SANCTITY OF CONTRACT.

New Zealand Herald, Volume LXIX, Issue 21115, 24 February 1932, Page 12

SANCTITY OF CONTRACT.

Sir—l think 1 am responsible for the suggestion that I lie Bank of England was obliged to break a promise. As I understand it the Bank of England accepted foreign trade balances payable in gold on demand. The French, by suddenly withdrawing large credits in gold, precipitated an international run on the Bank of England, and on September 20 the bank ceased to meet its obligations in gold, '.hereby breaking a promise. 1 hope that "Inquirer" can show that 1 am wrong, as I hope someone else will show that there is no need to worry about our internal fixed charges, interest, rates, wages, rent and the like. It is unpleasant to appear to advocate the violation of the sanctity of contract, yet wo all to-day accept gratefully the concession granted to us by a foreign people (the Hoover moratorium). No voice was raised then regarding tho sanctity of our obligations. Wo continue to seek war debt concessions. The American people lent money to our nation (o enablo it to carry on the war. Our own people lent money to New Zealand to carry on the war. Can we with honour and honesty ask 1 concessions from the American people and at the same time plead the sanctity of contract to excuse a similar sacrifice from our own? Professor Algie's impartial article made it clear that Ihe variation of a contract may lie excusable in the interests of the nation,and those who advocate an adjustment of all internal fixed charges can havo no other purpose in view. J. 13. McMillan.