Bankruptcy Attributed To Shortage Of Capital

Press, Volume CIII, Issue 30366, 15 February 1964, Page 11

Bankruptcy Attributed To Shortage Of Capital

A shortage of working • capital was the main reason for his bankruptcy, said William Rezso Simon, at a meeting of his creditors before the Official Assignee (Mr P. D. Clancy) yesterday. Simon, aged 31. married, with three children, was adjudged bankrupt on February’ 3. He showed: a deficiency of £5263 6s 9d. his total debts being £6373 6s 9d and his assets £lllO. In his statement.' Simon said he arrived in New Zealand from Hungary in 1958 and started in business in 1959 as a manufacturer of lighting ware. Because he lacked capital he obtained an advance of £3OOO from Mr W. A. Lake. In March,- 1963, he decided to get a release from Mr Lake, and entered into an agreement with Arnold and Wright, Ltd., which gave that company exclusive

•rights ' to ■ his products. He was bound with heavy repayments to the company which prevented him from keeping up to date in payments to other creditors. As orders for his products fell off it was soon apparent he could not meet these heavy repayments. Because he hoped to regain business, he did not immediately reduce his staff of 15. During this time his overhead was high, but his agreement with Arnold and Wright, Ltd., prevented his seeking other orders, . he said. The creditors decided that unless a satisfactory offer was made by Monday for plant and fittings they would be sold by auction. They also decided that the agreement with Arnold and Wright, Ltd., should be looked into. Mr Clancy formally closed the meeting. .