SUBDIVISION DISPUTE.

New Zealand Herald, Volume LXI, Issue 18897, 20 December 1924, Page 13

SUBDIVISION DISPUTE.

SURFDALE ESTATE'S CLAIM. THE MERRILANDS PROPERTY. OWNERS SUED FOR COMMISSION CASE FOR THE PLAINTIFFS. The action arising out of a land subdivision at the Merrilands estate, Ono Tree Hill, was continued before Mr. Jusi ice Reed in the Supreme Court yesterday. Surfdale Estates, Ltd. (Mr. Finlay and 'Mr. Anderson) sued for a declaration that John Paterson and James Paterson (Mr. I!. McVeagh), commission agents, and Helen Paterson, spinster (Mr. Ostler), wen.' trustees for plaintiffs, in respect of £2271 5s 3d and £450 13s. commission alleged to bo due. Plaintiffs also asked that defendants be ordered to furnish proper accounts of all moneys collected by them from purchasers, and to pay these to plaintiffs. There was a further claim for £1500 general damages, being estimated profits plaintiffs would have . made had they been allowed to carry out . a contract with defendants for the sale of the land.

According to the statement of claim defendants agreed to sell the land in question to Milburn and Rowllings, but later they determined that transaction. Milburn and Rowllings appointed plaintiffs as sole agents lor the subdivision and after defendants had' ended their agreement with Milburn and Rowllings plaintiffs were appointed by defendants to obtain fresh contracts from purchasers, giving such purchasers full credit under tho new contracts for money paid to Milburn and Rowllings. Sales and Commission. Mr. Finlay said the decision must depend on Up to a certain point of time plaintiffs were selling for Milburn and Rowllings, and only after that date for the defendants. Anything done, therefore, while the company was agent for Milburn and Rowllings must be accounted for to Milburn and Rowllings, and not to the defendants. Counsel went on to point out that defendants, in affi davit, had admitted that over £22,000 worth of propeity had been sold by plaintiffs. In respect of that plaintiffs were, in the terms of the contract, entitled to 10 per cent, commission. Evidence for Plaintiffs. Martin Savory Dunne stated that ho was managing director of plaintiff company. Plaintiffs entered into a contract with Milburn and Rowllings for tho salo of Merrilands, and in the course of the contract plaintiffs carried out all the necessary work, having the land subdivided and plans prepared. Sales were mado by plaintiffs on behalf of Milburn and Rowllings up to May 18, 1924. Witness sold about £45.000 worth of land for Milburn and Rowllings up to May 8. The original purchase money, as between Milburn and Rowllings and the defendants, was £55,000. About £110,000 was the agreed price for the. subdivided ostate. Witness had several conversations with tho Pater sons, and they asked him to carry on with the salo. Ho agreed to do so. Basis of Contract. The terms .of the contract, continued witness, were arranged on the basis that plaintiffs would get the assignments of the existing contracts, and also the outstanding commission on those sales, viz., £2773. All commission in regard to sales made for the Patexsons direct was to be 10 per cent. Witness got instructions from defendants to have the purchasers all sign new contracts with them. Plaintiffs had received £702 in respect of the sales shown on four of the schedules, rind they had paid £688 2s lOd to Paterson Brothers. Plaintiffs claimed 10 per cent, on the full amount of the sales, less an odd credit of £14. Witness asked the Patcrsons about the old commission that was due and was told by John Paterson that, as the money was being collected, plaintiffs would receive it monthly. Plaintiffs expended about £4500 in connection with the agency for Milburn arid Rowllings. A Surf dale Transaction. Cross-examined by Mr. Ostler, witness stated that he had about. £150 or £160 when he landed in Auckland from Australia Ho also' had £2000 at his call from the person for whom he worked in Australia. The Surfdale Estate was the first venture he went into in Auckland. Ho secured an' option for the man who engaged him in Sydney. Counsel quoted from a letter written by witness, in which ho wrote; "Being 'broke' spurred me on and I took an option on Surfdale for £150, paying same with a. cheque drawn on tho A.8.C., Sydney, which, of course, was no good. But I 'kidded' the local agent here to hold the cheque till I finally bought the property and thus save exchange. Ho diii, lie not only saved tho exchange but he also saved me." Counsel; Is that true?—No, certain'-,* not. What was your object in telling a series of lies ?—lt was- written to somebody who had taken mo down and I wanted to show him what a smart fellow I was. I thought he might be wanting to borrow money, so I told him a "tale of woe." It was written '.o a friend not for disclosure, and . not for your hands. A Swift Advance in Life. Counsel read the following quotation from the letter in regard to witness' doings ir. Auckland: "1 fished round, and, would you believe me, got a syndicate together with £7000 capita!, taking up one-third myself, depeuding on management fees, £750, and commission for sales, to pay my footing. At present Sur f da'o looks like shoving £55,000 to £60,000 net pro fit and dividends will commence in August. ... It is like a fairy tale. Two years ago. hard up for a meal! To-day assets nvf" r-re\- &[ . ]( business worth £3000 per annum." Counsel: i., .. ■„'■) lies''—Thai was a fair idea of the position. Quoting further from the letter, counsel read: "The future is marvellous scope unlimited; prospects glorious." Witness, continuing, said he owned one third of Surfdale. Ltd.. and had sold 1100 sections ot that estate. One-third j '<> the money he was collecting belonged to him. Questioned about a certain transaction, | witress said a cheque was dishonoured, j A? far as lie could remember that was the only cheque oT the- company that was dishonoured. ■ ! Financing Syndicates. Witness was tjr.rationed in regard to his associations with various estates. He had, ae said, been financing certain syndicates with hard cash. About a year ,120 the V'onnt Royal Company owed him personally about £600 cash advanced to meet expenditure. Eighteen months a"o the Oneroa ("omnanv owed him £2000. Ho had drawings as v.ell as salary. Have you'ever had a meeting of direc, tors?— Yes. Proceeding, lie .-.aid they had no minute book. There were no formal J evolutions. 1 sunpose vmj had your own way right through and what vou said went ?—Prcltv well. - J In your agreement with Milburn and RowllmTS you were obliged to advance i money if you had not sold ruflicient land to produce £5000?— At a certain <•,-;(,-. | Proceed nir. witness said that on April 18 j they should have paid MiHmrii and Row] litis* £2043, but actually €2812 was paid. Then the difference, £769, was an advance by you to Milburn and Rowllings W-.'ch they had to pay back ?—Wo were collecting out of commission. If we had known thev were so far behind they certainly would not have had it. Continuing. witness said the actual commission thev had earned up to May 8 was £4559 and thev had taken net-'ally £1747. On May 7 and 8 ;you negotiated an Agreement with the present, defendants ?- We went into it, but the ucgoliatioua »ere carried on for a month.

i What sales did you make between April ! 18 and May 18 t-lAbout ten. i Witness gave evidence in regard to a transaction with a man named Walsh, i who had deraiinded repayment of £248. | raid as purchase money for a Merrilands section. Asked if he had paid that money into any trust account, witness said £212 was paid into the Merrilands account. Then you must have paid it into the Surf dale account first V —lf it was paid by cheque we should do so first. Counsel said that one of the Patorsons* defences was that they wore justified, by witness' conduct, in taking the matters out of his hands. His Honor: Assuming you may be entitled to take it out of his hands, that does not answer in regard to payment* of commission. Witness said they were entitled to pay the money into their general account as Milburu and Rowllings owed so much commission. In replying to further questions, witness said they had about 180 sales at tho end of April, and only about 20 were not up-to-date with their instalments. That indicated that tho sales were solvent aDd good. His Honor put a question as to the cause of the contract being terminated, and witness, replying, said he knew, or instinct told him, they were going to cancel, as he understood his salesman was taking on the selling: at a lower sionAfter further evidence had been given, His Honor adjourned tho case until Monday.