PURCHASE OF CITY PROPERTY

Wanganui Chronicle, 28 November 1947, Page 6

PURCHASE OF CITY PROPERTY

ALLEGED USE OF DUMMY TWO SCHOOL TEACHERS CHARGED. IP.A.) Invercargill, Nov. 26. Allegations of deceit and the use ot a "dummy” in the purchase ot a city property was made by the Crown in prosecutions under the Land Sales Act begun at the Magistrate's Court. Defendants are Julia Crowe, school teacher, and Gladys Marion McKenzie, retired school teacher, both of whom pleaded not guilty. Crowe is charged that with intent to deceive she made a misleading statement to the Land Sales Committee in Invercargill. McKenzie is charged that she entered into an application inconsistent with the Act. Both defendants are charged with being parties to a scheme inconsistent with the Act. "We don’t dispute the facts," said Mr. C. N B. French. The defence is that tha actions of defendants were perfectly lawful, and are allowed by the Act" t „ Mr. J. R. Mills, for the Crown, said these were the first prosecutions under the Act in the Southland District and he believed the first in New Zealand under this particular section of the Act. In October 1945, McKenzie was desirous of purchasing a two storied brick property owned by Charles Albert Davis, in Gale Street. Defendant owned her own house and was a joint owner of four other house properties in the city all let, and a building site in Herbert Street. In March 1945, she had been involved in two cases where the Crown objected to her purchasing property on the grounds of undue aggregation. The Land Sales Committee consented to the purchases, considering they were "border line" cases. Consent was given on certain undertakings concerning the other properties held by McKenzie being given In view of the amount of property owned by her McKenzie realized that if she made application to purchase the Gala Street property it might be refused, continued Mr. Mills. It was agreed in the circumstances that she get a friend to purchase the property on her behalf, and it was arranged at that time that the friend, who was going to be the apparent purchaser, would later transfer the property to the defendant. It was after discussions with the defendant's then solicitor, that defendant contracted with Crowe to act for her. Except for a share in a family home Crowe owned no other property, and it was realized that the consent of the Land Sales Committee would be forthcoming if Crowe was named as purchaser.

McKenzie's name was not mentioned to the committee and the consent of the committee was duly granted for the transfer of the property from C. A. Davis to Crowe, said Mr. Mills. “It is freely admitted it was McKenzie’s money which was used for the deposit on the property. It was her money from a National Savings account which was paid. A further sum and the balance ot the money was also raised by McKenzie. After the sale of property to Crowe, tenants of the rooms and flats in the properly always paid rentals to McKenzie? , The Crown’s case was that Crowe was used as a “dummy" in the sale so that no difficulty would be experienced with the application to the Land Sales Committee and in accordance with the scheme that she would subsequently transfer property to McKenzie, who was the real and actual owner. By the scheme, McKenzie ultimately became the registered owner of the property.

The transaction was investigated by the police. Botli defendants admitted the facts hut said they were acting <>n legal advice, so much that they considered what they were doing was permissible. The fact of their ignorance of the law was no excuse, declared Mr. Mills. The fact that a legal adviser had told them they could proceed in that wav did not excuse 'tpt!' B, 1 Ml. B°th were teachers, and wel" ffliihated women. He submitted they knew when they entered into the scheme they were using it as means of evading land sales legislation. What they had done was not consistent, with the spirit of the act. The hearing adjourned until tomorrow. ' ’ ’