CLAIM FOR £775

Sun (Auckland), Volume III, Issue 833, 29 November 1929, Page 11

CLAIM FOR £775

DISHONOURED PROMISSORY NOTE ACTION HOLDER CLAIMS PAYMENT “Here is an unholy trinity—John I McLaughlin, a solicitor in bankruptcy and struck oft" the rolls, the plaintiff. Edward Joseph Flood, whose business : was going to pieces and who was later working as a tally-clerk, and V. 1 A. Wawn, whose business was in liquidation—each lending the other large sums of ntonev on the strength of a P.N. for £ 775. ' This statement was made by Mr. R. Parry to Mr. Justice Smith in the ; Supreme Court today, in presenting j the defence to the claim of Edward Joseph Flood, a Sydney Accountant, against James Gni.-.i Gear, of Auckland, for payment of a dishonoured promissory note for £775. The P.N. was given by Gear while in Sydney in 1323 to John McLaughlin, a solicitor, who endorsed it to X'. A. Wawn. who endorsed it to Flood, who claimed payment as holder in due course. Gear based his defence on the allegation that he was induced by duress or undue influence by McLaughlin to give two promissory notes the day i that he and McLaughlin were supposed to sail from Sydney to New Zealand to investigate the Wellington firm’s conduct of defendant's business. The notes were given on the undertaking ! that McLaughlin would not negotiate or deal with them in any way. TRUSTED AS FRIENDS For the defence, Mr. Parry said that Gear went through a considerable portion of his large New Zealand estate while living in Sydney. The Wellington legal firm, which was acting as Gear’s trustee, kept the defendant on a short allowance, and it was to take his estate out of this firm's control that Gear planned to return to New Zealand with McLaughlin, whom he trusted as a friend and legal adviser. McLaughlin gave no evidence for either side in Sydney, because it was understood he was coming to the Dominion to give his testimony. Counsel intimated that he would apply, if necessary, for an adjournment to obtain McLaughlin’s evidence, as his testimony would “blow out” plaintiff’s case entirely. “I must say that it looks like a manoeuvre,” remarked his Honour, in referring to the absence of McLaughlin's evidence. Mr. Rogefson: McLaughlin did not give evidence, on counsel's advice. Mr. Parry: McLaughlin is far too sharp a man to let counsel know what he is doing. Continuing, Mr. Parry submitted the evidence showed that Flood handed back the P.N. to McLaughlin a few weeks after receiving it, and did not see the document again for five years, during which McLaughlin was struck off the rolls for dishonesty and fraud and went bankrupt. At the same time Flood admitted • that the P.N., which was being held by a dishonest solicitor, was his only security for advancing hundreds of pounds. The present action, counsel asserted, was instigated by McLaughlin, and was being backed by a Christchurch man whom Flood did not know. The whole evidence tended to show Flood was not interested in the proceedings, and that McLaughlin was the only interested party. Counsel submitted that there were betting transactions between Flood, McLaughlin ancl others, and that every - person who cashed a cheque was either an hotelkeeper or a bookmaker. Flood had also admitted that he had made advances to McLaughlin prior to making the note, and he had not claimed on McLaughlin’s estate in bankruptcy. It had to be proved by paintiff that he had taken the note before it was overdue, and there was evidence to show that he did not do so. Counsel quoted evidence which he claimed showed clearly that Flood and McLaughlin were engaged in sporting activities, most of their business being done by them with racing men with a not too savoury reputation. His Honour: Perhaps Gear was one of the sports. Mr. Parry admitted that Gear had been in with this set and led a wild life in Sydney, but after voluntarily spending nine months in hospital he cut out drinking habits and broke with bis former associates. Gear had never betted in bis life. His Honour pointed out that Flood failed for £70,000, and his assets realised £60,000. He added that the whole business savoured of gambling transactions which could not be proved. (Proceeding.)