CLAIM FAILS

New Zealand Herald, Volume LXXIV, Issue 22864, 20 October 1937, Page 21

CLAIM FAILS

ACTION AGAINST CEOWN EXCHANGE RATE ISSUE PAYMENT FOR AMMUNITION Judgment for the Crown was given by Mr. Justice Reed, in the Supreme Court yesterday, in an action brought recently by the Colonial Ammunition Company, Limited, for tho recovery of £6193 lost as the result of the increased exchange between New Zealand and England. Mr. Richmond and Mr. West appeared for the plaintiff company, and Mr. Meredith and Mr. Smith represented the Crown.

In his written judgment, His Hdnor said the case was a petition of right, in which £6193 was alleged to have been short-paid by tho Crown in respect of the purchase of ammunition. In the contract the price payable by the Crown for small arms service ammunition supplied was mainly regulated by reference to the current price being paid by the War Office to contractors for similar ammunition in England. The question raised was whether exchange should be added to the contract price to arrive at tho price payable by the Crown. Plaintiff had always accepted the amount so ascertained, but without any variation because of exchange.

For many years the exchange rate was negligible, but in 1930 the premium rose to £5 per cent and in 1933 the exchange stood at £125 New Zealand for £IOO London. Since then it had varied between £124 10s and £125. Until the representatives of the parties met in London in 1936 the question of the addition of the appropriate exchange to convert the War Office price into New Zealand currency was not raised. The plaintiff's contention was that on the true interpretation of the contract the current War Office price should be converted into New Zealand currency to arrive at the price payable by the Crown. Tho Judge agreed with the Crown's contention that the correct method of ascertaining the price was as follows: Having ascertained tho number of pounds payable in London for the same quantity of ammunition, the basis of payment should be tho same number of New Zealand pounds. Judgment would be for the Crown, together with costs according to scale.