SUPREME COURT.—CIVIL SITTINGS.

New Zealand Times, Volume XXXIII, Issue 5393, 10 July 1878, Page 3

SUPREME COURT.—CIVIL SITTINGS.

Tuesday, July 9. , (Before his Honor the Chief Justice.) MATTHEW M’CRBDIE V. JOSETH ■ NATHAN . AND CO. - ■ ' ' - 1 ■ Mr. Travers, with him Mr. Edwards, for the plaintiff; Mr. Gordon Allan, with him Mr. Brandon, juri., for the defendants.. ' Mr. Allan opened the case for the de- «■■■ fendants. ; ■ . iJoseph Nathan, the defendant, on being called, ■ said he wasinEngland in part of 1876 and 1877, - when - Mr. Roxburgh managed for him." Ho received advice of an arrangement being made with Mr. M. McOredie. In May 1877 he returned to business in Wellington. He first saw McOredie on business of importance on the 4th or sth of June, when he required some large sum of money, iB6O or £llOO. He ■ examined the books, arid found that McCredie’s indebtedness was .something like £3OOO, of which oyer £3OOO was on-open account, the. rest being on bills current—bills endorsed, and > •: bills direct to the finfl; The guarantees were not included. The goods bought by McOredie from the firm since he started amounted to £I2OO, and he said he had done business to the extent of £6OOO, having made £2OOO profit. He pointed out that McOredie was ,i;stillindebted.to the firm in’ an amount equal to the original indebtedness to McKirdy, the effect being that the plaintiff had not paid anythiugto McKirdy, but thofirmhad paidhim. Mr. Roxburgh’s diary was produced in the presence of Mr. Roxburgh and Mr. McOredie. The diary was handed to, him, and he read out this extract, and pointed to it:— “ Matthew . McOredie. 'Sample’s , business. 2i per ceritriori bills. Security: property, &c.; life'insu-arice, £IOOO. ’ Tea per cent, interest, ’ ' AU goods through us." The entry , was dated 3'oth May, 1876. He asked if there was any written agreement, and one replied—he could not say which—that there waS no other but that (id,the'diary). Ho asked McOredie if, ' he had kept the agreement by.buying goods “through us?” That would include goods the firm had not in stock; but would buy for the plaintiff, for which a-commission of 5 per oerit. - would be charged. Mr.McCredie replied “No."; ‘ said,;! 1 Why .have you not done it!” Ob,’’ ho said, “ I could buy my goods cheaper.” ’ I ■* said, “ Certainly, if you would be allowed to sell £6OOO, worth Of goods bought on my credit, by my endorsement,. when I had to pay for . the goods, you taking the money for which you had sold them to go into the market and •buy for cash, certainly you could buy cheaper, but I cannot continue such a state of things, or I should be supplying you with means to compete, against myself. . Therefore I refuse to make you any cash advances unless we have a proper and fair understanding, and also,a proper written, agreement between ns.” I * ’ pointed out to him that as he was trading entirely on my capital I had a right to partial-'' pate in his profits. We.then went into the matter of 'a basis upon which we would do business. It was then agreed that he should buy all his goods of or through us ; that goods we did not have in stock we should purchase in the local markets for him at a commission of 5 per cent.; that all oash advances should bear ;acommission ‘of- 2J -per cent. 1 I’told him that the money he tnen required I would only advance upon these terms and under this arrangement. He agreed to this. He made no objection whatever, and said he was agreeable to this. He,; got the money, £3OO ■ and £800; and wegot the bills. It is our universal practice when wa taka people’s bills like this aad r give them cheques to give a debit and credit note; ' so that there could be no dispute about it—a discount slip or statement, showing the interest, &c., and I believe these Were given to , Mr. McOredie at the time. [Documents produced.] It may be correct that" Mr. McOredie did not get them for some days afterwards. I ■ do not know anything about the bills being signed by Mr. McOredie in blank. Both slips bad “Cominission 21 per cent.” marked upon them. It was a thorough and a perfect understanding between Mr. McOredie and myself that he was to give these bills for these specific sums. He thoroughly well knows it. He arranged witS myself that he was to pay this —2i per cent, commission. -1,--;’ ‘. Evidence was then given as to bill transactions between the parties, and defendant narrated his instructions to Mr. Roxburgh to get an agreement drawn up, and the receipt,of ■ a ' letter written by McOredie, declining to ao- ' cede'to . the terms proposed, and expressing • readiness to pay the firm off. There was an interview at Nathan and Co.’s office, at which the defendant said the following took place;— : I asked him to explain his,conduct. ‘ I asked what he meant .after haying entered into. an' agreement with me, - and : having received further advances from ma upon certain conditions, by breaking the agreement aud- not carrying it out. i He told me he never had any ; intention ; of carrying it out; that when he - made the’agreement he had no intention of ‘ carrying it oat. “.Well,” I said, “ yon got iriy money# then, under false pretences. Why did you enterinto such an agreement ? ” He said that he wantedthe money, and as I said I ■would not give it to him without, he had made ■ the arrangerilent with the intention at tho time 'of not carrying it out. , The total cash advances to McOredie were £6503 os. 10d.; the actual amount of bills endorsed for McCredie's accommodation in favor of , McKirdy, £11,966 9a. Bd,; and guarantees, £1900; .making’a total a'ccommo- *’ datiori of £20,369 10s. 6d., for which' £399 13s. , gd. was .charged as reopetmission. Commission was not charged on about £4OOO. He- did not reckon the interest ’aa a profit, because he had ,to pay interest. If ' McCredie’s claim were allowed the firm would - receive some--1 thing like £4B in payment for having taken the risk of £20,000.* McCredie’s liabilities 1 in July were about £9OOO, and at’no. time were „• they less, rthan £BOOO. Directly ho heard of the guarantees be told Mr. McOredie-he would charge commission cni them. ‘As' to the bill - of sale not being registered, he asked McOredie . “What was the good of a.bill of,-sale if it was not registered.” It was‘not given until the 22nd November, so that,up to that time —Mr. McOredie had-Joseph -Nathan and Go. in his power. . The firm never had any security besides the bill of ‘ sale, no having been . .executed. . -McCredie’s purr .« chases for the, year were some £I2OO, The firm purchased from McOredie during the year ; goods to the value of; £566 Is.' 9d. On, some ' of the goods the firm sold only the same; profit r was added as Mr.‘McOredie had added to the cost’ of goods bought by the firm from him. Mr. .McOredie, - when buying, ' was always : treated ..liberally - by the'.firm. If the firm allowed tho per cent; claimed by’McOredie there would be a positive loss on part of the ' goods, ns on some they only added 10 per cent. . on tho cash cost price, and .they were sold to McOredie on. four .months' bills, Any allowI ance would be made at the time of sale, A -very lengthy ■ examination was then conducted ’respecting ~ cheques, aud . bills given for McCredie’s accommodation. , , Nothing important was elicited in tho cross--examination. < »George Roxburgh examined,; said ; I was -for some time manager for; Mr. Nathan, but ' "'am no.longer in his service.. I had met,Mr! McOredie frequently .-before entering into a transaction with- him. 1 We were not Intimate friends. In the month of May I met McOredie, who mentioned that-Sample’s business was for ... sale, arid that be would like to go back to his old ■ tr,-wie,saying.that' he had-been in'the ironmongery trade for many years; He said if ho could, get a.firm.tO ; support .him on reasonable terms ;he,would purchase it. i -I asked him for iefor- . mation as to bis position. See, Eventually wo •met in Mr. Macdonald’s office, Mr, Macdonald , and Mr. Yoimg being present. I agreed nlti- ■ matelytha tenne should, be bills at three,six,; nine, ahd twelve mouths to be given to.McKirdy, endorsed’by us, and on which, a commission of .21.. per .cent, should he. paid,.. upon - the- total purchase from McKirdy ;.that security should ho _givcn over bis property in Webb-street, fudr.slso .a biU .of. salo ovor -hia. stock ' and

household effects. - There was also an.arrange-: 1 meat made that he should insure his fife for £IOOO. AU-his goods ordered or purchased outside Wellington should be purchase 1 through us, and that we should charge an indent commission of 5 per cent, on all goods imported, the 'terms to be cash on arrival. To those, terms Mr. McOredie acceded. This was about the end of May, and I made a memorandum in my diary to that effect. When McOredie gave short-date I bills for McKirdy’s convenience it was understood that , commission would not be again - charged, on them, —that was provided they were met at 6,9,- and 12 months, as agreed. Interest at 10 per cent, was to be.charged on all finance transactions pertaining to these bills. In opening Mr. McCredie’s account it was the intention ttiat tho transaction was for the year, and during that year only one 2 J per cent, commission would be charged, McOredie of course retiring the bills out of the proceeds of the stock for - which they were given. If the arrangement had not been carried out and completed, and the money paid in the year, I should have made .a fresh arrangement, and have charged another commission. There was no agreement as to that. The invariable custom in such a case would bs»to make a now arrangement at the end of the year. It was not intended at all that., oiir transactions with Mr. McOredie ; should be closed in a twelvemonth, excepting as to the purchase from McKirdy. There was no arrangement made as to cash advances Mr. McOredie might get excepting as to- those in connection with Mr. MoKirdy’s,- sale. Instructions were given to prepare a mortgage, but it was not completed. The delay in getting the mortgage executed, and the bill of sale 'executed, arose through illness in Mr. McCredie’s family. Mr. McOredie was bound to buy goods through us, but certain lines we bad not got he had to buy from other warehouses. ’ His bills for these we had nothing to do with before we gave tho guarantees. It was understood that the bill of sale should not be registered at the time it was given ; the reason for non-registration was this.. Mr. McOredie was buying ri stock over which he was prepared to give us a bill of sale, aud was at the same time open to buy goods from other merchants in town. There never was an! embargo, pat upon Mr.' McCredie’s buying in Wellington goods wo could not supply. ,' His bill of sale was not to. be registered, so that bo might be able to buy from other merchants in the town such lines as we could not supply him. After tho completion of the bill of sale in November nothing having been said in Mr. Brandon’s office regarding non-registration, the bill of sale ’ was* duly registered. Immediately afterwards Mr. McOredie called upon mo and complained of the bill of sale being registered at 'that time. I told him that as it had been done in contravention of an understanding which we made I should arrange with such houses as he would name for a moderate amount of guaranty of their debts, as we could then hold security over the goods supplied by them. The bill of sale secured present arid future advances, and included goods in stock arid to be supplied. Guarantees were given to Messrs. Mills, Dawson, aud W. \V. Taylor. No commission was contemplated - on those, three guarantees .at the time, and I am not aware that there was any subsequent agreement to pay commission on them. The guarantee to the bank was given in February. Mr. McOredie took his account to the Bank of New Zealand at the instigation of the manager of the National Bank. When Mr. McOredie started, he had intended to bank at the New Zealand, but at the solicitation of the manager, and in Consonance with my ownfeeling,he opened his account at the National Bank. He afterwards removed it to the Bank of New Zealand.’ In February the manager of that bank asked Mr. McOredie to arrange for a guaranty of £IOOO, and w.e gave one to the Bank' of New Zealand! Them was no special arrangement made about that. The entry in the diary, “ all goods through us,” meant all goods ■ imported aud any wo had in stock! On the 4th or sth June I' saw Mo'Jredie at Mr. Nathan’s office, when a cheque was given for £3OO, and another for £BOO. I did not fill the bills up, and I do not think I gave directions to do so.' I think Mr. Nathan said to Mr. McOredie that he had broken his agreement by not buying goods through the firm. He also said he would not make advances urileas he got commission on them. I know the'bills were left by McOredie accepted iu ■blank to be filled in with the charges. I gave instructions that prices to Mr. McOredie were to be as reasonable as the salesman could fix; in fact, he was to make a redaction upon the ordinary rates. When we first entered into an arrangement Mr. McOredie mentioned that some allowance should be made to him., I have no recollection that I ever said, that a specific agreement would be iriade as to the nature of the allowance. When we purchased goods from him we were to pay 10 -per. cent, on the cost. I never had any complaint made about our charges. ■ ' ’ W. •M. Bannatyne, merchant, said it was usual to charge a commission ou giving guarantees, even if no agreement were made as to ’ commission. The usual rate was 2 J per cent. If an agreement were made for one year, aud the balance was not wiped out, the merchant would be entitled to charge another commis sion at the end of the year. He never, in addition to this, charged a commission on cash when advanced, but he knew ,it was done. George Hunter, merchant, said it was usual to charge 2J per cent, upon a guaranty. It was usual to treata balance unsettled at the end of the year as a fresh advance. The practice had been to charge a coiriinision upon the balance brought forward at the annual balance, Thoirias Buokridge, manager of the ironmongery department of . Nathan. and Co.’s business, stated that he received instructions from Mr, Roxburgh, in the presence of Mr. McOredie, that he was to charge the smallest profit possible on all goods purchased by Mr. McOredie, and to take in exchange any goods he had to arrive, that is, if they were required for the stock. He carried out those instructions. He allowed 10 per. cent, off brass foundry goods bought by Mr. McOredie at a time when he would not have let others have them at each a rate.

John Young, ironmonger, stated that when a person was bound to take goods from one house, giving an allowance would be a matter of arrangement. He was not bound to any one, but since he started he had bought most from Nathan and Co., because they were the cheapest. The defendant’s case was closed at a quarter to 6 o’clock. - ‘ The jury retired ’shortly after 8 o'clock, and at a few minutes to 9 o’clock returned a verdict for the plaintiff for £199 6s. IN BANKRUPTCY. ; IN RE THOMAS LOVEJOY. Mr. Edwards applied for a final order of discharge. There was no ' opposition, aud his Honor made the order as prayed. BE’CARL PETERS. , Mr. Fitzherbert applied for a final order of discharge. ’ ’ - There was no opposition, aud his Honor made the order as prayed.