FRAUDULENT SALE TO A BROTHER

New Zealand Times, Volume XXXII, Issue 7319, 24 December 1910, Page 1

FRAUDULENT SALE TO A BROTHER

THE YINEGAED TEANSACTION sto6k-in-trade made over to ASSIGNEE. The validity or otherwise of a transaction involving tho sale of a drapery business by Jack Viuegard to Abraham Vinegard. his brother, was decided by the Chief Justice, Sir Robert Stout, yesterday, who found that the latter had acted with a full knowledge of his brother's position, A motion had been behalf ol the Official Assignee for an order to act aside and declare fraudulent the sale of iho business by Jack Vinegard to his brother Abraham, or to declare that the good© and chattels in tbe possession of in the ©hop formerly occupied by »hia brother belonged to tho. Official Assignee. BANKRUPT'S CONDUCT. The point to be decided, in his . Honor’* / opinion., wa© whether bankrupt had com-, mitted an act of bankruptcy prior to tho date of the alleged sale. This transaction took place on September 27th, 1910. The petition was lodged by creditors asking for the adjudication of bankrupt on October 24th, 1910. and the adjudication was made on October Ist, on the ground that Jack Vincgard had, with intent, to defeat’ or delay his creditors, departed from his dwelling-house and otherwise absented him- / self. The court, declared his Honor, was not restricted to. the act of bankruptcy on which the petition was grounded.: Any acf. of bankruptcy within three months before the order of adjudication might, be relied - oh. The Official Assignee relied bn the fact that debtor committed an act of bankruptcy prior • to* September 27th—the date on which the sale was ©aid to have been effected—namely, . that Jack Vinegnrd was then about to depart out of Now Zealand with intenfto defeat or delay his creditors; "The solo question is:i Does the evidence 1 show that Abraham Vincgard knew that, his. brother was about to quit!: New Zealand; that his brother was owing debts at the time; and that his object in dispose ing of his property was to avoid paying his ■ creditors or delaying their payment? I am of opinion that Abniham Vinegard l must have known that, his brother was about to quit Now' Zealand. He could not-possibly ,hav© believed that he was going merely for a trip for a fortnight or ho .to Rotorua. His brother had had, a business for some , years in Manners street; if his brother.wa& taking: merely a trip to Rotorua for• his health it ..was not at :UI , likely, that he would have disposed of his business, with- . out competition, to his brother, without acquainting;'his creditors-' There is no lex-" 1 '; plaaiatibn' that -caiu lie given I ‘of. the di©posjtipu ’ol luH-businc.sa.vCxcoi>t the one that h© wa&. quittiug New Zcaluud; and quitting - New Zealand' to defejvt or; delay-hi,s crc<h* tors. That he had creditors even appears • on the receipt. which Abraham , Yinegardtook from his brother) ; The receipt end© as •. follows;—‘Mr-A. Vincgard ‘is taking over the said- shop. • but is in no wav responsible for any debt© due. by me.’ Why, was thatput in if it, was not:an arrangement really . between the brothers to pass over the pro periy to Abraham Vinegard and to defeat and delay the creditors? ’ ■ ' THE PURCHASE MONEY. ’■ “It is said that X must assume that‘Abra* : ham Vincgard paid his brother the £240,:-. mentioned in me; receipt, an** that .that money was Abraham own. It may bo so, though it is, strange that ha should have had that large sum of money , without ever.;having had it in a.bank, and: having kept-it in a box in his bodroom. But I will assume for the purposes of this . case that Abraham Vinegard did pay tho . money. That, however, is not sufficient. If the purchase was made after an act of bankruptcy he is * not protected unless ho did not know of that act of bankruptcy, and in-my opinion ho knew that his brother' had debts and he knew that his brother was’about to quit Zealand, and that is an act of bankruptcy on which tho ' Official. Assignee can, rely,- The whole thing turns but .really l to bo a question of fact, and I have come to the conclusion that on this question of fact, namely, .Abraham *' Vmcgard’s knowledge of hie brother about- , to quit and being.in debt is shown by the f whole transaction andVby < what happened ; ■ afterwards, his. statements •to .the credi tors, etc." . •••..; V ■.>).;,■• DEFENDANT’S REMEDY. I may add that Abraham Vinegard is not, without hi© remedy for bis money; ■ Ho ha© a right to demand from. his brother tho amount of money that he paid him, and no doubt his brothen will communicate with him and he, will be able to get from hi© brother the money that he gave him for the: goods which now belong to tho Official Assignee. Plaintiff was allowed costs amounting to £ls 15a. and witnesses' expenses and , disbursements. ■ - ■ ~ Mr A. H. Hmdmarsh appeared, for Abraham Vinegard. and Mr G, Toogood.for tho Official Assignee and the petitioning creditors. , .