BUSINESS FAILURE

Northern Advocate, 19 June 1926, Page 6

BUSINESS FAILURE

OF SOFTGOODS, SALESMAN. MEETING OF (J KEDITOES. An account of liis business transactions since coming to Whangarei in March, 1925 , was furnished by William Henry Franklin at a meeting of creditors held yesterday at the oflice of the Deputy Ollicial Assignee, Mr E. F. Kamsey. Mr A. M. AVoods appeared for the bankrupt.

The financial statement revealed that bankrupt’s total debts amounted to £-108 2s Id, comprising £405 2s Id owing to unsecured creditors and two promissory notes totalling £3. The total assets were £lls 5s (id, including stock £lO 13s (id, book debts of £3O 3s estimated to produce £B, furniture £0 12s, and motor car valued at £9O. The deficiency was £299 ICs 7d. On being examined, the bankrupt stated that he was a softgoods salesman by occupation. AVhcn he first came to AVhangaroi he owed about £2O, and at the time could not pay that amount. He borrowed £IOO from his wife. The book ho kept contained a coireet record of all his transactions up to May 8 last. Any moneys borrowed by him did not go through the books. Ho put the £IOO borrowed from his wife through the books, but did not think it was necessary to do this with the other borrowed money. He kept a record of the amounts elsewhere.

■About the time bankrupt borrowed the monpv to buy a ear ho would bo owing about £IOO. He could not have paid up his liabilities thou, had he boon called upon to do so. Out of £1(30 which he borrowed from Elmsley he paid £lls for the car and a sum to Messrs Boss and Glen dinning. At the time ho backed certain bills he considered he was in a position to do so. Ho did not bank money borrowed from Wordsworth, but paid it into Court to settle an account. One Eobcrts of Onerahi sued him for rent, and H. E, Harris of Auckland brought an action to recover £lll. Bankrupt

did not disclose lo Harris fhe fact that he was in debt. Harris issued a distress wavrant ami seized the car about .Time I last. Emslcy knew bankrupt’s position, and it was only Wordsworth whom he told that he had a fair sum of money owing to him. He gave Wordsworth a written undertaking, about Apr il 23, to give him security over the ear.

Bankrupt owed a friend a sum of £sl) which he had not disclosed in his statement, as lie did not think it was necessary. It was a private arrangement. Bankrupt did not disclose his position to the friend, to whom he gave security over the ear, but it was not registered. He did not tell the friend that he had given AVordsworth security over the car.

In reply to Mr Briggs, on behalf of Mr Gray, a creditor, bankrupt said that ho considered the securities over the car both good ana valid. At the time he bought the car ho was not able to meet his liabilities, exclusive of the amount due to his wife. Air E. A. James: “On May 29 yon made a contract. Why did you make it you had no chance of praying it?” Bankrupt: “I did have a chance.”

Mr James: “It was a week or so before you filed, was it not? You gave mo your word that the account would be paid within the month.'’ Bankrupt: “The month is not up.” Mr James: “If you pay me now you will go to gaol. ’' Bankrupt: “I can't pay you now.” Assignee: “Wore you heavily in debt when you contracted the debt with Mr James ” Bankrupt: “Yes.” Mr James: “You never had the slightest intention to pay.” Assignee: “Is it not a fact that you were simply robbing Peter to pay Paul? Should you not have filed twelve months ago?” Bankrupt: “I was only owing a little money then —about £100.” Assignee: “How do you arrive at the other £350 owing now? Do you consider that you were. straight in your dealings ” Mr Woods: “You cannot make him incriminate himself.” Assignee: “Well, I will leave it to the creditors.” Mr Briggs moved that the Official Assignee take such steps a.s he considered necessary in order to deal with the bankrupt under the penal provisions of the Bankruptcy Act. The motion was seconded by Mr James and carried.