MORTGAGE ON SHARES

Otago Daily Times, Issue 21986, 22 June 1933, Page 2

MORTGAGE ON SHARES

APPLICATION OF RELIEF ACT COURT RESERVES DECISION. (Peb United Press Association i WELLINGTON, June 21. The Court of Appeal is considering an important legal question, whether or not the Mortgagors Relief Act of 1931 and amendments apply to mortgages of shares in companies. An application was filed in the Supreme Court, under the Mortgagors’ Relief Act of 1931, and the Mortgagors’ and Tenants’ Relief Act of 1932 on behalf of a mortgagor for relief in respect to a mortgage executed in July, 1930, over three parcels of bank shares securing repayment of £3OOO and interest.

Counsel for the mortgagor after referring to the section of the Mortgagors’ Relief Act in which a mortgage is defined as “Any deed, etc., whereby security for payment of moneys or for the performance of any contract is granted over land or chattels or any interest therein respectively,” submitted that the word “chattels” should be given a modern meaning, which was “ any typo ,of property except real property.” Ho submitted that the history of the mortgagors’ relief legislation clearly showed that the Legislature had adopted the word in its widest and most modern sense. Such a meaning would be sufficiently wide to cover elioses in an action such as shares in a company. Counsel for the mortgagee contended that the court should adopt the older and narrow meaning of the word, which restricted the term “chattels” to tangible personal property. He dealt at length with the difficulties which would arise in connection with local body loans in the event of elioses in an action being held to be chattels within the meaning of the relief legislation. The court reserved its decision.