LAW REPORTS.

Dominion, Volume 7, Issue 1981, 11 February 1914, Page 4

LAW REPORTS.

-<» SUPREME COURT. THE INTEREST CHARGES ON LOAN INSTALMENTS. TO LOCAL BODIES. BEFORE THE NEW ACT AND AFTER. RATE CAN BE RAISED. A decision of great importance to local bodies was given by the Chief Justico (Sir Robert Stout) in the Supremo Court yesterday. The case involved tho question whether the New Zealand State Guaranteed Advances Amendment Act, 1012, is, or is not, retrospective regarding interest charges on loans to lofial bodies. The action is a test oase to ascertain tho position of local bodies who were actually receiving loans from the State Advances Department on the instalment system when tho amending Act came into force. Is the rate of interest now subject to alteration? . The action, was taken by the Whangarei Borough Council against tho Superintendent 'ol the New Zealand State Guaranteed Advances Office. Tho borough asked for a declaratory decree (a) that Section 2 of the Act of 1912 does not-entitle the Department to increase, tho rate of interest on tho third instalment of a loan from 3J- per cent, per annum to per cent, per annum; (b), that tho WJmngarci borough is entitled to have the remaining instalments of its loan advanced at the rate of interest agreed upon when the loan was granted, namely, 3} per centum per aunum; ' The parties had agreed to a special case, and the hearing took place on December 17. . Mr. C. P. Skcrrett and Mr. Fell'appeared for the Whangarei Corporation, and Mr. J. W. Salmond, Solicitor-General, for tho State Advances Department. ' The original Loan Terms, In- the course .of his judgment, His Honour said that the question' really ivas: "Have* the Whangarei Borough Council thei right to get tho loan they applied lor;' and which the Board and the . Commissioner sanctioned, on the terms agreed to, or have the statutes provided that the Government must repudiate an agreement.made and grant ii'loan on new or other terms diiforent from'those formerly agreed to?" The .loan ■ was applied for on February 2, 19jl,.nnd granted on I'obruarv 15. The terms and conditions agreed to wore: (ii) The amount of the loan to bo £19,200.. (b) The term of the loan to bo 3GJ years. . (c) The rate of interest to be 3 V pei'xcentum per annum. (d) The loan to be secured by' a special rate of twenty-five-tbirtieths v of a penny'in the pound over the . whole cf the borough of Whangarei. • (o) All statutory and other pro- ■. ceedings .necessary for .raising the loan to be duly taken. What is tho Position Now? Only two instalments on the loan had been paid when the 1912 Act passed. After quoting the 1912 amendments, flis Honour said that no doubt the Court ought not to assume that the Legislature would seel; to vary an . existing contract, or. repudiate an existing agreement. ,If a wrong had liocn done -t was for tho Legislature to •remedy; the Court was power■'lpfe?t(i':do ,si). -lie was forced to the conclusion that the words of the sta-tutes-varied the existing contract. "And,'/-hevcontinued, ''as if conscious .that, u w'rpng had been done to a local ; body, which, if it had been between citizens,> would have led to'an action lor,.damages for breach of contract, the . . Legislature, lis#' passed Sub-Section. 2 of ■•lection .3, which is as follows:— - '■ "A local authority shnll have no" ' •, l'ight. iif action against the Super- . inteiulent for .breach of contract or '.' • otherwise.in respect of the failure of the. Superintendent to advance ■ to that local authority any moneys at the: rate of interest at which tho application for such moneys was '.finally. granted. by the' Hoard'." •' — "The Legislature, in fact, savs" (His' .Honour-;; continued) "if it iias provided that.the. Superintendent shall repudiate a 'loan-ciil the. terms granted, and thus a breach of : contract has .been, committed,, nevertheless a. local authority shall have no right of action against tlio Commissioner. Since this action was commoiiced; thero ban been passed afurther statute dealing with advances. It came into, force only on December 4, -19X3 —tho Local Bodies Loans Act, 1913, No. 30. It has -made a further eliango i' l the law." Here His Honour qiioted Section G8 of . the 1913' Act, which-is: "The .rate of interest charged - .- shall t be 41. per centum per annum, , or ■ftiie-eighth * per centum per ■ annum " more , than '• tho rate at ; -which the money was raised (whi6hever is. the. greater). In 'calculat- , ,ing the last-mentioned rate all fees, commissions, discounts, aiul other .charges-connected with the raising . shall be. included. This paragraph shall ;apply to all loans, or to any Part thereof, paid to a local au- ■ thority on or after the commencement of this Act whether the ap- . plication for such loan iwas finally ; granted before or after that date. - Nothing in shall : affect the rato of interest payable ■ on any loan or part of a loan'paid to a local ituthority after tlio passing- of the New Zealand Stato Guaranteed Advances Amendment Aqt,'l9l2, and before the passing of this Act." Whangarei Council Has No Legal / Redress. The words—"this' paragraph shall appl.v to all loans, or to any part thereof, paid to a local authority on or after the commencement cf this Act, ,whethcr tho application for such loan was finally granted before or after that ciate"—did not seem to His .Honour to leavo any doubt as to what was meant. 'I am of opinion," .1 e concluded, "that tlio Whangarei Borough Council is with-out-legal redress against the Superintendent. No doubt the Borough Council is not, however, without remedy if it has suffered any injury, as it can apply, to tlio Legislature, which has'altered the arrangement 'made between the plaintiff corporation and tho Advances Office, ant) the Legislature has ample power to grant redress. It is ■ not necessary for me to consider the matter from the point of view urr;ed . by the Solicitor-General, namely, thai the giving of loans to local bodies is o benefaction, and consequently no local body can claim any relief lroni a reiusal to lend as tho loan is a mere f?ift, I'hat I lie Legislature will no doubt consider if the plaintiff seeks' relief from it." NEWSPAPER CASE. PRELIMINARY PROCEEDINGS. A phase of the action in which the "New Zealand Times" Co., Ltd., claims £3000 by way of damages from the Wellington Publishing Co., Ltd., for alleged libel, was dealt with in the Su. , preme Court yesterday.

The matter arose out of a summons by the defendant company, calling upon tho plaintiff company to show cause why the latter should not forthwith deliver- to the defendant company "par* ticulars of the loss or damage alleged in the statement. of claim to have been suffered by the plaintiff, with the nature of such loss or damage, am.) how the amount of damage has heen estimated or made up," The ground ujirm which the summons was moved was that , without such particulars the defendant was unable ta prepare fully to meet tho plaintiff's ease at the trial. The summons followed upon a demand upon the plaintiff's solicitors to furnish the particulars. Tho plaintiff's statement of claim is a cliargo of libel, and in one paragraph after stating the words complained of that are said to be libellous and setting out the innuendo as to their meaning the plaintiff says: "The plaiutiff company has thereby been greatly injured in its business, credit, and reputation," 3 His Honour remarked, that there was " no claim for damages at- the end of B what might be-called tho first cause of ® action. There was then, lie proceeded to say, a second and alternative cause " of action, not twj causes of action, and tho alternative eau-se repealed every ® allegation contained in the first cause, j and went on to aver that- the libel com--1 plained of was printed and published ? maliciously, with the intention of in- " juring tho plaintiff company in its, business, and of inducing the t'msiness peo. a pie of the community'to cease, advertis- " ing in the plaintiff Company's newspaper, or have aiiy business transae- " tions with that paper. In the last ® paragraph in the second and alterria- ' tivo action the averment was that the 0 plaintiff company had suffered great damage thereby. The prayer for damage was: "Wherefore tho, plaintiff company claims (a) in respect of the first cause of. action, and alternatively m respect of tho secoiKJ cause of action, tho sum' of £3000." Ii- was clear, therefore (His Honour said) from the statement of claiiii that there was 110 claim for special damage, using the phrase "special damage" in its ordinary acceptance. Further," it was clear from . the summons that what was asfeeel was 1 not particulars of the damage alleged ' m tho second cause of action, but par* ! ticulars of the damage claimed in the ac--1 tion. Where generil damages are claint- • ed in U libel 'action, particulars of how • the plaintiff arrived at the amount, he claims could-not be demanded. Defendant had said that tho second ceiiis& of action was of the nature of an a.e- ---! tion on the case, and Hot an action ! for libel, and that the action on the l case was not maintainable . unless damr ages had been sustained, and that as the 1 proof of such damages ivas necessary > for the, maintenance of this cause of i action, the defendant comunny said - that it, therefore, had' ft right t:o -det maiid how these damages, had . been t arrived at.. ' 3 It seemed to His.Honour that the , .words "suffered injury ill its business. » credit, and reputation" was a general statement,- seeing that it was repeatedin the second cause of action, sufficient to warn the defendant of the .lature sf Uie : evidence which it was proposed.to call. '-The plaintiff was not bound to state .what the .evidence was, nor to give a statement of. the particulars of how ho arrived at his damage. Thathad never been done. The only ques--1 tion that 'seemed to His Homii'i- arguable was whether there was sufficient averment, in the-claim to show t ! at tho plaintiff, was going to give soiiie evidence of loss of business. He thought that the wofds sufficiently implied Hit,. but in oasn there. uirght-be any diffi----nulty about th« matter, he tlwuwht that, the proner order lie should make was 1 this: ."Siimnjons ; refused because jriain- ■ • /tiff, ohlv, general- (Innwe to' • its business, and not. en oafticular in-, ) stances of damage," Two ) cdstß"\ycrc 'allowed tlve 'plaintiff. '■