APPEAL UPHELD

Press, Volume LXI, Issue 18406, 12 June 1925, Page 11

APPEAL UPHELD

IN STAMP DUTY CASE. MAGISTRATE OVERRULED. COSTS AGAINST THE DEPARTMENT. The conviction of Frederick Wilding, K.C, for an alleged breach of the Stamp Duties Act was quashed by Mr Juslico Adams at tho Supreme Court yesterday. His Honour upheld tho appeal against tho Magistrate's decision without requiring tho appellant to answer. In tho Lower Court, Mr Wyvcrn Wilson, S.M., convicted Wilding and fined him £2o for an offence against Section 36 of the Stamp Duties Act, 3908, the charge being: "That ho did, ou or about the 13th day of August, at Christchurch, in Zealand, boing employed or concerned in, or about, the preparation of a certain instrument, to wit,.a memorandum of transfer dated August 13th, 1922, and executed by Bowron Bros, and Company, Limited, in favour of William John Campbell, with intent to defraud his Majesty, omit fully and truly to set forth all tho facts and circumstances affecting tho amount of ad'valorem duty with which such instrument was chargeable." Mr P. S. K. Macassey appeared for the Crown, and Mr M. Myers, K.C, and Mr M. J. Gresson for the appellant.

Evidence similar to that heard in the Lower Court was given by George Bowron, George John Smith, a director of Bowron Bros., Ltd., and John Morrison, Assistant-Commissioner of Stamps at Christchurch. "Case Not Proved." "The appeal is on the plain, simple, and short ground that the Crown has not proved its caso," said Mr Mycra. "There is not a little of evidonce to support the conviction." Ho asked his Honour to do what the Magistrate should have done. It was a matter for regret that the caso should not have come before tho Supremo Court in the.first place, for it might well be that tho tribunal before.which the case went in tho first. instance might not have, had the knowledgo 6f the practice of the professions to cnablo it to draw the right and proper conclusions. The Magistrate had' gone egregiously wrong. The fact that Mr Wilding had been convicted had been ' telegraphed'-from tho North Cape to tho Bluff* and it had been commented on by the public, and at least one newspaper. A great deal of barm had been done, and it would be. advisable, if his Honour came to the conclusion counsel asked him to, that the wrong should be remedied at the earliest possiblo opportunity. Speaking of tho legal questions, he said, that the law on the subject had not been acted upon by the Court. from -which tho appeal was made. The only way in. which a conviction, could have been entered was by adopting "tho easy but fallacious, standard of subsequent events. " t Even in a civil case it had ,been.held over; and. over again that charges of fraud must be proved .by: the .strongest and clearest of evidence. The evidence must-be inconsistent ifith' innocence. The only evidence : that connected >Mr Wilding with the.matter was strongly in . his favour.•'"lf necessary,' counsel J 'was prepared; toargue- that tile .opinion given by; Mr Wilding' on the facts be-fc-TC hini was sound, but it did not \ 'matter if'; the opinion was •' right or', wrong if it.was honest.'. -Wilding had had no knowledge of the Boag agreement, tho .agreement with-Anning, the agreement ;.%vith. Stephens, or the assignment from Stephens to : the Bowron trustees. If he" had known of the chain of agreement the position would have been quite different. : Counsel submitted that the Magistrate had inferred fraud where. he .had no right or justification for doing so, for the evidence was all the other.way.

. Case for the Crown. '. ; Mr Macassey said he ■wished toes-' tablish fraud on Mr Wilding's part in the transaction between Bowron and Campbell. If it 'were' bona fide,- then there should have been the cancellation ,of the Anning agreement. Counsel sub'matted..'that' tho wholo of the matter had been put before Wilding, by his clerk Granger, and that the irresistible inference was that .what was done was done by Wilding's" instructions. Wilding's duty had been to ascertain the facts.- Counsel could not dive into a man's mind, and he could only judge, his /opinions, by -the outward actions. Mr Myers: He could have called Grangor; he has.not done so. . Continuing,; Mr Macassey said that if honest advice- had been by Wilding, then the contract between Anning and Campbell should have been cancelled. As a mater of fact, the Annings remained in possession of Kolsie, ...Campbell of Clifton Palls, and Bowron Bros, of Cook Kock. .•'■■■..-His"-Honour said that the case concorued, a gentleman With 40 years' standing *in • the legal profession, which le'cognisod. him as a leading member. This enjoined a reputation for honour and integrity, deserved or not. An important, client brought business to him; -and he,, agreed to act for both parties. The'appellant, advised Bowron Bros, to ignore the Annings, nnd to transfer direct. What was:: thb motive that induced (as counsel for the Crown would have him believe) the appellant to give dishonest advice .'in,order to avoid the payment of stamp duty payable by someone else? Mr Macassey: To got over a difficulty and to please Bowron Bros. His Honour: It would be a calamity if a man, after earning a reputation over many years in an honourable pro fossion found that that reputation would not stand him in stead when he is'charged with what looks liko a purposeless fraud. Is there no presumptionvto be drawn from certain facts as to the .probabilities of a man with such a reputation committing such a fraud without adequate motive? Whero is there any motive at all, adequate or inadequate? Mr Macassey said that one did not know what influences might have been felt. • .

The Judgment. Giving judgment, bis Honour then outlined the charge and said that a conviction made one liable'to a fine of £SO and the amount of dxity of which the Government had been deprived. The onus was oh the prosecution to prove that the appellant being employed in and about xiie preparation of a transfer with intent to defraud, suppressed certain facts. The fact alieged to have been suppressed wa& the existence of an intermediary agreement, between Stephens and Anning Bros, for tho.exchange of Clifton Falls. The appeal came before the Goiirt as a re-hcarmg, and the Court.had heard the evidence and came to its own conclusion. "In n ,y opinion," said Ms. Honour, the prosecution has completely »ued to Drove the offence, charged and. there .is nothing that appellant can justly be called to answer." Appellant was

senior partner in the firm of Wilding and Aeland, which' bad acted as the solicitors of Bowron Bros, and Co.. Ltd. In 1917, Bowrons contracted with Stephens for the sale of the property known as Clifton Falls, on terms of a memo in writing, and of a formal, contract prepared in 1917. but not produced in Court. In March, 1921, Stephens in formed, one of the directors of tho vendor company that ho could not carry on. Ho was ad-\-ised to sell, but the company declined to relieve him of his responsibility. Stephens instructed H. H. Cook, a lajid agent, to dispose of bis interest in Clifton Falls, and Cook negotiated for an exchange with Anning Brothers. Anning.Bros, to t=>ke Clifton Falls, and Stenheus. Cook Rock. On. April 6th, 1921, a memo was signed, in which-the name of the vendor was not civen. It purported to sell Clifton Falls to Anning Bros., and it was signed by the Annings and by P. G. Boag, .who was tho vendor to Bowron Bros., and who had not been given title. The document was prepared by tho "enterprising land agent," without reference to the solicitors of the parties, Anning • Bros.. obtaining nothing more than a- memo from Boag. who could not bo considered a party to the transaction. Cook had no instructions from Bowrons. It appeared that Stephens had then Cropped out of sight ps far as CHfv>n Falls was concerned. In August, 1822, an agreement between Stephens and Bowron Bros, provided that Stephens should give up Cook Rock. Aiming Bros'. continued to occupy Clifton Fails.. In August, 1923, Cook arranged for the sale and exchange of Clifton Falls to Campbell, and of Kelsie to Anning Bros. Dougall and Upliam were acting for Campbell and they proposed to take transfer. I'p to. that date the Annings had nothing but the Boag document as title to Clifton Falls, and when asked for a signature to the transfer they refused for two reasons; (1) they-had no title, and (2) it would make them liable to double duty. .' Hero bis Honour quoted /from the evidence of Anning. Continuing, bis Honour, said jtha't' tho only matter discussed, by Anning and the appellant. was an action for misrepresentation on p a; sale.;' It appeared that Anning bad given no information to Granger regarding the various document? discovered iu Cook's possession long after tho transactions had ripened to the execution of the transfer in respect of which the cliargo was laid. Up to this f dale the Anning brofchors' had nothing but the Boag aceement regarding the purchase. • of Clift'<n Falls and no dnc"m< v nt connecting Bowron Bros, with it. His Honour would assume, in default of better information, that -Granger had given the same statement.' to his principal; There were then, no .documents a?, in the pre. sent •nmceeding's. showing the connexion o? Bowron Bros, and the-Annings, pud Ann'n"- and Ste'ohens,' regarding Clifton Falls. Mr: Wilding's Opinion. - His Honour found it difficult to see how Mr Wilding's ■'[ opinion could be challenged.".. The Crown •" challenged" < it on the authority of Hulse v. the Minister of Stamps, a Court of Appeal decision in which the" Chief Justice dissented. His Honour said that thoHulse case was no authority, that .the opinion was wrong.. . The sub-section 2.0f the Finance Act provided that a note or memo under the Statute -of Frauds,, should be an agreement in'writing. It was .now suggested that an. agreement in, writing meant-an oral agreement, .and, the Chief Justice, who'.'had disagreed from the majority of the> Court, bad- been gone to. as an authority. His Honour was not- prepared, to ;hold on that -nuthority- that'-oral' agreements' Had "to be recited in'memos of,transfer. If there was no /memo in writing it might be somewhat difficult, to show, how the.-'adoption of the method carried. irito effect, would result in the-loss' pf anv duty. His Honour was not ; pre-.' pared to.'say 'that 'the parties'- were bound to cite the oral. agreement, as ; the Court of Appeal had .'not. held 56.: His Honour-would.assume'that some: documents were known to the parties,. but there was nothing that might bo said to indicate that the appellant bad ever, seen those ' documents on which the Crown, relied, for. its prosecution;. There- was nothing to show of their existence. The evidence of Smith,,Bowron, and Anning'led'him to the almost irresistible presumption that 'the appellant knew nothing about the do'cuiinents.. .. ■ The evidence had .-■ established, quite clearlv, that the appellant had noj knowledge of the documents on which j tho Crown relied almost wholly to sustain the corivictiou. The presumption that whatever Granger had ' known must have been reported to the appellant, . was..contrary,.to., the..well-known practice in big legal firms. : That tho senior • ps|rtner should know all the matters dealt with by'the clerk was quite impracticable. The principle of law demanded that! a charge of fraud must bo supported by the clearest'of evidence. In the present case,- the action of the Crown had been rendered much more serious by tho standing of the appellant in .the I profession. Ho waa a K.C. and had acquired-a .reputation for. honour, and j integrity, and his Honour must consider that when; he had doubtful documents 1 before him..'

• There. was nothing . further to add. cscept to stato that afU-r carefully reviewing the evidence, ,3ns Honour found that there was no caso whatever to answer. 1 Without:calling on appellant to answer the charge, ho would uphold the appeal and quash the.,conviction. Mr '■ Myers made an application for costs.. Mr Macassey opposed.the application, satying that.' tho prosecution was brought in "the interests- of the .public and tho Department. His Honour was of opinion that if the wholo facts had been considered by the Departiiient, there would have beon.no prosecution.. \ Mr Macassey: The subject of tho prosecution was justified by the facts before tho Department. His Honour: On"the facts beforome, it was not justified, and I feel disposed to-giv? costs if it is in my power. : After authority had been searched, his Honour granted the appellant £2l costs.