MEETING OF CREDITORS

Otago Daily Times, Issue 18468, 1 February 1922, Page 3

MEETING OF CREDITORS

A FARMER’S BANKRUPTCY, A meeting of creditors was held yesterday at Baiclutha in the estate of James Hyslop, of , Clydevale', farmer. Mr J. L. Duggan (clerk of the court). acted for' the. Official Assignee, and the following were,present:— Messrs Jas. Guest (Guest and Sons), Thos. Christie; Peter Miller, M. Low, J. Stevenson (Todd Bros.). S. Dunlop (S. Dunlop and Sons). P. C. Hislop, T. D. Pearson (D. Munro), and R. R. Stewart (Dunn’s Cooperative Co.). Mr Walter (instructed by Mr B. S. Irwin) appeared for ■ the bankrupt. ' ■ The total debts to unsecured ' creditors were set down at £613 18s, assets a. Ford motor oar valued at £l2O, leaving a deficiency "of £495 18s. ' (■<’ The principal ■ unsecured creditors are as. followThos. Christie (mill-owiier. Clydevala). £155; Jas. Tweed (Lovells Flat, carpenter), £167 2s 7d: Guest and Sons (Balefutha), £SO; Peter Miller (Clydevale), £4O 10a Id ; P. C. Ilislop (Clutha Motor Garage). i>ll 10s -. Mark Low (saddler), £l2 19b sd; S. Dunlop and Sons (Clydevale, blacksmiths), £3O 14s 3d; Dunn’s Co-operative Co., Ltd. (Balctutha),, £2O: Clutha River Board, £2O; D. Munro, (coal .merchant,. Baiclutha). £3O;. Todd Bros. (Dunedin), £57. _' ■ • . Bankrupt, in. his statement, said that in November last he sold his' farm as a goipg concern to Messrs H. Fleming and Sons for £6OOO. As well as owing ' some, £3600 to, Wright, Stephenson and Co. under mortr gage and bill of sale, h© owed £750 on mortgage to W. B. Treahy and £766 to the Crown for balance of purchase money to make the leasehold land freehold. When accepting £6OOO lor the farm he understood that the purchasers, were to take oyer, the 'liability tip the Crown,* and that the £SOOO was to be paid in addition. It was' not until alter he had signed the documents that he discovered, his mistake. He 'considered the property well worth £6750, and would not have sold for less." He had estimated that he would have about £7OO out of which to pay any unsecured creditors, and... had considered- himself . solvent. He attributed- hie present position to his misuiiderstandingihe terms upon which he sold; Bankrupt was placed on oath. Examined by Mr Stewart, he said it was not until after he. had sold his farm that ho knew he had to pay the Crown the balance of £766 in regard to payment to convert the leasehold into freehold; he thought the debt would be taken over by the purchasers, He sold the farm acting under the advice, of Weighty Stephenson and Co. The mortgage with Wright, Stephenson and Co. was arranged about 10- years ago, and a bill of sale oyer the stock about the same time. The bill of. sale was renewed several months ago; he could not state the precise date. He sold the farm as a going concern. The sale took place on October 17, and delivery was given on November 17. Wright, Stephenson and Co. had a list of the stock; he had bought no, stock since the bill of sale was renewed. That would be about September, he thought. It was effected, he expected, to make, Wright, Stephenson and Co. more secure. He never dreamed that anything was to be deducted from the purchase money in connection with the conversion of the leasehold. Ho had expected a balance of about £6OO. Ho thought- at th© time that he understood the agreement. He discovered his error at the time of the Baiclutha Show, when he was interviewed by a representative of Messrs Wright, Stephenson and Co. in regard to the transfer of the farm. They got on to the £766 in regard to the conversion! of the leasehold. He was told that the amount had to be deducted from the purchase money, and said that that was nonsebse. The - money was due. to his creditors, and he had signed-no such agreement. There was a sum of £320,8s 4d for which, it seemed, he was taking security from the purchasers for five years. Mr Walter said .. this was. the , case. -He pad made the discovery that day. There was a further amount of £4B 7s 5d in respect of farm articles taken over by the purchasers at tb# time of the sale. Mr Stewart took exception to the bankrupt coming before his creditors with so little information. It was apparent, he said, that the meeting would not be able to do anything that day. He asked bankrupt why, finding himself'in the position he in to the sale agreement he did not consult His ’solicitors straight away.; Bankrupt said he had examined the" agreement, and it was signed by him. Ho did not read the agreement when he signed it, it was read over to him, Mr Stewart: From what you say at looks as if you were entitled to some asset by wav of a second mortgage. Mr Walter aaid that baji.krupt seemed to be tho - victim of 'unfortunate csiroumstaDoe^.*. Mr Stewart proceeded to question, bankrupt about a house he.had recently built, a ooetly house, counsel said. Bankrupt said he had erected a house costing £3OOO. It was not finished yet. Mr Stewart; Do you mean to say that you felt justified' in incurring such expense in the position you were in? Bankrupt said he had felt justified. Times bad got worse since then. Mr Stewart dealt at some length with the- renewed bill of safe over tho atocki He asked the date of its renewal; afid bankrupt said it would bo some time in November. Counsel pointed out that that was now some months ago. It.might be possible to attack tho bill-of-salb, but sufficient time might have elapsed to make it valid. He asked bankrupt why he did not file his petition in December instead of waiting till tho end of January. Bankrupt said that the holiday'season canoe on, and he waited till after the holidays. Mr Stewart: That k most unfortunate for your creditors. Bankrupt, Mr Stewart ‘added, had built a very expensive house and then furnished Wright, fitophonaon and Company with security over his stock and oyer his land,, and bad quite forgotten his creditors. It was unfair. In answer to farther questions bankrupt said he had two sons on the land, but he bad assisted neither of them financially. Mr Stewart said (hat when bankrupt found himself in the hopeless position he was in ; ho should have called his creditors together at once. The effect of hie delay had simply been . that. the unsecured creditors would get nothing at all unless the bill-of- ' sale oduld be invalidated, and he was afraid it might now be tod late. He moved that the Assignee make inquiries into the bilL oi'-sa.lo, also th© item £330 8b 4d, interest and adjustment, in Wright. Stephenson and Company’s statement. He remarked that there were several matters in the document, that required explanation. . Mr Thos. Christie said that half his debt S represented payment of wages to the ing mill hands. Ho remarked that it seemed as if he were keeping WrightStepheneon and Company going, Mr Miller expressed' 'the new that it was difficult to believe that bankrupt was not aware he was bankrupt at the time he sold out, or when he was incurring the experts© of Iris house, Mr Stewart’s motion was carried.

Bankrupt asked to be allowed the aae of the motor oar to return home. In view of tiie distance this was granted, bankrupt to deliver the car at Todd Bros.’ garage, Baiclutha in.a,week.