THE EMERGENCY LAWS

New Zealand Herald, Volume LXIX, Issue 21293, 21 September 1932, Page 13

THE EMERGENCY LAWS

RENT AND INTEREST CASES LEGAL ADVICE TO READERS PROBLEMS AND SOLUTIONS Letters of inquiry continue to reach the Herat,n from correspondents i" town and country, \ylio arc still finding difficulty in applying to their own particular cases the provisions of the National Lxpenditure .Adjustment Act and other emergency enactments. All such inquiries are handed to an Auckland barrister for j consideration, and a number of his replies are printed to-day as follows: — "Lease."—The, board's attitude is correct. By a notice published in the. Gazette on June 7, leases of land administered bv secondary school boards were exempted from the provisions of part HI. of the National Expenditure Adjustment, Act. You cannot, therefore, claim any reduction. "G.P.M." —(1) The leaflet enclosed by you appears to lie in order. 1 have, of course, no means of checking the proportion of chattels comprised in the security, but from the wording of the lcatlet I should say that this has been properly done, and that the new interest rate is correct. (2) As to the "hardship clause" referred to by you, section 33 of the National Expenditure Adjustment Act provides that you may apply to the Court for an order exempting your particular security from the operation of the. Act on the ground that a reduction "would ho a cause of undue hardship" io you. In order to succeed you would have to show that your case was different from that of hundreds of other people affected; and with so small an amount at stake I do not think you would be warranted in going to the expense of Court proceedings. "Morris Minor."—l cannot make the necessary calculation for you without more data than I possess. If you cannot agree with your mortgagee as to the proportion of principal and interest in your instalments, then deduct what you consider to bo the proper deduction and leave it to him to correct you. If -you follow this course you will probably be qurte successful in obtaining a prompt icpl.\ ; from your mortgagee. Mortgagor and Mortgagee "Debt No. 49" writes:—"l obtained a, State, Advances to Settlers loan of £ in 1927 (30 years' term) and also gave a second mortgage of £ —_ over the same property at the same time. Lnder the provisions of the recent legislation, am entitled to relief ? If so, to what extent, and from what date Answer. —(1) "ion aro entitled to 10lief. The interest on each of your mortgages will reduce by 20 per cent, but not below a minimum of 5 per cent. Payments „of principal arc not affected, the relief being restricted to interest payments. The effect of this in your case will be that in respect of your second mortgage you will probably be entitled to a full 20 per cent reduction. On llic first mortgage the reduction will probably bo small, according to the rate of interest you are paying; and if you arc already paying only 5 per cent interest (apart from sinking fund) you will not be entitled to any reduction at all. (2) The reductions take effect from April 1, 1932; but if you have already over-paid in anv payment made by you since that date, you cannot claim a refund unless you make your claim within three months of the payment being made. "D.S.N.":—(I) Your mortgage and debenture, being given to secure a bank overdraft, are probably made payablo "on demand." If this is so, they are expressly excepted from the provisions of | the National Expenditure Adjustment Act j and you arc entitled to no reduction. (2) j As to the exercise by your mortgagee of its power of sale, this matter is governed by the provisions of the Mortgagors' Relief Acts. For a summary of the effect of these provisions see the answer to "A.E.8." printed below. "Ground Rent."—Your second letter makes your position clearer. (1) If the second interest payment was made within three months after, the first payment being made, then you were entitled, when making the second payment, to claim a refund of an excess payment made in the first payment. (2) As regards your second question, it is difficult to say definitely what the Court would do in a case like, this. My advice to you is to do nothing; just let your mortgage "run on" and keep your interest (at the reduced rate), and also rates and insurance, paid up promptly. Do not sign 'any renewal or other document without the advice of your own solicitor, and if you receive arty summons, or any notice under the 'Mortgagors' Relief Act, sec your solicitor im'mediately and instruct 'him to apply to the Court for relief under the provisions of the Mortgagors' Tlclief Act. In this connection, read the answer given to "A.E.8." above, which is partly applicable to your case. Landlord and Tenant "Lessee."—You have a lease until November, 1932. Under the National Expenditure Adjustment, Act you are entitled to a reduction; but not necessarily to a reduction of 20 per cent. 'lho Act provides that your rent will reduce to 'four-fifths of the rent that would have been charged by your lease if, instead of being signed iti November, 1931, it had been signed on January 1, 1930. "What this hypothetical rent, (as at 1/1/1930) would "have been, is a matter for agreement between you and your lessor, and,if you cannot agree, tor decision by the Court. The amount at stake in your case is so small that you should be able to agree without going to Court. It is fairly obvious that ill your case the rent would have been nioro if the lease had been signed in January, 1930. 1 would say that it would be quite a. reasonable settlement to "split, the difference" between yon, | and assess the reduced rent now payable I as 15s 9<l per week. "Smallholder." —In the first, place J cannot tell from your letter whether you ! i( |o entitled to any reduction, since you :do not give me. tho date of your lease, the. name, of your lessor, the amount of your rent, or'the value of the property. Assuming, however, that, you are entitled to a 20 per cent, reduction, you may deduct this proportion from your rent, payable on October 1 next. 'You are now too late to claim a refund on the payment made in last April. -"Justice." —The question asked by you is almost entirely a. matter or the. wording of the order already made by the Court in your case. I presume that, this order makes some reference to the payment of rates and other current, outgoings by the mortgagor. T can give you no definite advice without knowing the exact wording of the order.