SUPREME COURT.

Gisborne Times, Volume VII, Issue 398, 24 April 1902, Page 2

SUPREME COURT.

CARROLL-WI PE RE TRUSTY. BANK OF NEW ZEALAND.

(Before His Honor Mr Justice Conollv.) At the Supreme Court yesterday the case of Carroll and others v. the Bank of New Zealand, was resumed.

W. A. Barton, Registrar of the Supreme Court, gave evidence with regard to the notice of sale.

Mr Rees said that after the ruling of His Honor yesterday as to the admission of evidence iu the case of Wi Pere, he had two or three other witnesses besides Mr Carroll, but on consideration he found that they must have been stopped at once. Mr Carroll’s evidence was also of that nature, the great bulk of bis evidence being as to verbal agreements made between them and the bank. He did not therefore prefer to call Mr Carroll. Mr Bell pointed out the first intimation of the intention of the other side not to put Mr Carroll in the box that he had received was that which had just been given by Mr Rees. He bad every reason to believe that Mr Carroll was to be put in the box.

His Honor : The case was specially adjourned in order that Mr Carroll should give evidence. Counsel, after seeing the witness, could decide that it was unnecessary to call him. Mr Bell : I have no right to complain that the Court has been trifled with, but I have never been treated with such discourtesy as this. The postponement was made to allow Mr Carroll to bo called, I intimated to your Honor that I desired to put questions to Mr Carroll, and I hear now that I have not the opportunity. Mr Rees : You can call him. Mr Bell : I can call Mr Carroll, but not cross-examine him. His Honor : Mr Carroll is not moro than an hour or so in the place. Mr Rees had neglected to give Mr Bell notice of his change of intention. Mr Bell asked that the fact of Mr Carroll being in Gisborne and not produced should bo noted by His Honor. Mr Rees said His Honor notified that, as a certain class of evidence was struck out, it would not be necessary to call Mr Carroll. He only knew five minutes before the Court opened. Mr Bell said he was entitled to comment on Mr Carroll’s absence as he would in the case of a jury.

His Honor said Mr Bell could address him, as he was the jury. Mr Rees intimated that the case for the plaintiffs was concluded, as Mr Carroll was not to be called.

In opening the case for the defence, Mr Bell said he proposed to show why flo called evidonce at all. The first point was as to the furnishing of accounts by the bank, and he had been placed in a very-unfortu-nate position in this matter. When the Registrar of the Validation Court was first put iu the witness-box bo could only give accounts up to 1897. Upon a further search he found in his safe the accounts rendered in the year 1900, but was unable to give any month. The Judge of the Validation Court was most unfortunately absent. It was impossible for coun-

sel to suppose for one single moment that that they would not have produced by the Validation Court the various accounts which had been duly filed there each year excepting the year 1901, In that year the paper was delivered to the Judge himself. The question whether the Court was or was not alive was one which the Judge himself had been raising, and accordingly, as a greater precaution, the paper was given to the judge himself, as they might be met with some allegation that they had put the accounts in some place which was not open to intpection. He would prove that the accounts had

been duly kept by the Bank—first by the Estates Company, and then by the Bank, always open and available to the trustees and the mortgagors, if they chose to inspect them. Secondly, that since the year 1895 annual accounts had been made up to March 81, and had been sent by the office in Wellington having charge of the matter to Mr DeLautour-, the solicitor in Gisborne, to be filed iu the Validation Court, duplicates being sent to Mr DeLautour. He would be able to prove the delivery of one of these duplicates to the Validation Court in several years. He would have to ask His Honor’s permission to call Mr DeLautour. because it was Mr DeLautour’s han! that delivered the statement of 1901 to Judge Bathain. His Honor said that if Mr DeLautour did not object he could be called. Counsel, continuing, severely commented upon the manner in which documents had been filed in the Validation Court, His Honor : It looks very much as if the process of filing consists in throwing these papers into a room ; that is called filing. Passing on Mr Rell said thqt the first

point that he wishod to prove was the regularity of the accounts. The second point was the deeds of 1898, which would simply be proved by putting them in. The third point was the stock, which would not take a minute to prove. They must prove that there was p 0 stock except the stock referred to in the deeds of 1898, and those of 1892, owned by Carroll and Wi Pere, and mortgaged to the bank, The bank had no stock in the property of Carroll and Wi Pere. Fourthly, they would prove in respect to each particular mortgage, as well as in respect to the general mortgage, the whole principal sum was due, and in some cases the whole interest was due, and in some oases, in' addition to the principal, a large sunt of accumulated interest was due. It was quite sufficient for their present purpose , , ■ , ' ' i>»«o t.hfi nrincinal to show that m tu.—.. . sum was wholly due, that the time for demand was past, and that they, as mortgagees under ’the contract, were going to ■sell to repay themselves. Walter George Foster, Manager of the Assets Realisation Board, stated that he became Manager of the Estates Company in 1895. Witness gave evidence as to the furnishing of accounts from time to time, and also with regard to the manner iu which the indebtedness to the bank increased.

J. Brooking, Registrar, was recalled, and stated he had searched, but could not find the reports of the receivers for 1900 and 1901. He produced one for 1899. It was filed in the Validation Court, and signed by Mr Rees as solicitor for the receivers, and Mr Jackson. Mr Bell put the report in, stating this closed the ease for the defence. Mr Bell’s address occupied over two hours, in the course of which he detailed the transactions with the bank from the year 1892. He pointed out that iu 1895 there was but one set of securities held by the Estates Company to which the bank had succeeded, and they had absolute undisputed power of sale. The bank had

always resented interference on the part of the trustees in regard to the original decrees, although it had acceded on one point as to its powers of sale. In 1895 the bank took a fresh mortgage, fixing the debt at £95,000, and making the date of payment three years later, with a provision that it might be postponed until 1901, but no further. There was* not one sound reason that could be given ' by the plaintiff for restraining the sale of the original properties. Referring to the properties, Mr Bell said that the transac-

tions had been most unsatisfactory for the Bank. From the beginning it had been one hopeless and irremediable sink for money for the Natives, and all concerned, hopeless because there had never been any person on behalf of the Trustees capable and competent of dealing with

;he affairs of the Trust. His friend Mr

Rees was competent as a lawyer, Mr Carroll was competent as a member of

the Government, and Wi Fere might, for all he knew, bo a competent member of Parliament, but among them they were as incompetent to manage or guide the course of this great trust as he himself would be, or, he might venture to say, any other lawyer. One document was sufficient to show the hopeless and irremediable condition into which they had plunged these great properties. His Honor:' They assert that a proper scheme, which this Court is supposed to be able to form, would be all right. Mr Rees : The bank have had the sole management of it.

Mr Bell: Yes, and we must squander our money in paying receivers and useless expenditure. It has been a terrible waste of money. HU Htffipti We know that native

charges are ten times as much as they ought to bo. Continuing, Mr Bell roferred at length to the validated titles and the proceedings of the Court, pointing out that it was part of the scheme of the trustees that other lands should be brought in so as to givo relief to the original securities. For seven years the bank had had no further increase to their securities, and all this time things had been going to the bad. What was contemplated in 1895 was that the securities would be so scattered that it would be possible to redeem man)' of them. The trustees now made the same suggestion as they did in 1895.

They said : “ Stop a bit; hold your hand ; there is hope that this great estate may yet be saved.” He did his learned friend justice when he said that the estate would not be wound up so long as ho (Mr Bees) could prevent it. Passing on, Mr Bell showed that in-recent years the sum of over £II,OOO had been paid over in cash to tho receivers, and there was practically nothing to show for it. The money had been simply wasted. Where, ho asked, had this £II,OOO gono. He contended that if the receivers had been fairly competent, they would have • gono to tho Validation Court long ago, and said that it was quite hopeless for them to carry on. When tho Bank sought to realise on their mortgages under the deed of 1895, the Trustees asued for more timo, contending that it was the hurry on the part of tho Bank to sell tho property that was ruiniDg tho ostate. The Trustees said that their position was improving—that tho land was increasing in value each year. Ho thought Mr Bees would have done better to have advised his clients to' sell instead of squandering money in litigation with regard to titles.

His Honor: It is porfect nonscnso their talking about their improved positiou and bringing £157,000. They do not bring £IBO into Court, let alone £137,000. Mr Bell: Mr Wi Pero said that ho wanted to be shown the account for tho £137,000, and would have been satisfied. His Honor: I heard Wi Pero say that, but it was nonsense for him to talk like he did. Mr Bell, proceeding with his address, stated that efforts had been made in tho colony to borrow money on tho properties for the purpose of liquidating tho Bank’s claim, but all efforts to obtain tho money had been unsuccessful. Almost overy financial institution in the colony had been appealed to in vain. The securitic., were admitted to bo amplo in valuo, and the titles deemed to be good. In many cases, tho titles had been improved by being placed undor the Land Transfer Act, and yet-every application to borrow had failed: In declining to lend, tho various offices generally gave two reasons —first, that doubts existed as to tho power of the trustees to mortgage ; and, secondly, that there were so many risks in dealing with Native lands that counsel advised them that they wore not safe. “ And it is not likely that this present litigation will tend to diminish the terror of financiers,” added Mr Bell. His Honor : You are quite right thoro. I havo seen enough of tho East Coast lands that I would not accept any at a gift.

Mr Bees (sotto voce): I don’t think you will have any of thorn offered to you, (Laughter). Mr Bell said that the end was coming. Every effort had been made to help.theso people to bring the properties to Something like a profitable state, but it had been hopeless and idle. Tho money of the bank had been wasted, tho time of Mr Bees had beeu wasted, and the sum of £SOO per year paid to one of tho receivers had been wasted. In conclusion counsej dealt at length with the legal points involved in the case, and claimed that he bad established to the satisfaction of tho Court the right of the bank to exercise their powers of sale. Mr Bees commenced his address shortly before the' adjournment last evening, and will continue it this morning.