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THOMAS V. HOUSTON CORBETT FACTS At the beginning of 1964 the appellant, then 25 years of age, having passed his final medical examinations, was employed as a house surgeon at the Waikato Hospital. In or about March 1965 he sold his motor car and in result had a credit in the joint bank account of himself and his wife of PS539. He had become acquainted with one Varner Joseph Cook whom he knew to be a law clerk employed by a firm of Hamilton solicitors. In this situation he consulted Cook with a view to the investment of
PS400, apparently not being content with the interest he could have earned in a savings bank account. H e was then given vague particulars of the nature of the investment which Cook had in mind, namely, the providing of temporary finance for someone he understood to be a client of the respondents who was immediately unable to pay for a section he had purchased at Taupo. Cook asked him to make out two cheques. The first cheque, which was dated 26 April 1965, was made out for PS100 in favour of "V. J. Cook or bearer"; the second, bearing the same date, was made out for PS300 in favour of the respondents. No trust account receipt was given but the appellant accepted a promissory note for the total amount of PS400 signed by Cook personally. Cook paid the PS300 cheque into the respondents' trust account, but not the PS100 cheque. Two days later by means of false entries and false information given to one of the principals of the respondent firm, Cook obtained the respondents' trust account cheque for the PS300. On the same day the appellant's PS100 cheque and the PS300 cheque Cook had obtained from the respondents were both paid into Cook's private bank account. In July 1965, the appellant, requiring the PS400 to enable him to purchase his new car, saw Cook and asked him to make this sum available to him. There was some delay during which time Cook arranged temporary bank accommodation for the appellant. He told the appellant that he had paid into his account a sum of money (whether the exact sum was mentioned was left in doubt) informing him that this was the total amount from the land transaction which the appellant had entered into in April but that he required from the appellant his cheque for PS840 which he said belonged to others interested in the land transaction. The appellant, who was not versed in business matters, wholly trusting Cook, gave him his cheque for the PS840. A few days later he found that sure enough PS1,381 13s. 3d. had been paid into his account on 6 September 1965. The position then was that in the eyes of the appellant the land transaction had been
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