A SAWMILLER'S FAILURE.

Manawatu Standard, Volume XLI, Issue 9653, 19 November 1913, Page 3

A SAWMILLER'S FAILURE.

. A meeting of creditors in the bankrupt estate of Machael Hersey King', of Rauritnu, sawmiller, was held at the Deputy .Official office yesterday. Mr G J. Scott (Deputy, Official Assignee) presided, and there were also present or represented, Mr H. R. Cooper, representing Collett and Co. (Dannevirke),~ Bank of Australasia (Taumarunui), J. j\ Strang, A. McMillan and Co., Mr Wynyard, representing the Onehunga Sawinilling Co., Mr White, secretary of the latter company and Mr E. H. Crabb. Mr Walker was also present on behalf of 06llett and Co., and bankrupt was also in attendance. In his written statement bankrupt stated j&ykree years ago'he acquired a farm of 461 acres near New Plymouth, which was mortgaged for £4500. The farm had been badly neglected, and was in very bad order At that time he had something like £SOO cash, but after the fkst year he found this sum quite insufficient to work the farm with, and it took him all his time to pay the interest and rates, amounting to nearly £3OO annually. He tried to sell all or part of the farm, but could not ,get a cash offer, and after exhausting all 1 resources, including £550 advanced by Mrs King, and his-son's savings, amounting to £IOO, he decided that he could not hold the farm longer. Arrangements were made with Eggers and Co. to exchange 257 acres for their sawmill at Raurimu, to be taken over on January Ist, 1913. Owing to difficulty in obtaining necessary consents this was not done till April Ist, when everything was found to be very low run down. A new length of train had to be laid down before cutting could commence, as the stand'where the hauler stood was cut out and had to be lifted. This took the best part of two weeks. Only*, 66,325 feet for the monrh were obtained, and af the contract price of 6s 6d per 100. was barely sufficient to pay wages and cartage. During May bankrupt did fairly well, running out 89.222 foet, and in June 79,393 feet were cut About that time bankrupt carried out improvements which he con aidered would add twenty to thirty thousand feet to the monthly output with the same number of hands. These addition? occupied fifteen days, but the Julv output was only 41,414. Luck was against bankrupt, and at the end of July an accident happened to the log hauler, and in thf middle of August another accident happened. After repairs had been effected, and 5000 feet were being- cut per day, another accident happened on August 22nd, the hauler being again badly broken. Despite this 71,206 feet were sent away, the month having eight more working days te go, which would have meant another 40,000 feet. Bankrupt stated he was running single-handed most of the time, and he mentioned this to justify the cost of making the alteration and additions to tin mill. :

All along, bankrupt stated, ho had been very dissatisfied with the way the timbei was being wasted by excessive docking. and the company's man refusing to send away any second or \ timber. About the end of August he went to see the company's manager on the matter, but to hir surprise he said they would not take sce ; ond-class timber,* and he had instructed their man at the mill not to send it, Oi hearing this bankrupt went into his position, and after a meeting of creditors h>:d been held at Taumarunui, and a resolution passed asking bankrupt to file,' he die] so. With reference to the allegation that the Onehunga Sawmilling Company refusoc 1 second-class timber. Mr''White, represents tive of the company, denied this, stating that under their agreement the company was bound to aexept the second-class qualitv.

In answer to Mr Wynyard. bankrupt stated he did not think he could make t rery profitable business out of tho mill, but expected he could pay wages and ex pensos. He had seen Mr White on one occasion during August, and complained to him of excessive docking and not taking xway second-class timber. Bankrupt stated he had complained to the company's representative continually. He had offered the company several alternatives, to sell them tho mill, increase the price on the mil! output, or take the whole output. Mr White: I don't remember you offer ing the mill, but I told you we would not consider buying the mill.before you evo; offered it. Proceeding with his examination, bankrupt stated lie eomplanie'iT several times ir regard to the excessive docking, and although he had a clause in his agreement giving him the right to arbitration, he had not availed himself of it, owing to hie knowledge coming too late. There was still a £IOOO liability to the Government for the bush land, secured by four promissory notes, endorsed by the Onohung* Sawmilling- Company. The last promissory note elue had not been met on due date, only a portion of it, £l5O. An extension of time had been granted, but the company paid the amount.

To Mr Walker: Eggers and Company ran the mill for three months, and during that time the mill went to the bad £2OO. To Mr Wynyard, bankrupt stated Eggers received £2O a month.

In reply to Mr Walker, bankrupt stated he was supplying white pine at 4s bd. totara, riniu. matai and maire at 6s 6d. on trucks, to the Onehunga Sawmilling Company. He did not know this was an impossibility for sawmiliers. The company bought the whole output by the agreement, and took the second-class timIwr, which was a stumbling block to sawmillers. It was after interviewing the manager of the company, and on his alleged refusal to accept the second-class timber that bankrupt went into his position. He had. been losing 6d a 100 feet all round, taking into consideration wages, horsr feed, and fair wear and tear. In answer to Mr Crabb, bankrupt stated he had paid £llsO in royalties, and had cut 120 acres. *

Mr Walker stated that if Mr King could have sold his timber in open market he would have been alright, but he was tied to the company by his agreement. He eetimatod the mill was worth £3000.. At the meeting at Taumarunui the creditors had asked the company to take the mill over and pay them 20s in the pound. Mr Wynyarel stated the company did not need the mill: all they wanted was the contract carrieel out. He explained the company's position with regard to Eggers and the- transference to bankrupt. The company'"thought Mr King was a good business man, and would not have taken up the agreement unless he could carry it our; All the company did was to protect itself under its securities. Mr Walker stated the company launched Eggers on a project with nothing ahead of them but disaster.

Mr Wynyard: No. If so, why isn't Eggers a bankrupt? Mr Cooper: He got out of it in time. (Laughter.) Bankrupt: Eggers tvas continually losing and drawing on his resources, as he had money. Mr Walker : If Collett and Company had known of bankrupt's ruinous agreement they would never have sold him the goods. The meeting was then adjourned until this morning to.enable the Onchunga Sawmilling Company to make an offer for the mill.