SUPREME COURT.—In Bankruptcy.

New Zealand Herald, Volume XI, Issue 4075, 4 December 1874, Page 1 (Supplement)

SUPREME COURT.—In Bankruptcy.

Thursday, 3rd December. [Before His Honor Sir G. A. Arney, Knight, Chief Justice.l An adjourned sitting was held this morning, for the following business : — Re George Thorne, jun. — Mr. W. Thome, solicitor, appeared on behalf of Mr. Whitaker, counsel for the bankrupt; Mr. MacCormick for the Bank of New South Wales. Mr. Hesketh appeared for Parbury, Lamb and Co., of Sydney, and examined the bankrupt relative to his dealings with that firm.—Bankrupt examined by Mr. Hesketh, further said : I commenced bu Q iness as Jolin Roberton and Co., at the end of July, 1872. I wound up my books on the 30th of June previous. 1 took stock on the 30th of September, 1573. I thought at the last date I waspossessedof £5000,clearsurplus. Mr. \\ aymouth has since made up the account, from which it appears that there was, in September, 1573, a clear surplus of £4765. That was allowing for all bad and doubtful debts. There was then the consignment of wool to Mc Lellan ; but I did not, in taking stock, take notice of that. I concluded the wool was worth what was drawn against it. My liability on the 30th of September, 1573, to the Bank of New South Wales was £24,000, after deducting the value of securities which they held. I do not deal with the wool in making that estimate of liability to the bank. I did not take stock after that time. On the evening of the 2nd of January my assets were £2350 more than my liabilities. The wool transaction did not come into that estimate. The Bank of New South Wales make the loss on account of the wool £11,000. If that claim should be allowed against my estate, then my deficiency was about £9000. There was a loss of £2000 in trailing on account of the pressure put on by the bank. I had to sell goods to pay the bank. This was between the 30th of September and the 2nd of January. I was not aware of these losses until I went through the accounts with Mr. Waymoutli. I had dealings with Parbury, Lamb and Co. They consigned tobacco and hojs to me for sale. They did not always draw against them. I remitted as soon as these were sold. The last consignment of theirs was tobacco. We sold it. I do not think they drew for this consignment. AV e used to send bills payable. I admit the claim against the last consignment. I think it was during December that 1 became aware of the course to be pursued. I understood that I was liable for the loss on the wool, but the bank were to carry me on. The fact was there had been an announcement of

" 9000" loss on the wool. .Nobody thought ai the first that this meant £9000; but inNoreir ber it became known that the actual loss was at least 45,000 dollars. This was an estimate. I did not then foresee bankruptcy, because with the line business that I had, if the bank had carried me through as they said, I thought I could retrieve my losses. I had £'20,000 worth of goods in store. I consulted Messrs. MacCormick and Maekechnie. Some arrangement was suggested by which I wr i to give a bill of sale and proceed to Sydney. But this arrangement was obviated in some way. I was staggered by the information, and could not believe the loss to be true. I rendered account sales for the tobacco on the 3rd of September. After the 30tli of September I borrowed money from Grice, Sun--ner and Co. —£SOO, about the 17th September. After I took stock, 27tli October, I drew upon my father for £2000. I negotiated this bill at par. 1 exhausted my cash cred it in Sydney. My father was responsible for £1000. It was in the nature of a loan.—Mr. MacCormick: I object to this. The witness is simply misleading the Court. The fact is that the bankrupt sent his father the money by cheques, exactly £2000, to meet these bills. —The Bankrupt: No.—Mr. MacCormick : Will you swear you did not.—The Bankrupt: My father became responsible for £1000 ; the bank in Sydney paid my cheques. It was a transfer from Sydney to Auckland, which enabled me to get this cash credit £10CD, in Auckland. The effect of it was that it was equivalent to a loan to me of £1000. I made payments between the 3rd of January (the date of adjudication in bankruptcy) and the 9th of January. There was a slight pressure put upon me by some other creditors than the bank. I knew of drafts of Cameron—one for £ISSO, the other for £1550. I paid the latter. The bank gave me liberal accommodation, but they suddenly withdrew it. The fact is, if I handed over all the security I possessed to the bank and left all the other creditors without any security whatever, considering that I had got credit from them, to avoid a catastrophe, then I might have satisfied the bank and avoided these proceedings ; but I could not do that. Mr. Ivey said to me that the bank was the money partner in my firm. I think that after the loss of £9000 I continued to incur fresh debts.—Mr. MacCormick said the meaning of the pressure was that Mr. : Thorne, jun., used to import goods very . largely. He stood upon such favourable terms with the bank here that he got credit very largely. The bank finding this large importation, although they had in some instances given up the bills of lading without getting his acceptance, they told the bankrupt they could, not do this any longer; that if he wanted to import goods largely he must pay for them.—Bankrupt: 1 incurred fresh debts because the bank promised to carry me through. I did not sell goods between the 3rd and 13th J auuary. I had goods on hand on the 3rd of January. I do not think I voluntarily parted witii goods the same as I had parted with money. A U the goods I had on the 13th of January have not gone to the benefit of my creditors. Some wool and cotton were given up. I did not think I was bankrupt then. I consented to the bank getting the goods. It was done under the decree of this Court.—Mr. Mac Co- < mick : The explanation is that the decree was served before the adjudication in bank- ' ruptey.—The Bankrupt: The submission to . adjudication was on the 9th of January, and ; the consent was given that the bank should | get them. The value of the goods was about j £277. I gave up the goods bought by ad- ■ vances under the produce account. An ; action was brought by the bank against mo, and the decree was made in the course of the proceedings.—Mr. MacCormick : I must ask my learned friend to be specific. The object of this examination is to shew that the bank have become possessed of goods which should go to the benefit of creditors, and not purchased under this produce account.—Bankrupt : Advanced upon.—Mr. Hesketli : I refer to this schedule of goods which is before the Court.—Mr. MacCormick : And the items refer to articles that were purchased under the produce account.—Bankrupt : There was a bill of lading in the Bank of New South Wales, Sydney, for a cargo of llax per Skimmer of the Waves. That was on the 6tli of January. The cargo was consigned to order. Part of that cargo was kauri gum, but I held the bill of lading. There was a cargo of timber by the Lalla liookh, which was to have gene to Parbury, Lamb and Co., value £530. I know the bill of lading came into the hands of the bank. I never assigned it to them. I heard from the captain of the vessel how it was.—Mr. MacCormick : All this can merely amount to hearsay.—Bankrupt: The bank have realised and put the proceeds to the credit of the estate. There were £2259 worth of timber squared in the bush, which was to have been delivered to me. But I had taken accommodation bills on account of it from Christie, Hayes, and Nisbit. I had made advances of £2000 to Christie. I cannot say whether the bank have had that timber, or that they had of it what was equivalent to £1000. I had not much experience in wool svheu I entered upon. the wool transaction. It was not entered upon as a speculation. It was part of a commission business which: I had through Mr. Eoberton, who had been doing business for McLcllan. But I had a wool stapler in my employment who was a thorough judge of the article. The fact was there was a general trade panic about that time. The interest I had in the wool wh-s that I was to receive per cent. I drew

upon Cameron at 60 days. Some of the wool was worth 90 cents, per pound. The washed wool was worth from 80 to 90 cents., and the greasy wool from 50 to 60 cents. It went into the hands of the Bank of San Francisco, who were the agents of the Bank of New South Wales. I should have preferred the wool to have gone to the Bank of California. I handed the drafts and the bill of lading to the Bank of Now South Wales here, and they forwarded them to their agents, the San Francisco Bank.—Mr. Thorne asked the Court upon the evidence that it should declare the bankrupt had passed his last examination. —Mr. Hesketh said that there was some difficulty as to the authority to appear for Messrs. Cameron. —Mr. MacCormick asked the Court to allow the opposing creditor (the Bauk of New South Wales) to tender evidence. He some of the statements were absolutely without foundation. Mr. Hill, the Inspector of the Bank, would be able to shew the Court what these statements were worth. He intended to offer the evidence of some of the officers of the Bank. —-His Honor granted the application, and the Court adjourned shortly before five o'clock to Friday