AN UNUSUAL CASE.

Taranaki Daily News, 11 April 1922, Page 6

AN UNUSUAL CASE.

QUESTION OF SETTLERS’ HELP. INGLEWOOD COUNTY MATTER. A case of interest to local bodies came before Mr. A. M. Mowlem, S.M., at the Inglewood Magistrate’s Court yesterday, when the chairman, councillors and inhabitants of the Inglewood County Council sued Frederick Bracegirdle for £3O, being defendant’s share of a promise to safeguard the Moa Road Board against the necessity for drawing upon the council’s general fund for the completion of a bridge within the county.

The statement of claim stated that in 1919 the Moa Road Board raised a loan of £2300 for the erection of a bridge over the Kurapete stream and certain metalling work on trie Everett Road. The work was duly commenced, but it was found that the sum provided was insufficient to complete, whereupon six settlers on the road —namely Frederick Bracegirdle, J. Wallace, F. Townsend, E. C. Cooper, T. Potroz, and E*. W. M. Lysons —promised jointly and

severally that if the total amount required to complete the bridge was not raised by further loan they would bear the cost of the defic' ncy, provided the individual liability did not exceed £3O. A memorial to this effect was delivered by the settlers to the board. On completion of the bridge it was found the deficiency amounted to £3>69 14s 7d, and to test the validity of their claim from the guarantors the Inglewood County Council, successors to the Moa Road Board, brought the action against Bracegirdle. Mr. H. R. Billing appeared for the plaintiffs and Mr. H. H. Quilliam for the defendant.

Mr. Billing outlined the facts contained in the statement of claim. He said the Everett Road was little used, except by the settlers living thereon, and it was not a main road. When the Moa Road Board found that the sum

raised by loan was insufficient it was decided that the work could not go on unless the settlers were prepared to bear the extra capital cost. At a special meeting at the board’s office the position was explained to the settlers, and the six' farmers above mentioned .agreed to accept a liability up to £3O each to secure the completion of the bridge and certain metalling works, the guarantee to be later liquidated by loan from the Government or elsewhere. An alternative liability for free labor to the extent of the guarantee was accepted by the settlers. Mr. Billing said this was really a test case, and action against the other five guarantors would depend on the result. The agreement signed by the settlers was not strictly in order, but there was also an oral agreement entered into. The Road Board had made a provision that the extra cost must be borne by the settlers concerned, and not the ratepayers. Mr. Quilliam said that the plaintiffs jnust either stand by the agreement or cast it aside. Mr. Billing said it was not the original agreement, and it was admitted to be ambiguous. THE COUNCIL’S CASE. A. Corkill, chairman of the Inglewood County Council, in evidence, said the contract for the bridge and metalling was chiefly for the benefit of the six settlers mentioned in the guarantee. He detailed what transpired at a special meeting of the board with the settlers, and the drawing up of the agreement. The work having been completed, application was made for settlement of the guarantee in October last, but the settlers refused to pay. Certain of the settlers had worked on the job, but he believed they were paid. ’ In answer to Mr. Quilliam witness said he had no knowledge of free labor having been given on the road, but it was possible, as settlers all over the; county sometimes did a little work. The final estimate, which brought the negotiations with the. settlers, was an increase on the earlier estimates. Increasing cost of labor and material also had a bearing on the fact that there was a deficiency. The placing of a sum on the estimates was not always a guarantee that the money would be granted, although it had always been so in his county. He remembered a deputation of the settlers waiting on the council, but he did not remember them, offering to do labor up to £2O in value on the contract.

Robert Buckley, clerk of the Moa Road Board in 1918-19. said that at a meeting of the settlers with the board the guarantors had agreed to safeguard the board against having to draw on the general fund for the completion of the work. An arrangement was arrived at to reimburse the settlers by a fiesh loan if they were called upon to pay the £3O guarantee. Witness gave up his position as clerk when the board was formed into a council on April 1, 1920. Cross-examined by Mr. Quilliam, witness said the "figure of £3O was arrived at by means of the engineer’s estimate. It was estimated tnat with subsidies, etc., the total amount available would he £3OlO. He had heard it suggested that less money should be spent on the metalling, and the extra amount added to the bridge, but this was found to be impracticable. It had not been decided who should take the initial steps to raise a loan to reimburse the guarantors. 8. E. Neilson, clerk to the Inglewood County Council, gave evidence that up to March, 1921, £3069 had been spent on the contract. Witness said he had had no report of the signatories of the guarantee having put in free labor on the contract. Mr. Billing pointed out that none of the guarantors had paid the amount of their guarantee, but one ratepayer (Wallace senr.) had paid £3O, under the impression that he was liable, and it had been refunded.

THE DEFENCE. Mr. Quilliam contended, in outlining the case for the defence, that the agreement produced was an intelligible bne, and they could not very well go outside it. The document meant that a loan of £3O each would be made by the signatories, and that the sum would be refunded out of loan. The word “safeguard’’ in the agreement meant little, but “liquidated” was most important, as it meant that in any circumstances the signatories were to be reimbursed. He submitted that the document was ambiguous and meaningless, and could not be usfed as a ground to sue upon. If "a guarantee had been given when the work was estimated to cost a certain amount and the work was afterwards changed, that would be grossly unfair to the guarantors. He contended that the money was only lent

with the intention of refunding it out of the first loan raised unless the council could not raise a further loan, in which case the signatories would stand the loss.

James Hunter, a member of the Inglewood County Council, gave evidence as to the events that led up to the signing of the guarantee. The Road Board, he said, required to be sure the money was in sight before completing the contract, and for this reason the settlers agreed to loan the money on the understanding that it would, be refunded. Witness had opposed the council in taking the proceedings. At the time the agreement was made the council was not prepared to do the work out of the general fund. rhe meeting at which the agreement was arrived at was working on a lower estimate than that which was finally used.

Frederick Bracegirdle, the defendant, said the engineer had altered the estimates for the. bridge, and the council tried to take £2OO from the metalling and to add it on to the bridge work, but this was -found to be illegal. A meeting was called between the settlers and the council, and at this meeting the agreement was drawn up. At that time the council proposed to secure another loan or grant which would cancel the settlers’ liability. They heard nothing more until payment was applied for, and thought the liability was cancelled. The guarantors understood that they were to get interest on the amount guaranteed. The agreement was that their liability terminated as soon, as any further money was obtained by the council. The settiers had done a considerable amount of free labor on the road. In one case they metalled 10 chains of road, and in another formed half a mile of road. Had the settlers taken the alternative and put in labor instead of guaranteeing this would not have been a gift to the council, but would have become a debt chargable with interest. E. W. M. Lysons said that he drew up the agreement in question. It was the intention to embody the general agreement arrived at in the document, and to put it into legal -form later. He corroborated the former witness’ statements. When he got notice asking for payment of his ’ share of the guarantee he considered the liability had elapsed, because he understood the council had raised further loan money.

Elma Clive Cooper, a signatory to the agreement, also gave evidence. Subject to securing evidence regarding the dates of certain subsidies, this concluded the case for the defence.

His Worship said that on receipt of the information regarding the subsidies he would give his decision in writing.