A STOCK-DEALER'S BANKRUPTCY.

Evening Post, Volume LXXX, Issue 84, 6 October 1910, Page 3

A STOCK-DEALER'S BANKRUPTCY.

». QUESTION OF FRAUDULENT PREFERENCE. SUPREME COURT DECISION. Reserved decision in the case between! the Oflicial Assignee in Bankruptcy of the 'property of Frank Futeher, bankrupt, and Abraham and Williams, Ltd., respondents, was to-day delivered by Mr. Justice Cooper. The case was an appeal from the District Court, Pahiatua. Tho Official Assignee (appellant) moved the District Court to declare that certain payments alleged to have been made to respondents by bankrupt within three months of the bankruptcy were void, on the ground that they amounted to fraudulent preference. The court dismissed the motion with respect to all the payments with the exception of one payment of £100, which was alleged to be m respect of certain bullocks and drays, which the respondents claimed to I have received " and subsequently sold to j a man named Burling. In respect of these bullocks, the court ordered that the respondents account to, the Oflicial Assignee for all moneys received by them on accontifc of ibheee bullocks and drays, and that any payment made to the respondents on account thereof should be declared fraudulent and void. The Official Assignee appealed against the judgment of the court in respect of three other payments. The circumstances revelant have been published before in The Post. Futeher was adjudicated bankrupt an 27th August, 1908, upon a creditor's petition. Substantially, the question for the court was as to whether these payments — £5 6s 9d, £188 4s 6d, and £245 Is 6d— were fraudulently preferential. In respect to a sum of £30, the appellant .rested his appeal in relation to that on the ground that the property in it had vested in the Official Assignee before it was received from respondents. The item £5 6s 9d was a credit for some, small lots of stock sold by respondents in ordinary course of business on account of debtor. The item £188 4s 6d was the price of sheep belonging to the debtor sold by the debtor himself to one Tucker, and paid by Tucker to Messrs. Smith and M' Sherry, solicitors, and by them paid to the respondents on the sth Juue, 1908, _nt the request of the debtor, and credited by the respondents to the debtor's account. The item <£245 Is 6d was the price of sheep belonging to the debtor, and sold by the respondents on behalf of the debtor, and received by them on the 2nd June, 1908, and credited by them to his account. It was pointed out that the debtor, who dealt largely in stock, had been financed for some years before his bankruptcy by respondents, who are stock agents, and auctioneers. Before the Oflicial As-* signee in examination, the debtor said he kept no books, that respondents had never pressed him for money, and that •he discovered he was insolvent just before the presentation of the petition. This evidence was contradicted- His Honour held that the onus of establishing fraudulent preference rested upon the Oflicial Assignee, in the present case he was of opinion that this had been proved in two paymeaits — the first two cited. In the case of the payment of £245 Is 6d, his Honour hfld it, after reviewing the evidence, to be a fraudulent preference. As regards the £30, the court hefd the order amounted to an equitable assignment. "In; the result/ said his Honour, "I dismiss the appeal so far as it relates to the payments of the sums of £5 6s 9d, £184 4s 6d, and £30, and in respect, of the order concerning the bullocks and drays, and allow ft -in reference to the sum of £245 Is 6d, which sum I order the respondent* to ipay to the Official Assignee in Bankruptcy. 1 ' No costs were aJlowect. Mr. C. P. Skerrett, K.C., appeared for appellant, and -Mr. M. Myers for respondent.