GUARANTEEING ADVANCES

Otago Daily Times, Issue 7853, 22 April 1887, Page 3

GUARANTEEING ADVANCES

(Pbr United Pbess Association.)

Invercargill, April 21

At the Supreme Court civil sessions today the case of the Colonial Bank v. Lewis and Moffett was concluded.. The bank claimed £1352 on a guarantee given by defendants in favour of Reynolds, hotelkeeper, Fortrose, and put in an agreement to that effect. The bank held security for £900 advanced to Reynolds before the guarantee was entered into, and the manager (according to defendants' .evidence) suggested, that they should take over this security and stand good for £1300. Defendants refused to become guarantors for more than the sum then to bo advanced to Reynolds (£300). After discu>sion, the banker promised that if they signed a guarantee the bank would uot call on them to pay the moneys until Reynolds' securities were realised, and whatever they fetched would be placed against the £1300 guaranteed, so that the defendants would be in tie same position as if they guaranteed £300. On that understanding defendants signed the gaurantee, and the bank now held them to the written agreement, the manager denying defendants'version of the conversation on which the verbal agreement was based. The banker also promised he would not pay Reynolds more than the £300 guaranteed, but when defendants were called on to pay they found Reynolds had got £1700, part of it for personal use and not for the completion of the building mortgage. ■ Mr Solomon (counsel for defence) said the position was that the bank said " We will stick to your guarantee and securities too; we wou't ' let you have the benefit of anything." This was a very pleasant position for the bank, but it would send defendants out into the cold without a penny The bank not only denied the agreement, but wi-hed to deny defendants' right to have it brought out; they said in effect, " There is a written document, and whatever arrangement was made verbally, whether what you say is true or not, we won't let you bring it out."

The jury returned a verdict for defendants on all the issues submitted. Judgment was not entered up, pending the decision of a law point as to the adinissibleness of. evidence relative to the verbal agreement 'while the written guarantee was in existence.