A DISPUTED LOAN

Wanganui Chronicle, Volume LXXXIII, Issue 19846, 21 May 1927, Page 6

A DISPUTED LOAN

SUPREME COURT ACTION A BANKRUPTCY AND THE SEQUEL His Honour Air Justice Ostler, at the Wanganui Supreme Court yesterday heard an action brought by Frederick Young, of Putiki, against Emily L. King for payment of £340 allegedly due in respect of a loan. The plaintiff, for whom Air G. W. Currie appeared, alleged that through the agency of defendant’s husband he loaned money to the defendant (£200) and in exchange received a receipt. Some years later, the defendant, through the agency of her husband, paid certain sums on account. The plaintiff, in evidence, said that in 1918 the defendant borrowed £2OO from him, security for which was given over a motor car and furniture. The loan was made to Airs King. Plaintiff received a payment of £8 on account either in 1920 or 1921, the payment being made by defendant’s husband. The husband filed a petition in bankruptcy in 1923, but plaintiff did not prove in the estate. In July, 1925, a payment of £2 was made. Finally the defendant did not reply to a letter sent by plaintiff. Mr W. A. Izard, for defendant, submitted that there was no evidence of payment by Mrs King, but his Honour said that the receipt from the defendant put the husband in the category of an agent. “Too Slick.” J. Curran, bailiff at the Wanganui Alagistrate’s Court, deposed as to serving a distress warrant on King in connection with another matter. King had been too “slick” and had put his car away, while the furniture belonged to his wife. Receipts showing that the furniture belonged to Mrs King had been produced at that time. Mr Izard said that the defence was that the money had ndver been received by Mrs King, the car was never hers, but the furniture was. King and Young had been great friends and at the time that King got into difficulties, he and Young arranged that in order to protect the furniture the loan of £2OO should be transferred to Airs King. The receipt with lhe date June 5, 1918, was therefore not signed until October, 1923. A receipt for £2OO had been received from Young who had made considerable use of the car.

His Honour held that the transfer of the loan was not an evasion of liability, and an adjournment of fifteen minutes was granted in order to give Mr Izard time io consider this aspect of the case. On resuming, Mr Izard announc d that it had been decided to fight the case out on the grounds that Mrs King was entirely unaware of the fact that her husband had ever owed the £2OO. If Mrs King did not know that she could not be liable. Emily King, giving evidence, deposed that she had been asked by her husband to sign the receipt in order to protect her lurniture against any action which might be taken under the Bankruptcy Act. in reply to Mr Currie, witness sail she received a letter from Alcssrs Currie and Jack asking for repayment of £2OO. “Would it not be tne natural thing to do to reply stating that you did not owe the money?” said Air Currie.| Witness: Aly husband told me to take no notice of Ihe letter. Saving the Furniture. Witness admitted that she left ,hc whole of her business transactions in her husband’s hands, and he had a frm hand to negotiate with Young. James King said he gave plaintiff various amounts on different racecourses. He never asked Young for the money back as he knew he owed Young money. He did not tell his wife that he owed Young the money, as Young had told him not to. Mr Currie: You concocted this story with Young concerning the furniture and the bankruptcy, in order to defraud your creditors? Witness: No. It was to prevent them taking my wife’s furniture. Mr Currie: Can you suggest one single reason why Young should be a party to such a scheme as that? Witness: He suggested it. Mr Currie: You were getting rather close to criminal proceedings when you concocted a scheme like that! His Honour said he believed that tne true facts of the case were that King owned the furniture in the first place, or gave it out that he did, and he mortgaged it to a man named Hall. Hall pressed for payment, and King went to Young and asked him for a loan to piy off the furniture, and the loan was given. It was only when the bankruptcy came along that the furniture was transferred to the wife and pre-dated in order to defraud the creditors. Air Currie submitted that Mrs King was bound by the act of her agent. His Honour, in summing up, said he thought the defendant knew a great deal more about the transaction than she admitted. The defendant assumed the debt with all equities, and his Honour thought that King’s statement of a contra account of £6O was not unreasonable. He. would not allow interest on the debt, and would give judgment for the plaintiff for £l4O with costs.