RENTS FROM PROPERTY

New Zealand Herald, Volume LXXI, Issue 21906, 15 September 1934, Page 15

RENTS FROM PROPERTY

DAMAGES AWARD SEQUEL

PUBLIC TRUSTEE'S APPEAL JUDGMENT OF THE COURT [by telegraph—press association] WELLINGTON. Friday The Court of Appeal gave judgment to-day on an apjreal brought by the Public Trustee against a judgment of the late Mr. Justice MacGregor at Wellington last year in a case concerning rents from and management of property. , • The facts giving rise to the appeal were that John Merry, a retired bootmaker, Wellington, had accumulated considerable house property in Wellington, when, in September, 1913, he was committed to a mental hospital, where he died in September, 1924. From the date of his commitment until September, 1928, the estate was managed by the Public Trustee, who then transferred it to Mrs. Alice Merry, widow, the sole surviving beneficiary. In January, 1929, Mrs. Merry commenced an action against the Public Trustee. She alleged that the Public! Trustee so unskilfully and negligently managed and controlled the real property of the estate that large losses were caused by reason of inadequate rentals being obtained. She claimed £2999 damages. An order was made in October, 1932, referring a series of questions of fact to Mr. E. Page, S.M., as a special referee. He reported in June, 1933, that in respect of three properties at Brooklyn, Kilbirnie and Houghton Bay a prudent, skilful and diligent business man or trustee would have obtained considerably higher rents than the Public Trustee received. Variation of Judgment

Mr. Justice MacGregor gave judgment for plaintiff for £1059, plus costs and disbursements. From this the Public Trustee appealed. The Appeal Court, in a written judgment, delivered by Mr. Justice Reed, varied the decision of the Supreme Court by giving judgment for the respondent, Mrs. Merry, for the deficiency in rents as found by the referee between September 3, 1913, and May 13, 1925, with compound interest at 3 per cent, and dismissing the other part of the claim, including respondent's cross appeal. As each party had partially succeeded the Court allowed no costs in respect of the appeal. The Court first held that the evidence supported the report of the special referee and that appellant had failed to show that the report was otherwise than a fair and impartial finding on the evidence. The report justified an inference of negligence on the part of appellant, but other factors affected the question of the amount of damages recoverable. The Court then found that the right given to a landlord by the War Legislation Amendment Act, 1916, to increase his tenant's rent from an agreed rent to a standard rent had never been taken away, thus holding that the English case of Dufty versus Palmer had no application in New Zealand. Degree of Negligence The Court held that Mrs. Merry was not entitled to claim that the Public Trustee was negligent in the management of her property from the time she unreasonably refused to take it over. The appeal was accordingly allowed as to so much of the judgment as related to anv period subsequent to May 13, 1925. With reference, however, to the period from September 3, 1913 (when the estate of John Merry was committed to the Public Trustee's charge), to May 13. 1925, the Court said: "It is established that during that period appellant failed to obtain rentals which a prudent, skilful and diligent business man or trustee could have obtained, and he must be held liable for the difference. "It may be observed that there was also evidence that revealed a considerable degree of negligence in the administration of the Public Trust Office during, at all events, part of the period referred to, and it was admitted by officers of the department who gave evidence before Sir. Page that some of the methods adopted at that time in the management of estates would not be tolerated at the present day." *