CAMP CATERERS

Hawke's Bay Tribune, Volume XXVI, Issue 283, 13 November 1936, Page 5

CAMP CATERERS

Creditors Consider Their Bankruptcy BOOKS TO BE EXAMINED After withdrawing a motion that the Crown Prosecutor investigate the position of the partnership with a view to prosecution, the meeting of creditors in the bankrupt estate of Lawrence Frederick Mooney, William James Hyde and Phillip McCabe, trading under the name of Mooney and Hyde, decided to adjourn the meeting to enable the books of the firm to be examined, and their report prepared. The meeting was attended by over 20 creditors, of whom in addition represented other creditors. During the proceedings suggestions were made that the bankrupt Mooney had indulged extensively in gambling, but bankrupt maintained that he nad had no knowledge of the financial position of his partnership until shortly before the petition was filed. The official assignee, Mr G. G. Chisholm, in opening the proceedings, stated that business was commenced four and a half months ago by the first two bankrupts, and that shortly afterwards Phillip McCabe entered the partnership. At the time of the bankruptcy the partnership was catering for five camps on the East Coast Railway. A statement by the bankrupts, showed that the average weekly income from each man was not above 18/-, and that the average overhead expenses of the business were very high. When pressed for payment of an account by Ellison and Duncan they finally paid and did not anticipate being unable to carry on. Insufficient initial capital, contracting for catering at too low a charge and heavy overhead expenses incurred in operating the five camps were the reasons to which they attributed their failure. CAMPS WITHOUT FOOD. ■ “No provision was made to supply anything to the camps when the business failed in bankruptcy,” said Air Chisholm. “One camp at Tutira complained that it had been without food for some days, but had collected all payments due up to the day of the bankruptcy. We have collected £248 2/1, most of it meal money due from the men. The £350 estimated as stock in the camps was hopelessly out. I don’t think/ the stock in all the camps was worth more than £5O. I don’t see that there are any more than a few pounds yet to come in.” Mr Chisholm added that when the business was closed by the creditors under the supervision of Mr J. McLellan a motion had been passed making debts incurred after this point preferential. If' the present meeting confirmed this there would not be enough money to pay them. A motion to this effect was moved by Mr S. H. Hindmarsh, and seconded by Air F. 8. Swan and carried. • Examined by Air Chisholm, William James Hyde said that the camps were established in the order Waipunga, Glengarry, Tutira, Raupunga and Double Crossing. The original arrangement when there were but three camps was for Afooney to supervise Waipunga, witness Glengarry, and McCabe Tutira. Each stopped in his camp until the arrangements became impossible. because of the pressure of business. Witness then became the organiser for all five

.eens in the camp were in the cic of the partners if they were present or otherwise in charge of a man appointed by them. At each camp there was a chef, a second cook and two assistants to feed an average of 42 men at the larger camps. The partners took as wages £5 a week each, but this amount bad not been received in full for a short period before the bankruptcy. Witness drew an extra £1 a week as board owing to the fact that he had to keep a, house in town and it was mutually agreed that he should draw enough from the partnership to bring his wife and family from Wellington. Travelling expenses, he added, were rather heavy, £4 PROFIT IN TWO MONTHS. ' All takings were not banked towards the end of the partnership and though all should have been recorded this was actually not done, thus the bank hook did not show the full amount of tho takings. The accounts were never examined with a view to determining the financial position of the partnership. When it had been iu operation for about two months a proht of £4 was shown on a statement prepared by the bookkeeper. “The overhead expenses must have been very high,” commented the assignee. “Did you guess the cost of catering for each man or work on an estimate?” “I worked on the estimate of what it used to cost my brother in Tawa Flats,” was tho reply. “I don’t think the deficiency could all have been caused by undercharging. There must have been leakages in some of the camps, but it is very hard to prove," Mr. C. W. Nash, representing the bankrupts, said that Mr. McLellan had compiled a statement of the assets and liabilities of the partnership, the main difference between this statement and that presented by the official assignee being the amount of £350 listed as stock in the camp. Mr. McLellan stated that the bookkeeper had prepared that estimate. She had taken an inventory of tho stock in the storeroom at Napier, and of that in the first camp, basing her calculations for the other camps on the figures she obtained there. She had stated that the estimate was a conservative one. “When the figures were supplied they were believed to be correct,” said Mr. Nash. Questioned by Mr. A. S. Tonkin, Mr. McLellan stated that the books kept by the partnership included one which might have been called a cash book, but it was not kept in the usual manner. QUESTION OF LEAKAGES. “I want to got at the question of leakages. Could any of the staff have taken cash in the ennteen and pocketed the monev 9 ” asked Mr. Tonkin. “It could not have been cheeked, but I think that in some cases it did happen,” said Hyde. Did the bookkeeper tell you that you were losing money nt flic rate of £l2 <o £l5 a moiitkt’—'‘No. She after ve had been going about three months

that wo had been losing money, but had every chance of picking it up.” Because seven years ago at Tawa Fiats it cost 14/2 to feed a ma», you, starting seven years later, with rising prices, work on the same basis!— “Prices were higher then.” You were trading on a shoe-string, weren’t you,—“Yes, to a certain extent. ’ ’ “Mr Hyde must have realised that he was insolvent at the end of August,” said Mr Tonkin, “yet -ho wont on trading without reference to his creditors.” Mr Nash: When a new partner was about to come in he asked for information from a public accountant, who looked upon the offer as ft good business proposition. Mr Tonkin: Did be examine the books? Mr Nash; No. Mr Tonkin: The point I am getting at is that these people were insolvent and knew that they were insolvent, but still continued trading. Thera is another point I want to get at and that is, are you, Mr Hyde, in the habit of gambling? Air Hyde:. No more than anyone else. WIFE HAS TWO CABS., .How many cars have you!-—“My wife has two.” Where did she get those!— “From her own money. From money J gave her.” Did not a prospective partner not enter the business because of your reputation as a gambler! — “The man who was putting up the money heard something from someone else.” And you have a nice taste in sherry! —“The money I spent on that was on my own personal account.’! What is the greatest amount you have owed a bookmaker since you commenced business!— “On my own account, nothing. At one time before I started it was £21.” ' Air H. B. Lusk: About two months after you started you found that file money you were taking wag not su’ffi- > , cient to pay your accounts! Bankrupt; It was sufficient to pay the accounts presented to me. Why didn’t you call in the creditors — then?—“Because I thought the business could be carried on successfully.” Mr H. Ellingham: Why did you come to; us for flour after trading with Nathan’s and Ellison and Duncan’s? • Bankrupt: Because they both told us ! we could get it better from you. Mr. H. B. Lusk: I suppose you fail to appreciate the compliment now. INTEREST UNDER WILL. Mr. Tonkin: Have you, Mr. McCabe, any interest in a Public Trust account or under a will? Mr. McCabe: I have two-eleventh« of a £lOOO on a third mortgage. Air. Tonkin (to Mr. Mooney): Have you any shares in any company! Mr. Mooney: None that are not. dis-, closed in the statement. Mr. Redstone then moved, and it was seconded by Mr. J. D. Martin, that the official assignee place the facts before the Crown Prosecutor with a view tq ascertaining if there were sufficient grounds for prosecution and if this was the case to collect evidence against the person or persons concerned. <' It will be practically impossible for me to do this without a thorough examination of the books,” said Mr. Lusk. The motion was therefore withdrawn and another passed adjourning the meeting and authorising Mr. McLennan to examine the books and prepare a re‘pprt for a subsequent meeting,