L. MORRIS’S INSOLVENCY.

Evening Star, Issue 14053, 7 May 1909, Page 6

L. MORRIS’S INSOLVENCY.

FIRST MEETING OF CREDITORS. A meeting of the creditors of .Louis Morris, of Dunedin, clothing manufacturer, was held in the office of the Official Assignee this afternoon. Mr W. S. Fisher (Official Assignee) presided. Mr F. Z. Moore appeared for the bankrupt; Mr Hawkins for Mr A. C. Hanlon ; Mr Wood House for the Commercial Property and Finance Company; and about twenty creditors were present personally at the opening of the meeting, of whom twelve had proved. •The schedule filed by the debtor shows debts to unsecured creditors £4,780 16s lid; debts to secured creditors £I,BBB, less estimated value of securities £920, this' item leaving a surplus of £968. The total debts are thus £5,748 16s lid. On the credit side are stock-in-trade, £700; plant, machinery, etc., £700; and book debts, £SOO, making in all £1,900, Deficiency. £3,848 16s lid. J

The unsecured creditors for sums over £lO are :—Bing, Harris, and Co., £1,333 4s lid ; Ross and Glendining, £3B 9s 7d; Butterworth Bros., £64 5s 3d; Sargood, Son, and Ewen, £23 9s; New Zealand Express Company, £2B 0s sd; Bank of ivew Zealand (for Ed. Webb and Son and Baxter, Woodhouse, and Co.), £63 5s 6d; H. C. Campbell, £2O 16s sd; Union Bank, £743 9s 4d; D. Moloney and Co., £35 10s 6d; John Mill and Co., £3l Is Id; A. and I. Bnrt, £l6 2s 9d; J. C. Seelye, £l9 3s 4d; Brown, Ewing, and Co., £24 7s 2dDr Gloss, £l3 10s 6d; W. Brittenden and Son, £lB 8s 8d ; ‘ Evening Star ’ Company, £l4 14s 7d; E. Driver, £479 18s 8d; F. King and Co., £367; R. Jamieson, £173 E. W. Bennett and Co. (Christchurch), £59 18s Id; Commercial Agency (Wellington), £l4B 17s 6d; Central Agency (Wellington), £lll 18s Id; Atkinson Bros. (Christchurch), £7O; Manufacturers’ Agency (Melbourne), £18; Munro, Clark, and Co. (Auckland), £6O; Asnburton Woollen Mills Company, £37 16s 8d; Mackay, Logan, and Co. (Auckland), £ao; H. M. Chisholm (Auckland), £22 11s 6d; Lade, Walker, and Ludkm (Ashburton), £44 9s sd; F. and R. Malcolm and Co., £lB2 2s 9d.

Ihe secured creditors are:—Commercial .Property Company', £1,400 {security £300) • A. C. Hanlon, £2OO (£180); D. M. Spedteii° 78 , (£120,; A - MU]er ’ £2lO (£320). Ait the above are secured with goods in bond, lor which they hold bond warrants. tnfnn that- there were sums of £SOO and £213 which had to be deducted irora the liabilities. They had been counted twice through a clerical error. This made tho liabilities about £5,000. A creditor remarked that about £l5O could be added on account of the British and Colonial Waterproof Company. The written statement by Mr Morris redds thus;— About twelve years aero I started business in Ross and Glendining’s building m Stafiord street. I had not been “ uslness /ery long when limes and M r ariane sold out in Dowling street, and Mr Baker and I became the purchasers of the business. We canned on for about , e years together, and things prospered with us until about the end of the fifth year, when we considered there was not sufficient profit in the business for two partners, and we dissolved, Mr Baker going to Invercargill. We had an accountant on part time with us in those days, who looked after_ our affairs and attended f the 0 . dissolution o: partnership, etc. omce dissolving with. lUr Laker until the present moment, some five years, I have been in business on my own account, and the whole of mv finance and accountancy' has been managed by the same accountant. He was r.-allv accountant ui connection with the business be.ore our time, we taking him from the service of Innas and M'Farlane, from whom Mr Baker and I purchased our business as above mentioned. I attended to the manufacturing part of the business and to obtaining orders, and my accountant insisted on having an agreement with me that I v.omd not interfere with the bpokkeoping or finance of the. business, he having full charge of all these, and as he had been go long connected with the firm, and was eo used do my class of business, I did not- interfere The first real tightening of mattexs with me .was when the Commercial Property Company intimated to me that my' account with them would be closed on their going into liquidation ; but I was assured that this difficulty would be got over by numerous accounts coming from the North Island and private accounts owing, for finite, etc. My accountant and myseif drew up an estimated balance-sheet” ten months ago. which showed £1.500 to the good, th© stock being estimated by me, and no one was more surprised than myself when I was asked by my largest creditor to go into matters with him, and, as a result, he informed me I would require to call a meeting of creditors. It might seem strange that I did not interfere with the financing or accountancy department of my business (personally I know 1 nothing about nooks), but I think that when you. bit, examine my accountant and go into matters with him, you will see prfma fade that I had a fair right to consider that he was competent and accurate in his dealings. He so impressed me with his ability and forethought that he had complete chai go of my cash, made all arrangements i\ith my bankers, with the Commercial Iropeity, with financiers, and otherwise, and received from me the sum of £260 per annum for his services. Had I had a youth, or a man not used to the trade, in charge of my affairs, I would have felt that I could not rely on his word, but I was assured that everything was goirm smoothly, tint the business was showing good profits, and that the tightness of tiie money market and the debts duo to me in th© Norik Island were tie only | causes of my having to feel the money stringency. In order to obviate this, I arranged to discontinue my North Island trade. I filed my schedule "to comply with a request of my creditors. I cannot give the slightest idea as to what were ’the causes of my bankruptcy. Mr Lilly owes me a large sum, but I cannot say whether or not I have lost money, about which I know nothing, through defalcations. In a further statement, replying to the Official Assignee, Mr Monte ” said : One cause _of my getting into my present position is my having been disappointed by one of my largest customers in giving to me a far less quantity of work than they had undertaken to give, and that necessitated my keeping hands on who were not anything like fully employed. I had to keep hands on during slack times, or they would not have been available when rushes came. As far as my books are concerned I state that the books of first entry—that is, those with which I had to do—are all complete. They were entered up and costed day by day. The invoices are all there, and the cash received by me was always entered either in the receipt books or in the rough cash register. These were then taken away and supposed to be made up by the accountant at his home. I swear that I have no property other than that set out in my schedule. J swear that I knew nothing about the bill renewed bv the British and Colonial Waterproof Company being discounted elsewhere, while the original bill was still in the hands of the Commercial Property and Finance Company, until Mr Steele told me in Auckland..

The signed statement by the accountant, Mr Ernest G. Lilly, reads thus; “ In reference to Mr Morris’s statement- re hie accountant, the accountant states that he has been exceedingly harassed and .worried over the finance of this business for some years, and it has taken so much of his time that the actual posting of the books, etc., was not ‘ carried out. The books were run on the basis of working from invoices and- notes made on slips of paper. The receipt book, of course, showed all payments received and by whom they were received. Tie accountant states that the financing of the business for the last five years has been of considerable magnitude. and caused a great deal of worrv, anxiety, and trouble", and that the payiim of wages and otherwise doing the busfness of the firm was enough to keep a competent man fully employed. What really was required in the’ firm was a ledger-keeper in addition to the accountant. The accountant states that Mr Morris has always showed a high appreciation of his services, and of his financial ability to carry matters through, and has often expressed his appreciation personally both

by ■word and deed. The accountant states that he_ was always hopeful that matters would improve with the firm, as there were always good profits in the business.” The meeting was proceeding at 3.15 p.m.