LEGISLATIVE COUNCIL.

Nelson Evening Mail, Volume VIII, Issue 181, 29 July 1873, Page 4

LEGISLATIVE COUNCIL.

INTEREST BILL. The Hon Dr Pollen moved the second reading of this bill. He said that the present rate of interest allowed by law where there was no special agreement was 8 per cent, and the chief object *of this bill was to reduce it to 6 per cent. The Hon Mr Sewell suggested that more time should be given for the consideration of the bill, and he thought the opinions of the banking and mercantile interests should be taken on it. The Hon Mr Johnston said the bill was one which affected the mercantile community in a great degree. He had heard no reason adduced for the introduction of the measure. He was aware that the rate of interest had fallen, but we could not be certain that the fall will be permanent; Even in London itself — the great money market of the world — the fluctuations in the value of money were considerable, He did not think that either the interests of the public or of the mercantile community would be consulted if the bill passed into I law. He would move that the bill be read a second time that day six months. The Hon Mr Waterhonse said that the bill had been introduced without due consideration. The effect of it wonld be that parties who had no property would be able to raise money at a lower rate of j interest than those who had. The law in England was that the rate of interest on ordinary business transactions should be -lightly in excess of that on money raised mortgage. The present rate of interest charged by the banks was in excess of that to be allowed by this bill except a special agreement to the contrary had been made. The effect of the bill would be that greater stringency would have to be used in monetary transactions. If money was lent by a bank at eight per cent — which is about the rate at present — on a six months' bill, the bank would in all probability enforce its payment at the end of that time, as the law after that date would only empower it to recover six per cent. This, he thought, would be a serious inconvenience, as it was often the case that the payment of the bill was extended with great advantage. The bill would also have a tendency in influencing & debtor not to pay his bill when due, as after that date he need only pay a lower percentage. The Hon Dr Pollen said that the previous speakers had evidently misunderstood the nature of the bill. It did not in any way affect the interest on money when a special agreement had been made. There was a class of cases constantly cropping up in the courts to which this bill would refer. The object of the bill was to prepent an exorbitant creditor from inflicting serious injury on an unfortunate debtor, when, perhaps, the transaction extended over a number of years. However, he did not wish to hurry the bill through the Council, and would not object to allow time to consider the bill. The bill was ordered to be read a second time that day six months.