SUPREME COURT.

New Zealand Mail, Issue 1204, 29 March 1895, Page 25

SUPREME COURT.

THE CIVIL SITTINGS. The civil sittings were continued on March 20th, before the Chief JusticeJAMES BLYTH V. FREDERICK TOWNSEND\ This was an action to compel specific performance of a contract, or in the alternative to recover .£3OO for alleged breach of agreementSir Eobert Stout appeared for the plaintiff, and Mr SKerrett for the defendant. In opening the case, Sir Eobert Stottt explained that it arose out of the affairs of the Wellington Co-operative 'Bus Company, of which the defendant was a director while the plaintiff was in its service as a 'bus driver. Prior to 1894 the Company obtained advances to a total amount of* <£6oo from Edward William Earp and William Symonds respectively, giving as security bills of sale over the plant. At the beginning of January, 1894, it became neee's'safy for this Company to obtain a further advance, and the plaintiff was asked to lend ,£250, which he had saved and placed on deposit with the Empire Loan Company. The plaintiff lent the money, receiving as security a mortgage over the Company's leasehold property, together with a bill of sale over the horses and cars, &c, of the Company, which bill of sale was to be subject to those kuld by Messrs Earp and Symonds, and subject to a bailment held by William McLean. At the time, however, the advance from Earp was almost paid off, and plaintiff was assured Symonds would not call up his money for four years. Plaintiff was to receive interest at the rate of 10 per cent., while the principal Was to be repaid at the rate of ,£2O a quarter. Default was made by the Company in payment of one of the quarterly instalments of the principal, and on the 14th May last the plaintiff was entitled to exercise the power of sale under the deeds of mortgage. On that date he agreed to sell the property to the defendant (subject to the other securities) for .£259, to be paid as follows: .£29 cash, and the balance by instalments of .£2O per quarter, interest to be at the rate of 10 per cent, as before, a new security to be prepared and given the plaintiff. This agreement the defendant had refused to perform, and about the 24th June he took possession of two 'buses and five horses (worth .£170), which were assigned to plaintiff by the deed referred to. The plaintiff, therefore, prayed that defendant might be decreed to perform specifically the agreement of the 14th May last ; or in the alternative that judgment be given for .£3OO as damages for breach of agreement. In the event of the Court deciding that he was not entitled to any relief under the agreement of the 14th May the plaintiff sought judgment for -£l7O as damages for the conversion of the two 'buses and five horses. The defendant by his statement of defence denied that by the deed of 6th January, 1894, the Company assigned to the plaintiff the horses and chattels mentioned ; denied that the Company mortgaged its leasehold property to the plaintiff ; denied that default was made in payment of ■ instalment of principal or that plaintiff was entitled to exercise the power of sale, and denied the contract alleged between plaintiff and defendant. Moreover, the defendant pleaded that if this contract was entered into it was upon the mutual mistake that Wm. Symonds could not call up the moneys owing to him until the 21st December, 1897, and that by mutual consent it was rescinded and abandoned in favour of a new agreement made on the 22nd Jure, 1894, to which Henry Hurrell was also a party. The plaintiff had for a long time been in the service of the defendant, and by his conduct had led the defendant to believe he had wholly abandoned the contract and was now barred from enforcing it. It was further pleaded that the action was not properly constituted as the contract (if any) was entered into by the defendant on behalf of himself and certain other persons. The defendant also denied the taking possession of and converting to his own use the two 'buses and five horses, or that they were of the value of .£l7O. William McLean, the first witness, said he was secretary of the Empire Loan Company which had had the deposit of plaintiff's savings. He had also been a director of the 'Bus Company, and the plaintiff was married to his niece. Witness was examined and cross-examined at some length.

James Blyth, the plaintiff, said he agreed to lend the Company «£250, and Mr Townsend was appointed to see that the mortgage deed was properly drawn up. At that time the Company had 52 horses. He lent the money to the Company, which afterwards got into difficulties. Mr Townsend asked witness to sell out his interest in the business to himself on behalf of a new company which was being formed. When he got the mortgage in May he was told that Symonds could not call up his money for four years. After the articles of association of the Company, consisting of witness, Townsend, Hurrell and Crossey, had been drawn up, he considered that he was a partner having a fourth interest in the business. He was never treated by the others as a partner, and received a weekly wage the same as the other drivers. F. G. Bolton, solicitor, who drew up the agreement between plaintiff and the 'Bus Company, T. Boon, formerly a director of the Company, Richard Keone, a director of the Company and also liquidator, and William Hamlin, a director, also gave evidence. The plaintiff's case had not concluded when the Court adjourned at 4.45 p.m. until 10 o'clock next morning. The case was resumed on the 22nd. Frederick Townsend, of Townsend and Paul, said ho was managing director of the 'Bus Company in November, 1892. He ceased to have anything to do with the

Company for a time, but was again elected a director in November, 1893. He wa3 then appointed one of a committee to report on the affairs of the Company. In December, 1893, a meeting was held, but be did not then explain to Blyth the nature of the mortgage. He knew nothing of the terms of Blyth's security, and had nothing whatever to do with it. A composition was paid oat of Blyth's loan. The financial position of the Company was very bad in April, when a scheme was formed by the creditors to take over the business of the Company, and get Symonds' consent to the transaction. Defendant saw Mr Symonds, but.he would not give his consent. Symonds was doing all he could at this time to put his security in force, In May a syndicate consisting of Messrs Hurrell, Boon, Keene, Glennie, Hamlin and defendant was formed to buy Blyth's mortgage and the Company's plant. At a meeting in Mr Bolton's office Mr Keene gave defendant and others reason to believe that Symonds would not call up his mortgage until 1897. A sum of money had been deposited with the secretary to effect the arrangement. He was afterwards advised that it would not be safe to complete the contract. He informed Blyth of this a feAv days after. After the arrangements with Blyth fell through, negotiations were commenced with Symonds, and a contract was signed on 2nd. June. Paid in connection with Symonds' mortgage about .£636. The Company failed to pay the instalment of rent due in May, 1894, and judgments were got against the Company by George Thomas and Co. and Kempthorne, Prosser and Co. The Company failed to pay the instalments of interest due on Symonds.* mortgage on June 12th, 1894. The business and plant were sold to defendant at public auction by G-eorge Thomas and Co. for .£525. He got possession of 44 horses and two 'buses. After the partnership was arranged it was distinctly understood that Blyth was to have nothing to do with the management. Crossey it was understood was to be manager. Cross-examined; He was present at a meeting of directors- in December when it was arranged that the plaintiff was to be appointed manager at a salary of £2 15s per week. He did not know what the resolution passed at a meeting in December, that the sesond mortgage be paid off at the rate of .£2O per quarter, after 5s in the pound had been paid, referred to. He agreed to buy out Symonds on 2nd June. Blyth became a partner on May 14th. He considered Blyth a partner until he commenced the present action. Never made out a proper balance-sheet. Crossey, one of the partners, never examined the books. Henry A. Hurrell, member of the firm of Rouse and Hurrell, deposed that Blyth, was treated as a partner. Alfred Crossey and Andrew Wylie, solicitor, also gave evidence. Sir Eobert Stout then addressed the Court on behalf of the plaintiff, but had not concluded when the Court adjourned until next morning.

ERrDAT, March 22nd. (Before His Honor the Chief Justice.) BLYTH V. TOWNSEND. Counsel having addressed the Court, His Honor reserved his decision. BAKER AND OTHERS V. r,OCKIE. This was a claim for .£75 commission.^ Dr Findlay appeared for the plaintiffs and Mr Stafford for the defendant: Counsel for the plaintiffs intimated that the parties to the action had come to a> settlement, the plaintiffs agreeing to accept .£SO, each party to pay its own costs. _ . Judgment was entered accordingly. REID V. REEVES AND ANOTHER. Mr Young, for the plaintiff, moved for judgment in an action in which the plaintiff, who is a beneficiary under the will of the late Eichard Neville Eeid, of Palmerston South, prayed that the investment of the defendants, as trustees under that will in 175 Bank of New Zealand shares, should be declared a breach of trust; that the shares should be declared to be the property of the defendants personally; and that they should refund to the estate the sum of IS7II 7s 6d, the cost of the shares. The defendants were not represented by counsel. The [[Chief Justice raised a question of jurisdiction. The matter was allowed to stand over in order that counsel for defendants may appear. The Court then adjourned until lO o'clock on Monday morning.