IN BANKRUPTCY.

Manawatu Standard, Volume 9162, Issue 9162, 11 March 1910, Page 5

IN BANKRUPTCY.

PUBLIC EXAMINATIONS

The Supreme Court, his Honor Mi Justice Sim presiding, sat to-day to hear bankruptcy business. The public examination of Stewart McClelland, late hotelkeeper at Ashhurst, was called on first. Mr Fitzherbert appeared for the D.O.A. Mr Cooper ' appeared for the creditors and stated that negotiations were in progress with bankrupt's wife for a settlement. A meeting of creditors had just been held, and a compromise would mean something for them. Counsel therefore asked for an adjournment. This was granted. William James Pye, bankrupt, of Rongotoa, was next examined, Mr Cooper appearing for the D.O.A. Bankrupt said he was a carpenter working at Rongotea. His assets, as shown, were £309 and debts £341 17s lid. The statement of assets showed the furniture to be worth £15. He admitted having insured it for. £100, and had given its estimated value to the insurance company at £130. Some of the furniture was claimed by his wife—about £20 worth. That, he admitted, did not account for the difference. He kept a day book and a ledger; a small wages book and a pass book. He never kept any record of what moneys he owed. He never made up a statement at any time before his bankruptcy to find out how he stood. He started in business in March, 1908, as a builder and contractor, with a capital of about £7. His first contract was for £230, but, he did not receive

' nil the money. That was finished about July, 1903. 'Tho next was for £304, and then came the Bank of New Zealand £190 (with £36 in extras), followed by Wischung's £270, which was in May, 1909. The last contract was with Hamlin for £65. So far as he knew he only lost money on the Bank of New Zealand contract. Ho wasn't sure about tho rest. He secured land on lease with a purchasing clause, and built a house worth £340. which was finished in May, 1909. Ho tried to borrow money from Mr Richmond, and knew that if he did not got it ho could not pay his debts. Ho insured his furniture in April, 1908, and it was not done to assist in getting a loan from Richmond. In August, 1909, a private meeting of creditors was held. Before that he had given Amesbury Bros, orders on various people who owed him money. Amesbury Bros, camp to tho meeting and put their claims in in full. They knew that a meeting of creditors was being called when they asked for the order. He gave them the order because they would not go away without it. They told him that one of the creditors was taking cut a distress warrant, and would take all his furniture, and they asked why they could not have a share as well. He had been told that he could stay in the house after his bankruptcy. so long as he paid the rent. He had not paid the rent. In reply to Mr Guy, who appeared for the bankrupt, he stated that he had not paid the rent because Broadbelt had said it was to be paid to him and no one else. The D.O.A.'s representative had valued the furniture at £25.

His Honor made an order declaring the public examination closed. A summons waa issued by John Glover (Mr Fitzherbert) against the D.O.A. in the above bankruptcy to show cause why an agreement for sale should not be cancelled and an order made for possession of the property to be given to Mr Glover. Mr Cooper showed cause for

the D.0.A., and after hearing argument his Honor stated that Mr Glover would not be prejudiced by the bankruptcy, and would ultimately receive all the moneys payable under the agreement. The summons was therefore dismissed with costs, £3 3s.

Albert George Steward was next examined, Mr Fitzherbort appearing for the D.0.A., Mr Innes for one of the creditors, and Mr Cooper for bankrupt. Bankrupt, "in reply to Mr Fitzherbert, stated he was adjudicated bankrupt on December 17, 1909. His liabilities were £2768 2s 9d, and assets £2719 2s lid. He had no other liabilities besides those included in the statement. He commenced business as a tailor in 1905 with a. capital of £200, with part of which he bought stock. He did not understand book-keeping himself, and up till 1907 his books were very simple. Ho then got a new set (produced), which Mr Walker, an accountant, kept for him. At that time he had about seventeen or eighteen hands. He was tailoring only at that time, and kept about £1000 worth of stock in hand. The books produced represented a true statement of his business. He did not know why a profit and loss account had not been kept. He used a ledger, day book, cash book, order book, bill book, and bank book. He estimated he was making a profit of £250 a year. In May, 1909. bankrupt supplied a balance-sheet to Dickerson and Co., his principal creditors, and that showed a balance of £1700. That balance-sheet was up to August, 1908. He gave another in July, 1909, which showed a balance of £1083. The difference- he accounted for as follows: —Loss in personal business, £381; loss on two clearing sales £100; loss on Weat street property £30; loss on Mr Delbridge (cutter), £75; law expenses, £65; interest on accommodation, £80; other interest, £28; making a total of £759 Is Bd. Between the time of hie second balance-sheet and the time of h'u filing, the balance of £1083 disappeared. He accounted for that by the fact that in the balance-shee-ts he had not included two loans, which he considered were not trade liabilities. They accounted for £330. He had nothing to do with compiling the balance-sheets, which were made out by Mr Walker, and he did not know why a number of amounts wore loft out. Ho did not know where the other money went to.

Mr Fitzherbert: Can't you give us any explanation of where tho difference has gone to? His Honor: Isn't the explanation that the first statement was untrue, .and that there was no balance at all ? Proceeding, bankrupt stated that when ke renewed the last bills at the end of 1909 he was under the impression he could pull through. Everybody else was renewing them about that time. He thought ho had a reasonable prospect of paying for the goods when he bought them then. He had reduced his hands; and had several prospective buyers for the Manchester street property. It was sold for £2250. His land speculations and ordinary business were transacted in one account. He was selling below cost for a considerable time, hoping that trade would pick up. To Mr Innes: Tho books kept prior to 1907 were, ho thought, sufficient to disclose his financial position. So far as he knew the books kept since were also sufficient. All moneys received were paid into his banking account except borrowed moneys. In the cheap sales he made suits for £3 10s. There was no actual loss on them. The loss came in advertising and working overtime. He was paying heavily for borrowed money, but thought the depression would soon bo over, and ho would be able to square up. Between the two balancesheets ho had reduced his liability to Dickerson and Co. by £100. (Left sitting.)