WAGE PROTECTION

New Zealand Herald, Volume LXXVI, Issue 23413, 1 August 1939, Page 13

WAGE PROTECTION

IMPORTANT DECISION STATE HOUSE CONTRACTS THE ; ADVANCES CORPORATION NO PRIVILEGES OF CROWN After hearing argument submitted to him by counsel in the Supreme Court Mr. Justice Fair has decided that the State Advances Corporation must be considered a separate and distinct entity and that it is not to be identified with and entitled to the privileges of the Crown.

The judgment is of great' interest to contractors and workers engaged in the erection of State houses in that it decides that the State Advances Corporation while engaged in the erection of State houses is subject to the provisions of the Wages Protection and Contractors' Liens Act, 1908, so that a charge may he secured upon contract moneys in the same manner as if the houses were being built for an individual owner. Submissions by Counsel The, action claiming a charge on moneys payable to a contractor under the State housing scheme was brought by Smith and Smith, Limited, merchants (Mr. Wilson), Winstone, Limited (Mr. Henry), Henderson and Pollard, Limited, and N. J. McLeod (Mr. Buisson), and the trustees of the William Peet estate (Mr. F. C. Jordan) against the State Advances Corporation (Mr. Ball) and 0. A. Smith, builder.

It was urged for the State Advances Corporation that the corporation was the Crown, and was consequently not bound by the provisions of the Wages Protection Act. On behalf of the claimants it was urged by Mr. Henry that the corporation was not the Crown or the agent of the Crown, and was consequently bound by the Act as if it. were an individual owner. His Honor's Judgment

In giving judgment His Honor said he had been disposed to think, on hearing Mr. Ball's argument, that the State Advances Corporation was an alter ego of the Crown and was entitled to the immunities and privileges that the Crown has granted to it bj' Common Law and by Statute. But further consideration of the authorities cited by Mr. Henry, His Honor continued, had led him to the conclusion that he was obliged to hold in this case that the provisions of the State Advances Corporation Act, 1936. amounted to a declaration that the corporation was constituted as a separate entity, intended to exist as a separate entity from the Crown in its genera! capacity, and was entitled to sue and to be sued in such independent capacity.