COURT OF APPEAL.

Otago Witness, Issue 3671, 22 July 1924, Page 46

COURT OF APPEAL.

WELLINGTON. July 14. The Court of Appeal is to-day engaged in considering the case ot M’Dougall v. the Attorney-General and ibe permanent head of the Railway Department. The question for the court is the interpretation of sections 12 and 14 of the Public Service Expenditure Adjustment Act, 1921, and of the regulations under section 14, M'Dougall, a leading fitter in the railway service, contends that he has not been paid the scale increase of salary to which he is entitled. A preliminary point was taken by the Attorney-General that the Declaratory Judgments Act, 1308, under which the proceedings were issued, could not he involved in any matter in New Zealand in which the Crown is to be bound. Mr Skerrett, K.C., and with him Mr O’Leary, appeared for the plaintiff, Sir F. D. Bell, K.C., for the Attorney-General, and Mr Myers, K.C., for the Railway Department. The court dismissed the appeal in the case of Toogood v. Nash, holding that the husband was not liable for tne cost incurred by the wife in unsuccessfully bringing or defending divorce proceedings against the husband. Application for leave to appeal to the Privy Council was reserved for consideration. July 15. The Appeal Court reserved its decision in the case Macdougad versus the Railway Department., in which appellant seeks an interpretation of the regulations covering salary payments as affected by the “cut” and subsequent reclassification. July 111. The Court of Appeal to-day was engaged considering the appeal (from the decision of Mr Justice Hcrdman delivered at Auckland in April last) of Arthur Cleave, of Auckland, printer, against the Wairakei Company (Ltd.). After a lengthy trial lasting five days the company succeeded, in effect, in obtaining judgment against Cleave as upon claims for £0265, while Cleave, in a counter-claim, in effect, succeeded against the company as upon a claim for £2057. The claim of the company arose out of certain transactions in the shares of the respondent company in which Cleve was concerned. Mr M. Myers, K.C., in opening for the appellant, dealt with transactions in which Cleave sold 5000 shares (which had been allotted to him by the directors as part of his commission) to one L. C. Johnson. Johnson’s cheque for all the moneys due on allotment (15s per share) being dishonoured, Cleave had paid the allotment money himself to the company, the directors of which decided to let him step into the shoes of Johnson. Cleave then sold these shares to various purchasers, who obtained transfers (which were approved by the company) which received altogether from Cleave and these various purchasers 20s in the £ for these 5000 shares, but afterwards claimed to recover, and did recover, from Cleave the sum of £1250 (being 5s per share allotment money on the 5000 shares) on the ground that the shares could have been, and should have been, issued at par. In effect, Mr Myers contended that the company had recovered by the action £6250 for 5000 £1 shares, whereas it was entitled to only £SOOO. Mr Myers therefore contended that that part of the judgment which awarded the company the £1250 was wrong. Mr Richmond, for the respondent, contended that Cleave was a trustee of the assets of the company. Johnson’s shares were illegally allotted, and his application was a bogus one. His cheque was dishonoured three months after the application, but the company was not notified till much later. Cleave could have notified the company that the cheque was dishonoured, and got it to cancel the allotment. Johnson’s name was put on the register, and there was no doubt that he became a member. Johnson's name was not properly taken off the register. That being so, lie was still a member, so the company had allotted his shares in error to other people. The directors had no right to sell for 15s shares to a fellowdirector which he had already sold before they were allotted to him for £l. The Court refused leave to George Toogood, solicitor, of Wellington, to appeal to the Privy Council against the Court's decision in a case in which Toogood sought to recover costs from William Henry Nash, which costs were incurred by the respondent’s wife with Toogood when she was an unsuccessful party in a divorce suit. July 17. The Court of Appeal continued the hearing of argument in the appeal (from the decision of Mr Justice Herdman delivered at Auckland in April last) of Arthur Cleave, of Auckland, printer, against the Wairakei Company (Ltd.). Mr Richmond, for respondent, contended that in disposing of 5000 fully-paid shares (which had been given Cleave by the company in settlement of a sum duo to him) to applicants for shares Cleave was liable for a return of the money. July 18. The Full Court is to-day considering the case Connor v. Nelson, Moate (Ltd.). In the Lower Court, Connor was awarded £1026 damages for falling down a lift well in Wellington. Defendant moved for a nonsuit or for judgment, or tor a new trial; and plaintiff moved for judgment. These motions were removed into the Fidl Court. The questions for the court are: What duty (if any) did Nelson, Moate owe to Connor, and what was the nature of the permission (if any) given to Connor in respect of the use of the lift. Mr Skerrett, K.C. (with Mr O’Leary), for the defendant company, contended that there was no legal nexus between plaintiff and defendant, and, further, that plaintiff, even if ho had defendant’s permission to use the lift, had permission to use it only in the natural and customary way without negligence, which he had not done. Mr O’Regan appeared for plaintiff. July 19. Decision was reserved.