The War Service Homes Commissioner has forwarded me the following memorandum for advice:

A case has arisen where a sum was received on behalf of an applicant from an adjoining owner in respect of his half share of fencing. From this sum was taken an amount for payment of interest on progress instalments made for the erection of the house etc., and the balance of £22 10s6d was placed to the applicant's credit, vide sub-section 29 (2) of the Act.

The applicant is now desirous of applying the sum so credited towards the cost of placing a veranda on the house, but in view of sub-section 29 (3) of the Act, your opinion is desired as to whether the Commissioner has power to meet the applicant's request and use the credit for a purpose other than in payment of instalments or arrears.

Sub-section 29 (3) states that such deposits and interest thereon 'shall be available for payment of any instalments, or arrears . . . ' and it is submitted that this sub-section is authoritative for the Commissioner to take thereout instalments due or arrears and does not debar the use of a deposit for another purpose and that the words 'shall be available' do not infer the words 'shall be used'; therefore it is not mandatory in that deposits and interest thereon shall not be taken for any other purpose and further that the word 'available' only refers to such time as a deposit may be required by the Commissioner for payment of an instalment or arrears.

Section 29 deals with the manner in which the purchase money of a home or an advance made in connection with its purchase is to be repaid by the applicant.

Sub-section (2) authorises a purchaser or borrower to deposit with the Commissioner amounts exceeding £1, such amounts being in excess of the instalments due at the time the deposit is made. Such deposits are to bear interest and are to be available for payment of any instalment or arrears of instalments due to the Commissioner.

In my opinion the application of deposits made under sub-section (2) to purposes other than the payment of instalments is foreign to the scope and intention of section 29.

Such an application of a deposit would defeat the requirements of sub-section (3) which provides that the deposit 'shall be available' to pay instalments. To apply the money to some other purpose renders it not available for the statutory purpose.

I am accordingly of opinion that a deposit lodged under section 29 (2) cannot be used for any purpose other than the payment of instalments.

[Vol. 18, p.45]