SHEEPFARMER’S FAILURE

Evening Star, Issue 21718, 12 May 1934, Page 18

SHEEPFARMER’S FAILURE

ADJOURNED MEETING Of CREDITORS OFFER BY MORTGAGEES . . The adjourned meeting of creditors in the estate of Henry Stokes, sheep farmer, of Liuclis, was held .yesterday afternoon, the Official Assignee (Mr M. Adam) presiding.

The unsecured creditors were shown, at £7,953 18s 4d, and the secured creditors at £28,391 13s Id, the estimated value of securities being set down at £26,(341 13s Id. The total deficiency was thus shown at £9,703 18s 4d. The bankrupt was represented by Mr H. S. Adams.

Dir E. A. Duncan appeared for John Humphries and others, of Napier,; mortgagees of the Napier property, and Mr 0. J. Payne for Wright, Stephenson Ltd., secured creditors over the Liudis run. Tho Official Assignee said that his investigations showed that there was nothing in the Napier property to be recovered. The statement made by the bankrupt at the last meeting was identical with that made before tho commission in Hawke’s Bay when applying for relief. The only information he had with regard to the Napier property was that Swaiies Ltd. was not carrying oti in the same property as it' was at tho time of the earthquake. With regard to. the Tarrus property, .the, position was that apparently the partnership itself was insolvent, but under the partnership agreement when one of the partners went bankrupt the other two proceeded to get rid of the bankrupt.J f that were done it would he put into the hands of the other two, but apart from tho partnership the sons apparently owed their father £1.500. If tho sons went bankrupt that would disappear.

Mr Payne said that there were' two properties—the building called the Rita in Dunedin and the other properties at Tarras. There was no doubt that the mortgages on the Tarras properties were greater than the value of the securities, and that being so the partnership was uiifinancial and i-eally, bankrupt. .On tichalf of the mortgagees he would say that, they considered that the Stokes’s had got into this difficulty because of the earthquake—that was the foundation cause of their difficulty —and the mortgagees were quite willing that the sons should be given a chance. If the young fellows could get hold of the property the mortgagees would agree to allow all the mortgage moneys to remain, and trust the Stokes sons to pull through. This would give the sons a chance of making good.The mortgagees considered that the Stokes boys worked so hard and well in this matter that they .considered the boys should bo given a chance, and for that reason they would allow;-their moneys to remain. If the two sons were, willing to take over the Tarras properties ynd indemnity . the father against all the partnership debts then the assignee could relieve the partnership from any moneys owing by the partnership to Henry Stokes’, the partnership relieving Henry Stokes front all moneys owing by him in respect of any deficit in connection with the securities. That would mean that there would he no further difficulty with respect to the Tarras properties, because they would be carried on by the sons,He understood that the largest creditors were anxious that the Ritz .should Be carried on, because tbere.ivas a prospect of it being an asset. If the suggestion he made was carried out it would mean' that the Ritz could be carried on iby the Henry Stokes’ estate and become a valuable asset. Mr C. W. S. Cox (Bank of NewSouth Wales) said that the matter had been placed before the bank, and in connection with the runs it authorised .him to consent to release the, Stokes sons. on the lines suggested by Mr Payne, on the understanding that if they made good they would make some gratuitous payment to'the estate* Mr Duncan said he had no instructions from his principals to agree to any proposal, and all he could do v-'aa to report to them. They were told by Dir Payne that there was no equity in the Tarras property, but Ik; did not know that the matter could be thrown out so quickly. Ho desired to know if there were any dropping back or increase of stock.

Mr Payne said that there was ;no doubt the stock had been depleted. Mr Duncan said that he'would suggest to his principals that unless they were prepared to put up the money to obtain an independent valuation cf (ho run they would have to fall in with the suggestion made by Air Payne. After further discussion it was 'decided to leave the matter in the assig. nee’s hands to wind no the estate. ■