had been duly handed the Official Assignee. In June, 1918, some of Harris’s creditors had 'expressed dissatisfaction with the position and had threatened to sell the .'life ~ interest, but had suggested that Harris himself might endeavour to arrange? a, loan on this security. Harris had- come later to Wellington and • had interviewed Richardson. Richardson’, bad refiised to lend on such security but bad offered to purchase the, interest'for £1750. An assignment of'the life interest had ac-cordingly-’.been executed, and Richardson'had also obtained the benefit of insurance policies -oil Harris’s life amounting to £2OOO. Ten years later Harris issued a writ against Richardson and ; lhe . Supreme Court case had resulted as, mentioned, Richardson being ordered to account for the moneys received by him. “Mr Justice Herdman had the parties in the'- witness - ’box ’ before him,” said Mr ) Justice.; Adams ; in delivering the tice Herdman)' desprites the; ajipelifmt ns a s|irelyd J; exphriehced ihoney-ieii-; der his previous. experience of and. his family—they had'five , children—must have been well- aware that the (family had been struggling, against adversity, and that the -y;,^sj^hdeht. whs financially embarrassed. The learned . Judge also find’s thhw,respondent was not a free agpnt; and could not protect himEelf. He ’dcscribes the. respondent as and .inexperienced in

matters of finance, a struggling man who, having been once a farmer, had sunk to the level of a labourer Tbe respondent had no one to advise him, and the assignment was prepared by the appellants’ solicitor who gave him no assistance before making his bargain.” Air Justice Adams discussed some of Richardson’s own evidence and said briefly that lie acted as a prudent investor should act, but did not impart bis information to the respondent. “In our opinion,” continued Mr Justice Adams, “tbe price paid by the | appellant was so inadequate as to I quote an expression occasionally used t- shock the ccnncicnce of the Court the transaction a,s unfair and unjust. In plain terms it was an unconscionable bargain. Fnrtljp'r, we think it very unfortunate that tbe appellant’s original solicitor, knowing as much as ho did, thought it unnecessary to warn the respondent that he should consult an independent solicitor and even to go to the length of refusing to complete the transaction until lie bad done so.”

After discussing tbe argument raised by tbe appellant and the question of costs, Mr Justice Adams gave judgment against him as set out above.