MORATORIUM BILL PASSED

Dominion, Volume 7, Issue 2224, 10 August 1914, Page 7

MORATORIUM BILL PASSED

MORTGAGES AND SECURED LIABILITIES SCOPE OF THE ACT. MORTGAGES EXTENSION. \ ■ ■ : A Mortgages Extension Bill, to provide for a limited moratorium, was pa6sod by Parliament ,oi) Saturday as a matter of urgency. For the purposes of the Bill a mortgage is 1 defined as- "any deed, memorandum of mortgage, instrument, pr agreement, whereby security for payment of moneys or for the performance of a.ny contract is granted over land or chattels or any interest therein. Following pre the operative clauses of the Bill:— So long as a state of war exists in. New Zealand, and for such period as may bo prescribed by regulations hereunder, not exceeding six months after a st&te of war. Jias ceased to exist, it shall not be lawful for a mortgagee without the leave of the Supreme Court— . (a) To call up or demand payment from any mortgagor of the principal sum or any part of the principal 'sum aecured by any mortgage: . (b) To exercise any power of sale or Te T entry conferred by any mortgage or by statute: .-.••• (c) To commence, any action or proceeding for breach of any covenant, agreement, or condition expressed or implied in any mortgage other than a covenant, agree-ment, or condition, for the payment of interest. (d) To commence any action or proceeding for any penal rate of interest secured by the mortgage. ■ Application for the leave of the Supreme Court "may be made by originating ' summons. If the ground upon which such, leave is prayed is that the mortgagor has failed to pay the principal sum or any part thereof at any date, whether'before or "after the cpinmen«eanept of this Act, appointed for payment thereof, no such leave' sfliall-'be granted eo long i as interest at the ordinary rate on the principal sum secured'is paid by the mortgagor within such time <>r times as the Court is hereby authorised to appoint in that behalf. If 'the ground upon which 6uch leave is sought is the breach of any covenant or condition or' agreement, other tl}an non'r payment of the principal sum or'any part thereof or non-payment of'interest, the Court shall in every ease determine ther siich breach is of such a nature as to seriously endanger the security of the mortgagee, ariS shall'not grant'suoh leave unless the Court determines that'the'security is so'seriously endangered. In every action or proceeding by a. mortgagee for the 're'ooy'ery of aiiy sum for interest secured by a 'mortgage the Court hearing' such'" action or prooeeding may," if in its discretion and in the circumstances of the'pass it' deenis.it just and expedient in lieu of giving judgment for jinmediate payment, give judgment for 'payment at a dafe to be. fixed or by instalments payable at such times as the Court in its discretion determines, and'for tihis purpose the Court shall, have jurisdiction to' cause judgment to'be entered in "suchform as it deems best .to give full effect to the intent of . this Act,'and to'direct the,method of enforcement of suohijudgf merit. * ' '.' . The may from time to time ma& 'regulations for giyiiig full effect/to 'the provisiqne of this Act and for the due administration thereof. Wliere by the terms of a mortgage the, Jjoth principal ant] interest is provided by a series of regular instalments upon the .completion of which tho principal debt becomes extinguished, each such instalment shall, for the purposes only of this Act, be deem'ed to consist ■ wholly of interest, unless the Court otherwise orders. All the provisions of this Act shall ap. ply to the Crown. ; '" BILL BEFORE THE' HOU^e. ; PASSED THROUGH- ALL STAGES. '< The Hon. A. L. Herdman, who ' bad charge! of tho measure, 6aid that the Bill d»lt'. with mortgage's and chattels secii : nties. It would not'deal v.'ith promissory notes'. The Government hiul' not thought it necessary to deal with promissory notes or, ordinary debts. Perhaps these letters • might fcave to ba considered later. ' He that for the purposes of the Bill mortgage'' meant "any deed, jheiiipr randum of mortgage, "instrument, or agreed meat whereby security' for the payment of; moneys, or for the performance of"nny contract is granted over land or chattels, pr any interest therein." The principal clause of the Bill provided' that so long as a. state of war existed in New Zealand, and for such period as would be prescribed by regulations under the Act, not exceeding six'months after a state of war had ceased to exist, it should not be lawful for a mortgagee without the leave of the' Supreme' Court to s ! call "rip or demand payment from any mortgagor of the principal suii)' or'a,py part of . the principal suin secured by' any or to exercise any power of sale or "re; entry conferred by any mortgage or by Statute, -or to commence any action or proceeding #o"r- breach of 'any agreement, covenant, '©}' oonditipn, expressed or im* plied m any mortgage other than a covenant, agreement, or cqndition' for the payment of interest, or to 'qommence any action or proceeding for any "penal 'rate of interest, secured bv the mortgage. Shortly; a mortgagee could not 6ue fpr" principal, but he could sue for interest. "'There might bo cases in which a mortgagee should bo entitled to exorcise his rights a mortgage, a'pd spcli cases were provided for, by making it possible, for the mortgagee to apuly to the Supremo Court. Opposition Approval. Sir Joseph Ward said he thought there ought to be,inserted in the Bill a clause preventing mortgagors from having the rate of interest they are required'to pay under mortgages increased to a war rate in the event pf mortgages falling ip and being renewed. Ho would recommend "the suggestion to the consideration of the Ministry." Generally he thought the Bill a very,wise one,.end he yms glad to'fee iFr. T."E. T. Seddon (Westland) pslced whether Bill provided for advances mado on mining* properties. Mr. Herdman: A wining property is o, chattel, interest. Mr. J. A- Young l (WailAto) asked whether tho Bill dealt with bank overdrafts secured by the depositing of deeds in the bank. Mr. Hei'dniq-ii .said that suoh overdrafts were covered by the Bill. If a fasrmejwished to obtain at) overdraft on the security of deeds deposited, ho WM in.variably required to'sjgn an agrebineut to mortgage the lands referred to in the documents' deposited." The Hon. J. Allen (Minister-of Finance) gaid he was satisfied that the harikg were quite competent to carry oh alj their customers, and they' were tjuite prepared to do it. • ' Mr. A. H. nindmarsh (Wellington South) suggested that guarantors pf overdrafts ought.-to be protected. The Bill was read a first time. • When tho House resumed at 7.30 p.m., The Hon. A,' L. Herilmau moved the second reading of the Bill, explaining 1 again tho provisions of it, and saying that the object of it was tp give peaco of mind to ; those who had given mortgages over their property. TJio Bill was read n second time. In Committee, . The Hon. A. L. Hordman, replying to Mr. C. If. Wilson, taid that his opinion was that the Bill would apply to agreements to purchase under which the pur? chase money was paid in instalments. The Bill was put through Committee yfitii amendments, and rpad a third time find passed," Don't wait until tho "flu" has you firmly in its grip. Fight it at once with "NAZOL"—tho swiff and Buro remedy for Influenza. Always keep a bottio in thp house. 60 doses for Is. Gd, —Advt. ■