AGENT'S BANKRUPTCY.

New Zealand Herald, Volume LXVI, Issue 20384, 12 October 1929, Page 14

AGENT'S BANKRUPTCY.

FLATS WHICH DID NOT PAY.

CREDITORS DISSATISFIED.

CASE FOR CROWN SOLICITOR.

The affairs of John Edward Mortimer, agent. of Heine Bay, who was adjudicated bankrupt on September 30, were closely investigated at a targelyattended meeting of creditors yesterday. Creditors expressed dissatisfaction with the bankrupt's operations, and resolved to consult, the Crown Solicitor with a view to prosecution. The schedule showed that £B5l were owing to unsecured creditors. Secured creditors were owed £8938, and fho estimated value of securities, was £9l/5. With the surplus from securities of £237, the assets totalled .£3Ol. the deficiency being estimated at £550. In h's statement, bankrupt said that lie purchased a house property in Heme Bay iu 1927, borrowing £1250 on second mortgage. He converted the house into flats, which paid for about 12 months. A fire destroyed all his books and records. Rents were reduced and the flats failed to pay. Ho lost £2OO as the result of an action against liitn and a formerly-owned property went back on his hands, costing him £IOO. Ho purchased a motor car in the expectation of a good sale of the flats, and that a mortgage would be paid to Mrs. Mortimer. These did not eventuate and creditors commenced issuing summonses. Nine months ago, bankrupt borrowed £5750 on the flats and the car. He paid £SO deposit. on a petrol station venture, which ho expected to return him £lO a week, but it proved unsuccessful. Creditors, who were called together, offered bankrupt time to pay, and Mrs. Mortimer had offered to transfer to him the equity in a mortgage. Two Previous Failures.

Questioned by Mr. Mollov, who appeared for a major creditor, bankrupt said that he had been twice bankrupt previously. Bankrupt denied that his motor-car had been an expensive proposition, stating that it cost him only £l5O to run for two years. "You were insolvent when you took the petrol station," said a creditor. "At the time you owed £200." Further reference was made by another creditor to bankrupt's previous assignments. In reply to questions, bankrupt said that he had been prosecuted for a breach of the Bankruptcy Act and his discharge had been suspended for three years.

Mr. Biernacki, who appeared for bankrupt, said that a previous failure had been due to the action of a solicitor. "I do net agree with you, Mr. Biernacki, ' said the acting-official assignee. Mi-. V. R. Crowhurst. "Bankrupt must have received an adverse report from the assignee." In reply to further questions, banknipt said that ho had not worked at his trade as a carpenter for some time. He had been to America twice. "For some years you have been doing nothing and getting into debt all the time," a creditor remarked. Views of Official Assignee. "I have quite made up my mind over this bankruptcy," said Mr. Crowhurst, in asking creditors whether they proposed to take any action. A resolution moved by a major creditor that bankrupt's affairs should be placed in the hands of the Crown Solicitor was carried.

Mr. Biernacki said that he was surprised at the action of the creditor in moving the resolution, as it was due to him that bankrupt was in his present position. "If there is any excuse, tho Crown Solicitor will be the right person to deal with it," said Mr. Crowhurst. He added that he was entirely in agreement with tho resolution, and it had boen his intention to consult the Crown Solicitor whether it had been passed or. not.

A committee, consisting of the three largest creditors, was set up to investigate bankrupt's assets. Mr. Biernacki intimated that the question of Mrs. Mortimer's intention to transfer a mortgage of £IOOO would depend largely upon the action of creditors, and this matter also was referred to the committee for investigation.