WILL STOP EFFORTS TO RUSH IN AHEAD OF IMPORTANT BILL

Star (Christchurch), Volume XLIV, Issue 66, 19 March 1931, Page 7

WILL STOP EFFORTS TO RUSH IN AHEAD OF IMPORTANT BILL

Prime Minister Makes Statement On Action To Protect Mortgagors. (Special to the “ Star.”) WELLINGTON, March 18. THE INTRODUCTION in the House of Representatives this afternoon of the Mortgagors’ Relief Bill aroused keen interest among members, and the first reading stage, as a consequence, saw a discussion from all parts of the House, the greatest anxiety being shown that transactions involving hardship, which had already gone through, should be subject to review. The Prime Minister assured members that any attempts to “ get ahead ” of the Bill would not be successful. The question of making the legislation retrospective would be considered.

Mr Forbes explained that the measure would supplement the provision already made under which Commissioners of Crown Lands were acting as conciliation commissioners between mortgagors and mortgagees. He was pleased to say that a good deal of very useful work had already been done in this way in bringing the parties together. The Bill would give power to a tribunal to decide whether it was in the interests of the country that a mortgage should be called up. It was different from the moratorium, which operated to extend mortgages, and caused the mortgagee to approach the Court. In the present case the mortgagee would have to approach the Court to show why the mortgage should be lifted. Powers Of Tribunal.

ing that mortgagees were doing their utmost to put out the mortgagor. Mr W. L. Martin (Raglan): We all have. Mr Martin asked that a clause making the Bill act restrospectively should be inserted, covering transactions of the current year. It was hard to bring in legislation to protect people in the future, when many had already been forced off the land. The Government had already accepted this principle by announcing that any attempt to force the position between mortgagor and mortgagee in Napier would be dealt with by legislation which was not yet in existence. Principle of Law. Mr Poison declared that if the Bill proposed to go further than securing postponement of interest and calling .up of mortgages, so long as the mortgagee did not suffer hardship, then it assailed a vital principle of British law, the sanctity of contract, and would have a sharp repercussion in the country. He preferred to see conciliation commissioners appointed to arbitrate, for 90 per cent of the cases could be settled by mutual consent between the parties. His experience as an arbitrator showed that most mortgagees were reasonable, though there were some cases of hardship. One instance quoted was. that of a farmer who paid £16,000 for his farm ten years ago, paying half cash and putting improvements into the land at the rate of £IOOO annually. The mortgage became due recently, and as the farmer was unable to find £BOOO he had to give up possession of a farm which had had £26,000 spent on it. Mr H. G. Dickie (Patea) declared that any interference with the principal sum must be mutually accepted. A conciliation committee was functioning well in Hawera, arranging matters between mortgagor and mortgagee. He believed lenders would not deal harshly if it was likely to become a matter of public comment. Mr E. J. Howard (Christchurch South) recalled that the previous Bill extending mortgages was passed overnight, because Parliament was told that unless this was done before offices opened next morning, mortgagees would become active and a crash would ensue. “ Rushing In Ahead.” Many other members showed their interest m the matter by raising similar poin ;s, and when the Prime Minister rep’.ied, he said the Bill made it. very dear that the provisions applied to the Crown as well as the private individuals. (Hear, hear.) “In introducing such legislation,” he added, ** it is a case*of breaking new ground, and, cf course, mistakes can be made. The

The whole surrounding circumstances would be reviewed, and the Court would find out whether the proposed action would result in putting a man off his land or displace him from his property and place him in a position of great disadvantage. The interest of the mortgagee must also be considered, added the Prime Minister, because many people who put money into mortgages were absolutely dependent on it for their income, so that it would be left to the tribunal to decide what 'was fair. Mr Jones (Mid-Canterbury): Will it have compulsory powers? The Prime Minister: It will decide whether the mortgage should be called up or not. Mr W. J. Poison (Stratford): Will it have power to deal with postponement of interest? The Prime Minister: The matter of whether a person should be sold up for non-payment of interest will, come under the tribunal. The legislation will be brought into operation by proclamation, and when it is considered it has served its purpose it can be repealed in the same way. Immediate Relief Wanted. Mr M. J- Savage (Auckland East) welcomed the Prime Minister s statement, but suggested that if it did not give immediate relief it would be fooling the people. What was going to happen to the average farmer while it was being passed? While the tribunal was being set up, mortgagors should not have the right to foreclose, otherwise the introduction of the Bill would simply stimulate the calling up of mortgages. Colonel T. W. Macdonald (Wairarapa) assured the Prime Minister that retrospective action was needed, for he. had a number of instances show-

idea of having the measure circulated j is to let the country know what is pro- J posed so that representations for perhaps the extension of its scope or the incorporation df additional safeguards can be received before the second reading stage is reached.” Emphasising that it was intended 1 to bring the Act into operation immediately after it had been passed, the Prime Minister said it could be accepted that from to-day any attempt to “get ahead” of the legislation would not be successful. (Loud hear, hears.) “ I want to make that clear to any ( who may be trying to rush in ahead of the Bill,” added Mr Forbes. “We will prevent that being done.” Mr D. G. Sullivan (Labour, Avon): That means you will protect everyone from now onwards? The Prime Minister: “Yes.” He added that the Government would consider the question of making the legislation retrospective, and he repeated his assurance that no one would be able to defeat the object of the measure while it was before the House. Fullest Discussion. In rejecting a suggestion that the second reading should be taken forthwith, Mr Forbes said the Government desired the fullest discussion and consideration of the Bill before it was passed. What was wanted ■ was something that was workable and would not be unjust to either mortgagee or mortgagor. “ I am sure,” he said, “ that it is not the desire of the House to be unjust to any of these parties. “ While we often hear the mortgagee described as a Shylock, we must remember there are Shylocks among the mortgagors, and I think that, taken as a whole, the mortgagees of New Zealand are reasonable men. “ I know from information supplied me that in a great many cases they are meeting the mortgagors very liberally indeed at the present time. Of course, there are exceptions, and it is these the Bill is designed, to deal with.” Mr R. Semple (Labour, Wellington East) : We don’t need to worry about the decent chap. The Bill was read a first time. A summary of the provisions of the Bill appears on page 4.