THE COURTS.

New Zealand Mail, Issue 859, 17 August 1888, Page 23

THE COURTS.

COURT OF APPEAL.

Aynsley and Others (Appellants) v The Church Property Trustees (Respondents). - - (Judgment of the Court, delivered 9th August, 18SS.) Our decision in this case must be governed by the judgment of this Court in the New Zealand Loan and Mercantile Agency Company v Sperrey, 3 N.Z.L.R ; C.A. 34. The Dosition of the defendant body is the same as that of the Auckland Agricultural Company in the case cited, whilst the plaintiffs are in the position of the appellant Company in the same case. It was there held that the appellant Company ought to render statements as mortgagees in trust for the debenture holders under the mortgage made to the appellant Company by the Agricultural Company; and we are of opinion that the plaintiSa must here do the like as mortgagees in trust for the debenture holders under the mortgage made to the plaintiffs by the defendants. The statutes passed since the decision referred to have not affected the question raised in this case. Section 15 of the Property Assessment Aot, 1885, appears to be aimed at such a case as that of the ‘Guaranteed Investors’ to whom the first question in the New Zealand Loan and Mercantile Co. v Sperrey had reference. These persons were considered by this Court to be depositors, not lenders, and for this conclusion the document referred to as the Company’a ‘terms of investment ’ afforded ample ground. But the debenture holders in the present case are plainly lenders, not depositors. The Church Property Trustees have not received the money of the de. bsnture holders for investment, but as borrowers to be employed for the purposes of the trust. Sectio'n 15 of the Aot of 1885 refers to deposits, not to loans. We are therefore of opinion that the plaintiffs are liable to assessments as trustees ot the mortgage and that they are entitled to deduct tax from the interest accruing due for the period in respect of which the tax is payable. The questions put in the case are to be answered accordingly, and judgment entered for the defendants with costs. We can decide nothing as to the quantum of the tax in the absence of the commissioner and the plaintiffs’ ce3tin que trusts.