A BANKRUPT FARMER

Pahiatua Herald, Volume XXXVI, Issue 10919, 21 August 1928, Page 7

A BANKRUPT FARMER

AFFAIRS OF MR. J. G. COOPER DEBTOR’S STATEMENT. An adjourned meeting; of creditors in the bankrupt estate of John Christopher Cooper, of Masterton. sheepfarmer. was held before the Deputy Official Assignee (Mr A. D. Low). The proceedings followed upon a meeting held on July 10. Mr H. C. Robinson appeared for the W.F.C.A., Ltd., and, Mr R. McKenzie for bankrupt. The following statement was submitted by the bankrupt:—“I attribute my present financial position to my association with the W.F.C.A., Ltd., and E. B. Wellwood in the business in connection with the sale and purchase oi? hides in 1920. Prior to that date, I had lost most of the money which 1 had had, and 1 purchased a farm at MaiiKnm«hoe very largely with money belonging to. my wife, whose private niea»._ were, and, always have been, considerably larger than my own. The only capital I had. £7OO was sunk in the Mangamnhoe property. ‘•ln January. 1920, as a result of a suggestion put forward bv myself to a director of the W.F.C.A., a syndicate was formed comprising the W.F.C.A., through Mr J. A. Betts, Mr E. B. Wellwood and myself. On, business consisted of the. purchase

and sale of hides. Our operations from the cutset, were extraordinarily successful, and at the end, of three months we showed r, net profit of ; £7OOO. At this time I left for Eng- i land. When I returned I found that. I my associates had altered the whole policy of ihc syndicate, and, instead j of establishing an agency for hides, j had undertaken a speculative busi- | ness on a large scale. They had pur- I chased a small farm and butchery j business and committed themselves i in other directions. This was at the I commencement of the .slump, and the 1 result of the sudden drop of produce was to involve the. syndicate in very heavy losses. These speculative ventures were financed by the W.F.C.A. i and I was debited in the. company’s ' books with my share of the losses. ! and the result has been that I have j had to face a legal liability for. a I very large sum of money which I have never seen and from which I j have derived no. benefit. “In 1921, Mrs Cooper bought a i farm property ‘Kelvin Grove,’ at ] Bideford with the assistance of a | guarani tor. The Bank of New Zea- [ 1; nd financed the sale on the distinct | understanding that 1 should .sell the Mangamahoe property to wipe, out j my indebtedness of approximately I £5500 to the bank. I sold the Man- j gun’>; hoc property in accordance with . the bank’s instructions this year at a price which left me an eaiiitv of . something less than £5,000, £3OOO of | which being in the form of a second mortgage. This was not sufficient to extinguish my liability to the bank. ! “I have repeatedly urged the directors of the W.F.C.A. that if they would withhold proceedings to give me a chance of getting upon my feet again. I would probably be able, within a year or two, to pay .something towards settling this debt. As they forced me into bankruptcy at this stage, they have rendered it impossible for me to do anything. “I personally consider that I had r. good cause of action against the W.F.C.A. for a sum larger than the •amount of my indebtedness to the company. As it was certain, however, that extensive litigation would be involved I had not the means to engage in that, and there was nothing for me to do but to let the judgment he entered against me. “I am satisfied that if my wishes and directions had been carried out with regard to the hide business I should have 'been in a substantial financial position to-day.” At tlic meeting of July 10, in reply to Mr Robinson, bankrupt said that to the best of his belief he had a claim against the W.F.C.A.. hut lie had never made the demand. He had at different timbs acknowledged bv deed that he was indebted to the W.F.C.A. ASSETS AND LIABILITIES.’ The statement of assets and liabilities, -1 ■" s a sum of £4813 0s due

to the principal unsecured creditor, the W.F.C.A., Ltd. The only other unsecured creditor is F. W. Pointoii, whose claim is for £l6 10s. The gross debt to. secured creditors is £6600. Bankrupt explains that his indebtedness to the Bank of New Zealand is guaranteed by George Pain, and he. (bankrupt) is therefore liable to bis guarantor for any deficiency which the latter makes good to the bank. The total indebtedness to* both is £6600. Bankrupt's total deficiency, taking account cf secured and unsecured creditors. is shown at £8513 6s. The securities are a house and freehold section in Cole Street, set down at £ISOO (first mortgage. £450 ; second mortgage to George Pain) and a second mortgage over the Mangamahoe property—nominal value £3075. valued at £2OOO. BANKRUPT QUESTIONED. When the adjourned meeting resumed, Mr Cooper was cross-examin-ed at great length by Mr Robinson. In the course of his replies he said that he had stated at-the last meeting that Mils' Cooper refused at present to recognise the W.F.C.A.’s claim. As far as his guarantor, Mr George Pain, and Mrs Cooper were concerned, this action (the bankruptcy proceedings) probably would make a difference with regard to any offer that they might, now make. He believed, that if the proceedings had not been taken he might have been able to. pay something of his debt to the W.F.C.A. He could not guarantee it.

Asked why lie had neither produced any hooks nor referred m his statement to the absence of books, bankrupt said that he hardly knew. Had it been .suggested to him he would have referred to it. Questioned about a bock relating to the Mangann hoe property, bankrupt .said it had been destroyed. The books relating to the Kelvin Grove pi operty had -all been correctly kept by Mr Pointon. The circumstances of tlie two properties were altogether different. With regard to Mangamahoe, there would only be about a score of entries altogether. The position with regard to. Kelvin Grove Mrs Cooper’s property, was different. There was a considerable expenditure on capital and other accounts and the guarantor, Mr Pain, wanted to know from time to time exactly what the position was. The Mangamahoe book could be reproduced from the pass book. In the course of hi.s examination, bankrupt said that he had bought both his land at Mangamahoe and stock at boom prices, and had lost heavily when values fell,

Bankrupt was questioned at length by Mr Robinson regarding his receipts and expenditure during the last three years. He said that, lie had made a loss of about £IOO a year for the lost two. years. Mr Robinson asked whether, in incurring debts and meeting heavy household, expenses, when he had no income, bankrupt had not defrauded liis creditors. Mr McKenzie: “He paid them.” Mr Robinson: “Why is ho bankrupt then?” Mr McKenz e: “This debt was incurred long before that.” Mr Robinson: “His liabilities obviously were increased by the fact that these expenses were charged to him.”

Mr McKenzie: “They were paid out of Mrs Cooper’s income.” Bankrupt said that the origin, r] intention was that when the Mangamalice property was sold, the account should be in Mrs Cooper’s name. Until that it had to ibe in his name. Mr Robinson: “Why?” Bankrupt: “The bank asked for it. I can’t tell you.”

In reply to other questions. Mr Cooper said that Mrs Cooper felt, flint any new place purchased should "be hers because she had lost money in Manga.mah'oe. Mr Robinson asked that particulars of receipts and expenditure, during the last, three years and other details of bankrupt’s position should be presented at a later meeting. With reference to certain statements made by Mr Cooper Mr Robinson said that the W.F.C.A. would welcome and facilitate investigation.