BANKRUPT JEWELLER.

Auckland Star, Volume LVI, Issue 84, 9 April 1925, Page 8

BANKRUPT JEWELLER.

STOCK TO BE REALISED.

TOTAL DEBTS £5580.

PAPER SURPLUS OF £4299.

Failure in business as the result of depression in trade and the nature of the methods employed iwas the essence of the story told by Albert Berry Proud, bankrupt jeweller, of Auckland, when a •meeting of hi-s creditors was held today, Mr. S. L. Paterson presiding in the absence of the Official Assignee. Bankrupt was represented 'by Mr. McLiver and Mr. Wilson.

The total debts -were shown on the statement as £5580, which represented the amount owing to unsecured creditors. An amount of £105 owing to a secured creditor was set off 'by a security of an estimated value of that amount. The total assets were .shown as £9880 10/7, which included stock-in-trade (estimated New Zealand wholesale value) £9500 and book debts £200. A surplus of £4299 17/8 was disclosed on these figures. "Sales Went to Zero." Bankrupt started business in 1911, according to his written statement. All the books, records and papers relating to tflie 'business ivoiild be found intact and in order, ho said. He had opened in Victoria Arcade Buildings as an ■indent agent for jewellery lines and as a wholesale diamond and gem merchant. He held two English sole agencies. Diamonds and gems he wholesaled on his own account in New Zealand and the eastern States of Australia. With (business and stock increasing lie shifted into larger premises, but the first few years of the war saw a slight depression in trade, which, however, revived and quickly developed, and, as he held certain specialties he started importing heavily. He also began manufacturing on a large scale. On top of the few prosperous years general trade depression set in, and Qiis lines were affected very considerably. Sales went down to zero. Outstanding accounts were difficult to get in. He battled on through the depressed times for nearly two years, "thinking daily that the stagnation would lift." After tremendous efforts, with the help of a' loyal -staff, he had to curtail Qiis efforts and reduce expenses drastically. Became a Land Agent. In 1922 bankrupt entered the land agency business. In this line business went along more or less encouragingly, and for a period he did fairly well, but as business fell off the staff gradually left, and as Christmas, 1923, was approaching he resolved to go back to the jewellery business. He opened three depots in good positions, and enjoyed a satisfactory Christmas season. During 1924 he threw all his energies into the line. Business held fairly good for the first six months, but fell away heavily in the second half of the year. Unfortunately the whole Christmas season of 1924 "turned out a frost." He honestly anticipated that he would take £1000 or more, which would have satisfied all urgent claims. The • season proved inconceivably quiet, and bankrupt was left completely stranded. Bankrupt, in his statement, had to reluctantly admit that he wag beaten on the methods he adopted. He was anxious to pay 20/ in the pound. "Eiaiory of Broken Promises." "I started business on my own account with £0$ capital, and was an indent agent, with stock on consignment and no stock to buy," said bankrupt when under examination by Mr. Paterson. He could not say what his average yearly profit had been within the last five years. Bankrupt said he had been married twice, and there were six children. His wife had a property at Ponsonby on which a deposit of £100 had been paid. She also had a Singer motor car. It was bought in exchange for an old car, with a consideration of £100 to the dealer. Bankrupt gave his wife the old car. She also had furniture and effects. When he married, over five years ago, he had no house and practically no furniture. Bankrupt could not say how much money his wife possessed when lie married her. . He disputed tho account of one creditor, because he claimed that commission on sales was due to him. Mr. Paterson asked whether £3000 of this creditor's money was held by bankrupt in 1921, and bankrupt said that that was so.

What has become of that money?—lt was used in tho business.

But this was the creditor's money! —Yes, but there was an arrangement that money received should be set off against commissions due to mc. Is it not a fact that you never disputed the accounts till that creditor began to press for the money?—l cannot say- I was to get 8$ per cent commission, and I had a rough idea of what was due-

Mr. Paterson stated that his firm had investigated the position and had found no record in connection with payments alleged (by the customers) to have been paid, and this in a number of eases.

After further eyjdence. bankrupt advanced tho suggestion that he should realise the stock by employing salesmen on commission only. He thought lie could get the utmost value out" of the stock by this means, and make the turnover about £100 per week. A creditor remarked that it might bo that bankrupt could not be trusted further. That was so, said Mr. Paterson. For the past few years bankrupt had been practically playing with his creditors. To tho speaker's knowledge bankrupt's case had been a history of broken promisesA committee of creditors was elected to act with the Official Assignee in considering the best method of realising the estate. This committee was given power to act.