BANKRUPTCY COURT.

Auckland Star, Volume XXI, Issue 277, 24 November 1890, Page 3

BANKRUPTCY COURT.

(Before His Honor Mr Justice Conolly.) Solicitors' Costs.— lie Richard Wright's bankruptcy, Mr E. Heskoth moved for an order iixinjf the costs of bankrupt's solicitor, and Ilia Honor allowed £10 and disburse* ments.— He Thomas Moi-rin'a bankruptcy, Mr Cave moved on behalf of Mr Devoro bo iix the coats of the creditor's solicitor, and the amount of. £Q 8s 4d was allowed.

A .Debatable Question. — Re Thomas Johnson's bankruptcy, Mr Ciive moved that the Official Assignee ior tho debtor, in the opinion of tho Court, has a right bo claim a percentage on the amount. Mr Cave said the question was an important; one, aa it occurred in all] eases of composition, the point bein;; what percentage the Asaiguao was entitled fco charge under the second schedule of the Act. Ho submitted that in effect what had been done in the present case was that in consideration of a composition which the debtor paid he gob assigned back to him. tho estate, aud that was ono part of tho deed of composition.—Mr H, Campbell, who opposed the application., contended that the Official Assignee w-is an otVicer of tho Court, mid that no charge oufjht t 0 be countenanced by tha Official Assignee or the Court unless such : charges were imposed by law, inasmuch as it was a tax upon tho whole of tho creditors, the amount; of composition depending upon the value of tho estate. Tib words used in the Act were " the neb viViue of the estate realised by the Assignee, .including debts collected," and he contended that in no sonse had this estatoljoon realised. —His Honorsaid as at present advised he thought Mr Campbell was correct-, but he would take time to consider the question and give his decision on Fridayi—The following motion by Mr Campbell waa therefore allowed to stand over till Friday .•—" That Lho deed of composition bo entered and filed, and that tho adjudication bt) annulled."

DisoHAHCiKs Chanted.—Motions for ciisoharge were granted re George Ballavd, Arjjjua Augustus Koato M acdonald, Thomas Sitttor (in this case all ciaitesi were ttated to havo been paid), and William Henry Crick. Ti Mj Humphreys' Bankruptcy.—Mr Thomas Mace Humphreys appeared in por&on it) support of a motion for bis discharge, which ill- E.. Kesketh opposed, on behalf of the petitioning creditor, i.lr line, on tho ground thab the debtor had boon guilty of misconduct and gross negligence, and hud pub fcbo petitioning creditor to unnecessary expense.— Thomas Waco Humphreys having been sworn, was examined by Mr E. lioskoth, and deposed : I tiled in tho previous bankruptcy in November, 18C8, and in the present bankruptcy on the 20tVi February, 1890. I romomber undertaking the defence of ono Meyei' on two charges of breaking and entering. Moyore owed me money at that time for ofclier business. Ho me a bill of e;;chango for my {services. Meyer had written to his solicitor in London for about £300, which he believed was coming to him, and at his request Meyer gave me a bill of exchange for £250. i banded the bill of exchange to Mr Rao, who deducted from ili a private debb ot £10 and commission, handing me back £238 10s. I had at that timo a claimed payment from Meyer for £62 3s SS, leaving £163 11s 7d to bo accounted for. 1 accounted for that by Bending in a bill of costa for the cxacb amount, and rendered ib to Meyer after he came out of gaol. When ho camo oub of traol he applied to me for money. I did not claim to retain tho whole of tho money, but retained ib becauao an action was brought ugainst mo by Mr Mayer for oioney I had received. I sob up tho bill of costs by way of defence to Moyor'e action. Tho bill was submitted to■■fcixution and £115 43 7<i was taxed ofl. i paid Meyer fcbafc £115 4s 7d, ££o'ln cash and tho balance in promissory :n>t«s, of which £4616.4 have not been paid, Mr Meyer did not bring his action because I refused to account for the money. I was al*o ordered to pay the costs of the action and costs of tho taxation. The action was brought through the enmity of Mr Rae. Meyer came out of .gaol ou the 17th September, called ab my office and ankod for soma money, I told him what I had done. I gave him £20 and made an appointment with him for Thursday attornoon following, when I would have my bill of costs ready, and he would have the balance. I had previouslypaidawtiyfor him about £40. On 19th he sent a letter asking for £5, which I sent him, and on the same afternoon I received a note from Mr Napier demanding on behalf of Meyer £218 14s. I saw Mr Napier, who refused to allow ma more than £5 for serrices rendered to Meyer. I then brought at) action against Mr Rae for slander in respect of statements made independently of this matter. Messrs Brassey, Loram, Mcilhono and Moyer were some of the witnesses examined. I heard Mr Loram nay i gave him a promissory note, nob for giving evidence, bub for expenses and loss incurred. Mr Brassoy hinted that overtures had been made to him, but Mr Mcllhone did nob hint anything of the kind. If any sircfc statements were mado they were untrue. Tho result of that action was adverse to myself, and because of the non ■ payment of Mr Rue's costs in that action, my second bankruptcy was caused.—Ab tho-conclusion of this examination Mr Humphreys made a statement thab with regard to this action of Meyor they were on terms of perfect; friendship on the 17th September. Had he wanted to act dishonourably to Mover, ho could havo dono so. There was a bill for £50 outstanding for two years with interest, and he (Mr Humphreys) arranged to get back that bill with interest for £35, saving Meyer £20 on that trans action alone, in consequence of the action of Mr Napier, ho determined fed send in a bill of costs for the Whole euro, leaving the Registrar to tax the coats. If 1C had nob boen for Mr Kaa there would have been no trouble between his client and himself.— Mr Hesketh submitted that tho bankrupt had baon guilty of very serious misconduct which had previously boen (she subject of comment by His Honor. The account to hie client for £250 by delivering sucl) a bill of costs as that delivered by the debtor waa more than jnonstrou?. The sum of £115 was taxed off tho bill. There was misconduct, therefore, which was closely connectod with tho debtor's bankruptcy. Of tho debtors present liabilities, £170 was money'borrowed chiefly to carry on litigation in connection with this bill. He submitted tho discretion vested in the Court should be exercised to the fullest extent, and no discharge granted.—Mr Beale, who appeared' tor Moesra Gadick and Cranwoll and several other creditors, submitted that the misconduct must be Bucli a» tended to diminish the estate, and thab there had not been any such loss in the present case.—Mr Humphreys pleaded that tho Court should nob be made a vehicle of private animosity against members of the community, and that the animosity of Mr Rae should not be allowed to , have influence against him in the present application. He admitted that he made a blunder in putting in Meyer's bill of coats, bub emphatically denied the allegations of dishonesty. The whole of the objections'ajraiaeb his discharge, moreover, came not from Mr Meyer, bub from liv Rae. -- His Honor said this case was hardly free from diffi- N culty, and unfortunately he had not been assisted by counsel on either side by reference to cases of a similar nature. He was asked to refuse the discharge of the" bankrupt on fche\ groutid of miscon-' duct of his business, and the misconduct alleged was of a very peculiar kind. He could understand misconduct-, or gross i negligence of business to mean reckless trading, giving bad credit, and so on, by which the estate was injured ; but, as had been put by Mr Bealo, the misconduct

masfj be such aa to diminish the estate. In this case ho was to go into tho conduct of the debtor as a solicitor in rendering such a bill of costs as that which he rendered fco Meyer. No doubt that was gross misconduct. In one of thoverylasfj numbers of "New Zealand Law Reports" there was the caseof MrMcConneli, of Christchurch, in which the Courtof Appeal suspended a solicitor for two years on tha ground tha ttheexorbitant charges in his bill amounted to fraud. If the Court of Appeal had notr been sitting oa complaint of the Law Society, or of Mr Meyer on account of Mr Humphreys' bill of costs, it waa hard to see how the ease would bodistinguishod from that of Mr McConnell, but ifc appeared to him ho had no right to take such action upon himself. If ho suspended the discharge of the bankrupt in this case it would really be suspending him front practice on account of the exorbitant or fraudulent bill of costs, a thing which, for many yeare past, no single judge had taken upon himself, the matter haying also boon referred to a Court oi Appeal. Whatever bis opinion upon this bill of cost might be, and he had Baid what he thought about ib on a previous occasion, so that his opinion must be pretty clear to anybody, he did not think that was a matter which hb should deal with, in considering an application for an order of discharge. The opposing creditor had shown ho injury .to himself in the matter, or that the rendering of the bill of coats had prejudiced him in any degree; he was inclined to think tho debtor's position would have been worse if that bill had not been taxed in an extraordinarily lenient manner. He could not sea that tho estate had beon in any way damaged by the rendering of that bill of costs, for which-jchere waa another and a proper penalty, arid would therefore grant tho debtor's discharge.