FARMER "SOLD UP."

Auckland Star, Volume LVIII, Issue 152, 30 June 1927, Page 10

FARMER "SOLD UP."

UNCOMPROMISING MORTAGEE

BANKRUPTCY TERMINATED,

OPPOSED BY CREDITOR

(Ey Telegraph—Own Correspondent.) HAMILTON, thif day. "I am going to grant this discharge," remarked Mr. .Justice Herdman, when Mr. E. M. Mackersey asked for the discharge from bankruptcy of Timothy Cairns, farmer, of Kiokio.

Mr. W. H. King (Hamilton) asked c-n behalf of the only creditor, E. L. Strawbridge. that the matter be adjourned for three months, pending an examination by a magistrate into bankrupt's affairs, for which application had been made.

Bought During Boom. Mr. Mackersey said that bankrupt, in 191!), purchased a farm of 787 acres at Kiokio, during the boom period. He paid £75 an acre for the farm, paying £3000 cash, and also took over the stock for which he paid £2500 cash. He bought the property from Strawbridge, who held a second mortgage for £10,000. the property also being subject to a first mortgage of £4000 to a Mrs. O'Sullivan. The second mortgage became due in July. 1928, when Strawbridge pressed for payment and bankrupt made strenuous efforts to refinance. He had a valuation made by the valuer for the Auckland Harbour Board, who valued the land a.t £12 an acre. It was thus impossible for Cairns to raise £10,000 on second mortgage over and above the first mortgage. He was unable to make any terms with Strawbridge, who refused to be in any way reasonable, and in September, 1926, Strawbridge issued a writ against bankrupt for the full amount of the mortgage and interest. Owing to Strawbridge's uncompromising attitude, Cairns was forced to file.

Strawbridge exercised his power of sale under the mortgage and bought the property in for the sum of £12,668. He then proved in bankruptcy for the deficiency. "Pure Misfortune." His Honor: The case seems to have been one of pure misfortune for bankrupt. This man paid £3000 cash for the land, £2500 for the stock, and after farming it for seven years the mortgagee then sells him up and sues for° the deficiency of £2791. 1 •"'

ilr. King said that tlie bankruptcy was quite a recent one, and proceedings had been started for a magisterial examination. '

Mr. Mackersey said bankrupt was a returned soldier, and, in addition to paving Strawbridge £5500 in cash," had also paid £5800 in rates and interest. When the mortgage fell due, Strawbridge would not meet bankrupt in any way by either extending the time or reducing the mortgage. . He-sold-Cairns, up,..bought-the

farm in himself at many thousand's less than he had sold it to Cairns for, and then issued a writ against him In the Supreme Court for the balance due. Creditor's Position. Strawbridge thus had got £0500, as well as interest on the balance of the purchase money for all those years, had got his property back, and, after suing for the balance in full, he now opposed the man's application for discharge. His Honor: It seems to me to be one of those cases of misfortune common in the King Country of a man paying a large sum of money for a property far above its value. The application for discharge will be granted.