AUDIT SURCHARGE

Hokitika Guardian, 25 June 1926, Page 3

AUDIT SURCHARGE

COUNCILLORS’ TRAYET,I7ING EXPENSES. WELLINGTON, June 24. A ease in which a member of the Otorohangn County Council elected to contest the Audit Department’s surcharge in connection with councillors’ travelling expenses, has served to bring before the public the law on the question. The facts of the. case, as stated, were that the Audit Department satisfied itself that the County Council had paid £BO in excess of what could justly and lawfully he deemed actual and reasonable in terms of the Act. Surcharges were accordingly made, and all hut Councillor Lurman paid their proportions as agreed among themselves. He, however, elected to contest the matter in the Magistrate’s' Court. In his written judgment Mr Wyvern Wilson, S.M.. said: “The position of the Audit Department has been clearly defined by Mr Justice Chapman in a case decided under the existing legislation. His conclusion is. ' 1 must hold that what in tho-' statute is termed the surcharge based on;the finding of the Audit Office is conclusive. . . It must not he supposed that the Auditor-General lias unrestricted authority in such matters. ... If his decision could not in any reasonable way he justified the Couit would presumably have some uf’ans of saving so when he came to sue upon the surcharge.’ Sub-section (2) of section 7 seems to make it clear that the basis of the Crown’s action is the surcharge. On proof of the surcharge the defences set out in sub-sections 3 and 4 are available to the defendant. It would seem, however, from Mr Justice Chapman’s remarks that the Court might also review the Auditor-Gen-eral’s surcharge. 1 if his decision could not in any reasonable way be justified,’ the onus of proof resting, of course, upon the defendant. There is hut one surcharge of all the councillors, jointly and severally, for the whole sum ot £BO odd. The present action is to recover the balance remaining due on that surcharge, and 1 must so consider it in determining whether or not the Audit Office has had reasonable justification for its decision. ‘■'ln the present ease I am not satisfied from the somewhat bald statements of the defendant that it was except perhaps on isolated

ocasions, for any councillor to be absent from his home over night. From the evidence of the audit officer, it appears that lie made reasonable inquiries before deciding that the sum of £2 2s for each member per meeting was much in excess of a reasonable sum to defray ‘ the actual travelling expenses,’ as authorised by section 83 of the Counties Act, 1920. I am not prepared to differ from his view of that fact. The defendant relied upon tho case of the Auditor-Gen-eral v. Ewing, but I do not think that it helps him, for although a county council may fix a lump sum per meeting to defray the actual travelling expenses of councillors (and no doubt the maintenance or keep when travelling should lie included as expenses), the. sum voted must lie reasonable, and the exercise of the council’s power is subject to scrutiny by the auditor upon inquiry hv him into all the circumstances, and if it appears to him. that ail unreasonable sum has bo?n voted lio may surcharge it, and on an action to recover the debt the council’s discretion may be reviewed hv tlio Court.”

After quoting the decision in an English case hearing on the point, the Magistrate said that he thought tlio surcharge was properly made, and judgment should be given for plaintiff for £ll IGs (including moneys paid into Court), with costs, fees of Court 30s and solicitor £2 12s.