“FORCED TO GO BANKRUPT”

Dominion, Volume 18, Issue 223, 20 June 1925, Page 22

“FORCED TO GO BANKRUPT”

SEQUEL TO DIVORCE CASE

PARTNERSHIP TRANSACTION QUESTIONED

A meeting of creditors in the bankrupt estate of James Leach, motor instructor, was held yesterday. The Official Assignee (Mr. S. Tansley) presided. The bankrupt was represented bv Mr. W. It. Leicester.

In a lengthy statement of his affairs bankrupt said that lie was 41 years of age, married, and had four children. He had been running a garage in Adelaide Road for eight years, and had been teaching motor "driving for the past seven years. In 1920 three cars were purchased on the hire-purchase system, the total cost being £1275 Bs. 6d., all of which had been paid except |BOI 9s. 9d. In November, 1914, Janies Watson paid £4OO for a half share of the business. Since that date bankrupt had drawn £6 per week, and Watson £4 per week. Of the £4OO received, £l5O was paid into the business for a working account; A. B. Brittain had been paid £lOO, and the remaining £l5O bad been used up in paying debts. “The direct cause of my present state,” continued the statement, “is the fact that I was cited as co-res-pondent in a divorce case heard last month, and, together with costs, the sun of over £3OO was awarded against me. lam unable to meet the judgment. and, in order to give the person to whom I owe the judgment an oppoitnnity of fairly investigating my 1 - position," I am forced to go bankrupt, and place my affairs in the hands of the Official Assignee.”. Had it not been for the judgment, bankrupt stated, he believed that he could have progressed in his business. Tile only secured creditor is B. Reynolds and Co., Ltd., £lOl 9s. 9d. The principal unsecured creditors are William George Chandler, £336 25.; A. B. Brittain, £320 Is. 3d.; William Magee, £53; 1,. T. Watkins, £6. All the foregoing were described as personal debts, while partnership debts of small amounts totalled £B5 9s. 9d. The estimated assets comprised Half share in business, £9O 17s. 6d.; book debts, £l5 465. 9d.; cash, £1 10s.; furniture, £l9, a total of £llB 3s. 3d., leaving an estimated deficiency of £679 9s. 9d.

Mr. P. W. Jackson (representing W G. Chandler) questioned bankrupt at considerable length regarding the partnership arrangement with Watson, and was told that Watson came into the business in November last paying £4OO for a half-share. The arrangement was carried on until June 1, when the partnership was dissolved. Mt. Jackson: Did you not state on oath at the Supreme Court that there was not a partner in the business since January ? Bankrupt denied having said so. You have said that in January you received £lOO for a hall-share in the business. Was that true ?—“lt is true—but I received it in November, not January.” Did you say you were no longer in business in May ?—“I wanted to prd j tect my partner.” Mr. Jackson (to the Official Assignee) ; I think this transaction of partnership wants looking' into very closely. The Official Assignee; You suggest perjury t Mr. Jackson: Yes, sir! :Mr. T. Cleary (representing J. Watson, bankrupt’s partner): Bankrupt's statement is correct as far as the partnership is concerned. Mr. Jackson then wanted to know what had become of the £4OO bankrupt had received from his partner, and ventured the opinion that the partner would have “to whistle for it.”

Mr. Cleary: The position is that £4OO was too much, for a half-share; it was far too much for the whole business.

The Official Assignee: That’s his loss. He must have gone into the business with his eyes shut. It can’t be said that there is any fraud about it. Watson did not haze to pay the monev if he did not want to.

After bankrupt had been examined by a number of creditors, the Official Assigtie-- said, that he would adjourn the meeting sine die, and in the meantime would get into touch with Watson, to determine what arrangements could be made