A HUTT BANKRUPTCY

Dominion, Volume 4, Issue 1155, 16 June 1911, Page 3

A HUTT BANKRUPTCY

IRATE CREDITORS. AN UNFORTUNATE DEBTOH. A meeting of creditors in the bankrupt estato of John Robert Stansell, liotelKesper, Lower Hutt, and formerly a flaxmiller, was held ycterd:.,- in Wellington, (ho Official Asfisueo (.Mr. A. Simpson) presiding A large number of creditors were preset. .Air. M. I". Luckie appeared for the bankrupt; Mr. M'Grath (ivho held certain moneys of Staiifell's in trust /or creditors) was also present; and Mr. H. T. Ayson reprereiited Jlc«rs Gadsby Brothers. c>.£?<f C , C l iml crpdiJ-oi-* wc-e fat dotnt at ~-o-!» 125.; secured creditors, nil. A nets were given as .£675 17s. lOcl., including »'''is, 11s. 10(1., and cash in hands 0 tp, Kennedy and Co., ,£IOO. . il i< Principal unsecured creditors are a< JJ. Kennedy, Ltd., Wellington, merchanfa, J!166 12s. 7d. ; F. Hig/ott, Lower lliKt/horse trainer, ,£lO6 15s. lid.; Laery f n - C ~ 21 3s - ld -; J- H. Fairbairn Wellington, hotolkeeper, .£2l Gs. Ja.; J. E. Stansell, Kelburue, commis-l sion agent, ,£25; William Hendrv. Wellington, tailor, £21 55.; Menteath and Beere, solicitors, ,£G9 is. 3d.; A. A. S. Jlenteath, solicitor, ,£209 U. 7d.; New n^nl and Loan nn,l Mercantile Co., Ltd., .£lO7 4s. 7d.; M'Grath and Willis, solicitors. £2o; Kirk and Stevens, solicitors, Otaki, £51 Is. 10d.; J. G. Stevens, solici■tor, Otaki, .£l3Ol 18?.; George M'Beath, ■hotelkeoper, Otaki, ,£l2 Ms. 3d.; Executors late H. Austin, Foxton, sawmiller, £12 14=. 3d.; W. J. Howell, Paraparaumu, farmer, .£62 15s. 3d. Debtor's Statement. In his sworn statement the debtor traced his business transactions from 1903. At that date ho said that the Loan and Mercantile Company had given him an advance or about £ip. on the security of a bill of sale over his flaxmill plant at Waikanae. Mr. A. A. S. Menteath save two guarantees to the company oil debtor's behalf. In 1007, owing to the death of Mr. A. E. Lj:ons, whoso flax debtor was milling, the property had to be sold, together with the rest of debtor's property, and plant, which left him indebted to the Loan and Mercantile Company to the extent of .£315 Is. 10d. Subsequently £11 os. 3d. was paid off. The company, later, called on Mv. Menteith to pay his guarantees, agreeing to take three bills. 7n 10017 he obtained a personal seeuritv loan of .£350 from the National Mutual Life Association, guaranteed by various gentlemen, for the purpose of' building a house and improving a property at Waikanae. The Loan and Mercantile -Company would not consent to wait to let him cut this pronerty up, and he had had to sell at «E4O an acre. Had he not been pressed he ronld have got double the price. Whan hi« assets were realised ho still owed the National Mutual Life Association six payments of .£34. In July, 1907,- Mr. J. G. Stevens, of Otaki, lent hnnkrnnt .£7OO to obtain options over iiax properties at Northern Wairoa. Deposits were paid to the extent of, ,£650. Owing t,-> the price of hemp falling he was unable to complete the purchase. A liability of XlO2 was incurred to one. Hoskings, of Dnrgaville, for surveying some land at Knihn. This creditor eventually, in May of last year, obtained a' charging order for .£lO9 7s. 2d. against the leas: of the Railway Hotel. Lower Hutt. which had sinre been paid by Messrs. M'Grath nnd Miles out of purchase -money far debtor's interest in tho hotel. In 11)10 debtor came to Wellington, and worked at Northlands for a time. .In February. 11)11. he purchased the goodwill and furniture of the Railway Hotel, Lower Hutt. for .£8. r io. Mr. J.'G. Stevens lent him XBS, Speight and Co. and tho Phoenix Company ,£4. r io. The stock ho mircliased by three bills, two of which were met on due date—.£Bs and .£34, respectively. Two, -£85 and ,£2!, vera still unpaid. He sold the Railway Uotel to Mr. Robert Dtvyer (after staying there ten weeks) fot JiSdO, out of which he agreed to pay A. D. Kennedy and Co., Ltd., .£SO for commission. Mr. Hosking, of Uargaville, had pressed lim for the ,£lO9, so he was compelled 1 to sell. Owing to tho time he had to wait for his money (til! after the Licensing Bench had met), several old creditors had been pressing for payment, and he decided to file a petition in bankruptcy, to protect tho rest of his creditor.-'. Ho had no assets bar the money in tho hands of Messrs. .M'Grath and Wil-, lis, namely, the balance of Dwyar's money and .£2O, balance of a judgment of Utauta Parata; .£SB Its. and ,£IOO deposit held by A. D. Kennedy and Co., Ltd. He had a wife and four children to kee;..

The Trustee's Statement. A letter was read by the Assignee from Messrs. Af'Grath and Willis. The amount that fmn held was ,£379, being balance of money .received by them in trust on May 10 last.' Since the money had been received they had been served with noticesof .assignment from several creditors, and had also received an attachment order for the payment of part of the money, and a direction through the debtor to pay out sums greatly exceeding the amount in hand. A summons had also been served on them by A. I). Kennedy and Co., Ltd. (Wellington), for i; 73 %. Id., the, balance of money which they claimed, was owing to thorn.. Jlr. Stansell's solicitors had also asked for the payment of the money to the Assignee, but they (Messrs. M'Grath and Willis) had decided to avail themselves of the provisions of the Trustees Act, 1908, and pay the money into the Treasury. They had made ail offer to pay the money to the Assignee, providing they were indemnified against any possible loss; Tmt had received r.o reply from the debtor's solicitors to that. The Procssdings. .\ long discussion took p'laco as to the position in regard to the trust moneys held by Messrs. M'Grath and Willis. It was- pointed out that if Mr. M'Grath lodged the money with the Treasury a Supreme Court action would be necessary, with its additional expense, to secure it again to tho creditors. A cass was about to take place in the Magistrate's Court, brought by A. D. Kennedy and Co., Ltd., to recover some of the money from the present trustee, and Mr. M'Grath said that if Mr. Been.-, who represented Kennedy and Co., and other similarly interested persons, would agrcs to thc"Ofliral Assignee being substituted for himself as defendants in the case to Iμ heard in tho Magistrate's Court, ho would immediately give the Official Assignee a cheque for the amount of the trust moneys in his possession. After Mr. Beere and others had given this undertaking, the following resolution was moved by Mr. J. G. Stevens, seconded by Mr. W. J. Howell, and carried: "Tii.it the Official -Assignee be instructed to defend the action brought by A. 1). Kennedy and Co., Ltd., and that the Official Assignee conspnt t obe substituted for Messrs. M'Grath and Willis as defendants in the action." A resolution was also carried that tho moneys to be received from M'Grath and Willis by 'the Official Assignee, ou behalf of creditors, be held, to abide the result of tho action brought bv A. 1). Kennedy and Co., Ltd. Mr. Andrew Lees (a Lower Hutt creditor) pointed out that the debtor had purchased heavily from the Hutt tradesmen without paying them, and he thought bankrupt should bo examined to ascertain whether he had known his true position when ho did this. Mr. Luckie went lengthily into Stansell's past transactions and said that his present jHMtion was entirely due to unfortunate circumstances and undue pressure that had breli put upon him at awkward period?. Ho had gone into the Hailway Hotel, helped by pome of his old creditors to try to pull up. ' Mr. A,vsoii (rcprewiitins two Huft creditors) wanted to know why the debtor had gone into the hol'el owing at least .C2OOO. and lmd obtained credit all round the place.

The Assignee agreed with Mr. 4,v=nn When (he bankrupt went into the hotel he was insolvent and unable to meet his liabilities and it was a matter, in his opinion, for the Court to decide what had to bo done.

Mr. I.iicliic pointed out that Mr. 9tmisell had roho into his position carefully with some of his lareosi , predilnrs before Inkinrr over the hotel. He had been .■wisioii' to do ywetli'ii;; to pn:;l;Ic (lie Mvdilors to.lie nnid. Pnmo of them had lonn symuathotic ami lird even helned li'm. his desire to do what ho couitj.

Mr. Stevens, one of the old croililors, corroborated t'ni*.

Hi-. Aysou said this was all very well for the old creditors, but the position became rather hard for the J hilt creditors who hod though! Stiiiifi'll able t.» pay for what lie purchased. .Staneell alro Imil boon taking from .CIO to .£IOO a wed; in the Hotel and they should know what had been done with" Hip tnnnoy.

AFr. Brown (representin;; Laory and Co.) spoke in a similar strain. Debtor had even told him lie bad made money in the hotel. He thought if a- clever little bit of business 0:1 the part of the old creditors.

Mr. Lnckie said the old creditors bad found the nioiipy for liim to go into the hot'el.

Mr. Lees agreed that Mr. Luckie's explanations had disclosed that, the debtor had been unfortunate from the beginiiiut,'. Unfortunately (referring to Hie credit debtor had obtained at the. Ilutt) much business nowadays was done on borrowed mnuey in New Zealand.

The Assignee said he had not yet.had time to go into the estate, but he would do- so at an early dote.

Mr. Howell took exception to the inference that the old creditors had benefited. They had simply decided t'o help an unfortunate man to recover his position.

Mr. M'Monamen said debtor should not have bought so heavily at the Huff.

Mr. Arson declared debtor should have filed before ho went to the Hutt.

After further discussion it was decided to adjourn the meeting sine die, the Assipneo in the meantime to go into the estate and to defend the Court case next Tuesday.