Bar to Mortgage Relief

Hawke's Bay Herald-Tribune, Volume 81, Issue 28, 27 October 1937, Page 7

Bar to Mortgage Relief

— Press Sssociation.)

ABILITY TO PAY I Review Court Decision on Company's Action ADJUSTMENT OF LEASE

(By Tolozraph-

AUCKLAND, Last Night. In & lengthy written judgment the Court of Review, presided ovex by Mr. Justice Johnson, has virtually dccided that undoubted ability t'o pay is a bar to relief uuder tho Mortgagors' and Lessees Rehabilitation Act of last year. The decision was given on appeal against a decision of the Wellington City Adjustment Commission, which dismissed appellanfs applicatiQn for the adjustment of a liability. That application was made in respect of a lease of premises in Wellington, and it was refused on the ground that appel- , lant's admittefi ability to pay the rent in regard to which an adjustment wna sought rendered the adjustment unaecessary. The Court now holds that the Commission was right in dismissing the application for adjustment, and it dismisses the appeal. Appellanfc's application was accompanied by a statement of asscts and liabilities as at September 30, 1936. This showed a net surplus of assets over liabilities of over £160,000, and the holding of leasehold and freehold properties of a value of approximately £115,000, snbject to mortgages amounting to approxynately no more than £45,000. Appellant was admittedly an important and wealthy corporation carrying on a large business throughout New Zealand in such a sound financial position that no question of its ability to meet its obligations in any direction could arise. Appellant said, however, that the lease in respect of which it claimed n reduction of rent was one to which tho Mortgagees and Lessees Rehabilitation Act, 1936, applied, and that on the application by it to the Commission the Commission was bound to proceed to find a basic rent, and if the Tent so found was less than that payable under the lease, it was likewiso bound to reduce the rent payable under the lease to the basic rent unless other relevant considerations would make such a reduction inequitable. '