£38,692 DEFICIENCY.

Gisborne Times, Volume LXVIII, Issue 10733, 2 November 1928, Page 3

£38,692 DEFICIENCY.

SHEE P F Alt AIEII ’ S BANKRUPTCY

ESTATE OF J. R. AITJRPHY*.

Showing an estimated deficiency of £38,692, John RowJey Murphv sheepfarmcr, has tiled a petition in bankruptcy. Unsecured creditors total £.j9,937, while secured creditors are covered to the extent of £27.659; The assets are estimated to total £1245.

Jn hrs statement to the Depute. Official Assignee (Air Chas. Blackburn,), bankrupt says:— “I commenced sheepfarming manv years ago, owning a two-tnircis share in Tangihau station of 15,1.57 acres, my father owning the other third. In six years I had broken in 9009 acres and ibe property was almost free of mortgage. 1 next purchased a property at Bepongaere and at that tune it was a good investment. 1 subsequently sold half at the price of the whole, and later on part; was purchased by the Government, and i. retained 100 acres. In the meantime I purchased an East Coast station which was then a snip, and I could have turned it over at a substantial profit. I-leased from native owners a property at Taneatua, comprising approximately 8060 acres, and spent a large amount of money in felling bush, sowing and fencing. I next put chased a Wairoa station in a rough state, and I intended to clean it up and sell again.. When mv father died, I bought his share in the Tangihau station at £l3 psacre; and the stock at the then high ruling prices. I was a guarantor for Frank Lowndes and Son at the Bank of New South Wales; I guaranteed another man in. connection with a property at. Kopuriki, in Galatea, and I was one of the "guarantors at ;the.National Bank to secure the moneys raised to purchase the Admiral Codrington. I was further a guarantor in connection with the East Coast Eellmongery C 0.,. Ltd. All these guarantees have proved a very heavy burden.

“At the time of the slump, my position was quite sound, and continued so on account of Tangihau. Coast and Wairoa stations making a profit up to the end of the year 1925, when the continual low prices for our products and the effects of the various guarantees I had entered into made themselves felt, and I had difficulty' in meeting interest and other payments. Tile various mortgagees, however, extended consideration, and I was able to carry on.

“In the early part of 1926 my properties were revalued, and the result was that Tangihau was valued at £14.5,886, the Coast station at £51,636 (first mortgage being £3i 500), Bepongaere at £27,800, Wairoa £25,429 (mortgages £26,000), Tancniua £12,250 (mortgages £5360), and mi Aberdeen road house £3OOO (mortgage £ls€o). Tangihau and Itopongaero were under first mortgage to trie bank, which also held a first charge over all my stock, valued at £67,000, sub-mortgages amounting to £12,600, and a first charge over by ,interest in my father’s estate; at that time valued at £IB,OOO. T owed liio bank £179,000, and its firstcharge 'securities amounted in value at its own valuer’s figure, to £268,400, and in addition it had collateral second-charge securities. I decided in order to reduce liabilities, to try and realise, and thoroughly reorganise my affairs, evidencing my desire to meet the position .in the best and most practicable manner. My host managers w-ore put in the lies’ places, and I shifted to Tangihau at once, assumed tile control of that place, and placed Bepongaere in the market. I attempted by hard work and 'economy. to "work out of 'mv'difficulties. 1 was unfortunate enough to he burnt nut at Tangihau in the early part of the winter of 1926. which increased my difficulties, but 1 soon contrived to re-erect a sufficient place to live in, and later rebuilt the bouse, in August of that year I sold Itepongaero for £19,659, receiving £3900 in cash, which went to the hank. This turned an unprofitable nsset into a paying proposition to the extent of interest on the full amount of the purchase money, a very decided improvement in my position. “The bank had intimated its intentiorT’oT, selling the stock on Wairoa and other "places during the coming season, and this was done in February, 1927. I now, of necessity', caused the mortgagees to be acquainted with my position, with a view to asking them to take over the respective properties, leaving me with some liability to pay in the future when I was able. This was necessary, owing to my obvious inability to stock the places once the stock had been "taken off. The result, brieliy. was that the bank saw its way to carry on the Coast station fbr another'year, i.e., until February, 1925. The mortgagee of the Wairoa place was unable to finance taking over this, property, the stock was sold, and the place loft idle and unstocked. The same result took place. at Koupnriki, and at Taneatua. the native owners accepted a surrender of their - leases, leaving me with the liabilities. 1 was thus left with the respective liabilities and the properties unstocked. Although the load was a heavy one, each and everv creditor was most considerate, and I poped to work at a substantial profit each year, and in time obtain a sale of Tangihau at a price which at least would have paid a substantial dividend to everyone. I arranged with the mortgagee of the Coast property to take it back, and lie bought tb«* stock at valuation, thus'further reducing the bank account by a large cash payment. “After the sale of this stock, there was owing to the bank £133,000. for which it held good securities totalling £203,486. I was then informed that the bank intended to sell me up. ' lowered the price to a; cheap figure hoping thereby I might be able to save something, but I was unable to sell. The bank sold the land and stock together for £115,C00. There was practically no bidding, and the bank itself bought in the property and stock at this figure, and now it would seem that the balance of mv assets will just pay the bank the bal ance owing to it, so that- there ’= very little left for mv creditors, except the few small items ■ shown in niv assets as unencumbered. “As 1 have no profitable assets left. I have no means of working to meet my creditors, and I am therefore compelled to file. I regret very much my position, and the loss others will suffer as a result of my misfortunes.” Unsecured creditors are as follow: Gisborne: Hydro-Electric CoyLtd. £414 5z 3d. Gisborne Sheenfarmers’ F.M. and 51- Co. £1532 is lid, 8.8. Farmers’ Mont Co. £4o6i>. E. E. Chrisp £7500, Bank of N.S.W. £5009, Contain W. S. Hayes £2OOO. National Bank of N.Z. (surplus over security) £4241: Tolaga Bay- E. B Roland £4000: Wan-on: C. C. P Brandon £6000; Whakatane: J. M. Broingan £750; Napier: Onuond s Trustees £6OOO. The total of these is given as €39,937 13s 2d. but tin <= individual Items total up to £2060 more than that figure. Secured creditors are: Bank of Australasia £21.900 (estimated value of security £27.659). National Bank of N Z. £5759 (balance of debt, covered bv the estimated surplus of the security over wh-'rh the Bank of Australasia has the first charge). Ken] estate owned V»y the hnnkrnnt is set down as £155. the estimated value of two small sections, hut there is a mortgage charge of apnrorimateIv £IOO on one of these. The figures in this instance appear in error, as

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