A MONEY-LENDING TRANSACTION.

New Zealand Herald, Volume XXV, Issue 9012, 27 March 1888, Page 3

A MONEY-LENDING TRANSACTION.

LAISHLEY V. CAVE.

VERDICT FOR THE PLAINTIFF.

His Honor Judge Smith gave the following judgment at the District Court yesterday morning, in the case of Laishley v. Cave, heard at last sitting, and fully reported in the Herald : —

In this case I do not think the set-off can be sustained, either as it is alleged in the defence or as amended in the way suggested by Mr. Cotter. To allow the set-off, it would be necessary to go behind a judgment of the Resident Magistrate's Court in respect of each item. The note in Smith's L.C. to the leading case of Marriott v. Hampton, that money paid under the compulsion of legal proceedings, cannot be recovered where the proceedings have advanced .to the maturity of a judgment, has not the authority of a judicial decision, but the opinion of the learned editor of that work, supported by the tacit consent of a series of subsequent editors, two of whom attained to a very eminent position on the English Bench, constitutes an authority which is not lightly to be set aside, and in the absence of any judicial decision to the contrary, must be taken to be a correct statement of the rule of law. which is to govern this case. The judgments of the Resident Magistrate's Court, if challenged at all, must be challenged by proceedings taken in that Court. The item of £12 in plaintiff's claim—stamp fee and fine—cannot be sustained. The money was not paid at defendant's request, and the circumstances under which it was paid do not raise the implication of an antecedent request. As to the first item of plaintiff's .claim, I am of opinion that the plaintiff is entitled to recover the amount of £39 16s 6d, namely, one quarter's interest on £1327105, the amount of mortgage money remaining due under the mortgage at the time a quarter's® interest became due. Ido not see that the plaintiff was under any obligation to pay interest on the full amount of £1400. The memo, of 16th November, 1886, expressly stipulates that 12 per cent, be paid on the money remaining due under the mortgage. It is admitted that £1327 10s remained due on 14th of January, ISSB. I think interest at the rate of 12 per cent, is rightly claimed. The memo, just referred to, which, however, clearly does not show the complete agreement between the parties, contemplates the payment of the principal on 16th of November, 1887. Up to that date, therefore, 12 per cent. was payable. The consideration for the promise to pay 12 per cent, was the forebearance of the mortgagee to call for payment of the principal. The principal was not paid on the 16th November, 1887, but the mortgagee still forbore to call for payment, and no fresh arrangement was made. Under these circumstances, I think a continuance or renewal of the promise to pay 12 per cent, must be implied, upon the principle that where the parties to a transaction make stipulations for a definite time, and at the expiration of that time no change of circumstances occurs, and no fresh agreement is made, the parties will be presumed to continue under the previous stipulations so far as they are applicable. The defendant's letter of 24th October, 1887, so far from militating against this, contemplates the continuance of the then existing arrar ....-nt, unless some fresh arrangement we) made. It only remains to consider whe her the defendant is entitled to the benefit of the secret agreement between the plaintiff and the mortgagee. It is not necessary for me to determine whether that agreement is a valid one as between the immediate parties. The consideration seems very slender, if it be not altogether illusory. But that is not the question at issue. The question is, in what way has the defendant been injured by that agreement ? A Court of justice is not a censor or morals, nor is every sharp practice a ground for equitable relief. One may be surprised at the fact that the knowledge of the existence of this agreement was withheld from the defendant, and that all the defendant's requests that the plaintiff would intercede with the mortgagee for a reduction of interest were treated in the way in which they seem to have been treated, but it is difficult to see that the defendant has suffered an infringement of any legal or equitable right. Ihe plaintiff was under no legal obligation to intercede as requested, however much as a matter of honour, having regard to all the circumstances of the case, it might have been expected that he would do so. The defendant has made a definite agreement, which ho has failed to perform. As soon as the quarter-day arrived, it became his duty to pay the quarter's interest. When he failed to do so, the plaintiff's liability immediately attached. By discharging that liability promptly, the plaintiff gained the advantage of his agreement with the mortgagee—a very large advantage, no doubt—but a delay of I fourteen days would, if the agreement had been adhered to, have deprived him of- that advantage. I have carefully considered Mr. Cotter's argument on this point, but it seems to me the cases he cited as to the relation of principal and agent or principal and surety are beside the mark. If the defendant could have shown that he was always ready and willing to pay nine per cent, promptly, as soon as the interest became due, and in consequence of the plaintiff's conduct he had been called upon to pay and had paid 12 per cent., or if he had shewn that had he known of this agreement he would have been ready and willing to pay nine per cent, promptly, his position might have been very different. But the course of this transaction shews that on each occasion when interest became due he was either unwilling or unable to pay promptly.. It does not lie in his mouth to say to the plaintiff: "It is true I have failed to perform my obligation. _ You have performed yours, but as you by doing so have gained the advantage of paving a lower rate of interest, I must have the benefit of the advantage you have gained." I do not think such a contention could be sustained either in law or equity. Judgment for plaintiff, £39 16s 6d. Mr. Cotter gave notice of appeal. Costs were ordered at £9 3s.