SUIT AGAINST BANK

New Zealand Herald, Volume LXIX, Issue 21358, 6 December 1932, Page 10

SUIT AGAINST BANK

LABGE SUMS INVOLVED CLAIM AND COUNTER-CLAIM ACTION BY MR. W. D. LYSNAR SHEEP STATION LITIGATION [BY TELEGRAPH —I'RESS ASSOCIATION ] WELLINGTON. Monday An action was commenced in the Supreme Court to-day, in which the claim and counter-claim total over £120,000. -The plaintiff is William Douglas Lvsnar, ex-M.P. for Gisborne, who is claiming £50,919 from the National Bank of New Zealand, Limited, and the bank is counterclaiming for £71,990, the litigation arising over an east coast sheep station. Mr. Justice MacGregor was on the bench. Plaintiff conducted his own case. Mr. T. C. A. Hislop and Mr. G. R. Powles appeared for the National Bank. Prior to March 14, 1931, plaintiff was the registered proprietor of the Arowhana Station, near Gisborne. The station consisted of a back portion of 13.608 acres, over which the East. Coast Commissioner held a mortgage of approximately £21,700, including arrears of interest, and a front portion of 7820 acres, subject to a mortgage to the Public Trustee of £39,082. In April, 1916, plaintiff mortgaged all his equity in the land to the National Bank and some years later he executed a further mortgage to the bank over a piece of freehold land comprising about six acres and also over livestock on the station. Negotiations lor New Tenure Owing to the collapse of the wool and jfock markets and, the statement of claim alleged, to the bank insisting on retaining all available revenue from the station, plaintiff fell into arrears with interest to the Public Trustee and the East Coast Commissioner. The latter, in March, 1931, jold the back portion of the station and bought it in himself for £13,608. As it was submitted that the Arowhana Station could not be advantageously worked without the back portion, the plaintiff, at the request, it was alleged, of the general manager of the bank, entered into negotiations with the commissioner and the general manager to arrange some plan of working the station to the advantage of all parties and to secure a fresh tenuro of the back portion. As a result, plaintiff claimed, the three parties entered into a contract whereby in consideration of the commissioner agreeing to lease the back portion of the station to plaintiff for five years with the right of purchase for £13.000, the defendant bank agreed to reduce plaintiff's liability to the bank to a sum of £30,000, to be secured by piortgage (subject to the existing mortgage to the Public Trustee) over the front and back portions of the station, including stock, for five years at 5 per cent. .. Allegation of Contract

Plaintiff alleged that the contract was entered into on May 1, 1931, b'ut on May 2 the general manager of the bank attempted tq vary it by imposing additional conditions on plaintiff. When plaintiff refused to allow the insertion of these conditions the defendant served notice on plaintiff. Subsequently the bank wrongfully, it was alleged, entered into possesion and use of the front portion of the station, all the livestock and chattels on the whole of the station, 220 bales of wool, 839 carcases of frozen mutton and lamb and 6283 sheep and lamp pelts which plaintiff had stored. The defence generally is a denial of vital portions of plaintiff's claim. The bank admits it entered into possession of the property, as alleged, but states that it did so in pursuance of powers conferred upon it by various instruments. It denies that there was any contract entered into by the plaintiff, the commissioner and the bank. Plaintiff outlined his case at some length, mentioning correspondence between himself and the bank in regard to nrrangements for securities to the bank and reference to a new tenure of the "back portion" of the station, without Which the remainder of the station could hot be worked to advantage. He gave evidence concerning a contract which he claimed was made between himself and the bank after arrangements had been completed for a fresh tenure of the back portion of the station. Plaintiff Cross-examined Counsel for the bank, in cross-examina-tion, sought to show that the contract was subject to certain conditions, the most important being that the bank was to have control of the management of Lysnar's property and that plaintiff repudiated the conditions. Plaintiff contended that J. T. Grose, general manager of the bank, Wanted to control the management altogether. Plaintiff refused, except that new expenditure should bo subject to the general manager's approval. Replying to counsel, plaintiff admitted writing to the Public Trustee on June 27, 1931, saying he was unable to complete arrangements with the bank and adding a postscript, "I undertake not to allow myself to take advantage of provisions of the -Mortgagors' Relief Act, 1931." The following month he withdrew the undertaking, as the bank had gone to the Public Trustee to make terms regarding his property, while he (plaintiff) was negotiating to get money to pay off the hank. The hearing was adjourned until tofnorrow.