Magistrate's Court, Palmerston North.

Manawatu Herald, 1 September 1896, Page 2

Magistrate's Court, Palmerston North.

(Before B. L. Stanford, Esq., 8.M.) JUDGMENT IN THE CASE OP PEiUJEAU V. ANDERBON. Mr Fiizherbert for plaintiff, Mr Hurley fur defendant. Before deciding in minute detail with, tha pile of documentary evidence and accounts which have been under review of this Court for nearly three days, or endeavouring to reduce the several hundred items of account to anything like order, it is necessary to review the position which the parties occupied last October when they commenced their disastrous relationship. At that date Anderson's freehold was under mortgage to Pdireau, and all his available chattels were secured to Perreau for the sum of £98. With the matter of mortgage of freehold I have no* thing to do, all interest being now paid up to date, and the question of the chattel security I will speak of later on. In the latter end of Octo* ber or the beginning of November, 1895, negotiations were being earned on between the parties with a view of an arrangement by which Perreau 1 wa9 to finance and conduct the office business of a a flax-miller near Fox ton, to buy stores, supply neces- | saries, pay the men, provide the flax-mill-equipment, and so forth, while Anderson was to be the working man, and control all the operation! at the mill, putting all the fibre produced through Perreau's hand*. So far the facts are undisputed, but it appears that the functions under* taken by Perreau entailed on him an imperative duty of keeping accounts in an accurate and lucid form so that they could be readily understood, | and submitting such accounts for the ■ inspection of Anderson at such rea* sonably short intervals as may be desired. That he has entirely failed in performing his duties in this respect is at once evident from the documentary evidence proi duced in Court. Such a duty as I have described cannot be said to have been fulfilled by Perreau, when according to his own account all he did was to invite Anderson to come and examine a pile of receipts, orders, vouchers, and letters, reduced to no sort of order, in such confusion in* deed that Anderson himself required to employ the services of an account* ant to deal with them and produoe order out of chaos. Indeed, until an action had been commenced against him in the Fozton Court, Anderson was quite unable to form an intelligible notion of the financial position he was alleged to occupy, no state* ment of account having ever been placed before him. This entire failure to formulate accounts on Per* reau's part must be held to have put him gravely in the wrong, since Anderson had no proper opportunity until action was commenced against him in May last, of checking accounts or disputing items. When a man undertakes such duties as those undertaken by Perreau, it must bo

lupposed that he brings to his selfimposed task certain capacities. It is only necessary to look at what Perreau calls his books to recognize that, even if willing, which I very much doubt, he was quite unable, through ignorance to keep the simplest accounts of any kind, in proper order, and that this inability on his part seriously prejudiced Anderson is beyond all doubt. And here I think it right to say that more unsatisfactory evidence than that given by Perreau I have never heard in a Court of justice. In his replies to all the more searching questions asked by Anderson's counsel, his answers were equivocal, sometimes he prevaricated, and again and again absolutely contradicted himself. With every desire to show consideration for Perreau's obvious natural stupidity and want of education, J. was forced to the conclusion which was only corroborated by the evidence given in defence, that he was endeavouring all along to hide, away the truth, which he thought might prejudice hia claim and impose upon the Court an entirely fictitious story. The position he undertook to occupy was one requiring accuracy, candour, and extreme fidelity, while he bas shown himself from first to last

pareltss, false, and utterly wanting in even a rudimentary notion of good faith. I shall be at pains to justify the use of such plain language when I come to deal in detail with the various aocounts. On the other hand Anderson appears to have done his work well, and as even the falsified accounts before mo show, with considerable financial success. His evidence in all respects was fully corroborated by his witnesses in so far as the main facts at issue were concerned, and though on one matter which was the proper subject for strong comment by Perreau's counsel, he made a serious mistake. I came to the conclusion, after hearing his explanation, that his mistake was made in forge tfulness of facts, and without any deliberate intention to mislead. From what I have said it

will be understood that in balancing the reliability of contradictory evidence on either side, I rely on the veracity of Anderson rather than Perreau. In a statement of the " Mill Acount " of some six pages there are no less than six errors (they have been called clerical errors), including one wrong addition of a short column to the extent of six pounds twelve shillings. Most of these errors are for small amounts, but all, with one exception/are against Anderson, and in iavour of Perreau. To call these " accounts " is to misuse the term, and yet these were all that were furnished to the defendant after the lapse of nearly six months. I come now to consider first of all the M<ll Aocfiunt, but before dealing with the

various items here it is necessary to come to a conclusion on the disputed question whether Perreau lought the mill engine for himself only, and hired it with the mill to Anderson at a rental of £5 per wack during December, 1895, or whether he hired out the mill only at £3 per week, leaving Anderson t) pun has i the engine for £250 (a profit of £50 to Perreau), out of the proceeds of fibre. Perreau's account of the transaction is that he bought the engine for himeelf alone, and leased it with the mill to Anderson at £5 per week. There is not one word of evidence corroborating Perreau's statement, on the other hand Anderson's statement that he arranged to buy the engine and that he only found out that Perreau did not think so on Sunday, December 22nd, 1895, is folly supported not oniy by the evidence of his two sons, who may be •aid to be interested parties, but also by the evidence of Kerr and Hadfield, who were entirely independent witnesses, both of whom positively swore that Perreau had told them about the time of the transaction that Anderson was to pay him for the engine out of the proceeds of the fibre. I entirely disbelieve the evidence of the plaintiff in this matter. The first item with which I deal in the Mill Account is that of commis iion. The evidence as to the amount of commission to be paid to Perreau was absolutely contradictory, Ander son affirming it was 2£ percent, and Perreau alleging it was 5 per cent. I am satisfied that the former sum was agreed on and will only add that it is difficult to find any reason why Perreau should recaive any commis.. sion at all for work a part of which he performed in so inefficient a ma ncr, and this leads me to tho arg-mant of plaintiffs counsel, which was to the effect that Perreau had no prospect of making a profit on the flaxmill business at all c mmansurate with the risk ran unless he

receiv d a commission of 5 p?r cent.

N<m it appears in the first place that -he ( erreau) paid only £3 per week <for the lease of the mill, while he let it to Anderson in January at £5 per week, and that under the November arrangement when the mill only was leased and the engine sold to Ander 8on r he was to make a profit of £50 on the engine, for which he had given bills. It seems to me that having excellent security on the fibre for the limited advances which

he made, a profit of £50 on the

engine was a fair return for the risk tua, and that commission could oniy

be extended to repay him for his labour in keeping accounts, which I feayg said he wa3 unable ov unwilling

to keep at all. I hate allowed 2} per cent, commission on advances up to December 81st 1895, and no provision being made for payment of any commission at all under the agreement of January 2nd, 1808. I have disallowed the items charged in January and February, 1896, of £5 13s lid and 8s lid. Considering now the item on the. Mill Account on the basis that the engine was sold to Anderson and not hired to him, the first three items on the summary of account at foot. And also numbers 5 and 6 will be disallowed. These items were for expenditure on the mill and engine which should not to be charged to Anderson since under the agreement of January 2nd, 1896, he was not to be the buyer of the engine. Altheugh up to December 31st, 1895, I have dealt with the figures as though the engine were to be Anderson's, it is clear that he cannot be charged with the amounts named above when Perreau had broken the agreement and Anderson had ununwillingly been foroed to come into an entirely new contract. (The remainder of the judgment will appear in next issue.)