SUPREME COURT.—IN BANKRUPTCY

Otago Daily Times, Issue 7005, 29 July 1884, Page 4

SUPREME COURT.—IN BANKRUPTCY

Monday, July 28. (Before his Honor Mr Justice Williams.)

RE ROBERT GUTHRIE AND ROBERT ANDREW. In this case Mr Stout applied for a final order for the discharge of the bankrupts. Mr Sinclair opposed the application on behalf of the Bank of Australasia.

Mr Sinclair said that he was instructed by the Bank to draw the attention of the Court to some circumstances connected with the bankruptcy. His Honor would remember the facts that came out on a former occasion with respect to the disallowance of the Bank's claim against the estate by the Assignee. He (the learned counsel) submitted that such facts were sufficient to disentitle .the debtors to their discharge. In the first place, he contended that the going into the concern by Andrew was part of a preconcerted arrangement in order to favour the trustees of Mrs Walter Guthrie, and to give them certain bills of exchange. This was the idea the debtors had in their minds at the time, and it would have bad the effect of seriously prejudicing the other creditors, including the Bank of Australasia. Then there was the dealing of Mr Robert Guthrie with part of the partnership property. He was instructed that some short time before they filed their petition for adjudication Mr Robert Guthrie had removed to his own house goods belonging to the firm. His Honor: I aever heard anything of that before.

The Assignee: It was in evidence before the Court, because Mr Stout took objection to it.

Mr Sinclair proceeded to state that his instructions were that on the eve of bankruptcy Mr Gutbrie had removed some of the private goods of the firm, and on being questioned by the Assignee denied having removed the goods. Subsequently, on the Assignee again pressing him on the point, Mr Guthrie was compelled to admit that he had removed the goods, but by way of excuse said that the goods (iron) were .taken as a sort of set off for wages which had been allowed to run in arrear. On subsequent investigation, however, it turned out that the debtor admitted that he was wrong in taking the goods, and the Assignee was paid for them by a friend of his. He contended, however, that this payment did not wipe out the unfairness of the bankrupts' conduct, and that their conduct had not been of that fair and straightforward character to entitle them to an immediate order of discharge. Mr Stout said that the sole opposition to the

debtors discharge came from the one creditor who had bsen benefited by the estate, and had been benefited to the detriment of the trust astates. The Bank of Australasia having taken up the attitude of an opposing creditor, he would point out Mr Sinclair: Does your Honor consider it within the province of my learned friend- to launch out against the Bank because they, have assumed a hostile attitude to the debtors ?

Hia Honor: He can only etata what is in evidence, and what ho is going to prove. Mr Stout said that he merely intended to comment on evidence given at the previous examination, The conduct of the Bank in making opposition to the debtors' discharge came with peculiar grace. The position of the matter was this: Mr Gibbs was in difficulties with the Bank. He was owing the Bank a large sum of money, and, in order that the Bank might be relieved of its liabilities and carry him on, he went to Mr Walter Guthrie and got security and assistance. Mr Gibb'a position was not then known to Mr Guthrie. He carried on for some time, having got £1000 or £5000 worth of money from Mrs Guthrie's estate, which he gave to the Bank of Australasia, who gained by that amount, and had realised their securities in a peculiar fashion. Despite this loan, Gibbs found that he was unable to carry on longerj and again Mr Guthrie came to his assistance, and paid the creditors 10s iv the pound. The Bank, however, would make no rebate in its account, and, holding securities, insisted on being paid in full. After the composition had been paid, Mr Gibbs sold out his interest, amounting to very little, to Mr Robert Guthrie. . The business was then carried .on by Eobert Guthrie and Robert Andrew. Then Guthrie and Asher dissolved ; Asher going through the Court and getting his discharge, the Bank making no opposition. After that was done Guthrie carried on business, and Andrew joined the firm^ Instead of the Bank being injured it had got all the money practically, and had not lost a penny by this estate. But the Bank wished the debtors made answerable for the liabilities of Gibbs, for.which they had not given a discharge. The debtors had been forced to file, and the way the Bank had realised their securities showed what chat forcing meant. : His Honor said that it seemed to him inexplicable why. Andrew joined the firm, having nothing. Mr Stout explained, as to the irontaken by Robert Guthrie, ■ that his brother had come forward and paid the full value., to the Assignee, in order that there might be no dispute about it hereafter. The Bank had, therefore, not suffered to the extent of one farthing by that. His Honor: I see by the report that these bills were given on August 10, 1883, to the trustees of Mrs and Miss Guthrie's estates. It is not suggested that the bills were otherwise than for value ?

The Assignee: That is hardly correct. The original debt was for. vaLue, but I hold that the estate was actually insolvent at the time they were given. Mr Sinclair: As a matter of. fact the Bank are suing Mr Walter Guthrie on the ground that the money was not given for-value, but that it belonged to Mr Guthrie, who was a partner of the firm. . ■ ■.

His Honor: When the matter was before the Court previously, the impression I formed was that the money belonged to Mrs Guthrie's trustees, and I did not think that was seriously disputed.

Mr Sinclair: We say that when the firm's affairs • presented a black appearance the money was treated by Mr Walter,Guthrie as a loan—he sought to make h*is trustees creditors, in order to get as much out of the fire as possible. Mr Stout could only say that such a statement was, absolutely incorrect, It was monstrous that such statements should be made in order that they might find their way into the Press to influence the action* of Mr Walter Guthrie. The Bank were seeking to make Mr Gathrie liable as a partner, and it was unfair that statements should: be made and published in order to educate the public mind that the Bank was robbed.

Mr Sinclair would like to put himself right on this point. He had carefully refrained from saying one word on thS subject of further proceedings, and had only done so in reply to a remark from the Court.

His Honor said he would like to hear^from the Official Assignee about the removal of the iron by Robert Guthrie. If the Court could conclude that a wilful lie had been told by the debtor to the Assignee—and it seemed like it— the action of the Court would be influenced thereby. The Assignee suggested that the debtor should be put into the box. His Honor: I think he had better go into the box, so that the Court may hear what he has to say about it.

The Debtor (Robert- Guthrie), examined by the Official Assignee, acknowledged that he had said in his statement of February 8 that he had taken no iron except 12 sheetß, which he_ had paid for in cash. —Asked to reconcile this with his subsequent statement on oath on February 12, he said that he did not know how much iron had been taken away at the time.

After further questions upon the subject, His Honor said: The difference in the statements is not as to the quantity of iron, Mr Guthrie; you must know that very well. The Debtor then said that his first statement was wrong. ' The .Assignee: Did you know at the time that some iron had been taken which you had not paid for ?

The Debtor: Yes. His Honor: You knew it on the occasion oi your first statement ? .

The Debtor: Yes,

His Honor said: I see no reason for suspending the discharge of Andrew. The matter has already been six months before the Court, and I do not think it has been satisfactorily proved that giving these bills waß wronging the estate. If the conduct of the debtors has not been satisfactory in some respects, as I appear to have considered in my judgment in a previous case, still I think that seeing the matter has been so long before the Court, there is no reason for withholding Andrew's certificate of discharge. As for Guthrie, the fact of this untrue statement having been made cannot possibly be overlooked. I shall take into consideration the fact that it has been retracted, and reparation made, but still the statement was made in the first instance, and I have little doubt that unless something had turned up in the meantime it would have been adhered to. Guthrie's certificate of discharge will be suspended for six months further.

ADJOURNMENTS, _ The cases of David Korr and Alexander M'Gregor were adjourned until next sitting.

, BE 0. S. ALLEN. The Assignee Baid this examination had been partly gone through, but he had a few more questions to ask the debtor, There was, for one thing, an alleged claim against the Bank, but he bad no means at his disposal to substantiate it.

The Debtor, examined, explained the details of his claim as concerned certain property his share of which he had sold to a Mr Peter Drummond shortly before his bankruptcy. He asked that the Bank should be restrained from selling the property, as they threatened to do, upon a third mortgage. His Honor said that the best thing would be for the Assignee to call a meeting of the creditors, when they could hsar the bankrupt's statement and decide what action to take. The Debtor stated that he filed in order that the creditors should have an opportunity of protecting the estate. The examination was passed.

BE WALTER MIIiEB. The bankrupt did not appear, and the case was therefore adjournad.

BE JOHN GUTHRIE. Mr Macdonald appeared for the debtor, who stated that he was a lighterman. He explained several items in the debts, which amounted to

The examination was passed,

HE AUSTIN AND lEWIS. The Official Assignee said that the supervisor in this case objected to the bankruptcy being closed until certain arrangements were concluded for the refund by pat ties on behalf of the bankrupts of some moneys which were held to have been wrongly taken out of the estate. It was a verbal agreement by way of compromise, and if it were not carried out he presumed that would be a ground for his opposing the discharge. His Honor answered in the affirmative. The Assignee then made no objection to the bankruptcy being closed. Mr Brent, on behalf of the bankrupts, then asked that a day might be fixed for the application for final discharge. His Honor fixed Monday, August 18. The Court then rose..