ASSISTED DEBTS

New Zealand Mail, Issue 1626, 29 April 1903, Page 72 (Supplement)

ASSISTED DEBTS

A POINT OF IMPORTANCE TO CREDITORS. An important point to debtors and creditors was raised in the Magistrate’s Court last week during the hearing of two oases in which the Commercial Agency Company, as assignees from the original creditors, took action against G. J. Whin cop and others for the recovery of 424 2s 9d and £1 12s 6d. The question was whether notice of an assignment must be given to a debtor before action is brought, to entitle the assignee to sue in his own name. Mr Meek appeared for plaintiff and Mr Jellieoe for defendants. Dr A. Me Arthur, S.M., on the 21st delivered judgment in the cases as follows:—• “Plaintiff sues on an assignment to him of a debt due by defendant. The debt was admitted, and the assignment produced, but counsel for the defence claimed a nonsuit, on the ground that the assignee was suing in his own name without having previously given notice in writing to the debtor in terms cf section 39 of the Property Law Consolidation Act, 1883. This section is a copy of subsection 6 of section 25 of the Judicature Act, 1873. It is established law that in equity as between the assignor and assignee, notice is not necessary to the validity of the assignment, although the legal light remains in the assignor. The assignee can only enforce an equitable assignment by suing in the name of the assignor o<r by joining him as party. “The Judicature Act of 1873 and the Property Law Consolidation Act of 1883 give to the assignee of any debt or legal chose in action all legal rights and legal and other remedies, hut under the following conditions :—(1) The assignment must be absolute and not by way of charge ; (2) the assignment must be in writing, signed by the assignor; (3) the assignee takes subject to all equities; (4) express notice in writing must be given to the debtor, and the title of the assignee dates from such notice. “In other words, these Acts create a legal right to sue in the assignee’s onvn name, but that legal right is confined to cases where the assignment is absolute and by writing under the band of tho assignor and where express notice in writing has been given to the debtor. Moreover, the legal right to the debt does not pass until the date of the notice to the debtor. “Plaintiff sues in bis. own name without having given express notice in writing to the debtor, and must therefore be nonsuited in each case, with £1 la costs.” Leave was granted to appeal.