150 PER CENT

Southland Times, Issue 18968, 15 June 1923, Page 5

150 PER CENT

MONEY LENDER’S INTEREST. (Per United Press Association.) CHRISTCHURCH, June 14. An action was tried in the Supreme Court, before Mr Justice Adams to obtain judgment as to rate of interest a money lender may legally charge. Plaintiff was Lazarus Wolfe Banlkind, Christchurch, a moneylender, who has offices in several centres in New Zealand and the defendants were Hugh Kennedy, Christchurch, tramway employee, and his wife Helena Kennedy. The statement of claim set out that on June 6. 1921, plaintiff lent defendants £5O, on security under the Chattels Transfer Act. They covenanted to insure the chattels against fire and to pay plaintiff all insurance money. The chattels, including furniture, were destroyed by fire on February 7, 1923, but were insured with Britsh Traders’ Company. The sum then owing was £72 15/4. The manager of the Company paid the insurance money to defendants’ solicitor and plaintiff now claimed the sum of £92 15/4 against defendants. The defence was that the transaction was harsh and unconscionable. Defendants claimed relief under the Moneylenders Act, and asked asked to have the transaction reopened and the accounts taken and that they should be relieved from paying anything in excess of a fair sum. It was stated in argument that a registered accountant had calculated that Mrs Kennedy borrowed from Balkind in three advances, £72„ repaid £6l by instalments, and at end of nineteen months still owed £72 15/4. The interest for the first twelve months on a straight advance was 56 per cent./ per annum; for the second six months, on the same basis, it was 54 per cent. According to the accountant the investment returned Balkind 150 per cent, per annum, over the whole term. Council for plaintiff said that nobody would object to pay 2/6 for use of £5 for a week, but it was £6 10/- a year and 130 per cent, per annum. A money lender was entitled to make a reasonable profit in the same way as an ordinary trader*? was, and the interest charges were his only means of meeting his expenses and recouping himself. In the present case, the chattels having been destroyed, defendants asked that they should be relieved of some of the money they had agreed to pay Balkind. His Honour, said that he thought that Balkind in 1918 had said that his business was unprofitable and would be wound up. Counsel said that that was Balkind’s intention. Still, his doctor had ordered him to relinquish business and in a few days he would leave on a long voyage. On his return, probably he would wind up his business, but he might continue to lend money. The decision was reserved.