THE BANKRUPTCY ACT.

Auckland Star, Volume LVII, Issue 111, 12 May 1926, Page 8

THE BANKRUPTCY ACT.

CHARGES AGAINST YOUNG MAN. ACQUITTAL OF ACCUSED. At the Supreme Court yesterday afternoon, before Mr. Justice Herdman and a jury, the case in which Hugh Cox SmittC charged with three breaches of the Bankruptcy Act, was concluded. Mr. Paterson conducted the prosecution, and Mr. Fitzherbert appeared for the accused. When the case was outlined for the Crown It was stated that accused started in business as a fruiterer, with a capital of £150. Six months later he was adjudicated bankrupt. He then owed creditors £500, and his assets realised £56. After lengthy evidence Mr. Fitzherbert submitted that there was no case to go before the jury. Mr. Paterson eaid that there was evidence that proper book 3 were not kept. His Honor said that it eeemed a rather feeble fiort of a case. One of the Crown witnesses was not dear about what books should be kept. He could not recommend the jury to convict accused. The jury, without retiring, returned a verdict of not guilty. CHARGES AGAINST A GROCER. Leslie John Mullaney (Mr. A. G. Davis) was charged that (1) having failed to keep reasonable and sufficient books of account with intent to conceal the etate of his affairs; (2) having within three years before the declaration of insolvency retained £100 on credit from Hubert Charles .Barrett by means of a false statement; and (3) having contracted a debt of £224 with Burns, Philp and Company, Ltd., without having reasonable expectation of being able to pay it. For the prosecution, Mr. Paterson eaid that accused's books were quite useless for the purpose of showing the position. In two and a-half years of trading he contracted liabilities amounting to £2300 (reduced to £1500 by the witn drawal of a proof of debt of £800), while his assets realised only £170. The estate paid a. dividend of 1/5 in the £. Evidence would be given that Mr. Barrett guaranteed accused's overdraft for £500, and in June, 1924, accused applied to Mr. Barrett for further assistance, submitting what purported to be a balance sheet, which showed that the overdraft was the only liability, whereas at that time he owed £1700 to other persona. George C." Gorrie, public accountant, ;said that the accused did not keep the usual and proper booke for a grocer, as there was neither ledger nor cash book, and only a daily record. The balance sheet presented to Mr. Barrett failed to show creditors other than the bank. It showed a turnover of about £250 a week, whereas on the average accused banked about £25 a week. Accused Found Guilty. Irving Clark eaid that accused ran his account up to over £600. Arrangements were made for accused to pay £5 a week off the account, and in June, 1924, it stood from £350 to £380. Walter Newling, a storekeeper, said that he had lent accused between £700 and £800 and had received promissory notes. For the defence, Mr. Davis said that it would not have been difficult from accused's books to ascertain his position at any time. Egerton Gill, public accountant, said that a daily record book was often kept by small traders, but it would be necessary to keep it properly written up. To his Honor: He had not examined the books. The jury returned a verdict of guilty on all four charges. Sentence was deferred. His Honor (to the jury): It will be some satisfaction for you" to know that he has been previously convicted Mr Paterson: For embezzlement as a lodge secretary.