District Court.

Poverty Bay Standard, Volume IX, Issue 933, 9 April 1881, Page 3

District Court.

BANKRUPTCY DIVISION. [Before Mr. Registrar Greenwood!. An application was made to the Registrar in Chambers by the Manager of the Bank of New Zealand to restrain Wi Pere from selling a certain flock of 2000 sheep seized by him, in the estate of A. F. Hardy, for rent. Messrs. Finn and Ward appeared for the Bank ; Mr. Nolan, instructed by Mr. Rees, for Wi Pere; Mr. Turton for the Trustee. Mr Nolan objected to the affidavits of Mr. Matthews, and Mr. McLean (trustee in the estate) owing to erasures therein, thereby destroying the jurat. After arguments from counsel, the Registrar decided that the signatures which had been altered on a second swearing, did not form part of the jurat, and admitted the documents. Mr. Nolan contended that the Registrar had no power under the 96th section of the Debtors and Creditors Act to make the order applied for. It appeared that Wi Pere abandoned a portion of his claim on the estate for rent —for which a proof of debt was made at the meeting of creditors—on account of having obtained possession of the sheep ; therefore he elected to seize them, not against the Trustee, but against the mortgagee. The 96th section says : — The proving or claiming of a debt or demand under this Act shall be deemed an election by the creditor to take the benefit of the bankruptcy with respect to that debt or demand, and the Court may, if it thinks fit,accordingly restrain any action suit or proceeding by the creditor in contravention of tins section. The affidavit of the Trustee supported Mr. Nolan’s objection, in that he had not taken possession of the sheep, and to not being concerned in the application of the Bank for the order to restrain. Mr. Nolan also contended that under the Bth section the Registrar was quite incompetent to make any order on the prayer of an outside creditor ; but only on the application of the Trustee in the interest of the estate. The Bank’s recourse was under the Distress and Replevin Act; and not under the Debtors and Creditors Act for an order to restrain ; and more particularly as there was not a tittle of evidence, under the affidavits filed, that the Bank holds any security.

Mr. Ward, in support of the application, argued that his clients, the Bank of New Zealand, holding the sheep as secured creditors, had a right to them, and contended that under the Act the Registrar had power to grant the order, and, in the interest of the creditors. In reply to a question of the Registrar, Mr. Ward said that the action of the Bank was taken because a large balance was claimed by them, over and above the security of the sheep ; and that it was their duty to see that the best price be obtained for them. If there was a forced sale, there would be a loss to the estate. The Registrar held that under both the Bth and 96th sections of the Act, he had no jurisdiction in the matter, and refused the application. The question of costs was reserved for the decision of the Judge.