MORATORIUM

Wanganui Chronicle, Volume 84, Issue 180, 2 August 1940, Page 6

MORATORIUM

DURATION OF WAR EMERGENCY REGULATIONS GAZETTED MINISTER EXPLAINS PROVISIONS [ Per Press Association. J WELLINGTON, Aug. 1. A virtual moratorium is imposed for the duration of the war by the Mortgages Extension Emergency Regulations, 1940, which were gazetted to-day. Protection is afforded in cases outside the scope of these regulations. The Debtors Emergency Regulations, 1940, were also issued today. They supersede the Courts Emergency Powers Regulations gazetted on the outbreak of the war, which gave extensive protection to mortgagors and debtors of every description. An explanation of the new regulations was given by the Hon. H. G. R. Mason in an interview this evening. Mr. Mason said the Mortgages Extension Emergency Regulations applied to a mortgage’"' of any property, whether real or personal, or of things in action, such as a life insurance policy. Agreements for sale and purchase were also protected, the purchaser being treated as the mortgagor, similarly a lease with a purchasing clause was protected and if necessary the lease could be extended to protect the lessee’s right of purchase. The protection given virtually amounted to a moratorium for the duration of the war, The regulations precluded the call-ing-up from any mortgagor or guarantor of the principal sum or any part of the principal sum secured by mortgage, or of the exercise of any power of sale or entry into possession unless the mortgagor had abandoned the property. Similarly actions or proceedings in the court for a principal sum may not be taken without leave of the court.

Penal rates for the recovery of interest may not be enforced without leave of the Court. Where periodical payments were made, which included instalment of principal and interest, the whole payment was treated for the purposes of the regulations as if it were all interest.

The Court may, in its discretion in an action for interest, give judgment for payment at a date to be fixed, or for payment by instalments at such time as the Court determined. Where the principal sum exceeded £2OOO. the Supreme Court alone had jurisdiction, but for amounts under that the Magistrate’s Court also had jurisdiction. There was no appeal from one Court to the other. There could be no contracting out. of the regulations and a mortgagor’s consent to the performance of any act by a mortgagee which would otherwise require application to the Court was effectual only if witnessed by a solicitor employed independently of the mortgagee, who certified that consent was given by his advice. “The chief difference between these regulations and the ones they supersede,” said Mr. Mason, “is that the new regulations do not in any way require the mortgagor to show that his difficulty is due to war conditions.” Referring to the Debtors Emergency Regulations, Mr. Mason said they afforded protection in cases outside the scope of the Mortgages Extension Emergency Regulations. In the superseded regulations one set of principles was made applicable to all cases, but it was found in practice that the two sets of cases really required handling rather differently. In the Debtors Emergency Regulations certain action may not be taken against members of the armed forces or their dependants except by leave of the Court. In the case of dependants leave had to be obtained before action could be taken.