SUPREME COURT.—CIVIL SITTINGS.

Otago Daily Times, Issue 4027, 14 January 1875, Page 3

SUPREME COURT.—CIVIL SITTINGS.

"Wednesday, January 13tm, (Before His Honour Mr Justice Cliapman and a Special Jury.) A. It. HAY V. IJOUG AXD lIITTO.V AND SO.MERVELL. In this action the plaintiff prays—(l.) That a certain receipt, dated 12th January, 1574, might be declared by decree of Court to amount at most to a security for the due retirement of four bills of exchange therein mentioned. (2.) That upon the due payment of what might be adjudged, or found to be due, in respect of the first bill of exchange in the receipt mentioned, and the delivery up to Hogg and Hutton of the three other bills, the said receipt might be cancelled and destroyed. (3.) That Hogg and Hutton might be required, at their own cost and charges,, to execute and register a release of the encumbrances registered against the title to ihe land mentioned in the declaration. (4.) That Hogg and Button might be decreed to hear and pay plaii£ tiff's costs of suit, together with such othrr costs as might be awarded to the defendant Hendrv Somervell, by reason of his having been made a party to this suit. And (5 ) That plaintiff might have such farther or other relief as to the Court might seem fit. Mr Mneassey, with him Mr Stout, appeared for plaintiff r Mr Barton, with him Sir Stewart, for defendants Hogg and Hutton. The hearing of this case was resumed at 10 a m. On the application of Mrßartcn, the following new issues were submitted to the Jury :—(1.) Was it intended between the parties to the agreement of 12th January, 1574, that the defendants, Hogg and Hutton should occupy the premises therein mentioned for a term of three years I (2 ) Was the plaintiff ihe real owner of the premises in the occupation of Hogg and Hntton? (3.) If plaintiff is not the owner, did he enter into the agreement and do the matters and things in the declaration alleged, as the agent of Hendry SomervtH* And, on the application of Mr Macasscy, the following issue was also added ■ Was the transaction or arrangement «f the 12th January IST-t, entered into merely for the personal convenience ami accommodation of the plaintiff ? Mr Stewart, in opening the case for the defence, said that the evidence, even for the plaintiff's case, showed most conclusively that this action was brought without any right in law or fact. The object of the action must be apparuit to all. Hogg and Hutton having instituted proceedings against Somervell, who was supposed to he the real owner of the premises in Princes street, Hay, bein«on the sp"t, employed Mr Marassey to take pn£ feedings against Hogg and Hutton with the view of undermining their position in regard to Somervell hy withdrawing from them any rights they mMit have, and ejecting them from the premises. That was the only object of this action. He thought that the Jury, after they heard the evidence, would allow the matter to remain in its present position, and allow the other action to settle the rights of the parties. The motive which prompted the other side in admitting that Hay was Somei veil's agent was probably a fear that the defendants would prove not only that Hay was agent for Somervell, but that Haj was'himself the beneficial owner of these premises. This was a most extraordinary ca.se. The plaintiff said he entered into this arrangement merely as- an agent. If he were a mere agi nt why should he commence these proceedings? The view the defendants presented with regard to this agreement was that the agreement of 12th Jannary, 1574, was a conditional sale of the premises in Princes strrct for 3 years, ami that that agreement, no matter what was agreed to with regard to the bills, gave Hogg and Hutton an undoubted right to those premises for three years—a right of which H y and Somervell were trying to deprive them. Was it'at all likely that Hogg an-1 I-luttou would incur the liability of meeting £000 worth of bills without receiving any consideration ? Was it not more reasonable to suppose that both parties really intended that Hoirg and Hutton should have the premises for three years in any event, as a consideration for accepting tlie?e bills? The following witnesses were called for the defence :— , James Ho^'g, one of the defendanta, stated that he was in partnership with Mr Hntton. Witness was a tenant of Hay's in 1573. He believed Hay to be the real owner of that property. Witness had been in occupation of the premises since 1870. Hay told witness in 1573 that the property was his, although in Somervell's name. He said that he had to pay £500 to the Building Society, who held a mortgage over the property, and it would suit him to pay the money, as the Society did not appear to understand the matter. This was a few days before witness signed the first series of bills. In July, 1873, witness and his partner were negotiating for a continuance of the tenancy for five years from the end of the tenancy then running, which would terminate in 1874. They arranged the amount of rent. Hay said ho would let them the two places for £7 "a week, and he piwe them a month to say for how many years they would take the- premises. Witness a=ked for a week longer to consider the matter. Hay replied, "There's no hurry, you can have another month if you like." Hay marked the date on the back of a case. Before a week expired, witness called in Hay and said they could take the place for five years at the rent agreed upon—£7 a week. He replied, " Very well," and then, after a pause, he said, " Since I saw you last I have had an offer of partnerships from two young men, and I don't know how they would like to come in—whether they would pay rent for my shop, or whether I should put in rent ox an asset. If you like to wait for two or three months, and if their partnership does not take place, the premises will be jours for certain." Witness said, " all right," and he then looked upon the transaction as settled. Hutton was present. About a month after that Hay was in witness's place, and Hutton remarked jocularly that they trusted a good deal to him (Hay) as they had no writing for the short term of tenancy then running. Hay then s.iid, "It will not take long to do that," and wrote out n n agreement. Hay also told witnessthat the increased value of the property made him much better off than he thought he would be. When Hay fir.-t asked witness to sign the bills he was very reluctant to do so. Hay said he would be perfectly safe in doing so, as even if he hart to pay the money so much in advance, there would be plenty of margin between £600 and the amount of the rent. After consulting Hutton, witness told Hay he would accept the bills. Witness told Hay that he could not take the bills with his name only, but would require Somervell's name also. SomerveU's mmc was then added. Witness's reason for advancing the date in the agreement to the first March, was to bring it as near as possible to tho maturity of the fi:st bill, and to make it an even month. That a month after accepting the bills—in February—Hay told witness that he had received an offer of £4500 for the premises, and he said he would, uot sell the property unless the pur-

chaser agreed to give Hogjr and Hutton their tenancy. On the day of the sale of the property to Herbert, Haynes, and Co. Hay came into witness's place with apparently a new idea in his head. He proposed that after he went home and obtained a fresh stock of goods, witness should allow him to go into one of the shops occupied by witness, which would be next Herbert, Ha3'nes, and Co.'s shop. Witness told Hay that he could not consent to such a thing, as it looked too dirty for him to have anything to do with it. Hay then went away, but in the afternoon, after he had effected a sale of the property to Herbert, Haynes, and Co., ho came back and showed witness a sale-note dated 24th February, which stated that the premises were handed over free and unencumbered. Witness said to him, You have attempted to sacrifice us," and he then took steps to register the agreement of 12th Janua^-. Hay did not stop to have a conversation, but walked out of the shop. Witness's impression was that Hay was ashamed of what he had done. Hay tokl witness a day or two previously that he could get £200 more for the property if he sold it without their leave. Hay's statement as to what took place at the Bank was not correct. Witness went to the Bank on account of the first series of bills, but not when the last were discounted. Witness never pressed the agreement of 12th January upon plaintiff. On the contrary, he was very reluctant to enter upon it. Witness bought a carpet from Hay on 23rd December, before the bills were trfven. The price was 5s (Id, and after asking several times for it. Hay sent in a bill charging 7s Cd. Witness sent it back for correction, and it was returned by him with a note attached, stating that the reduction was made in consideration of the acceptance of j the bills. Witness had a. conversation with plaintiff about it, and witness admitted that ho sold the carpet at fis 4d, and said he had in his own mind intended to make an allowance. After some difficulty, witness got another account from Hay, charging 5s 4d for the carpet. In all conversations about dealing with the property, Hay never mentioned Somer?ell's name. Cross-examined: Witness intended to hold Hay to his agreement after he failed to retire the first nHI; but if Hay had offered to retire the other three bills as well, witness would have been willing to accept his tenancy at the terms agreed upon. He did not want to take advantage of Hay on acconnt of having to meet the bill. Witness was not helping Haynes against Hay. There was no arrangement whatever between witness and liis partner and Haynes. AVitness had paid no rent tinee the Ist March, but he believed credit was given them for £150 paid on the first bill. By the Jury: The reason why witness refused to take the £150 with interest when tendered by Hay, was, because he thought he would injure the position of himself and partner if «o accepted the money-they having to moct three other bills. The only reason witness gave Hay for refusing to take the money was, that they (Hogg and Hutton) were carrying out their part of the agreement. Witness believed that his firm gave £000 worth of bills for three years' tenancy of thenpremises. He would have been ready at once to pay £7 * week for the premises if a lease had been executed in their favour.

Robert Gillies, of the firm of Gillies and Street, stated that he was employed in February last by Mr Haynes to negotiate the purchase of the premise^ occupied by Hay and Hogg and Hutton in Princes street. The place was advertised for sale, and witness obtained particulars from Hay as to the prope tv and price. Not a word was said about Somervcll. Witness understood Hay was the owner. He mentioned no other person as being interested. There were three different offers of the property by Hay. The offers were £4000, £4500, and £4700. The latter was accepted. On the first occasion Hay told witness that although (here was no leasn or promise of a lease to Hogg and Hutton. he would only stll the property on condition that they had their premises. He drew luck from that offer, saying he wanted to yive Hogaiid Hutton the first offer. On the second occasion Hay authorised witness in writing to sell the property for £4500 subject to a lease to Hogir and Hutton of the premises. On objecting to that, as witness's principal wished to have the property clear, Hay said ho could not se!l the property clear as Hogg and Hutton had a claim for three years' occupancy, and a promise in honour for five years'tenancy. Hay sometimes said they had a claim, and sometimes said they had no leiral claim. Witness's principal objected to that, and wanted to know what price was wanted for the property, clear of all encumbrance. Ultimately the property was sold to Haynes for £4"00. Hay was to arrange with Hogg and Hutton, witness understanding that Hay was on such terms with them that he could do so. James Hnlton, member of the firm of Hogg and Huttqji, aud one of the defendants, said that in IS7I he had a conversation with Somervell. Witness remarked that ho thought Hay was the real owner of the place, and had often told him so. Som-rvcll .-aid. " Never mind. Whatever Mr Hay does will be right. I will not interfere." On one occasion Hay told witness that he wanted to pay £500- to the Building bociety, and that if that sum were paid off lie would make something out of the transaction. Hay had often told witness that he was the owner of the property. Hay was recalled at the request of the Jury, and in reply to a question, stated that he was in a position to meet the first bill when it fell due. K. S Allan, accountant to Hogg and Hutton, reeolected having a conversation with Hay about January 1874. It took plact in Hogg ami Hutton's office. Hay mentioned that although the property was in Somervell's name it was virtually bis, that he (Hay) was paying off almortgage held by the Building Society, and that as soon as it was paid off the property would be his. He said he intended' to sell the property as he thought sheep-farming would pay Mm better. Speaking of the property being held in Soinervell's I name, Hay said it was necessary to do that sort of thmjf sometimes. In cross-examination, the witness stated that on one occasion Hay told him that he would make it hot for Hogg and Hutton. J. B. Anderson, Manager of the Bank of Australasia, stated that on the 14th of March last Hay's account was overdrawn to llie extent of £40 14s 4d. Cross-examined.: Witness had no doubt that Hay's account had since been overdrawn to the extent of .-S4OO or £500. Mr Macasscy: If a cheque signed by Hay for £150 had been presented on the 14th. March, would it have been honoured? Mr Barton objected to this question, which was not pressed. This terminated the evidence, and the Court then adjourned until 10 a.m. next day (Thursday].