ESTABLISHED 1866. The Marlborough Express. WEDNESDAY, AUGUST 20, 1919. THE MORATORIUM.

Marlborough Express, Volume LIII, Issue 195, 20 August 1919, Page 4

ESTABLISHED 1866. The Marlborough Express. WEDNESDAY, AUGUST 20, 1919. THE MORATORIUM.

The last extension of the moratorium expires on August 31st, and that is one of the reasons why Parliament should meet before the end of the month. It is necessary to take legislative action in the next few days to prevent the financial disturbance that- would be caused by the sudden disappearance of the measure which v has been affording protection to so many mortgagors during the war period. Failing some new provision a large number of mortgagors would require simultaneously to find the money to pay off their liabilities, and the maturing of the whole bulk of the overdue mortgages would doubtless mean embarrassment and hardship for many borrowers. The matter rests in the hands of Parliament, -which will, it may be supposed, be guided by the Minister for' Finance. Whatever proposals the Minister has in mind have not been divulged publicly, but it is anticipated that he will advise the adoption of methods providing for a gradual calling up of the money due under mortgage. A number of business and professional men whose (•pinions were obtained by the Auckland Herald, favored the removal of the moiatorium on the graduation principle, after the fashion of the Australian plan. In Australia it has been agreed that mortgages shall become due in rotation, in the order of the dates of the ; ir original maturity. In that way mortgages can be rearranged without imposing an undue strain on finance. 'One of the business men interviewed, however, urged the desirability of lifting the moratorium in the near future. He thought that the borrowers' would be able to meet their difficulties readily enough with the assistance of the banks. He pointed out that money had been lent out of many estates wherein beneficiaries were concerned, and these naturally;. desired to be able to call in the sums out on mortgage to enable the capital in the estate,to be distributed among them. He considered that borrowers had had a good rest and plenty of time in which to make arrangements for the refunding of sunis borrowed, the term of the moratorium having been fbed originally for six months after the declaration of peace. There would undoubtedly be a very large number of mortgage's expiring when the moratorium was removed, and the sum involved would, he thought, run into hundreds of thousands of pounds. An enormous iSurn would thus be released for other purposes, such building. The bulk of, opinion, however, seems to be that the sudden lifting of the regulations would have an unduly' severe effect and the idea shotild not "be entertained. One suggestion is that the law be amended so as to transfer the onus of proof from the mortgagee to the mortgagor. The present position is that if the mortgagor makes default in such a way as, on the pre-war basis of the law, would entitle the mortgagee to enforce his powers, the latter must, under the terms of the Mortgages Extension Act, apply to the Court for an order authorising him to proceed, and the onus of pi oof is thrown on the mortgagee. The suggested modification is thatthe mortgagee should still be 'required to procure an order of the Court, but the onus of proving that that course would involve undue hardship should be thrown on the mortgagor. The reassuring Opinion was expressed by Mr A. P. Green, the manager of the Bank of New Zealand, 'hat the extension of the moratorium, given an arrangement for the gradual ; calling up of money due under mortgage, will not have a disorganising effect. Money is plentiful, lie says, and he thought the "demand which might arise would b© met without trouble. There might be a further rise in the price of money. The.1 larger financial institutions accustomed to< lending money had increased the rate of interest for new loans entered ,ihto during the war. That rate might be increased a little, but beyond that he did not? fear thai'-any particular effect would be produced on the money market by the inevitable removal of the moratorium.