Re Hynds [1917] HCA 2; (1917) 22 CLR 541 (28 February 1917)

HIGH COURT OF AUSTRALIA

In re Hynds.

H C of A

28 February 1917

Barton J.

L. L. Dobson, for the applicants, in support.

W. H. Hudspeth, for Burgess and Cummins, to oppose.

There was no appearance for Hynds.

J Barton read the following judgment:—

Feb. 28

Barton J

In this case no evidence has been given or argument adduced on the part of the first applicant which satisfies me regarding either of the requirements of pars. (a) and (b) of sub-reg. 5 of reg. 4 of Statutory Rules 1916, No. 284, as amended by Statutory Rules 1917, No. 13. The date fixed by the mortgage to Topham for repayment of the principal sum has long since passed, and the date up to which Topham verbally agreed to defer the calling in of the principal money was 16th December 1916; and the principal remains wholly unpaid. I am of opinion that the mortgagor, Hynds, is unable to redeem the property or to pay even a portion of the principal sum out of his own moneys (see Statutory Rules 1917, No. 13, reg. 2, par. (e)). He cannot pay even the interest. In any such case, unless I am satisfied as to either of the requirements above mentioned—as to both of which the onus lies on the applicant—reg. 4 (5) deprives me of discretion to grant the leave asked for. I am of opinion that the sub-regulation applies, as its words indicate, to any case in which the principal is overdue and the mortgagor is unable to redeem, or even to repay in part, and the Court is not satisfied under either par. (a) or par. (b). I am not so satisfied, and I must therefore dismiss Topham's application.

The application of the Cascade Brewery Co. has been heard together with Topham's; so I deal with it also now. The advance by the Cascade Brewery Co. under mortgage was repayable on demand, and although there has been fruitless demand of interest there is no evidence that the principal itself has been demanded. But reg. 7 of Statutory Rules 1916, No. 284, as amended (Statutory Rules 1916, No. 324, reg. 2), provides that where a mortgage for a specific amount provides for the payment of the principal sum on demand, and a demand has not at the commencement of the Regulations been made, the principal sum shall, for the purpose only of the Regulations, be deemed to be payable immediately after the commencement of the Regulations. The commencement of the Regulations—now some time past—must, therefore, in such a case be held to be the date fixed by the mortgage for repayment; and this result brings the Company's case into line with Topham's even if repayment has been demanded, of which there is no evidence, as I have pointed out. So that I cannot grant their application.

I may add as to both these cases that, even apart from the grounds I have stated, I do not think that either application ought to be granted. It is true that the mortgagor has not been able to pay his interest; his income has evidently so largely dwindled that he is deprived of the power to do so. For the same reason, and à fortiori, he could not at present pay any part of the principal moneys. A bad fruit season has been added to the difficulties, already heavy enough, caused by the War—for instance, a falling off in the traffic of an hotel in a locality normally much frequented by tourists. There have been other hardships, however necessary, of which all struggling business men, including orchardists and publicans, are conscious, and it is easy to see that the mortgagor's prospects of speedily redeeming his properties are very slight if much pressure is exercised. But if he is not pressed I think that as times improve he may reasonably be expected to come gradually into a position to pay his way. I cannot say that it is improbable that under such circumstances he will become able to discharge the mortgages and free his property. I think, therefore, that this is such a case as the moratorium was intended to relieve and protect.

Further, I am far from satisfied that it would be "unjust and inequitable" not to grant the applications or either of them (see Statutory Rules 1917, No. 13, reg. 2 (d)).

As Hynds has not appeared, he will, of course, not have any costs. The costs of the fourth mortgagees of opposing these applications are to be paid by the applicants in equal moieties.

Applications dismissed.

Solicitors for the applicant, Dobson, Mitchell & Allport.

Solicitors for Burgess and Cummins, Page, Hodgman & Seager.