SUPREME COURT.-IN BANCO.

New Zealand Times, Volume XXXIII, Issue 5420, 10 August 1878, Page 1 (Supplement)

SUPREME COURT.-IN BANCO.

Friday, August 9.

(Before his Honor Mr Justice Richmond.) The Court sat at 11 o’clock. PEACOCK V. ANDERSON.

This was an appeal from a decision of the R.M. at Patea,

His Honor gave judgment in this case as follows ; ,

In this case the plaintiff, on the 14th June, 1877, executed a deed of arrangement with his creditors, which, ou the 30th August, was declared completely executed. On the 3rd of August the plaintiff went to visit the defendant, taking with him tho personal effects for the detention of which this action is brought. After staying with the defendant. for some weeks, the plaintiff went away, leaving the articles in the defendant's house. Ou the 30th April, 1873, the plaintiff returned ; and that then took place amounted in ray opinion to a demand ou the part of the plaintiff for the delivery of tho goods, aud to a refusal on the part of the defendant to deliver them. It was attempted iu the Resident Magistrate’s Cou-t to set up the title of the trustees under the arrangement deqd as an answer to the action, In my opinion the magistrate was right iu rejecting this defence. A bailee cannot, iu general, set up against his bailor, the title of a third party, without showing that he is authorised and required by that third party to detain the . subject of the bailment. See the remark of C. B. Pollock ou Ogle v. Atkinson, in Thorne v. Tilbury, 3 H. and N. 534 ; and also the observations ot Baron Bramwell during the argument of the second case ; also Jeffrirsv. Gb, Western Railway Co., 25 L.J., QB, 107. The earlier case in the same Court of Cheosmau v. Excel!, 20 L.J., Ex. 209, in which it was held that the defendant was entitled to set up the jus terlii, is distinguishable on the gtound that the deposit of plate in that case was a fraudulent transaction for the purpose of defeating an execution, and that there could be implied under the circumstances no undertaking on the part of the defendant to return the property to the plaintiff. (See the judgment of Baron Parke ; also Story on Bailments, p 102.) In the present case some evidence appears to have been given that the trustees claimed the goods, or a part of them ; but there was none that the trustees had any communication with the defendant on the subject ; nor did it appear that the defendant himself asserted the title of the trustees. I must assume that the magistrate came to the conclusion that the defendant was not acting under any authority from the trustees. Where facts are stated which might ho the ground of a further inference of fact, and this inference if made would support tho judgment, the magistrate, who is the solo judge of fact in these cases, must bo deemed to have drawn the inference. Unless tho defendant was acting under the authority ot the true owner, lie was a mere wrongdoer, against whom the title ot the plaintiff was sufficient. As regards the promissory note the amount of which the defendant sought to set-off against the demand of tho plaintiff, I think ray conclusion would be, were it necessary to decide the point, that the debt which it created has not been barred by the deed of arrangement. That instrument, as sot out iu the case, appears to contain no express release, nor does it import a release. The cose of Ipstones Park Iron Co. v. Pattiuson, 33 L.J. Ex. 193, cited by Mr. Hutchison, is in point, notwithstanding the difference between .the English Bankruptcy Act of 1861 and the Debtors and Creditors Act, 1876. Private agreements with particular creditors, who are at the same time taking part in a general arrangement between the debtor and the whole body of creditors, are without doubt invalid, as in their nature inequitable and fraudulent. In re Leuzberg's policy, 47 L. J., Oh. div. 178. But the defendant seems to have stood entirely aloof from the arrangement, which in my opinion, distinguishes, the present case. He has neither signed the deed nor proved under it. An action upon the promissory note might be restrained by this Court under secs. 133 and 135 of tho present Debtors and Creditors Act, but it.does not appear that the plaintiff is otherwise affected by the deed. It is, however, unnecessary for me to decide any of these points respecting the promissory note, because I am of opiuion that its amount could not be subject to a set-off against such a demand as the plaintiff's, oven in the Courts of the Resident Magistrate. Under see. 58 of the Resident Magistrate’s Act, 1867, the pin ntiff has tho option of demanding the return of tho specific goods; and in the alternative the damages to which ho is entitled are unliquidated. There can be no set-off against such a claim.

On the whole X am of opinion that the magistrate has come to a right conclusion, and that the judgment must be affirmed, with costs. Appeal dismissed, with costs.