A FARMER'S COLLAPSE.

Auckland Star, Volume LVI, Issue 244, 15 October 1925, Page 9

A FARMER'S COLLAPSE.

; • » . AFTER SUCCESSFUL DEALS. M I FARM FLOODED BY RIVER. LARGE AMOUNT INVOLVED. How a farmer, after many successful land deals, bought a syndicate out of a block of land in the Waikato, when he had accumulated over £10,000 worth of securities, was forced into bankruptcy, was told at the Official Assignee's office this morning. Bankrupt, Thomas Edwardes Eyre (Mr. Haddow), formerly of Kopuku, but now of Manurewa, showed a nominal surplus in his schedule of over £10,000, a sum of £021 14/3 owing to unsecured creditors and £9400 to secured, the securities being valued at £21,200 17/3, leaving an estimated surplus of £11,179 3/. To this was added assets iv the stock-in-trade valued at £1200, making the total estimated assets £12,379 17/3. This left a nominal surplus of £11,758 3/. In a lengthy statement, bankrupt said that in May, 1023, he owned mortgages in properties totalling- £10,300 and had about £1500 cash. He decided to take on another farm, and bought a block of 1000 odd acres of swamp at Kopuku. In making this purchase he took over all the mortgages, and undertook to pay the arrears of interest and rates. He also gave a house and four acres in Hamilton, subject to mortgages, to complete the payment. The owners of the block (a syndicate) had it valued, the estimate being £22,000 odd. This syndicate had spent thousands in draining and developing the block. He built a house and sheds and started milking, but when the wet weather came he found that about 800 acres of the property was under water and would be so for several months owing to the Waikato River backing up. When he saw the property in April it was dry, with drains through a large portion. The land was equal to the best in the Auckland Province if it could be drained. He had been assured that it was all drainable. Bankrupt went on to explain how other properties came back on his hands and now he had become involved in further trouble by guaranteeing two contractors in a sawmill. He was eventually forced into bankruptcy through a farm in the King Country of 943 acres, which he had sold, subject to a mortgage of £2500, for £3800 cash above the mortgage, coming back on him. Made Money Wholesale. Examined by the Assignee, bankrupt said he was an experienced farmer. He had not taken outside advice, but relied on his own judgment. He had made money wholesale until he took up the swamp block. He knew that the area was not properly drained, but it -was going cheaply. At the time he had mortgages in properties aggregating £10,000 which he considered were worth face value. To Mr. Terry (for the petitioning creditor), bankrupt said the mortgage on the swamp was £9400 odd. He paid up various amounts outstanding by the syndicate, amounting to a few hundreds. He was advanced a further £500 by the mortgagee of the swamp farm. At the time of the sale one of the mortga«*es wae due and the mortgagee would agree to it running on for another term only on condition that bankrupt gave a collateral security over all his assets. At the same time he received an advance of £500 from the mortgagee. Mr. Terry asked bankrupt why he should give further security when the property was only mortgaged for about half its value. Bankrupt said he did not see any harm in it as it would allow him to get further advances later on. Bankrupt confirmed his statement that he had got £3800 cash for the property above a mortgage of £2500. This was the farm which the petitioning creditor now valued at £1500.