In Attorney-General v. Tottenham Urban Council (1910, 73 J P. 4371, a sum of 118,350 had been advanced by the defendants' bank ers, but the Local Government Board, upon an application in 1907 from the defendants for leave to borrow the 11S,350. refused their sanction in respect of 14,910. The defendants proposed to pay the 1,4,910 and interest on the overdraft out of a general district rate. It was held that the loan of X.4,910 by way of overdraft without the sanction of the Local Government Board was illegal, and that the defendants must be restrained from applying any part of the general district rate or any other fund or rate under their control in repayment of the loan ; that the defen dants were not entitled to make any pay ment of interest upon money borrowed with out the sanction of the Local Government Board ; that the payment of 1S55 as interest was unlawful and ought to be disallowed on audit, but this declaration was to be with out prejudice to the power of the Local Government Board to remit such disallow ance ; and that the defendants be perpetu ally restrained from making any further pay ments of interest upon money borrowed with out the sanction of the Local Government Board, or other statutory sanction, whether such borrowing was by way of overdraft or otherwise.
Another instructive case is the .4 ttorney
General v. 31ayor, etc., of the County Borough of ll'est Ham and others (1910. T. L. R. liS3). Mr. Justice Neville, in the course of his judgment, said : " The Corporation appear to have considered and they cer tainly acted as though they were entitled to use moneys borrowed under specific powers not merely for the specific purposes for which the powers were bestowed, but for any purpose to which any funds of the Corporation could lawfully be applied, so long as they kept proper accounts of the expenditure. . . . In my opinion, this view of the position of the Corporation was erroneous." The judgment contained the following declaration : " 1. That the overdraft obtained from the bank for general purposes in respect of bor rowing powers granted for specific purposes was ultra sires and illegal.
" 2. That the application of money due to the Consolidated Loans Fund in repayment of such overdraft was ultra tires and illegal.
" 3. That the borrowing of money frora the bank for the purpose of the electricity accounts, otherwise than in the exercise of borrowing powers with the sanction of the Local Government Board, was ultra mires and illegal." (See COUNTY COUNCIL, CU.NR DIANS OF THE POOR, MUNICIPAL CORPORA TION, PARISH COUNCIL, RURAL DISTRICT COUNCIL, UP,IIAN DISTRICT COUNCIL.)