COURT OF APPEAL.

New Zealand Times, Volume XXXI, Issue 4895, 29 November 1876, Page 2

COURT OF APPEAL.

Tuesday, November 28. (Before their Honors Mr. Justice Johnston (presiding), Mr. Justice Williams, and Mr. ' Justice Gillies.) ■ ' . , . . . WEBB V. NATIONAL’ BANK OF NEW ZEALAND (LIMITED). The Court of Appeal sat at 11 o’clock, and proceeded with the consideration of the above case. Mr. Travers commenced his argument on behalf of the respondents, and said' that he, would admit that the form of the rule was not the usual one, the cart being, before the horse, but thought it was quite open to the respondents to apply far the rule in the alternative. His Honor Mr. Justice Johnston said that the object in having a proper form for the rule was that the Court might hot occupy itself with the consideration of a Question, which . might not arise. Sir. Travers then proceeded, and said he would admit that, in the present case, the form was at variance with the English practice. He proposed, in dealing with the case; to take- the - declaration first. ; The effect Of the first count was trespass quare claummfregit accompanied by asportation of goods. ( There was no tdlegation of property in the goods, .and the .appellant could not recover on this ground alone.. Pritchard v. Long, 9 M. and W. 366, bore out this contention most fully. It might be urged that the goods on the .land were" the goods mentioned in the settlement, but there was nothing to identify them as such, and there was ho other averment.. With the trespass,to land, the question of title arose. The property consisted of two (parcels—(l) the freehold subject to the mortgage, and (2) the leasehold held for. the residue of ;a.tenu of 10 years. ■ There "was nothing to, show at what time the money secured by the mortgage was to be- repaid, and the rights of both mortgagor and mortgagee were not defined. In any case, all thatpassed under the settlement was the equity oH

redemption. He would admit that the signature of one trustee to the deed was sufficient to set up the trust as being an acceptance in fact. His Honor Mr. Justice Johnston pointed out that there had been no disclaimer by the other trustee, and asked wbat would be the effect. Mr. Travers said that for the purposes of his present argument it was immaterial, and he would assume, although without admitting it, that the petitioner was appointed in substitution for the two original trustees. If this was the case, all that would vest in him so far as the freehold was concerned was the equity of redemption. As to the leaseholds, he would be merely assignee of the term, and both freehold and leasehold wouldhe vested inhimassole trustee for the sole and separate use of a mamed woman. There was no averment that he ever entered upon the leasehold as such assignee. The action was for interference with the personal occupation of property, and could only be brought by tbe person in actual or constructive possession. There was no averment equivalent to an averment of possession. Had Mrs. Hunter, the person beneficially interested, died, and the trustees entered into possession, they might have maintained the action, hut trespass could not be maintained without possession. The assignee of a term must, according to all the rules of pleading, aver possession m an action of trespass. In support of his argument he relied upon Harrison v. Blackburn, 34 L.J., C.P., 109. The same objections applied to the appellant aa if the action had been brought by the original trustees, and they were in his place. Buie of Court No. 80 gave the appellant the opportunity of alleging possession in general terms. Possession on the part of the trustees would have been inconsistent with their fiduciary position. The action should have been by the beneficiary and not by the trustee, who was in a sort of reversionary position. It was not averred that Mrs. Hunter was in possession, and, m fact, possession was not averred all- If it was contended that the trespass was other than as against the possession, the circumstances under which the corpus of the property was damaged must be set out. He would submit that the count was bad. He was also at a loss to understand how the order under the Trustee Act could vest in the appellant the right to bring the action. This objection, that the order was not virtually an appointment of a trustee, would apply to the whole of the counts throughout the declaration. The appellant sued by virtue of an alleged legal status, and rule 74 provided that in such a case the facts relating to such status should be specifically .stated. The appellant should have set out a sufficient order shewing his appointment, and this vice went to the whole declaration. Another question arose, viz.: Was a personal claim for damages for interference with the possession of real or personal property a chose in action within the meaning of the statute? There were often cases in which choses in action arising from personal property might pass, but he did not think the present was one. He would refer the Court to “ Woodfall on Landlord and Tenant.” Bth edit., p. 677, where it would be seen that in the case of an action for rent, a beneficiary who did not let or demise could not recover, and vice versa, and that a trustee could not constitute himself landlord by merely giving notice to the tenant to pay rent to hint His Honor Mr, Justice Williams stated the suppositious case of a trespass to lands, the lands being in the occupation of a tenant at will. In whom would the right to the action vest ? Mr. Travers said most certainly in the tenant, as the essence of the action was interference with the occupation. He would submit that the count was utterly bad, as it did not contain the necessary averments, inasmuch as the appellant was improperly appointed, and the right of action did not pass to h’™ under the vestiug order, and because his status was not set out as required by the rales. He would mention the case of Vallance v. Savage, 7 Bing 595, which dealt with the respective positions of those in possession and reversioners as to actions for trespass. He gathered from the second paragraph in the second, count that it was intended for a count for conversion. There was a special allegation as to the property in the,goods, but the appellant’s status was againfnot set out; Assuming that a cause of action would have vested in the original trustees for the conversion they must remember the complication of the circumstances —first the mortgage, then the settlement of the equity, and then the proceedings under the petition under the Trustee Act. Hia Honor Mr. Justice Johnston thought that they should not encumber themselves with the .’English term “conversion.” Travers said that the rules used the word conversion, although in Moorhouse v. Moore it was laid down that every declaration setting out facts entitling the plaintiff to recover was to be deemed specific. The devisee had made a mortgage and settlement and remained in possession. A mortgage of goods had been held to be an: absolute assignment, and so clear was this that such a mortgage was held to imply a power of sale. His Honor Mr. Justice Williams said that there were two cases rather against Mr.' Travers’contention, it being laid down that a mortgagee of chattels could not maintain an action for trover if under the terms of his security the time for payment had not arrived. Mr. Macassey mentioned that one of the cases referred to was Mears v. London, and S.W. By. Co. Mr. Travers then quoted from “Usher on Mortgages,” as showing that a mortgagor could maintain trover so long as the possession remained in him under the mortgage. The use vested in the mortgagor under the re-demiae, the property being vested in the mortgagee, no person but Mrs. Hunter could be the person entitled to maintain an action of trover, either as against a stranger or as against the mortgagee. The appellant claimed subject to facts utterly inconsistent with possession or the right to possession. He would admit that there was an implied right in the mortgagor to possession until the happening of certain events, but this gave no right to the trustee.. When the hank thought it necessary for their own interests they were at liberty to determine the mortgagor’s possession, and reduce their previous ownership in the goods into possession. The Court had nothing to do with the hardships of the case. When it was sought to charge the bank with conversion it was necessary to show that they had no power to take the goods under the terms in the mortgage.

His Honor Mr. - Justice Gillies pointed out that the count alleged trover of goods not in the settlement.

Mr. Travers said that this was a_ cause of action which should not have been joined, and the appellant was in fact not entitled to anything outside the settlement. It had been contended in the argument on the third count that a reasonable ground should have been shown for the exercise of the powers. He would submit that there was nothing to negative the presumption that reasonable and probable ■ cause had been taken, and, as in an action for malicious prosecution, so in the present case the appellant should have proved that the want of reasonable cause had an existence in fact. As to what would constitute reasonable and probable cause was a question for the Court. The same vices were common to this count as to the previous one. He did not propose to offer any remarks as to the fourth count, as it had been virtually abandoned by the appellants. Before proceeding to the judgment, he would refer the Court to Addison on Torts, 4th Edit., p. 289, for authority as to plaintiffs sueing in trespass, and to the case particularly referred to there—Hoskins v. Phillips, 3 Excheq. 168. He would submit that judgment should have been arrested, on the ground that there was no cause of action ; but assuming that he was in error, he would next refer to the rule. There was very little difference indeed between a new trial and a trial de now. The respondents were entitled to a trial de novo, on the ground that three of the counts in the declaration were bad. The damages awarded were on the first issue, which included good and bad counts, and made the verdict defective.

His Honor Mr. Justice Johnston pointed out that the Issue contained both fact and law, but the Court would presume that the jury found on the learned Judge’s direction as to the Jaw* Mr, Travers then proceeded, and said that

the fourth Issue should have been eliminated, and the fifth was the only one left for consideration, as if dealt with the whole subject matter of the declaration. Eeferenco had been made to the rule under which the damages could be apportioned on the application of either party, but this was more strictly a matter for the plaintiff in the Court below. As to the verdict being against the evidence, there was no doubt as to the goods being taken and sold, and the questions which arose were three: Was the sale wrongful? Were the goods the plaintiff’s? Had the plaintiff any status, and if so, had he come in proper form before the Court ? The action (if there was one at all) ought to have been brought against the Bank for careless and improper conduct in exercising the powers in the mortgage deed. The damages were excessive as under the first count in' the declaration, for no property in the goods being alleged they should not have been taken into consideration in assessing damages. As to the conversion, it did not appear that the amount due to the Bank had been taken into consideration, and the same question arose in the third count. As the damages had been on the whole of the issues and had not been apportioned, the Court could not now do so. Before concluding he would again call the attention of the Court to the destruction in actions of trespass by occupiers, where the damage was assessed on the injury to the residential right, and by owners where they were assessed on the injury to the permanent estate. He would submit that the excessive damages was quite a sufficient ground why there should be a rule absolute for a new; trial, or that a trial de novo should be granted on the ground that the judgment was .defective, or that judgment should be arrested, no cause of action being disclosed. The Court would be quite justified in sustaining the rule absolute. Mr. Stewart followed on the same side, and submitted that the vesting order was entirely inoperative so far as the present action was concerned. The order should be read as if the words “ chose in action ” had been used, for it could not receive greater force by going outside the statute of language. The Trustee Act included three different kinds of property, viz., land, stock, and choses in action. Land and stock were defined, but chose in action was not defined at all. He would submit that the term' referred to some defined ascertainable right existing at the time of the creation of the trust. The 27th section dealt with the term.

i His Honor Mr. Justice Johnston and his Honor Mr. Justice Gillies expressed an opinion that the term meant a thing lying in action.

Mr. Stewart then proceeded and said that the statute distinguished between a right of action and a thing in action. It might be gathered from section 35 that the idea pervading the statute was that a chose in action was some liquidatable ascertainable matter which should also be the subject of the trust. When the Act was passed in 1850, choses in action were not assignable in England. The adoption of the Trustee Act in New Zealand in 1854 should give rise to the supposition that it was adopted with the same intent as it had been in England in 1350, and the meaning of the term should be construed now as it was when the Act was first passed. All through the Act, with the exception of section 47, only the three kinds of property before mentioned were referred to. In this section the term “ personal estate” was used, but as it referred to escheats and forfeitures, no doubt it was used advisedly, as if a wide term were not introduced the usual construction of law as against the Crown, and in favor of the subject, would prevail, and the Crown might suffer. He would refer the Court to luce on the Trustee Acts, and to Urlin, another author on the same subject. Woodfall’s oases before cited were also important as showing that the statute would be interpreted by the practice. The practice of the Court of Chancery was always to ear mark, as it were, and indicate specifically each chose in action in a vesting order. Daniels’ Chancery Forms, p. 1941, as to forms of petitions, and Seaton on Decrees, p. 804, as to forms of decrees, would illustrate his meaning. In his opinion chattels moveable were not within the statute at all, and it was only to classes of property not passable by delivery that it applied. Hotel stock was not the class of property which would come within the meaning of the Act, because in such property a trust could have no continuity.

His Honor Mr. Justice Williams pointed out that the interpretation clause extended the term “ mortgage” to a mortgage of chattels. He mentioned this because he' thought 'Mr. Stewart was under the impression that bepause chattels would not pass, therefore rights of action arising out of chattels also would not pass.' • Mr. Stewart said there was nothing to justify the assumption that the property was even contemplated as being the subject of a trust, and it did not come within the provisions ; of the Act. The rule formerly as to choses in j action was that they were not assignable. . The King was always exempt from this rule, and on assignment from him a'subject could always sue in his own name, 1 but it was laid ’down in “Spence’s Equity Jurisprudence” that the King could not assign an uncertain thing such as damages for a trespass. From Harris v. McFarlane, 2, Court of Appeal' Cases, the inference could be drawn that a mere naked right of action like the present : would not pass. Reference had been made to the Conveyancing Ordinance, but although a chose in action might be assigned by deed, still it by no means followed that the Court would would have a similar power under the Act. The case of. King v. Johnson, cited by' Mr. Macassey, went no further than the assignment of a debt. The words of the Judicature Act were almost synonymous with those in the Trustee Act, and it had been laid down under the former statute that it only applied to an ascertained debt. His Honor Mr. Justice Williams pointed out that the words were “ debt or other chose in action,” which might be construed as ejusdem generis. ■ Mr. Stewart said that he would contend that the trustee Driver never had any right under the settlement capable of being trans- ' ferred to Webb. Section 50 of the Conveyancing Ordinance provided as to acknowledgements by married women. There was no evidence of an acknowledgment in the present case, and he would contend that the freehold did not pass under the settlement. The interest of the trustees (if any) was subject to the right of the bank under the' bill of sale. Mr, Stewart then raised objections to the declaration of a similar nature to those raised by Mr. Travers, and then cited Bailey v. Godfrey, 5 Amer. Rep. 157, the language of which was most suitable in its application to the present case. Hay man v. Governors of Rugby School, 43 L.J. Chan. 834, also bore on the case, and as to a reasonable time being allowed for payment under the bill of .sale Wharleton v. Kirkwood, 29 L.T. N.S. 644, was a much later decision than those quoted on the other side. Baron Brarawell’s judgment also bore on the construction of the term immediately, he stating that if the previous decisions were to be upheld they would - have to insert a clause in deeds declaring that “ immediately” meant immediately and nothing else. He would submit two points as to the construction of the deed viz,, (1) —That it should be construed most strongly against the mortgagor, as the deed was tendered by her to the bank, and they consented to advance money on it; and (2) that the rule of construction should be to give effect to every word if possible. Under the deed the mortgagor .was merely a tenant at will) and the bank had a perfect right to determine, the provision when they pleased. White v. Morris 11, Com., B. 1015, and Mayhew v. Suttle 4, . E. and B. 351, bore him out in this contention. It was alleged that the entry of'the bank was antiguous,, but in his opinion there could be no doubt that the bank had intended to exercise their powers when they first took possession. It was the interest of the bank at the outset that there should be a good sale. Ulbert v. Grosvenor Investment Co., which had been cited, was not analogous to the present case, as it was merely another application of the doctrines of estoppd. He would submit as to the alleged verbal agreement With the Bank—(l) that there was no consideration ; (2) that the partieaxould not

make a variation except'by deed ; (3) that in any case the contract should have been in writing ; and (4) that it was a direct violation of the trusts of the settlement. , There was also nothing to show that the appellant had done'anything under the agreement. * As to the rule, if the Court ultimately granted a new trial, he would submit that the respondents were successful in the appeal. . ; , ’ His Honor Mr. Justice Johnston asked if Mr. Stewart contended that the Court had no discretion as to costs?

Mr Stewart said that he was quite aware that the Court had a discretion, but it was a judicial discretion. The cases of - Cornish v. Borman and the Westland Tramways Company laid down a principle as to costs when the defendant moved in arrest of judgment, and he would submit ■ that the respondents were entitled to all costs from the granting of the rule. Motions for rules for arrest of judgment and new trial were concurrent motions, and the Court could deal with them as it thought fit. Turton v. Jackson, Macassey’s Beps., 877, bore on this subject; also Price v. Beid, 6 Scott’s New Beps., 1010. He would also submit that the Court could not say upon ■which count the jury had awarded damages, and that the rule absolute was in proper form, Supposing the plaintiff had proceeded in error, and that the defendants had not obtained their rule, they would have lost all right to a new trial. He would leave the case in the hands of the Court. His Honor Mr. Justice Johnston intimated that they would hear Mr. Macassey in reply next day at 2 o’clock. ■ JENKINS V. JENKINS AND ANOTHER. Mr. Stewart, by leave of the Court, mentioned the following cases in the above cause : —Edson v. Edson, 11 American Eep.; Adams v. Adams, 12 American Eep. ;• and Johnson v. Coleman, 23 Wisconsin Eep, mentioned in Story’s Equity Jurisprudence, par. 252. The Court then adjourned until 11.30 next day. '