VALIDITY OF SECURITIES.

Dominion, Volume 1, Issue 187, 2 May 1908, Page 6

VALIDITY OF SECURITIES.

AN IMPORTANT POINT. Argument was then heard relative to the appeal of Levin and Company, Limited, from the judgment of His Honour tho Chief Justice, in the case-between James Reed, for-' merl.v of Palmerston North,' and afterwards of Sydney, medical practitioner V (plaintiff), and Georgo'A. Simpson, of Foxton, liaxmiller (defendant), .adjudging certain securities held by Levin and Company, Limited, to be void as affecting the property of the, partnership of Messrs.' Reed. and Simpson. , . / Mr. Bell, Iv.C. (with him Mr. Ostler), appeared oil behalf of Levin- aiid Company, Limited (appellants), and Mr. Skerrett,: K.C. (with him Mr; Gilford Moore,' of Palmerston North), for the representatives of, the late\ Dr. Reed, (respondents); v Tho facts in this caso were/thai' the late Dr. Reed,' of Palmerston/-North, in 1903 entered into partnership with George Simpson, of Foxt-On, in a flaxmilling business at Bulls. Most of the capital was found by Dr. Reed, and it was. agreed that the cutting rights, tho lease of tlie mill'sitej aiid the trade ma- . clnnery should 1 belong to tho partners in equal snares, but that tho business was to be carriod on .solely.,in Simpson's, name..-. .Dr. ißeod was, in fact,'a. sleeping partner. Simprson borrowod money from Patterson arid C 0.,• but did not disclose the fact that ,ho- owned ■ 2, /• a half sharo in the. property, and in .February, 1005,:he:feaye a bill of 'silo to Pat. torson arid Co.' over the, whole, of the . part- , n-erslnp properties and somo\.property of his • to secure an advance of. some £1900 Dr Reed' had ;mea:invhflo : . gone; to reside" in Syd-' ney,.-but: m the. month' the-, instrument was . registered his attorney; Mr. 'Gifford-Mftore solicitor,, had- notice/ of tho' giving of tho security. Stops, were then taken to dissolve the partnership, but Dr.-Reed's'death about .this time caused some delay,- and,it was hot' *r i Sept-ember 6, 1905, ,fchafc claiming dissolution of partnership was issued-by Dr' Reed s'-; representatives against .Simpson:' Meanwhile, no .nptico'fwas given to Patterson and , P r -' Reeil's representatives' that part of tho chattels comprised in their bill . of sale belonged 'to tho, partnership. -On September 11—two days after, ho had' beon served with tho writ—Simpson went to Levin and Co., Ltd.,, and induced them to lend-him somo £3000 on the security of. the chattels . comprised in Patterson and, Co.'s bill of sale Simpson representing that -lib was tho absolute. owner thereof. Levin : and Co;..knew nothing of Dr. Reed. • Tho money was advanced, and used partly to pay off Patterson and Co. s debt .and partly to pay the liabili-' ties of. tho firm, arid Simpsori gave Levin and Co.- a bill of salo over tho'property to secure tho advance and further advances,, which were subsequently made. Levin and-Co. then ■got notico that part of tho property in their security belonged to the partnership. Tho property was then realised by.Loyin arid Co.; and it was found that there-was not' enough. > money ,to pay their, d'obt' out of' Simpson's - share of the/property.'-'Levin and Co.. then claimed that Dr.-RtHxl was estopped by liis conduct in allowing .to -bo in" sole , charge-of' the property from' setting' up his , claim to a share of-tlio. partnership property . until Levin and Co:'s-claim was paid. Tho' Chief Justico, however, held that • section 30 . of tho Chattels Transfer,/ Act, 1889, which . declares: that an instrument should : be void • which comprises chattels, of . .which the grantor was not the: true owner at 'the timo 'it [ was given; prevented .the . operation ' of, 'an' i estoppel. From this' judgment, 'an' appeal . was now made.' ~ i ... Counsel forWie appellant had riot.concluded' his address, when 'the Court'adjourned- until i 11 o'clock on Monday morning." ' '' 1 ' ——" '■' ' -— -.