BANKRUPTCY PETITION

Otago Daily Times, Issue 15955, 24 December 1913, Page 8

BANKRUPTCY PETITION

CREDITORS' APPLICATION REFUSED. Yesterday morning Mr Juetice S:m delivered judgment in respect of the application to adjudicate bankrupt Archibald Reid Falconer, of Mosgiel, storekeeper.— Mr Moore appeared for the petitioning .creditors, and Mr Finch for the debtor.

Ilis Honor said: ''The petitioners are Charles Henry Tucker and Thomas Alfred Mait'and, who carry on business under the style of 'Charles H. Tucker and Co.' They have proved that the debtor is indebted to them in the sum of £517 7s lid, and that ho has committed an act of bankruptcy under section 26 (j) of 'The Bankrupt}' Act, 1908.' It is contended, howover, on behalf of the debtor, that sufficient cause has been shown to justify the court in dismissing' the petition under section 40 of the Act. The debtor and one James Reid Prentice were carrying on busimtw as storekeepers in partnership at Mosgiel. A meeting of their creditors was held on the 21st of April last, at which it wao decided that they should assign their estate to three trustees for the benefit of the creditors. This was accordingly done, and the deed of assignment bears date the 4th day of AugU6t, 1913. It wa6 an assignment of all the partnership property to be administered for the benefit of ail the creditors as in bankruptcy. It did not contain any release to the debtors. Mr Tucker, one of the petitioning creditors, was one of the trustees of the deed, and .'r was executed by his firm. It was executed ajso by a number of other creditors, and no creditor appears to have refused to assent to the assignment. All the partnership estate, except some book debts, has been realised and distributed by the trustees. In these circumstances it seems to me that an order of adjudication' should not be made. Tho petitioning creditors have accepted the benefit of tho deed ot assignment, and have had the. estate administered under its provisions. It is not suggested that the debtor has any separate estate of his own, and there would bo no estate, therefore, to bo administered by the Official Assignee. The only reason apparently for desiring to obtain an adjudication is to enable a charge to be made against the debtor of obtaining credit through a false balance sheet, iri which the liabilities of the firm were not all disclosed, and its assets were over-valued. There was nothing adduced at the hearing to justify such a charge, and it seems to me that no purpose can be served by making the order asked for. The petition is dismissed, with costs (£7 7s) and disbursements to be paid by the petitioning creditors to the debtor. It is desirable to say that the petition in this case was not verified as required by section 36 of the Act. At the foot of the petition there is an affidavit by Mr Tucker in tho torm' given in rule; 415 of the Code of Civil Procedure. An affidavit in that' form is not a compliance witii section 36. Due verification of the petition as required by that secton is a condition precedent to the issue of a summons, and if objection had been taken by the debtor he would have been entitled to have the summon* dismissed on this ground: In re Nicol, 22 N.Z.L.R., 129; 5 Gaz. L.R. 42. In re Somcrvillo, 28 ,; N.Z.L.R., 1055; 11 Gaz. L.R. 672."