A FIRM'S AFFAIRS

Evening Star, Issue 21825, 14 September 1934, Page 11

A FIRM'S AFFAIRS

MESSRS OSWALD M. SMITH AND COMPANY WOUND UP ORDER MADE BY SUPREME COURT £15,000 OWING 70 UNSECURED CREDITORS The Well-known comply' of Messrs Oswald M. Smith anti Co. Ltd. "as this morning wound upby oidci ot Wis Honour Mr Justice Kennedy in the Supreme Court, it being stated by counsel for the petitioning creditois that £15.000 was owing to unsecured creditors. , . " Mr A. C. Stephens appeared in support of the petition for winding up. 1 Mr F B. Adams stated that, the papers served upon the company having conic into bis bands he therefore appeared on behalf of. the company. Haying no authority really, he would merely say that he did not oppose the oida asked for. The only point lie wished to discuss was in regard to costs, and he suggested it might be better to reserve that matter to see if these proceedings were necessary or would serve any useful purpose. His reason tor that was that as an affidavit showed the Electors of the. company were themselves prepared for the company to go into voluntary liquidation. For thmb to be done it was necessary for the dn octo s to convene a meeting, of sharcholdeis and creditor 'under fbe new statutfi and for a statement, of the aftans ot the companv to be prepared. Heyas not aware that there was any distinc tion between one form of winding ip and another. In the matter ot the examining of directors there was no distinction. Vn one case the liquidate! appointed would be the Official sjVncc and in the other case the liquidator would be appointed bv the creditors, who would have to find his rc numeration. . ~.. , Mr Stephens said the petition for winding up -"as brought by Messrs Aulsebrook and Company Ltd.. Messrs Cadbury, Fry, Hudson J.mutcd the Dunedin Brewery and Malt Cxlract Company Ltd.. M‘Leod Bros. Limited and the Taien and Peninsula Milk Supply Company Ltd. As there was no opposition to the application* connsel took it that the petitioners merely, had to satisfy the court that the preliminary conditions had been met. and further to make out their ground tor winding up. . .. , His Honour said ho was satisfied as to tlie necessary formalities. Mr Stephens said that, under section 169 of the Companies Act, a company could be wound up by the court if it could not pay its debts. Section 170 said that a company should be deemed to be unable to pay its debts if it were proved to the satisfaction of the court that it was unable to do so. , , . “ Thcrtl is failure to pay debts owing to the petitioners, as set out in the petition, amounting to £6.485,” said Mr Stephens. “ Those debts are all due and have not been paid.. The company has given debentures to the Bank of New Zealand, and under those debentures a receiver has been appointed.

. . . The directors expressed a willingness to go into liquidation voluntarily, but that proposal was not acceptable to the creditors. Further, a number of cheques have been dishonoured. and there are altogether unsecured creditors to whom £15,000 _is owing, and no assets to meet them. Mr Adams said it was admitted that the company was insolvent. Mr Stephens said the creditors knew there were no assets to meet the unsecured debts. .It was only in the interests of commercial morality that the step had been taken, and the creditors wished to have as much publicity as ■ possible given. That was the reason why such a form of procedure had been adopted. In regard to costs, it was not proposed to ask for an order because thev did not sec any hope of getting them. The assets were entirely secured, so there was nothing out of which costs could be paid. The creditors had provided a fund to carry on the proceedings. “ The petitioners are entitled to the order asked for,” said His Honour. “ An order is made that Messrs Oswald M. Smith and Company . Ltd., bo wound up under the provisions of the Companies Act, 1933.”