LIABLE TO BE SUED

Wairarapa Times-Age, 1 August 1939, Page 9

LIABLE TO BE SUED

THE STATE ADVANCES CORPORATION NOT ENTITLED TO CROWN PRIVILEGES. SUPREME COURT RULING. (By Telegraph—Press Association.) AUCKLAND, July 31. After hearing argument submitted to him by counsel in the Supreme Court. Mr Justice Fair has decided that the State Advances Corporation must be considered a separate and distinct entity, and that it is not to be identified with, and entitled to privileges of, the Crown; The judgment is of great interest to contractors and workers engaged in the erection of State houses, in that it decides that the State Advances Corporation, while engaged in the erection of State houses, is subject to the provisions of the Wages Protection and Contractors’ Liens Act, 1908, so that a charge may be secured upon contract moneys in the same manner as if the houses were being built for an individual owner. An action claiming a charge on moneys payable to a contractor under the State housing scheme was brought by Smith and Smith, Limited, merchants, Winstone Limited. Henderson and Pollard. Limited, and N. J. McLeod and the trustees of the William Peet Estate against the State Advances Corporation and O. A. Smith, builder. It was urged for the State Advances Corporation that the corporation was the Crown and was consequently not bound by the provisions of the Wages Protection Act. Cn behalf of claimants, it was urged that the corporation was not the Crown or the agent of the Crown, and was, consequently, bound by the Act, as if it were an individual owner. In giving judgment, his Honour said he had been disposed to think, on hearing counsel’s argument, that the State Advances Corporation was alter ego of the Crown and was entitled to the immunities and privileges that I 'the Crown had granted to it. by common law and by statute. But further consideration of authorities cited, his Honour continued, had led him to the conclusion that he was obliged to hold, in this case .that the provisions of the State Advances Corporation Act. 193 G. amounted to a declaration that the corporation was intended to exist as a separate entity from the Crown in its general capacity, and was entitled to sue and liable to be sued in such independent capacity.