BORROWING POWERS.

UNDER THE PUBLIC HEALTH ACT, 1872.

A sanitary authority may, for the purpose of defraying the costs and expenses incurred, or to be incurred by them in the performance of their duties under the Sanitary Acts,* borrow at interest the money necessary for defraying these expenses, subject to the regulations in the Sanitary Acts.

They may borrow the money on the credit of any rates out of which they are authorised by the Sanitary Acts to pay expenses incurred for sanitary purposes, and they may mortgage the rates to the persons by or on behalf of whom the money is advanced for securing repayment to them of the sums borrowed, with interest. (35 & 36 Vict. c. 79. s. 40.)

See Rates and Expenses, p. 156.

Public Works Loan Commissioners may make Advances.

The Public Works Loan Commissioners may, on the recommendation of the Local Government Board, make any loan to a sanitary authority in pursuance of their powers of borrowing, whether for works already executed or to be executed. The loan must be repaid within a period not exceeding 30 or 50 years, as provided by the Sanitary Acts, and must bear interest at the rate of not less than 3 per cent., or at such other rate as in the judgment of the Treasury may be necessary, to enable the loan to be made without loss to the Exchequer, on the security of any fund or rate applicable to sanitary purposes, and without requiring any other security.

In determining the time when a loan of this sort is to be repayable, the Local Government Board must have regard to the probable duration and continuing utility of the works for which it is required.

In the case of a loan already made to any sanitary authority in pursuance of any powers conferred by the Sanitary Acts, the Public Works Loan Commissioners may reduce the interest payable thereon to the rate of not less than three and a half per

cent.

These provisions do not extend to loans under "the Sanitary Loans Act, 1869," required to defray the expenses incurred or to be incurred by the Local Government Board in performing the duty of a defaulting local authority after the passing of the Public Health Act, 1872. (35 & 36 Vict. c. 79. s. 44.)

See Defaulting Sanitary Authorities, p. 193.

* For definition, see p. 33.

Power of Joint Board to borrow.

A joint board may borrow at interest on the credit of their common fund any money necessary for defraying any expenses incurred by them in pursuance of the Public Health Act, 1872, subject to the regulations of the Local Government Acts* with respect to borrowing by local boards. (35 & 36 Vict. c. 79. s. 30.) See Combination of Sanitary Authorities, p. 8; and Rates and Expenses, p. 172.

Power to raise Money on certain Land and Works.

Where any sanitary authority or joint board is possessed of land, works, or other property in pursuance and for the purposes of the Sewage Utilization Act, 1867, such authority or joint board may borrow money on the credit of such property, and may mortgage such property to any person advancing the money, in the same manner as if the sanitary authority or joint board were the absolute owner, both at law and in equity, of the property mortgaged. The money borrowed must be applied for purposes for which money may be borrowed under the Sanitary Acts; but it is not in any way incumbent on the mortgagees to see to the application of the money, nor are they responsible for any misapplication of it.

These powers of borrowing are, where the sums borrowed do not exceed three fourths of the purchase money of such lands, deemed to be distinct from and in addition to the general borrowing powers conferred on a sanitary authority or joint board by the Sanitary Acts. The sanitary authority or joint board may pay out of any rates leviable by them for sanitary purposes the interest on any money borrowed by them in pursuance of these powers. (35 & 36 Vict. c. 79. s. 41.) See Sewers and Drains, p. 45.

Validity of certain Securities.

The Public Health Act, 1872, provides that, where by a provisional order under the Sanitary Acts extending the borrowing powers of a local board, and confirmed by Act of Parliament, it was directed that the sums borrowed should be repaid within a period of 50 years from the date of the borrowing, any security which had been given for a sum borrowed should not be invalid by reason of its having been made repayable within a period of less than 50 years from the borrowing. (35 & 36 Vict. c. 79. s. 46.)

Provisions of the Commissioners Clauses Act, 1847, with

respect to Mortgages.

The clauses of the Commissioners Clauses Act, 1847,† with respect to the mortgages to be executed by the commissioners

* See p. 181.

† 10 Vict. c. 16.

30477.

M

are incorporated with the Public Health Act, 1872, and in the construction of that Act "the special Act" means the Public Health Act, 1872;""the commissioners" mean any authority authorised to borrow by this Act; and "the clerk of the commissioners" includes any officer appointed for the purpose by any such authority.

The mortgagees or assignees of any mortgage made in pursuance of the Public Health Act, 1872, may enforce payment of the arrears of principal and interest due to them by the appointment of a receiver. (35 & 36 Vict. c. 79. s. 40.)

These clauses are as follows:

Every mortgage of rates or other property authorised to be made under the provisions of the Public Health Act, 1872, must be by deed duly stamped, in which the consideration is duly stated. The deed must be under the seal of the sanitary authority, and may be according to the form No. 24, Appendix, p. 244, or to the like effect.

The respective mortgagees are entitled one with another to their respective proportions of the rates and assessments or other property comprised in the mortgages, according to the sums in the mortgages mentioned to be advanced by the mortgagees, and to be repaid the sums advanced, with interest, without any preference one above another by reason of the priority of advancing moneys, or of the dates of the mortgages. (10 Vict. c. 16. s. 75.)

Register of Mortgages.

A register of mortgages must be kept by the clerk to the sanitary authority, and where by the Public Health Act, 1872, they are authorised to raise separate sums on separate rates or other property, a separate register must be kept for each class of mortgages, and within 14 days after the date of any mortgage an entry or memorial of its number and date, and of the names of the parties to it, with their proper additions, must be made in the proper register. Every register may be perused at all reasonable times by a person interested in any mortgage without fee or reward. (10 Vict. c. 16. s. 76.)

Transfer of Mortgage.

A person entitled to a mortgage may transfer his right and interest in it to any other person. Every transfer must be by deed duly stamped, wherein the consideration is truly stated; and it may be according to the form No. 25, Appendix, p. 245, or to the like effect. (10 Vict. c. 16. s. 77.)

Within 30 days after the date of the transfer, if executed within the United Kingdom, or otherwise within 30 days after the arrival thereof in the United Kingdom, it must be produced to the clerk to the sanitary authority, who must then cause an entry or memorial of it to be made, in the same manner as in

the case of the original mortgage, and for the entry the clerk may demand a sum not exceeding 58.

After the entry the transfer entitles the transferee, his executors, administrators, or assigns, to the full benefit of the original mortgage and the principal and interest secured by it. The transferee may in like manner assign or transfer the same again,

toties quoties.

It is not in the power of any person, except the person to whom it has been last transferred, his executors, administrators, or assigns, to release the mortgage transferred, or any money secured by it. (10 Vict. c. 16. s. 78.)

Interest.

Unless otherwise provided by the mortgage, the interest of the money borrowed upon it must be paid half-yearly to the several parties entitled thereto. (10 Vict. c. 16. s. 79.)

If the sanitary authority can at any time borrow money at a lower rate of interest than any securities given by them and then in force bear, they may borrow the money at the lower rate, in order to pay off the securities bearing the higher rate.

They may charge the rates and other property they are authorised to mortgage in security under the Public Health Act, 1872, or any part of them, with payment of the money and the lower rate of interest, in the same manner and subject to the regulations herein contained with respect to other money borrowed on mortgage. (10 Vict. c. 16. s. 80.)

Repayment.

The sanitary authority may fix a period for the repayment of all principal money borrowed under these provisions, with the interest, and in such case they must cause the period to be inserted in the mortgage deed. Upon the expiration of the period the principal, together with the arrears of interest on it, must, on demand, be paid to the party entitled to receive the same.

If no other place of payment is inserted in the deed the principal and interest are payable at the office of the sanitary authority. (10 Vict. c. 16. s. 81.)

If no time is fixed in the mortgage for the repayment of the money borrowed, the party entitled to receive it may, at the expiration or at any time after the expiration of 12 months from the date of the deed, demand payment of the principal secured by it, with all arrears of interest, upon giving six months previous notice for that purpose, and in the like case the sanitary authority may at any time pay off the money borrowed, on giving the same notice.

The notice must be in writing or print, or both, and if given by a mortgagee or creditor must be delivered to the clerk or left at the office of the sanitary authority, and if given by the sanitary authority it must be given either personally to such mort

gagee or creditor, or left at his residence, or if he is unknown to the sanitary authority, or cannot be found after diligent inquiry, notice must be given by advertisement in the London Gazette (10 Vict. c. 16. s. 82.)

If the sanitary authority have given notice of their intention to pay off a mortgage at a time when it may lawfully be paid off by them, then at the expiration of such notice all further interest ceases to be payable on it, unless, on demand of payment, made pursuant to the notice or at any time thereafter, the sanitary authority fail to pay the principal and interest due on the mortgage at the expiration of the notice. (10 Vict. c. 16. s. 83.)

When the sanitary authority are enabled to pay off one or more of the mortgages then payable, and are not able to pay off the whole of the same class, they must decide the order in which they shall be paid off by lot among the class to which such one or more of the mortgages belong, and must cause a notice signed by their clerk to be given to the persons entitled to the money to be paid off, pursuant to the lot, and the notice must express the principal sum proposed to be paid off, and that the same will be paid, together with the interest due on it, at a place to be specified, at the expiration of six months from the date of giving the notice. (10 Vict. c. 16. s. 85.)

Sinking Fund.

In order to discharge the principal money borrowed on security of any of the rates, the sanitary authority must every year set apart out of such rates one twentieth part of the sums borrowed, as a sinking fund to be applied in paying off the principal moneys borrowed, and they must from time to time cause the sinking fund to be invested in the purchase of Exchequer bills or other Government securities, and to be increased by accumulation in the way of compound interest or otherwise, until it is of sufficient amount to pay off the principal debts to which the sinking fund is applicable, or some part of it, which the sanitary authority think ought then to be paid off, at which time it must be applied in paying off the same in manner above mentioned. (10 Vict. c. 16. s. 84.)

Receiver.

If, within 30 days after the interest accruing upon any mortgage has become payable, and after demand thereof in writing, it is not paid, the mortgagee may, without prejudice to his right to sue for the interest in arrear in any of the superior courts, require the appointment of a receiver.

If, within six months after the principal money owing upon a mortgage has become payable, and after demand thereof in writing it is not paid, together with all interest due in respect of it, the mortgagee, without prejudice to his right to sue for the principal money, together with all arrears of interest, in any of the superior courts, may, if his debt amount to the pre