WAS IT A GIFT OR LOAN?

Taranaki Daily News, 19 August 1933, Page 5

WAS IT A GIFT OR LOAN?

MONEY FROM HIS MOTHER. SUPREME COURT TO DECIDE. A claim for £3026 as money lent or in .the estate of May. Ellen Honeyfield deceased, was made before Mr. Justice Ostler at New Plymouth yesterday by Henry Robert Honeyfield (Mr. A. A. Bennett) against Charles Rufus Honeyfield (Mr. T. P. Anderson). The hearing will be continued this morning. The case was opened by the defendant, on whose behalf Mr. Anderson outlined the facts. Mrs. May Ellen Honeyfield died on July 23, 1932, he said. Her husband had predeceased her in 1919, leaving everything to his farms, stock and other things. There were seven children—Henry, then aged 23 or 24, Charles, 12 years younger, Mrs. Topliss, Rhoda (who died single in 1928), Alberta, Grace and Laura (both the last named, being now married). After her husband’s death Mrs. Honeyfield carried on the farms, but about two years later one of them was sold and the homestead farm at Ohaero was carried on. In 1928 all but three of the children, including Charles, had Jef t home. Charles attained the age of 21 in March, 1928, and'it was apparently suggested to him that he should buy the neighbouring farm owned by Perrott. He had no money, but he discussed the proposal With bin mother and suggested she should buy the farm. Charles bought the farm in his own’name with his mother’s consent; the moneys she paid him for that purpose were by way of gift. The total purchase price was £4174. The vendor left mortgages on the property totalling £2850, leaving £1324 to pay. The first cheque Charles received from his mother was for £192 ss, representing a deposit and stamp duty. Though he opened one later (in June, 1928), he then had no hank account, so he paid the cheque direct to the solicitors for both parties. A fortnight later Charles received a statement from the solicitors showing that they required £lll4 to complete the cash transaction, and his mother gave him a cheque for that amount and he paid it’to the solicitors. Shortly afterwards he bought stock from Newton King and paid for them with his own cheque for £656 and received a cheque from his mother for a similar amount. A further sum of £62 was paid in connection with the same transaction and the mother also gave a cheque for that SUHL In the meantime the loan of £2850 on the farm was re-arrahgcd and when a section of it fell due Mrs. Honeyfield gave Charles a cheque for £lOOO to pay It. The evidence would be that all these payments were gifts to the son Charles, who carried on Perrott’s farm as his own, always treating it as such, and paying everything himself. There was still £lBOO owing on the property. Mrs. Honeyfield died at the age of 69, leaving Charles the homestead farm, which was unencumbered, and a share of the residue (over £4000), in common with four others. Out of £9140 ((he net value of the estate) Charles’ share was £5232. Charles Honeyfield gave evidence to this effect. Cross-examined, he said he was not aware that the money hi« brother Henry received from his mother for his farm had been regarded as a Joan and not a gift. Witness denied that the money was lent to him with the condition that he paid no interest during his mother’s life-time as long as he managed the place during; her life-time. She had given him the money and he had to pay nothing whatever. Other evidence was given by Alberta Honeyfield, Rebecca Honeyfield, Fred ■ Sarten and Eliza J. Pigott. ' For the plaintiff Mr. Bennett contended that if the £3OOO were a gift the dis- z tribution of the estate would be most inequitable. „If it were a gift Charles’ share of the estate would be seven and a-half times as much as those of three other members of the family, 16 times . that of another and 27 times that of ani other. If, however, it were a loan, the proportions it bore to the shares of- the others would be three and a-quarter, ' nine and 25 respectively. Counsel said i he would produce evidence that the ’ moneys were loans.