UNUSUAL CASE

Ashburton Guardian, Volume 55, Issue 46, 4 December 1934, Page 6

UNUSUAL CASE

COMPANY DIRECTORS SUED. RETURN OF MONEY SOUGHT. ACTION TAKEN BY LIQUIDATOR. (Per Press Association.) CHRISTCHURCH, This Day. An action that is described as unique in New Zealand company law came before Ma- Justice Johnston at the Supreme Court to-day, when the Official Assignee, as liquidator of a company, brought a motion seeking an order requiring two directors of the company to pay him sums totalling £6Ol, of which £3BO, it is alleged, had been taken with intent to defraud creditors, and the remainder incurred as debts when the company was insolvent. The motion asked that Frank Henry Albert Dodge and Carrie Redvers Dodge, both of Christchureh, builders, be oT-dered to pay sums totalling £6Ol to the official Assignee as liquidator of Dodge Brothers, Ltd., builders. Counsel for the Assignee said that the company started with little liquid capital and soon found itself in trouble. The directors drew heavily on the capital as they advanced. In 1930 the company's turnover was £28,000, in 1931 with £IO,OOO turnover, the net loss'was £1653/ and in 1932 £293. In Julv, 1931, the company was definitely insolvent, but continued to trade and to incur debts. It had, no working capital and increased its commitments with creditors pressing. On October 26, 1932, after a . creditors meeting had been called, one member of the firm paid himself £IBO. Later another brother paid himself £2OO. The case is proceeding.