Lord Wright:-

The question to be determined in this appeal is what are the rights of the Alliance Assurance Company, Ltd., the respondents, under a debenture bond for £100 and the coupons still outstanding under it of which they are bearers. The bond and coupons were issued by the Mayor, Councillors and Citizens of the City of Auckland in New Zealand, the defendants in the action and the appellants before this Board. The Auckland Transport Board who were third parties in the action are also appellants, but no question arises in this appeal as to their position. The debenture bond is numbered 1744 and is for £100. It was issued under the common seal of the appellant corporation on 9th February 1920. It is headed:

Auckland City Council, Auckland, New Zealand. Auckland City Tramway Loan of £1,250,000. Secured on the revenues of the City of Auckland, subject to the existing loans chargeable on such revenues, and is payable at the holder's option either in Auckland, New Zealand, or in London on 1st July 1940, and is expressed to be issued by the Auckland City Council, New Zealand, under the Local Bodies Loans Act, 1913, and S. 26 of the Appropriation Act, 1915. It provides by its terms th