SUPREME COURT.—IN BANKRUPTCY.

Otago Daily Times, Issue 3937, 29 September 1874, Page 2

SUPREME COURT.—IN BANKRUPTCY.

Monday, 2Sth September. (Before His Honour Mr Justice Chapman.)

FINAL, ORDERS.

C. A. Martin's application for a final order of discharge was fixed for the 19th October. Mr Mouat appeared for the bankrupt. /ames Middleton applied for a final order of discharge. Mr Mouat appeared for the bankrupt, and examined liim with regard to his relations with his landlord and creditor, Logan. His Honour said the bankrupt should have filed his schedule at an earlier date. The Trustee reported that if the bankrupt had done so, there would have

been a dividend of 7s 6d in the pound, whereas at present there was nothing. The bankrupt, however,^ appeared to be a man who did not know:much about business attairs, _and he was not disposed to visit his misconduct with much severity. He would suspend his discharge for two months. Andrew Carr applied for a final order of discharge. Mr Mouat appeared on behalf of the bankrupt, and Mr E. Cook to oppose. The bankrupt formerly carried on business at Kaitangata as a bootmaker. Mr Cook examined him at considerable length with respect to various transactions ; but His Honour was of opinion that no misconduct had been proved, and granted a final order. creditor's petition for adjudication-.* Mr Mouat, on behalf of a petitioning creditor, applied to have George Perriman adjudicated oankrupt. He believed this was the first petition of the sort that had been presented to the Court. Perriman had executed a deed of arrangement by himself alone, purporting to be for the benefit of bis creditors; on the 23rd September instant and it was duly gazetted on the following day The petitioner averred that he h&; heved the said deed had not been filed with. bona fides, but fraudulently for the purpose of delay. . ..

_ His Honour said there was ho doubt that the making of a deed of arrangement was an act of bankruptcy, but a man who filed a deed was entitled to time, to ascertain whether it could come to maturity. He thought the present application was rather premature. • ■

Mr Mouat agreed that it would be premature, under ordinary circumstances, hut there were certain peculiar circumstances connected with this case. The application was made under the 274 th section of the> Bankruplcy Act. Notice had not been givpn to the debtor. .. _ : .

His Honour said that as the debtor was not present, it would be necessary to give him notice. Of course If he did hot appear after notice, it would be a default. He did not think he had granted any order nini under this clause up to the present. Would it not be preferable to take a declaration W the debtor? This was not like a rule' nisi that made itself absolute after an act o£ bankruptcy. He thought the petitioner might give notice.to. the debtor that he wonld move the Court on a certain day td declare, &c, and at the same time take an. order for his appearance. The clause under which the application was made did not seem to be like those clauses which relate* to creditors petitions. Mr Mouat apprehended that the only wW a creditor could come before the Court was by petition.

After some further conversation, " "" His Honour said that parting with property was an act of bankmptcy, but this deed filed by Perriman parted with ho pro^ perty. It amounted to nothing but a statement to the,effect r "lf my creditors will take 2s' 6d in the pound, I promise to paY them that amount." ...-....._ •*.

. '*£: M^ at said tTi®re was ong f *& stated in the affidavit, and borne out by PerrimaiL to the effect that Perriman's two sons, one of them a minor, were his principal creditors. That would have the double effect of Increasing his majority, and of defrauding the creditors of so much of the estate—that; waff snpposing the claim was not bonajide. Thai circumstance was suspicious. His Honour: Fathers do not often owe money to their sons; it is veryfrecraentlY the other way.v \: F : ■ * MrMouat said there was also ground for believing that Perriman had recently made large purchases of goods, which had disapSi eal 6l" i fc Was also averred that since fie hied the deed of arrangement he promised to pay one of his creditors—Mrs Walsh— in. full, to the prejudice" ofthe other creditors. Hopour doubted very much whether this deed of arrangement could be declared, an act of bankruptcy. said..that it appeared to come withinvthe 255 th: section of the Bankruptcy Act. If the deed could be upheld, it would be a proceeding-well calculated to favbrtf a iraudulent debtor, because it gave him fdrrr months protection. There was ■ another averment in the affidavit to the effect that a deputation from his creditors waited upon Pemman, and asked him to call a meefihff of his creditors; but he refused to do so, an* would not give any information. If this deed were executed for the benefit of the creditors, surely they ought to be the best judges as to what should be done in theirinterest. - . .....

His Hbncrar said he Had ne-^er teen caHei upon to act in a deed of tnia kind. THs deed would not be act of bankruptcy ia. England. ■■..--.-■■•-•■ * J

Mr_ Mouat said that in England it appeared to be the practice to get the sense of the creditors in some way. .He siibmitted that the averments made, although some of them were in general terms, would be sufficient to justify the Court in calling upon the bankrupt to answer.them. : ?■■•*... His Honour: You had better take order for his examination, and you musfe give him notice that you wffl: apply after such Examination, to have the deed declared to be, m words of the Statute, an act oE bankruptcy; The section ;entitle6 him to notice, and even if it did not; it is usual to give notice. riii . i ■ v :,u Mr Mouat: Then I presume this petition! will be available for his adjudication, should the deed be found by the Court to be an acfc of bankruptcy. ' ■ H?s Honour: The section seems to be complete!} disconnected with the earlier eectionsas to creditors'petitions. A creditor^ petition cannot be.entertained until there is an act of bankruptcy." " ."* Mr Mouat: My only object is to avoid de~ *ay,'... Tjie creditors fear delay, and a further delay after examination would almost:-de*eag their object '*'j$L •; Sis Honour: You see at present itbere fc nO;?ct of bankruptcy, and therefore one o£ the elements necessary to a creditoii* peHtion is wanting. The. elements necessary t& a creditors' petition are a sufficient debt and an act of bankruptcy.- There isno.^ct of bankruptcy yet I cannot even ask him^t® show cause why he should not: be adjudged bankrupt. You had. better limit the order to what the 274 th section points out, witfe. the addition of the order to examine: * Mr Mouat decided to adopt His Honour's sueeestion.

The Court adjourned,