MORATORIUM BILL.

New Zealand Herald, Volume LXVII, Issue 20759, 30 December 1930, Page 3

MORATORIUM BILL.

NEW SOUTH WALES MEASURE. [from our own correspondent.] SYDNEY, Dec. 18. The main reason for the introduction of the Moratorium Bill into the New South Wales Parliament was the protection of the home buyer who through enforced idleness, found that his savings which he had put into a house property were being taken away because he could not keep up the instalments. Several cases were reported in which the mortgagee had foicclosed when as much as £BOO had been paid on a £IOOO property. Actually the vast amount of unemployment made the legislation necessary. The new measure, which will be passed before the House rises for the Christinas holidays, will remain in force until April, 1933, and it is based largely on the Commonwealth Moratorium Act that was in force during the war years. The bill is made retrospective to November 26 last so as to protect persons against whom proceedings were commenced as soon as tho intentions of the .Government were announced. Ibe holder of a mortgago may not, without the permission of the Court, call up or demand payment of tho principal secured by the mortgage, or exercise any power of sale. When any case comes before tho Court the rate of interest may be reviewed and limited to 7 per cent. 'lbis is of special intcicst in view of the fact that all mortgages that have been renewed during the past year have had the interest increased to 7J per cent., which is now tho ruling rate. The provisions of the bill extend to agreements for the sale and purchase of land and to hire-purchase agreements. Under the latter system a vast amount of business has been done in Sydney in tho past. A hire-purchase agreement will be regarded as a mortgage on goods. If, however, any purchaser of land or goods fails to make a payment for six months or is more than 12 months in arrears, the vendor may give notico to exercise his rights. In tho case of a hire-purchase agreement tho Court is to have tho right to reduce the amount of the instalments and to postpone the payment of instalments having full regard to the rights of all tho parties concerned. The Court is given a wide discretion to vary instalments and to suspend payments. Foreclosure will be possible if there is evidenco that tho security is being seriously affected. There is a special clause to protect persons whoso property and investments are affected by tho moratorium. , Generally, it is conceded, tho bill, coming from a Labour Government, must be regarded as a very fair one. It is not nearly as 'one-Sided as most people feared it would be.