No money likely for 48 creditors

Press, 10 April 1978, Page 7

No money likely for 48 creditors

None of the 48 unsecured creditors of Hawford Manufacturers, Ltd. would have any chance of getting a return for their money, a Deputy Official Assignee (Mr L. A. Saunders) told a meeting! of creditors of the company. The company’s staement of affairs showed that 48 unsecured creditors were owed i $10,713 and two preferential creditors were owed $17,649. The company has an estimated deficiency of just over $26,000. Mr Saunders told the meeting that Mr B. L. McGee, the company’s principal director and manager, had previously gone into liquidation in 1972, when his company. Alpine Fashions. Ltd, was wound up by the Supreme Court with an estimated deficiency of $27,000 Hawfotd Manufacturers, trading as Karmel Fashions and Latigo Handbags, were manufacturers of leather.skin, wool, and hide garments and accessories based in premises in Bedford Row, Christchurch. The company was started in 1975 bv its two directors. Mr and Mrs B L. McGee, with a nominal capital of S3OOO, and continued to trade

until the beginning of thisu vear, when the landlordi; pressed for outstanding rent!: of about S2OOO. It was then . I ) that the Official Assignee’s ) 1 services were called upon. < Mr Saunders said there; had been a sale of items at 11 the factory, mainly leather! 1 goods, to pay the outstanding!; rent, and then a hastily held!I auction, to realise about’ ‘sl9oo from machinery and: 1 equipment. ! The auction had had to bell organised quickly so that the I goods could be sold before: the rent-paid period ended.; he said. Both Mr and Mrs McGee ■ , gave their reasons for the! ■ company’s failure as insuffi-) i cient capital, lack of orders! i for 1977, and the downturn f in the economy. In addition, Mr McGee said , that a daylight theft of $1800; ; worth of leather had led to! >, of a month’s work as well I Jas the leather itself. The police had been in-) I formed, but the leather had , never been recovered, he said.! No insurance could be! I claimed because the theft' , had occurred during working . hours when the factory was '! unlocked. j ■ Retail orders had lessened

considerably in 1977 from 'about 30 a week down to : about five, and there had not been enough capital for the 'firm to diversify, said Mr McGee. The increased price of I leather in 1976 and the difificult cash-flow situation had 'also contributed to the firm’s j bankruptcy, he said. ‘ “I could buy leather onlv iwhen it was needed for a specific order, and I had to I make a cash payment for it. il could not afford to build! up stocks of leather,” he said.! When the landlord had arrived with the bailiff to get) his rent, there had been only: lone employee left at the fac-| 'torv. Five had resigned inj 'November, when he had had! difficulty paying their wages. Mr McGee said he had drawn about $2OO a week .gross from the factory and! his wife, who also worked) there, had drawn about $lOO .a week. He had not alwavs been able to pay P.A.Y.E. I;taxation on wages. His own house had been :I sold last year in order to . satisfy his own debt to the company of $9OOO, and to put) urgently needed funds intoj the firm to try to keep it go-| I'ing. he said. [