SUPREME COURT.

Globe, Volume XXIII, Issue 2161, 28 January 1881, Page 3

SUPREME COURT.

SITTINGS IN BANCO. Thursday, Januaey 27. [Before their Honors Mr Justice Williams and Mr Justice Johnston.] Ths sittings in banco were resumed at II a.m. EALMEE, APPELLANT, V GXEDWDOD AND ANOTHER, RESPONDENTS. This was a case on appeal from the decision of the Resident Magistrate at Groymouth, in which the appellant, as chief manager of the Union Bank of Australia, wis the defendant, and the respondents plaintiffs as trustees of an insolvent estate. His Honor Mr Justice Johneton at the outset raised the point that the decision of the case had been by a Court having no jurisdiction, as the amount ot set off put in by the appellant for £2OO was above the limit of the Court, Mr Harper submitted that as this point had not been token in the Court below, be thought they could only take the case as sent up to them. Besides, it was not clear whether the £2OO meant a set-off or a lien.

Mr Garrick said that ho should take the point. The case was that the bankrupt, whose trustees the plaintiffs in the Court below were, had received from the manager of the Union Bank of Australia, at Greymouth, for the purposes of gold buying, the sum of £2OO, the bankrupt giving his cheque for tbe amount, to be held by the teller of the Bank as cash, and a certificate of trust. A bill, in favor of the bankrupt, drawn by the Grey County Council, for £37 17s 4d, oame into the Bank, and at the time of the bankruptcy the bankrupt owed the Bank, under the advance made to him for gold buying, the sum of £162 17s. The re-pondents, who were appointed as the trustees of the bankrupt, drew a cheque for £37 on the Union Bank of Australia, as against the bill of the County Council, but the appellants refused to pay the same, alleging that they were entitled to set that off against the debt due by the bankrupt to the Bank under the gold buying contract, they having a lien. The respondents, as trustees, then sued the Bank for the £37, and in the Resident Magistrate’s Court the appellant set up the defence of a set-off for the £2OO advanced to the bankrupt as trustee of the Bank for gold buying. The Resident Magistrate gave judgment for the respondente, disallowing the set-off of the appellant, who thereupon appealed. Mr George Harper for the appellant. Mr Garrick for the respondent. Mr Harper having read the case, proceeded to argue the appeal. [Oases cited in course of the argument : —Foster v Wilson, 12 M. and W. ; Bailey v Johnson, 40 L.J. Exoh., 179 ; Bailey v Fitch, 41 L J.; v Chartered of India, 36 L.J., Bankruptcy, 45; Commercial Bank of N.Z. v Dyer, Maocassey’s Reports, 659 ; in re Davis, 12 M. and W., p. 751; Watson v Ambergale Railway Company, 15 Jurist N. 8., 448 ; Williams y Evans, 44 L.J., Chancery, 319.] Mr Garrick, for the respondents, submitted that the Bank had no right to set off this £2OO against the money of the bankrupt, as he was a trustee. His Honor Mr Justice Williams said that on the case they mnst assume that the bankrupt had received £2OO for a special purpose, and then went bankrupt. Hence he owed that money to the Bank. Till he bought the gold for the Bauk and banded it over would be not owe the Bank that amount ?

Mr Garriok submitted that be would not, in the sense of a debtor and creditor account. The learned counsel then went on to deal with the case cited by Mr Harper, r Chartered Bank of India. Their Honors held that the terms under which the £2OO was handed to the bankrupt by the Bank made it admissable to be taken as a set-off against the bill deposited by the bankrupt with them for collection. Mr Garrick said that, under these circumstances, the only point left him to argue was that the jurisdiction of the Resident Magistrate being restricted tp £IOO, and he dealing with a case involving a set-off for £2OO, tbe Court below had exceeded its juriediotion. His Honor Mr Justice Williams painted out that in this case there was this difference from an ordinary one of set-off that the defendant in the Court below would have no remedy. Mr Garriok- quoted Dudley v Raphael, 1 “ New Zealand Jurist,” and also submitted that Mr Harper’s argument on the subject of lien did not apply, as a general lien was excluded by the arrangement. Mr Harper replied, quoting Poster r Wilson, 12 M. & W. 204, >s to the question of the jurisdiction of the Court below in the matter of the set-off, and also contended that the drawing ot the cheque by tbe bankrupt and lodging the bill for collection mode clearly the relation of banker and customer existing between the parties, and that this upheld his submission of a lion. His Honor Mr Justice Johnston said he thought they could not strain the question of eet off too much, and therefore they had to ascertain the position of the parties. The position of the bankrupt with the Bank was, he thought, engulfed by his indebtedness to the Bank, and, therefore, the judgment should have been for the defendant in the Court below.

His Honor Mr Jnst'o) Williams concurred. There was a trust created between the parties, which evolved a simple contract debt, and the case come within the 76th clause of the Bankruptcy Aot, the neutral credit clause. The only question was whether the Bank could raise this clause as a defence in the Court below. He confessed that it would be a great hardship if they could not, and he was unable to see any reason why they could not do so. As regarded jurisdiction there was this difference in regard to this case, that it was not like an ordinary case of set-off, as the defendant could not bring a cross action as the ordinary way. As his brother Johnston bad said the claim of the bankrupt had been swamped by the larger claim of the Bank. The appeal must be allowed. Mr Garrick pointed oat that the bond on appeal was not stamped. His Honor Mr Justice Johnston said this was too late. Order—Appeal allowed with costs. SAME V SAME. , This was an application by Mr Harper for the judgment herein of the Court below to be reversed. Mr Garrick, contra , contended that this was not the course to be taken. But as the appeal just decided reversed the judgment no more need be said. There was one very important question he wished to see decided, and that was whether under the Resident Magistrates’ Court Act appeal acted as a stay of execution. It was under the District Court Act. His Honor Mr Justice Williams pointed out that the judgment having been given and execution issued, it was necessary for the appellant to got rid of it, as the judgment had been reversed. Mr Garrick submitted that the other side had no need to come to the Court in this way. They should have applied to the Court below to stay execution until the appeal was decided, and therefore his clients should not be called upon to pay costs. Their Honors, after argument, made an order setting aside the judgment with costs. MCKBEBOW V WHITTAKER. This was argument on demurrer by the defendant to the plaintiff’s declaration. Mr Joynt for the defendant and in support of the demurrer. Mr George Harper for the plaintiff and contra to the demurrer. This was an action in which the plaintiff sought to obtain a decree for specific performance and injunction to restrain the defendant from dealing with the property. The plaintiff entered into an agreement with the defendant to purchase the estate known as Seaview, at Timaru, and paid a deposit and two instalments, but the defendant now refused to complete bis contract by executing a deed of conveyance prior to the plaintiff paying the final instalment due in June, 1881.

Mr Joynt was not called upon, their Honors considering that Mr Harper should show what authority ho had for bolding that the defendant was bound to deliver a conveyance prior to the completion of the payment of instalments.

Mr Harper cited the following authorities : —Maddook v Kinglake, 10 A. and E. 50; Sugden on Vendors and Contracts, pg. 240 ; Wilkes v Smith, 10 M. and W. 765 ; Dart on Vendors. His Honor Mr Justice Williams pointed out that the plaintiff could, if a certain day was fixed in the agreement for completion of conveyance, bring his action for specific performance, whether he had completed his payments or not, but it was not go in this case, as no time had been fixed. Their Honors gave judgment, allowing the demurrer with costa. STEWABT V FBASKB. This was an argument on demurrer to the plaintiff’s plea. Mr Button for plaintiff, and in support of the demurrer. Mr Joynt for the defendant, and contra to tho demurrer. The action was for an order for a statement of account by the defendant, Charles Eraser, who is the executor under the will of the late Alexander Stewart, and payment over of money to the widow and others. The pleas of the defendant, which were demurred to, were that the defendant had a release from the sons of the testator, which exonerated him from all accounts, suits, &s., and that it was rendered unnecessary by the bankruptcy of one of the plaintiff's. Mr Button contended that there was no consideration set forth in the release, nor did it appear in the release that an account had been taken as between the defendant and the plaintiff and accepted, nor could the bankruptcy of one of the plaintiffs relieve the defendant of tho duty of rendering aooounto. Authorities cited in support—Soulhdale v liynnes, 2 Vesey, 107; Booho v Mosohelles, 2 Ohoyles and Lefroy, 721; Brook v Sutton, 5 L.E., Equity Oases, 361; Nut ford's Chancery Pleading, vol. 5, page 305 ; Lowndes v Taylor, 1 Maddook, 425 ; Kay v Posbrooke, 8 Symons, 28; Latonr v Holcroffc, 8 Symons, 76 ; Barton v Jane, 8 Symons, 24.] Mr Joynt replied, dealing with the authorities cited by Mr Button, pointing out that tho release had been solemnly entered into by all the parlies, and that since the date of the release the defendant had done nothing whatever with the estate.

His Honor Mr Justice Williams pointed out that there was an allegation in the declaration that accounts had never been rendered. Were not the plaintiffs entitled to those accounts ? Mr Joynt submitted not. They had declared by the release that they were satisfied with Mr Fraser’s actions as trustee up to that time, and this was a complete estoppel, and a complete consideration for the release. As regarded the bankruptcy of one of the plaintiffs, which was part of the demurrer, he desired to quote sections 134,137 and 152 of the Bankruptcy Aot, 1867 [sections cited]. These sections clearly showed that the plaintiff, who had become bankrupt, had no interest whatever in the property. That was in the provisional trustee, and there was no status of the bankrupt in a Court of Law or Court of Equity [authorities cited in support—Payne v Dicker, L. E. 6, Chancery, 578; Motion v Moogen, L. E. 14, Equity 202 ; Hodgson v Sidney, 1 Exchequer 313; Morgan v Stebble, L. E. 7, Q,. B. 611]. Mr Button was beard in reply, and Their Honors took time to consider.

The Court adjourned till 11 a.m. this day.