SUPREME COURT.

Taranaki Daily News, 8 February 1918, Page 7

SUPREME COURT.

YESTERDAY'S PROCEEDINGS, (Before his Honor, Mr. Justice Edwards) , The quarterly session of the Supreme Court at New Plymouth was continued yesterday before his Honor Mi- Justice Edwards. CLAIM TO SHARE IN AN ESTATE. Hamilton Gilmour and the Public Trustee (Sir John Findlay, K.C, with him Mr. D. R. Hoggard) v. Laura Berry—a claim to be beneficially entitled to three-fourths of the estate of Allan Maguire. The defendant was unrepresentSir John Findlay, in opening the case, said every endeavor had been made to locate the defendant. Her agent had been communicated with, but they had no instruction as to appearing in the caseIt was understood at first that, a vigorous defence would be set up, but later it was suggested that a compromise might be effected. It had been expected until coming into court that the case would be contested. It was desirable to have the defendant in Court for the purpose of getting certain admissions. In her absence, however, Sir John said he thought he could establish a good ease for his clients. . . ~„ , His Honor said that plaintiffs were always at a disadvantage in such a case when defendant did not appear. Sir John Findlay said they first sued Laura Berry herself and then as executrix for her late husband, Daniel BerryIn Decemiber, 1901, McGuire, Gilmour tni Berry entered into a partnership to carry on business as ironmongers, under the style of Berry and Co., in Brougham Street, New Plymouth, the business to be managed by Berry. In the articles of partnership it was agreed that the capital be subscribed in tho proportions of three-fourths by Berry *nd one-eighth each by McGuire and Gilmour. The original articles of partnership, were understood to he held by th< Public Trustee as executor for McGuire, but it had been impossible to find them. An admission of the partnership could have been obtained from the defendant. The profits were to be distributed in the same proportion as the capital subscribed. McGuire had died in March, 1916, and proceedings were instituted by the Public Trustee as executor for McGuire, to declare the partnership dissolved on account of the death of McGuire. A receiver was appointed, and during the course of the proceedings it was discovered that Berry, without the knowledge of his partners, transferred his share in freehold property of the business, which had been treated by Berry as a partnership asset, to his wife. The memorandum of transfer set out that the consideration was the love and affection of his wife. It was stated that'the business had been losing money from 1904 to the end of the partnership, and it was suggested that Berry's transfer to his wife was for the purpose of protecting his share of the business against claims by the Public Trustee on account of Cadman's estate. The business had lost to such an extent that Gilmour and McGuire bad actually to find £6310, in addition to the amount of their original capital, to meet the firm's liabilities, and it was estimated they would lose about £SOOO on the transaction. The transfer to Mrs. Berry took place when the business was not in a position to pay its debts. Berry had died in June, 1917. Sir John held that the assignment of transfer was given to her as trustee and should be available for payment of the partnership debts. Victor Elliott, accountant, secretary of the.Taranaki Freezing Company, New Plymouth, and previously clerk for Messrs Roy and Nicholson, said he had seen the articles of the partnership of McGuire, Gilmour and Berry. It was about sixteen years since the articles were signed. He believed he engrossed the original copy of the articles, and witnessed the signature of 'Berry. He had no reason to doubt that the copy submitted was, a copy of the articles 9igned by the partners. Wm. Mowat Falconer, accountant, New Plymouth, said he was appointed receiver in an action by Hamilton Gilmour and the Public Trustee (as executor of Allan McGuire) against Daniel Berry. In May, 1916, he was instructed by the Public Trustee to investigate the business of Berry in order to ascertain the valne of McGuire's interest for probate purposes. Berry had consented to the investigation. His report was furnished on December 22, 1916. He found McGuire's interest was wort'' nothing, and that he would have to find £1358 16s 7d in order to meet the firm's liabilities, that was taking Berry's valuation of the assets. Gilmour would have to find an equal sum, which amounted to them making up the whole deficiencies on the assets. The assets did not realise anything like Berry's valuation. McGuire and Gilmour had actually found £O3IO-18s 9d, in addition to the amount of capital first subscribed, to meet the firm's liabilities. Berry included in tlie firm's assets the freehold premises in Brougham street, in which the business was carried on. For the year and 10 months between May 31, 1907, and March 31, 1909, the loss incurred in the business amounted to £1562 18s Id. Losses had been made from February, 1901 Berry wrote up the value of the business premises in 1904 by £1292 Ms Bd. When the examination of the books of the partnership was made by witness, the valuation of premises appeared in the books as £6OOI Cs. The Government valuation was £42' to. Ho had tried to sell the premises, the price asked bein b ' 4;4500, but no definite offer had been received. He had found the premises always treated as a business asset- There was a mortgage of £2OOO on the premises, held by the Government Life Insurance Department. The mortgage was in existence at the date of the transfer of the premises by Berry to his wife After the transfer of the premises ths interest on the mortgage was paid by the firm of Berry and Co. It appeared as a liability of the business. Berry supervised the keeping of the books, The books disclosed no payments by Mrs Berry, either for interest or rates! Berry's valuation of the stock at October 31, 1916, was £5921 12s. The stock waa mainly old. The total realisation, excepting the business premises, was £3582 6s 6d. The realisation had the advantage of war conditions- The stock was disposed of at a clearing sale. But for the inclusion of tho business promises as part of the firm's assets, the business would have been hopelessly insolvent.

To assist in proving the existence of the partnership, in the absence of the original articles, witness was recalled and said in all his interviews with Berry, the latter always referred to the business as a partnership with MeGuire and Gitaour. Berry had told him that his share was three-fotirtha and the other partners' one-eighth each. I Sir John Rttdlfty applM US jefef

ment in terma of. plaintiff's petition, and that defendant Tie declared a trustee of the partnership. His Honor gave judgment to the effect that the freehold property Was part of the assets of the partnership and that defendant was a trustee of the said three-fourths share registered in her name. Further consideration was reserved, with liberty for either party to apply. CLAIM FOR ROYALTIES. Legal argument was heard in the case of Thomas Skinner (Mr. J. E. Wilson) v. the Phoenix Oil Co., Ltd. (Mr. 0. C. Hutton, Wanganui) on a claim for £SO said to be due for royalties under a lease. The lease provided for the occupation of a certain area of land at a rental of £SO per year with royalties of 7J per cent, on all oil or gas obtained and sold, or a minimum royalty of £SO per year. It was admitted for the defendant that certain terms of the lease had not been complied with, but the claim was not for breach of covenant but for non-payment of royalties. It was contended that as no oil had been got or sold therefore there was nothing on which to assess royalties. Authorities were cited in support of the contentionFor the plaintiff, it was admitted that the wording of the lease was not as precise as could be desired, but that the fact'that a minimum royalty Was stipulated, that amount became" what (might be justly termed a dead rent, to be payable whether oil was secured or not. Judgments were quoted to Bupport that view of the interpretation of the lease. His Honor reserved his decision.