HIGH RATES OF INTEREST

Taranaki Daily News, 11 July 1933, Page 9

HIGH RATES OF INTEREST

EVIDENCE IN AUCKLAND CASE CLAIM FROM MONEY LENDER. DEFENDANT’S DENIAL OF FRAUD. SMALL LOANS AT HIGH COST. By Telegraph—Press Association. Auckland, Last Night. Evidence of money lending transactions at high rates of interest was given during the hearing of a claim before Mr. Justice Reed in the Supreme Court today. The defendant was a married woman who, it was stated in evidence, carried on the business of a money lender. A claim for £207 on promissory notes for £lO3 and £lO4 and interest was made by Robert Charles Cooke against Mrs. Ellen Batt. The promissory notes were dated June 1 and July 14, 1931. There was an alternative claim for the amount on the ground of alleged fraudulent misrepresentation. The defence was that the plaintiff was an unregistered money lender and that the transaction was illegal. Fraud was denied.

Council said Mrs. Batt did not dispute Cooke lent her two separate sums of £lOO, but she contended that as she promised to pay him interest at a rate greater than 10 per cent., and as plaintiff was not a registered money lender, she was under no legal liability to repay what she had been given. , Cooke said he was retired in May, 1931. He met Mrs. Batt, who told him she had a very profitable money lending business but required more capital to make more money. She said she had never had a loss. Being a woman people always paid her. She offered him two-thirds of the profits on the money he lent her, keeping one-third for herself. When he lent her £2OO he received in return the stamped receipt produced, which stated that £loo' of the money was to be lent out in small sums, the interest to be not less than £3 for every £lO and the time to be not more than three months. The other £lOO was to be lent for six months, the interest to be £3O for that period.

Witness said he received two promissory notes as well as the receipt. Early in July Mrs. Batt approached him for £lOO for a friend, who was stated to be a high police official. Cooke said he later decided to withdraw from the business. He found he was being repaid with his own money.

Cross-examined, Cooke admitted that a large number of loans had been made by him as recorded in his books. These included one to Professor Grossman of £lOO at £25, interest for three months, another to him of £lOO for one 'month at £24, and a third loan of £lOO made direct to Professor Grossman with in-, terest at £2O for one month. Witness said he found the “police official” mentioned was really a moneylender.

His Honour said the plaintiff had to prove fraud as if Mrs. Batt had appeared on a criminal charge of fraud. Hq did not think the evidence had been sufficient to establish fraud. After the legal position had been argued His Honour found ‘the plaintiff was not a moneylender on June 1, 1931, but that he was a moneylender on July 14, 1931. It had not been proved there had been fraudulent misrepresentation. Judgment would be for the plaintiff for £lO4, the amount lent-on June 1, and costs.