MUSIC DEALER’S INSOLVENCY,

Otago Witness, Issue 3994, 30 September 1930, Page 50

MUSIC DEALER’S INSOLVENCY,

MEETING OF CREDITORS. A meeting of creditors in the estate of John M'Lennan, of Dunedin, gramophone dealer, was held before Mr J. M. Adam, official assignee in bankruptcy, on Friday after-: noon. Mr Irwin appeared for the bankrupt, and the meeting was attended by about a dozen creditors.

The unsecured creditors were showq at £3157 3s 3d, assets £BOO, and the deficiency £2357 3s 3d. The principal unsecured creditors were: —Duncan M'Lennan, £1170; Bank of New Zealand, £100; W. F. Pile, £199 0s Id, His Master’s Voice (N.Z.), Ltd., £lB9 13s; Charles G. Shand, £lO9 15s 6d; Marjorie C. J. Mercer, £67 10s;. Barton’s, £5l 13s 9d; Charles Begg and Co., £3B 16s 7d; Crawford and M'Laclu ✓ lan, £62 2s Id; Brookes and Co., £5O; A. and J. Watt, £23 7s 6d.

In his statement, the bankrupt said that in March, 1925, he opened a small shop in South Dunedin, carrying on business as a tobacconist and gramophone and record exchange. In September of the same year he went into the shop now occupied by the South Dunedin Gramophone Parlours. Ltd. (in liquidation), and commenced business as a musical instrument and music seller. During the first four years the business grew rapidly, but he had to stand out of a large sum, as his business consisted mainly of selling instruments on time payment. His father guaranteed him £lOOO, but, as it became necessary to enlarge the stocks, much more money had to be found by his father. In May 1929, business began to decrease, and it became harder to collect accounts. He had a large stock and considered he could carry on over the time -of depression. In April, 1930, he estimated his assets at £3500, and his liabilities, other than the guarantee at the bank, at about £7OO. The business was then formed into a company with a capital of £l5OO, of which he took £1499. The expenses of collecting instalments on bailments became very heavy, and no profits were forthcoming. He attributed his present position to the depression in business and the fact that wireless had practically superseded gramophones. He considered that his shares in the South Dunedin Gramophone Parlours, Ltd., were worth at least £BOO.

The bankrupt was sworn, and stated that there were no other creditors. The amount owing to the Bank of New Zealand was overdraft up to the time the company had been formed. All the assets put into the company would be available for the creditors. His father had never been in partnership with him. He had taken £6 per week out of the business during the whole time. He denied drinking to excess. A creditor stated that the bankrupt had occupied a house at a seaside resort. There was a cellar full of empty bottles there.

Mr King (representing Crawford and M'Lachlan) said the bankrupt must have had a good time at the creditors’ expense. Further examined, the bankrupt stated that very little money had been spent in drinking, joy-riding, or horse racing. The bankrupt said he attributed his bankruptcy to business losses. The company had been formed because he thought it would be easier to get finance. During the past five months- he had paid £5O per month for stock. The meeting was adjourned to allow the official assignee to examine the books of the bankrupt.