COURT OF APPEAL.

New Zealand Times, Volume XXXI, Issue 4892, 25 November 1876, Page 3

COURT OF APPEAL.

Friday, November 24. (Before their Honors Mr. Justice Johnston (presiding), Mr. Justice Gillies, and Mr. Justice Williams.) The Court of Appeal sat as above at 11 o’clock. WEBB V. NATIONAL BANK OF NEW ZEALAND (limited). - His Honor Mr. Justice Johnston delivered judgment on the preliminary objection raised by Mr. Macassey in this ease on the day previous. Their Honors were unanimously. of opinion that if , the case stood, solely on the affidavits of the solicitors which had been filed, they would have sustained the objection. They had come to the conclusion, however, that they would assume that the granting of the rule nisi was on the presumption that the first step had been taken previously to the adjournment. The learned Judge below had evidently only adjourned the case to enable the Court to deal with the matter more carefully. They must take it that the motion had been initiated, and that an extension of'time, was only granted, that the propriety of acceding to the motion might be properly discussed. - , Mr. Macassey; then proceeded with his argument on behalf of the appellant, and referred to the rule absolute under which the findings of the jury were set aside, 'and a trial denovo granted on the ground that the 2nd, 3rd, and 4th counts of the;declaration disclosed no cause of action, and the damage having been assessed generally, the Court could not give judgment on the findings; ; and also, that a new trial should be had'between the parties on the’ grounds that the .verdict , was against ■ the weight of evidence, and the damages awarded' were excessiveand .further, that'each party should bear his own costs of, the that the rule be without costs to'.either party. He then quoted i from the ■ judgment of his Honor Mr. Justice Williams, from which it appeared that the form of the rule was wrong, and that his Honor was of opinion that if the reaponr dents had failed on the first branch, there was a doubt whether they could have succeeded on the second,'however strong a case-they had, as by moving first in arrest of judgment, it was admitted that the verdict was good. ,‘ In Bose v. Groves, 5 M. and Gl, 615, a rule, had been asked for in the sanle form as the present, and it was held by the Court that the question as to the new trial must be taken first, as no motion for a new trial could be made after a motion in arrest of judgment. ■ . Mr. Macassey then proceeded to argue that if the learned Judge was correct,'then the rule was bad on account of its form. In the case of Bell v. Menzies,' 29 L. J. 361, the question of several,alternatives'in a'rule had arisen on the rule nisi ,' and on application for the rule to be made absolute the Court had suspended the arguments on the alternative until a decision had been arrived at on the onepoinL In the present case undoubtedly the respondents were not entitled both to a new trial ahd an arrest of judgment. His Honor Mr. Justice Williams asked— Supposingthe-rule Wsf had been moved properly, what would have been the eHeot of the rule absolute?

Mr. Macassey-then referred' to the case of Beswick v. the Mayor of Kaiapoi, in -which it ■was laid down that the rule absolute should be read by the light of the nil e nisi. In the present case the Court below had declared in the same breath that there should be a new trial on all the issues submitted to the jury/ and that some of those issues should never have been submitted at'all. The first count in the declaration set out a post nuptial settlement by Mr. and Mrs. Hunter of, certain properties real and personal to trustees subject to mortgages to the bank ; that the trustees had not acted, and that the appellant was a fit person to act, and was willing to act in the trusts ; and the appointment of the appellant as such trustee by the Supreme Court under the Trustee Acts on the 30th April, 1875, by virtue of which the right to bring any action for the recovery of any real and personal property and damages for any wrong or injury done to the same were vested in the appellant, subject to the trusts of the said settlement; and the seizure and removal of the property settled by the bank, and consequent loss to the appellant as such trustee. The second count repeated the allegations in the first, and further alleged trover of the property settled. In the third count the mortgage, or bill of sale to the bank, was set out, which was executed previous to the marriage, and the allegations in the first count were repeated. It was also alleged that before default, and without notice, the respondent seized the property, as also other property not included in the bill of sale, removing and selling the same, to the consequent loss and damage of the appellant. The fourth count was that the appellant had offered, and the respondents’ managers had accepted such offer to pay the moneys due on the said mortgage, but that the respondents did not allow him a reasonable time before so entering upon and selling the said property aforesaid, to the loss of the . appellant as such trustee as aforesaid. The respondents duly pleaded to the declaration in justification, hut the. pleas were as bad as the first count in the declaration—which did not allege that the property seized was the property of appellant because there was no,allegation identifying the acts justified with the acts complained of. An objection had been , taken to the issues submitted to the jury which, with, the findings thereon, were as follows :—(1). , At the time of the entry and of the taking possession, removal, and sale,by the respondents mentioned in the declaration andpleas, had the power to enter, take possession, remove, and sell .contained in the.hill of sale in the declaration set out, become lawfully exercisable by the respondent under the terms of the said bill of sale ? (2). Hid the respondents, for considerations in the declaration mentioned, promise the appellant to forbear .from exercising the power of sale, and other powers, licenses, and authorities conferred upon them by virtue of the said

deed or bill of sale, by way of mortgage ? 13). Did the respondents wholly neglect,and refuse to perfoian the said promise ? (4). Did the respondents wrongfully take possession of, remove, and sell goods of the appellant, other than those subject to' the power of sale in the said bill of sale contained ? (5). What damage (if any) is the appellant entitled to recover from the respondents in, respect of the grievances complained of in the declaration ?‘ The cause was tried ou the 17th, 18th. and 19th January, 1876," before his Honor Mr. Justice Williams and a special jury at the sittings of the Supreme Court at Dunedin, and the jury answered the first issue in the negative, and all the others in the affirmative, and assessed the damages at £3OOO. . The position of the appellant was, similar to that of a trustee or assignee in bankruptcy, and a question would afterwards arise as to the effect of the Trustee Acts, when he should submit that it was the same in this respect as the bankruptcy law. He would next deal with the bill of sale itself. In the case of Ulward v. Grosvenor Company, L. Hep. 8 Q.BJl23,the agreement had been for payment by'inatalments, with a proviso that’ in case-of default the whole should become due.. There had been a vesbal agreement between the parties as to the time of payment, and in violation of this the defendants seized and told. . In the action it was contended, that . the plaintiff was estopped by the deed from giving evidence .of the parol agreement, but the Court had admitted the evidence, and ultimately the defendants had been mulcted in damages. In this case a great part of the argument turned on the construction of the word “fault.” At the time of the execution of the settlement ’ Mrs.’ Hunter was entitled to what in England would be termed an eqtiity of redemption 'in the freehold, although in New Zealand this estate might be more properly termed a possession of a freehold estate, liable to be defeated on default in certain conditions. The dicta of Judges Richmond and Chapman supported this view. Her holding of the leaseholds was free from incumbrances and her ownership in the chattels was subject to the bank mortgage, and in them the trustees would merely acquire a chose in' action. - Until default was made she was absolutely entitled, and in the case of a sale to a lona fide purchaser, it would have been a question whether the bank could have followed the property., The case of Bradley v. Copley, 1 Com. 8., 685, illustrated the principle that the property in, goods remained in the mortgagor until default. There was no magic or charm in the. provision for quiet enjoyment, for a Court of Equity would always restrain in these cases. The only use of such a provision was as the foundation of an action on covenant. Mrs. Hunter until default should have been treated as having the legal ownership, and at all events, the right to possession was moat justly hers, and the bank should not have interfered unless upon noticed Mr. Travers explained that the respondents sought to justify on an express reservation in the deed, and the question of demand or default after demand did not arise. He was prepared to concede that at the time of the settlement, Mrs. Hunter was entitled to the possession of the property, subject to the mortgage, and .that such interest would pass to the trustees.

Mr. Macassey then said that in Bose v. Watson, 10 H. of Lds. 672, and Marshall v. Holroyd, 10 H. of Lds. 191, it was laid down as a principle that whether real or personal property was concerned in these cases they were governed by the same law. He would next draw attention to the fact that under the Conveyancing Ordinance the legal estate remained in the mortgagor until default.; The right of possession remained in the mortgagor, and where the right to seize was extended,to after acquired property, undoubtedly to all intents and purposes the property remained in the mortgagor until default. In continuing his argument he would assume as a hypothesis that the seizure by the bank was a wrongful act. In proceeding with the consideration of the case it would be necessary to show,that.the right to recover damages was assignable under, the Conveyancing .Ordinance, and undoubtedly section 9 was very .wide in its provisions, ex-; tending‘as it did to every contingent; a, future executory right in real or personal' property. I His Honor -Mr. Justice Johnston had laid down in King; v. Johnson, where it had been argued that the ordinance only applied to realty, that book debts'were assignable. x He would not contend | that rights of action for personal damage,! such as battery, &c„ were assignable,’ but any. interest which under the Bankruptcy law would pass to the trustee 'would also pass under the Ordinance. If the equity-or right'itself was as-, signed the right of action i would pass with 1 it, although he would not contend that a bare right of action could be conveyed, by deed. Gilhbrand v. Edwards would illustrate M 3 meaning for the right to ‘sue as distinguished from, the thing, whether real or personal could not be passeid in gross. Some of the - cases decided: in; relation to Friendly; Societies might be of some little help in. considering this question. In the Queensberry Industrial Society v. Pickles, L. Eep. 1 Excheq.,: p. 1, the argument ’ turned on the construction of the word “ property,” 'and it was held that a bond which was clearly a mere chose in action would pass. Prosser v. Edmunds, 1 Young and C.,- 481, and Hill v. Boyd, Law Eep; 4 Excheq., p. 460, had been referred to in the Court below; and in’the case Harris v. Macfarlane, 2 Ct. of Appeal Cases,' p. 122, Prosser v. Edmunds had been dealt i with in deciding as to the assignment of eqnit- ! able estates. Section 27 of the Trustee Act, 1850, dealt with vesting orders.; and clearly | covered Prosser’s case. If Mrs, Hunter had died . her ; rights in the property would undoubtedly have passed to her; executor, or if she had become bankrupt to her assignee or trustee! As showing that an assignee under a deed of arrangement would be in the ’ same position, as a trustee, be would cite, Exeley y, Inglis, 27 L. J. Excheq., 145; Porter v. ICirkus, 36 L. J., C. P., 311; and Topping v. Keysall, 16 O. 8., N. S., 258. It was important to him to show that in so many cases a chose in action had been held to have passed as shewing the intention of the Legislature. The title of the Act showed that it was intended to apply to transfers of real and personal property, and in the interpretation clause the meaning of the term “mortgage” was extended to estates, interests, or property in lands or personal estate used as security, &c., which would clearly extend to the present case. Mr. Macassey then read the marginal notes as illustrating his views, and commented on the wide signification of the terms “lands or personal estate.” If a testator made a devise in such terms there would he very little left for the residuary legatees. The preamble referred to the Statute of Wm. IV., as to escheats and forfeitures which dealt with real and personal estate ■in similar terms, which was a strong presumption in favor of his argument. He then referred to the following casesln re Davis’s Trusts, L. Eep., 12' Eq. 214; Smirthwaites Trust, L. Eep., 11 Eq., 257 ; Bignold’s -case, L. Eep., 7 Chn. Apps. 223 ; re East, L, Eep., 8 Chn. 735 ; re Berkeley, L. Eep., 9 Ohn. Apps. 720, drawing induction as to the principles he had laid down.- He could not see from the premises why the Court should not have the power to vest in anew trustee such property as would by bankruptcy or death pass to the trustee or executor. His Honor Mr., Justice, Williams said that since the hearing in the Court below a case in re Woodfall, 42 L- 7. ■ Probate, had been brought under his notice which he would commend to Mr. Macassey’s attention./ , Mr. Macassey then proceeded to the deed, and stated that broadly his contention was that Mrs. •, Hunter; being in possession, was entitled to hold until a demand was mode. No debt was. payable under the deed until after demand, and there had been no default entitling the bank ,to sell and put an,end to the possession, until after demand, and a reasonable time allowed for payment. The respondents, might enter, but not proceed to a sale without a demand. He would ask the Court to look at the deed as a whole, so as to give it a rational interpretation, and not take any isolated passage. The principal features of the deed were a debt, an ; assignment of property as security for that debt a proviso for repayment on demand,, a power of redemption on payment, a power to enter upon, and hold the property after demand, or when the bank should consider it

necessary for their interests, to take inventory, dee., and a power of sale immediately upon such entry with a proviso relieving purchasers . from; the necessity of enquiry as to propriety of the sale. The question arose whether the words “ immediately upon such entry” were to do away with and practically deprive the mortgagor of her right of redemption.. His Honor Mr. Justice Gillies pointed ‘but that the power of sale extended to moneys not actually due. Mr. Macassey said that the reason for this was that if default should be made the .whole money should . become due at once, -the. mortgagor not being at liberty to say that the bank had ho right to sell because a portion of the money was covered by outstanding The Court would surely hot' hold that “immediately ” meant “ instantaneously,” but within a Reasonable time for this was the only way to give bffect to the provisions of the deed. All through the deed provision was made for .payment on demand, and it was on payment after demand that the security of the bank was at an'.end* ’ Thorns V. Wilson, 10 Jurist, N.S., ■2Ol |i Massey v. Sladen, =L; ,Rep. 4,Exoheq., 'l3; ; Brighty v. -Naughten,3 Best and S., 3,05 ; and Rodgers v. Mutton, 31 L.J., Bxcheq., 275, all bore on the construction of su'eh words as “immediately,” “instantly,” &c., He would submit that the real meaning was within a reasonable time. If the judgment of the Court below was correct, all the first part of " the power of sale should have been out out as nugatory. It was not only unnecessary iut deceiving, and it was only by reading all the provisions together that a reasonable construction could be put upon the deed. His Honor Mr, Justice Johnston said that if it was as Mr. Macassey argued the idea of a mortgage was at an end, for there was virtually no right of redemption. ; Mr. Macassey then said that the bank had the right to charge interest, Ac., and before the mortgagor could pay she must have had some intimation from the bank of the amount due apd owing. A Court of Equity, would not sanction anything as between mortgagor and mortgagee which would come in the way of, the mortgagor's right to redeem. As showing the efforts which a Court of Equity would make to support the rights of a mortgagor, he would cite “Fisher on Mortgages,” 278-80. In his opinion the deed had been drawn in such a peculiar form so as to avoid the order and disposition clauses of the bankruptcy law. The Court should so - construe - the deed as to give effect to the whole of its provisions. How could the mortgagor exercise the right of redemption without a demand ? He trusted the Court would look at the matter from an equitable point of view. As to the construction of repugnant clauses in deeds, he would .refer, the Court to Solly v. Forbes (2 B. and B. 38), Fumival v. Coombes (5 M. and G. 736), Fowkes v. Manchester Insurance Co. (8 it. T. N. S. 29), and a Victorian case, in which the Oriental Bank were the plaintiffs, reported in 2 Wyatt, Webb, and A’Beoket. ■ The Court adjourned a little before 6 o’clock, until Monday at 11 o’clock, when Mr. Macassey will continue his argument.