SUPREME COURT.

Taranaki Herald, Volume LIV, Issue 13485, 27 July 1907, Page 3

SUPREME COURT.

EMSLIE V. BUCHANAN.

JUDGMENT GIVEN.

The judgment of Mr Justice Button in the case Emslie v. Buchanan, heard in the Supreme Court, New Plymouth, on July 6th, was read by the Clerk of the Court yesterday. The dealings out of which this case arose were these: — Wilfred Wylam Emslie, now a farmer at Oakura, owed T. O. Kelsey £1600, together with £120 interest, under a second mortgage on some land in the Urenui district. Emslie sold this property to Neil Buchanan, farmer, of Waikato, subject to the mortgage. The first mortgagee sold the property and bought it in at the sale, consequently the second mortgagee, Kelley, had to look to the personal obligation of Emslie. Emslie under a covenant implied by the Land Transfer Act in cases where land is transferred subject to a mortgage, claimed that Buchanan was liable. He, therefore, having been previously sued by Kelsey for the debt, sued Buchanan for the amount of the mortgage and interest—in all £1720. This was the action heard on July 6th. Buchanan in turn claimed that he was indemnified by C. B. Buxton, of Wellington, by virtue of certain agreements made with him. Buxton was therefore joined as a third party. Buxton also repudiated the liability. His defence u-as—^l) That on February 13th last he received a deed of release from Emslie, freeing Buchanan, and consequently himself, from liability ; (2) that a previous action brought by Emslie against Buchanan had been discontinued, and plaintiff, having failod to pay the costs due on discontinuance of the action, was debarred from bringing a second action. By way of reply to this defence, Emslie 'claimed- (1) That both the release for Buchanan and the discontinuance of the previous action had been obtained from him by Buxton by means of misrepresentation; (2) tbat, even if the release were not obtained by misrepresentation, it was not effective since it contained no appropriate operative words ; (3) that the discontinuance was arranged by agreement of the parties, and that therefore no costs were payable, as alleged. Mr Hutchen, with "Mr Quilliam, was counsel for Emslie, Mr Johnstone for Buchanan, and Mr Spence for Buxton. The judgment stated that it appeared that Emslie was owing Buxton £960 on a property known as "Apiti." The mortgage was overdue, and Emslie unable to pay. To relieve himself from liability to* Buchanan, Buxton threatoned to press Emslie unless he released Buchanan, and promising to release Emslie from the Apiti mortgage if he complied. Emslie admitted that he was "practically worth nothing" and ! "bringing the action for Kelsey." In another transaction Emslie received £35 in full settlement of all liability undor transfer of certain lands to Buchanan. A deed signed the following day acknowledged a settlement of a previous similar action that Avas pending. The de!fence with regard to the filing of the discontinuance without paying costs must fail ,> neither party contemplating that costs were to be paid. The defence as to the payment of the £35 did not in itself afford an answer to the action, and the same might be said respecting the deed signed the following oay^ It was another element in the, ..agreement by which a settlement -was arrived at. 4n the deed signed it was declared "the action ife settled." Though this deed did not release Emslie, by it Emslie acknowledged a settlement of the action. It was suggested that Buxton could not set up as a defence an agreement made to release Buchanan. An answer to this would be found in the case of Callonder v. Wallingford, 53 L.J., Q. 8.. 569 (not quoted by counsel), in which it was decided that a third party was entitled to set up as against the plaintiff's claim any defence which would have been available to the defendant.

Judgment was for the defendant.with costs on the highest scale. It would appear .continued the jndgment, that the Court had no jurisdiction to order the plaintiff to pay costs to a third party (Witham v. Vane, 44 L.T. 718, on appeal H.L. 32 W.R. 617).