LEGACY IN DISPUTE

Wanganui Chronicle, Volume 79, Issue 185, 6 August 1936, Page 5

LEGACY IN DISPUTE

TO WHOM DOES IT BELONG? COURT ASKED TO DECIDE ASSIGNMENT DEEM£D valid. Conflicting interests in respect to a .egacy weie lupreseuLeu hi the ouprexne eourL at, vvanganui yesterday, Delore ms Honour, Mr. justice, usiier. 1 rustees in ine estate ol tne tale ihomas juamuer, Messrs. 1 iiuniao Muir uanwer ana Aioert Jonn burn, tor whom Mr. K. vvliners appeared asKea lhe court to deciae as io which al three parties belonged a iunu ol approximately iouu—tne Oidcial Assignee in tne bankrupt estate of .auuel Eleanor JacKSun, Mrs. Jackson nersell, or Mrs. Ada Matilda Falerson. His honour, alter hearing legal argument and perusing the documents, made an oraer in lavour ot Mrs. ratterson. xuj. A. A. Barton appeared for the Official Assignee, Mr. c. P. Brown lor Mrs. uacKsoxi and Mr. A. Howie tor Mrs. ralerson. It was staled that Mrs. Jackson had assigned her interest in her grandfather's estate (.the xate Mr. Bamuer) to Mrs. Paterson m consideration ol money advanced by Mrs. Paterson to Mrs. jacKson. Mr. Barton, on behalf of the Deputy Ollicial Assignee wno was acting m lhe interests ot Mrs. Jackson s creditors, attacked the assignment on the ground that it was fradulent within the meaning of Statute of Elizabeth C 5. Counsel submitted that the onus was on Mrs. Jackson to prove that the assignment was a genuine transaction. His Honour: In effect, you say the assignment is fradulent and was inaue to deceive the creditors. Mr. Barton: 1 suggest so. xMr. Brown submitted that there was no evidence of fraud. His Honour was merely being asked to infer xt. “Firstly, I submit that this was a fraudulent conveyance,” Mr. Barton proceeded "and, secondly, that the assignment was not an absolute assignment but was, in effect, and arrangement by way of mortgage. Mrs Jackson was being pressed by her creditors in 1930 and the only asset which she had was this interest in her late grandfather’s estate.” His Honour: Where am I to get the evidence that she was pressed by her creditors in 1930? There is no evidence of that at all. Mr. Barton: As Your Honour pleases. In January, 1931, Mrs. Jackson gave an assignment, or what purported to be an assignment, of her interests in her grandfather’s will. In May 1931 she filed her petition in bankruptcy. In an examination by her creditors on May 26 she stated that she was interested in the estate of the late Thomas Bamber. No mention was made of any assignment of that interest or of any arrangement by way of mortgage. One June 5 the Deputy Official Assignee notified the trustees that he claimed to be interested in the estate. No notice had been given the trustees at this time of the assignment of her intention to

apply for discharge from bankruptcy. An August 6, two uays beiore tne Court sat, Mrs. Paterson appears anu produces this assignment. Mrs. Jackson's discharge was nol granted then, out was heiu up on acounl of this assignment. It was granted subsequently, in November.' His Honour: How did it come to be granted then? Mr. Barton: it had been held up in tne nrst place on oenall ot tne creditors, out was not opposed at the November sittings because the creditors felt that tne granting of discharge did not afiect the legal position. Mr. carton then read a letter which was before the Court signed uy Mrs Paterson whereby si.e agreed to gi vt back to Mrs. Jackson an me moneys in the fund over -mu above tne which Mrs. Jackson owed to her (Mrs. Paterson), she (Mrs. Paterson) aid this, the letter staled, because ol Mrs. Jackson's destitute position. Mr. Barton suumnteu, urstlv. that the assignment was fraudulent, in that it was not disclosed to tne creditors. His second submission was lhat if the transaction was not an assignment, but an arrangement by way ol mortgage, lhe court should go bemnd the document itself and all that was left ot the fund after Mrs. Paterson had been paid should become lhe proP e rty ot Mrs. Jackson's creuitors (tne D 0.A.) Counsel stated that there was sufficient in the tuiju to pav the creditors in lull, pay Mrs. Paterson the fbo She paid to Mrs. Jackson originally and the amount Mrs. Paterson paid to the hank. There would still be X7O left lor Mrs. Jackson. Mr. Howie, for Mrs. Paterson, said that there was no intention on Mr o . Paterson's part to defraud the creuitors. There was no dispute ol the tact that she had paid the £5O. Mrs. Paterson had been approached by Mrs. Jackson who had mane the oflei to assign her interest, in the estate. Mrs. Jackson’s interest was eontim genl only. She had to outlive both her parents. Mrs. Paterson had acted m good laith and evidence could be brought that Mrs. Jackson had tried unsuccessfully before that to dispose nf the legacy. Mr. Brown, for Mrs. Jackson, said that an aflidavit could be supplied supporting her bona tides. There was no secrecy about the assignment and Mrs. Paterson had brought it voluntarily to the D.O.A.'s ofiice. His Honour ruled that the fund belonged to Mrs. Paterson. There was no doubt that she had given consideration and what Mrs. Jackson had was a contingent interest only in the estate. He could see no evidence that she had not acted in the best of good faith. Therefore, the fund belonged to Mrs. Paterson, and if she was disposed to act generously towards Mrs. Jackson that was a matter between themselves alone. An order that the fund belonged to Mrs. Paterson was made, with costs, as between solicitor and client, to be taxed and paid out of the fund to the trustees.