Appeal Court.

Feilding Star, Volume XVIII, Issue 92, 15 October 1896, Page 2

Appeal Court.

COLONIAL BANK V. BANK OF NEW ZEALAND.

(Per Press Association.) Wellington, Oct. 14 The Gase of the Colonial Bank and Liquidators v. Bank of New Zealand was heard in the Court of Appeal to-day. The question involved is as to the liability ot the Colonial Bank to the Bank of New Zealand for interest on accounts in B list, which the Bank of New Zealand seems unable to recover from customers. The gross total debts in the B list on the 31st August, 1895, vested in the Bank of New Zealand by agreement between the Banks and by the Banks and Banking Act, 1895, was £604,695. Against this sum the Bank of New Zealand retained £272,072 of the purchase money as security, and the agreement provided that this amount less what was required to make good the losses on B list, should ultimately be paid to the Colonial Bank with interest at 3 per cent. The Bank of New Zealand gets the benefit of all interest received from customers in B list at full banking rates, paying the Colonial Bank 8 per cent only on the cover retained. The Bank of New Zealand claims in the case of particular accounts where it fails to recover interest from customers, it can charge interest against the Colonial Bank and deduct from the cover retained. The Colonial Bank contends the cover was given only for amounts owing on the 31st August, 1895, and that the Bank of New Zealand obtained the whole management accounts getting nearly the whole benefit of all interest received, and taking the risk or the Jobs of interest. Messrs Haggit and Bell are appearing for the Colonial Bank, and Sir R. Btout and Mr Cooper tor the Bank of New Zealand. Later. The contention for the Bank of New Zealand in the case brought against it by the Colonial Bank and liquidators in the Appeal Court is that the Colonial Bank guaranteed the accounts in " B list " up to L 292.092 as current accounts and that they being interest bearing accounts the guarantee was for the principal and inter* eat up to the limit mentioned. Argument was concluded this afternoon and the Court reserved its decision.