A TEST CASE.

Taranaki Daily News, Volume L, Issue 322, 23 January 1908, Page 3

A TEST CASE.

A case which excited some interest locally was heard 111 the New Plymouth Magistrate's Court on Tuesday morning, in the nature of a friendly suit or test caw; brought oil account of the apparently defective maeliiuery under the Contractors' and Workmen's Lion Act, _ 181)2, and to ascertain the position of the parties eoncerned. Messrs. Smart Bros., for whom Mr. (!. drey appeared. entered a claim against the Hani; of iNew Zealand and the Ollicial Assignee in the bankruptcy of John Donaldson. Mr. Roy represented the Bank, and Mr. Kerr the Assignee. The plaintiffs claimed £177 8s 3d for work done by theni as cubcontractors in connection with the Bank of iNew Zealand at Waitara. Formal evidence was given by Mr. Ewing for Smart Bros, as to the supply ot materials and the giving of notices required by the Act. Mr. Roy, while admitting Smart Bros.' claim, drew the attention of the Court to the fact that there were, other claims laid by sub-contractors, among them a claim by the Sash and Door Company for £535 12s. Proceedings for the recovery of the latter sum had been commenced in the Supreme Court, ae the jurisdiction, of the Magistrate's Court was limited to £2OO. It was suggested that, if the Magistrate gave judgment against the Bank, execution should be suspended until after the Supreme Court judgment had been given. Mr. Kerr, for the Official Assignee, urged that judgment should not be given against the Assignee. As Smart Bros.' lien was a charge created by statute, it was not affected Bf section 55 of the Bankruptcy Act, by which the property passed to the Assignee. The Bank therefore was a trustee, in respect of the funds in its hands, for those who liad taken the legal steps to secure their lien, and therefore judgment could not go against the Assignee, who had no assets on which execution could tic. levied. Authorities were quoted in support of this contention. The Magistrate agreed with Mr Kerr's argument, and allowed the Official Assignee costs in the estate of .CS is. He also gave judgment fui Smart Bros, with costs £8 17s, tlie cost? in each case to be a charge, against tlu funds held by the Bank for the creditors.