The Public Trust Office.

Press, Volume LX, Issue 18229, 13 November 1924, Page 6

The Public Trust Office.

We called attention last week to Section 14 of tbo Finance- Act, which., decreed that any clause, in a mortgage should be null and. veid which provided that the monoys secured by the mortgage should become due and payable in lie event of the Public Trustee becoming administrator of the estate of the mortgagor. Such a clause has appeared in all well-drawu mortgages since the passing of the Public Trust Office Amendment Act of 192.1-22, the purpose of that clause being the protection of the mortgagee against the grave risk of injury threatened hy the improper powers conferred on the Public Trustee in Section 86 of the Act referred to. This obnoxious clause was repealed in the Finance Aet' last week, and its repeal removed the . necessity for the protective clause in mortgages. There was accordingly no need, even from the Public Trustee's j point of view, for the express prohibi- | tion of the protective clause, which is | uo longer necessary as a defeuco against the obnoxious power now given up by the Office. That the Office should have asked Parliament to forbid a practice that was rendered necessary by a condition which even the Office lias not the face to retain, was an impudent enough proceeding, but it is not so impudent as the account of the position which is given by the Public Trustee in a statement supplied by liim to the three Wellington papers. " For some time past"—so runs the statement, which is the same in all three papers—"the practice has been '' growing up of inserting in mortgage " deeds a proviso to the effect that " if the Public Trustee is appointed ' '■ executor or administrator of the " estate of the mortgagor or a sub- " sequent purchaser, the moneys secured under the mortgage are to " bo repayable on demand. The " effect of this covenant (says Mr J. " W. McDonald, Public Trustee) has " been, to deter mortgagors from i( appointing tho Public Trustee as executor of their wills, and action " has now been taken to protect the "interest or! mortgagors." H is typical of the Public Trust r Oflias that it should avoid aaj[ men-

{ion of the reason why well-advised mortgagees have insisted on the proviso mentioned, but it is astonishing that three presumably well-informed newspapers in the Capital should have omitted to say a single word to correct the false impression that would be conveyed by the statement we have quoted. The Office's want of candour is now notorious, but the Wellington newspapers ought to know better. The Public Trustee's statement that the offensive clause in the new Finance Act is designed "to protect the "interests of mortgagors" is hardly less typical of his Office's methods. It is not designed to protect the interests of mortgagors; it has nothing to do with the interests of mortgagors; the interests of mortgagors do not come into the question at all, unless it is against the interest of any individual to appoint anybody except the Public Trustee as his executor or administrator. If the Trustee means that, he ought to say so plainly. It seems to us that the Trustee's statement is exceedingly misleading, and is not likely to increase the public's confidence in the Office's way of doing business.