THE COURTS.

New Zealand Mail, Issue 662, 31 October 1884, Page 21

THE COURTS.

SUPREME COURT. IN THE SUPREME COURT OF NEW ZEALAND, WELLINGTON DISTRICT. (Judgment of Richmond, J.) (Delivered April 16, 1884.) Wl TE RUKE AND OTHERS V. NEW ZEALAND NATIVE LAND SETTLEMENT COMP ANT. Richmond J. : In this action, the plaintiff's’, who are nine in number, with nine other natives, not parties to the present proceedings, were owners of the Paremata Block under a certificate of title, issued pursuant to the 17th section of the Native Lands Act, 1867. An instrument bearing date 3rd May, 1882, executed by the whole eighteen native proprieters, conveys, or purports to convey, the block to the defendant Company for an expressed consideration in money of £9OOO. By another deed, bearing date 4th May, 1882, obviously forming part of the same transaction, and expressed to be made between the Company of the one part, and 44 the committee and owners of the Paremata Block of the other part ” it is provided, that, of the nominal purchase money of £9OOO, £BIOO shall be laid out in the purchase of what may be called paid-up shares in the Company. These shares are to confer special rights. The Company undertakes to cut up the block, and to sell or let the sections. Two-thirds of the net proceeds of sales and of the rents received on leases are to constitute a special fund, which,, as it arises, is to be distributed amongst the Native vendors by half-yearly payments, until they have received the full amount of their shares, which will then be extinguished, or at the option of the holders, the shares, instead of being extinguished, by payment may be retained; in which case they will entitle the holders to preferential dividends at the rate of 8 per cent per annum. The deed contains provisions relating to the balance of £9OO, which is treated as an advance on the security . of the shares, and other provisions to which I need not refer. It appears to be executed by seven of the plaintiffs, and by two others of the Native owners, who are not plaintiffs. In the month of April, 1882, application was made on behalf of the Company, to the Native Land Court sitting at Gisborne, for its approval, under the Native Land Act, 1873, sections 59 and 98, of the conveyance or memorandum of transfer. On this application it was sworn by the plaintiff, Wi Te Ruke, that the consideration of £9OOO had been actually paid, and the court was not apprised of the existence of the deed of the 4th of May, 1882. Thereupon the Court, on the 2nd of June, 1882, made what is called a conditional order :— 44 Reciting that the necessary inquiries relative to vesting the freehold tenure in the defendant Company had been made, and were satisfactory, and stating that so soon as the new certificate should be prepared, the necessary indorsement could be made, subject to the existing lease being surrendered, and the subdivision plan approved of and deposited. This statement of the effect of the order,. I quote from the 6th paragraph of the claim. No copy of the order has been produced, but I assume that this correctly gives its effect. The transaction was actually carried into effect in accordance with the deed of 4th. May 1882. Matters were so arranged, that the Company’s cheque for £8250, part of the nominal purchase money, waa not debited bo their account with the Bank of New Zealand until the 6th of April; on which same day, a cheque signed by, or on behalf of the native vendors for £SIOO was lodged to the credit of the Company. The consent of the Native Lands Court to the alienation of the block had been secured the day before. The claim of the plaintiffs attacks the transaction which the deeds purport to effect on grounds which are reducible to two heads, viz. : Ist, fraudulent misrepresentations made to the plaintiffs, inducing them to sign the conveyance ; 2nd, fraud practised on the Native Land Court, in keeping back the deed of 4th May, 1882, and representing the transaction as a sale for £9OOO cask.

The relief asked is that the Court orcler the defendant Company to 8 1 ' 8 P eUed memorandum of transfer to cas h The plaintiffs undertaking to repay the cas . advaLe of £9OO. Issues o actstated in thp pa,so and were cntj before H°s Honor the Chief Justice and a iurv of twelve, at the sittings in last December. The jury found aU the issues which were left to them, m favor of the delenciant Company. These findings dispose of the allegations of fraudulent misrepresentation macfe to the plaintiff's. Hut m regard to the allegations of a fraud practised on the Native Land Court, the admitted facts of the case are as I have already stated. On the findings of the jury, the Chief Justice ordered judgment to be entered for th defendant company; reserving to the plaintiffs leave to move to set aside the judgment, and enter such judgment as the Court should think proper upon the findings of the jury, and the admissions on the record, and the admissions.made by the parties, as appearing in the judge’s notes, and °“ t “ e 1 ' dence ; but the Court to be bound by the findings of the jury, and admissions, so far as they go. The present motion is made pursuant to the leave so reserved, and was argued on the 27th ultimo. Th e ground now relied upon by the P* 31 *-" 1 1 that the transaction as effected by the two deeds, is not a sale within the I P ea,l l in f ° t the 59th section of the Native Land Act, 1573. It is said that the section does not allow the Native Land Court to approve of a sale on a deferred payment of the consideration money, inasmuch as it requires the Court to be “ satisfied of the payment of the •whole amount of the purchase money stipulated upon,” and further, that a transaction which leaves the natives an interest in the proceeds of sale, is in the nature of a deed of trust, and not of a deed of sale, , and * s not, as appears by the terms of section 60 within the provision of section ,SJ. -Uie question is a very narrow one, not capable of determination by authority; and very little capable of illustration by argument. I see no reason for putting on the statutory provision so narrow a construction as the plaintiffs contend for. In the first place 1 am of opinion that the transaction is truly a sale. The property passes absolutely to the company, and the benefits secured to the natives are wholly distinct from their former rights of ownership. The schel P® of the company is that the native shareholders shall contribute land, and European shareholders money. The natives are.”!™® position of partners, who bring land into the joint stock. Such a transaction is clearly a sale to the co-partnership, at all events, where the co-partnership is an incorporatea company. Secondly, the requirement of section 59, respecting the purchase money, may well be understood as applying to such part of the money as is made immediately payable by the contract of the parties, lhe words, “ stipulated upon which were much emphasised in the argument for the plaintiffs, are really somewhat in favor of this construction. But on broader ground, I think a restrictive construction should not be put on the terms of section SJ. lhere can be no doubt, that to prevent natives from selling on deferred payments, is to impose on them a serious disability. In a large proportion of sales of real property in this colony a part of the purchase money remains unpaid upon some kind or security. No doubt it may be said that such disabilities may be protective. In the present case, however, it is far from clear that the .supposed restriction would be beneficial. No wise friend of the Maoris can desire that they should be put suddenly in the possession of large sums of money. Payment by instalments, provided always that the security is ample, may be m uch more beneficial to them. I hold that this Court ought not to adopt _ a construction which fetters alienation by imposing a personal disability ; that disability being, to say the least of it, a doubtful benefit to the subject : unless the intention of the Legislature has been made quite plain and indisputable. This leaves no ground to the plaintiff, save that which is afforded by the character of the proceedings in the Native Land Court. 1 am certainly of opinion that the suppression of the Deed of Covenant was a most improper act; though probably nothing worse than an error of judgment. The jury have negatived the existence of actual fraud in these proceedings. The true character of the transaction between the natives and the company must have been a matter of public notoriety ; and the ignorance of the judges of the Native Land Court, was mall probability merely official. It would be going a great deal too- far to say that the improper conduct of the company’s agents constitutes a sufficient ground for the cancellation of the deed of conveyance. The jury have negatived all fraud in the means by which that conveyance was obtained. -Lne transaction in itself must be taken to be, and appears to be a perfectly fair one. The wrong done is simply in the mode by which the assent of the Native Land Court has been obtained ; and in that _ wrong the plaintiffs themselves were participators, bo far as I can judge, the true transaction had it been fully disclosed, was- entitled to receive the approval of the Native Land Court The case, therefore, is certainly not one for the interference of this Court by the cancellation of the deed. It appears that the Native Land Court is not yet functus officio ; and it may not be too late for the plantiffs to apply for the rcsc.ssion of the order which has been made. That is their appropriate remedy, and I think them only remedy under the circumstances. There is a ground to which I have not yet adverted, on which it is quite plain that the plum i t a could not in any case.be cnffitiecl t° a p sent judgment in their favor. The:;T PPn co-owners of the plaintiffs bave made parties to this suit. , k would be obviously impossible to make , . - favor of the plaintiffs without first bringing these persons before the Coui • plaintiffs motion is, therefore, refused Pith costs.