BANKRUPT IN COURT

Hawera Star, Volume L, 24 July 1930, Page 9

BANKRUPT IN COURT

EXAMINATION BEFOREI

MAGISTRATE..

MORTGAGES O'N PROPERTY

Following two -previous meetings of creditors wnich failed to draw a quorum a court examination in bankruptcy or the estate of Hugh Chevalier l v ake, bricklayer, was held before Mr J. H. Salmon, S.M., in the Hawera Court yesterday. Tne D.O.A. (Air li. S. _,age) was ill attendance and Air E. Al. Beechey. appeared for the creditors. Bankrupt was an attendance with Mr L. A. Taylor as counsel. “No dissatisfaction was expressed at either of the two meetings o-f creditors called,” said Air Taylor before the examination opened. Counsel wished to make it clear to the court that bankrupt had not been brought to the examination through any fault of his own in the matter of affording information to his creditors. He had already given them all information possible.

Replying to Air Beechey, bankrupt said lie had nor known of Ins impending adjudication in bankruptcy until a few days after its enactment on May 31. le admitted having, received £24 on that day from tho Hawera Opera House. On the date of the first meeting of liis creditors he had not made a statement of his. position. “I did. ll know it was on until I saw it an the paper,” continued bankrupt. “I received no official warning and attended the meeting voluntarily.” The debt on which he was made bankrupt related to his South Road property which- was mortgaged' to his father for £1250, with a second mortgage for £SOO held by the Pease trustees. He paid no interest oil the mortgage to his father. He paid a certain amount on the second mortgage, but in July 1929 he was. behind and the trustees moved against him. Bankrupt then communicated with liis father.

Bankrupt contended he had taken over a worthless mortgage of £SOO for the Pease estate when he acquired the property He had difficulty in securing possession, and, when lie did so liis capital was exhausted. In view of that his father said, he would not press him to pay interest on the first mortgage. Bankrupt then continued paying on the second mortgage, hut not on the first. His father had asked him to pay the interest if he could. It was. incorrect to state that his father had never- approached him on the matter of the interest. Bankrupt did not inform the Peas® trustee that lie owed money on the first mortgage, but, when £353 2s 6cl was owing on it. lie knew that the Pease trustees had purchased the mortgage, principal and interest, for £I4OO. On August 8, 1929, bankrupt agreed to leave the house on August! 9 and informed the trustees lie had another place to go to. When the prosective purchaser of the former property came with, the intention of erecting; a. fowlhouse, bankrupt did not refuse to let him on the place, though lie advised the. purchaser not to. start building. Bankrupt left the place in the first week in September. He denied having .refused to go on August 19, but admitted he did not give possession until a. Supreme Court order was made. Mr Beechey: Had anything happened between August 8. when you said you would l go out on the 19th, and the latter, when you refused to go? Bankrupt: No. 1 couldn’t say definitely why 1 did not go out then. 1 11 was probably a matter of convenience.

I suggest to you that the fact of your assigning your legacy under your father’s will was the- reason?—That is not so.

It was because lie wanted ready cash and) not necessarily because of the debt to the Pease trustees that h.e sold his interest in his father’s will for £IOO, continued bankrupt. He did not know exactly the value of his interest in his father’s will, but as lie needed ready money lie considered! it better to take Lbe £IOO wliic-h lie could obtain from his uncle than to wait lor his mother’s death before realisation of the legacy. Asked to. explain a subsequent letter in which lie said he had hoped to have before then been able to realise liis share under his father’s will, bankrupt said the statement was made in the liopie that lie would eventually be able to purchase the legacy back from bis uncle. He had, however, made no arrangement to that end with bis uncle. He denied the suggestion that the sale of the legacy was made with the object •of defrauding the Pease estate trustees as liis creditors. When on May 31 he received £24 from the. Opera. House lie did not know he was bankrupt. The greater portion of it had to. go for materials and the whole was spent before he knew be was bankrupt. “Don’t try to rush me off my feet. You know what you are talking about, but I’ve got to think,” said bankrupt to Mr Beechey in further examination. The Magistrate: You will get along much hotter if you will keep l calm and not talk so much. Als a. bricklayer he had been given a considerable amount of work after the earthquake of June, 1929, continued bankrupt, but he. could not show evidence of bis total receipts and expenditure from then until the date, of bis bankruptcy as he did not keep" books. He carried on a cash business and though he contracted certain debts for

materials he. did not record the accounts in the usual books. •Mr Beechey: , 1 put it to you that since July, 1929 you have purposely kept no records of your transactions. Bankrupt: I can’t agree to that. Replying to Mr Taylor, bankrupt said that before the Pease trustees purchased liis father’s mortgage lie met Pease’s solicitor and gathered that it was thought the second mortgage, in the light of a recent valuation, was worth nothing and would drop out. He then thought he would: be free to dispose of his interest in liis father’s will. Bankrupt did not consult his solicitor concerning his disposal of the interest in the estate. ,