DIFFICULTIES UNDER THE BANKRUPTCY ACT.

Poverty Bay Herald, Volume VI, Issue 872, 25 August 1879, Page 2

DIFFICULTIES UNDER THE BANKRUPTCY ACT.

The gentlemen attending a meeting of creditors m the Dunedin Supreme Court offices last 'week had an experience out of the common. The meeting began at 2 p.m. The bankrupt was a resident of a country township, and except the Bank of New Zealand— represented by counsel — all the creditors present, of whom, personally and by proxy, there were some 14, were residents of the same place. The 14 creditors wished a local- trustee appointed, the Bank a Dunedin one. The Bank'a claim was larger than that of all the other creditors put together. This state of matters then . arose. A local trustee was nominated and seconded. The Bank's counsel nominated a Dunedin trustee, but there was no seconder, and the motion fell to the ground. But the Act declares that resolutions shall be decided only by a majority m "number and value" of the creditors present, and the Bank's counsel opposing the local trustee, the 14 creditors found themselves m a powerless majority of numbers, but a powerful minority of value, while the Bank was vice versa. Thus a perfect deadlock was brought about. The 14, however, had this advantage, that if the Bank left the room they could carry their man, and they therefore started on the task of tiring out the Bank's legal representative. The chairman took a f uIL-length position on. a sofa ; other creditors brought out pipes and tobacco ; the Bank's counsel studied the Act, and occasionally sent for Mr. Registrar Gordon to see whether ha could discover a settlement of the Gordian knot. The hours passed m this way till darkness came on, when, having prevailed on the Court attendant to build a fire, the sofa was placed m; front of it, and the chairman, the troublesome counsel, and one or two of

the others^ conversed comfortably on "the; political situation," the "tightness of v "the . money maiket," and particularly on the necessity of reform m the bankruptcy laws. The state of things continued till about 8 o'clock, when the pangs of hunger beginning to make themselves felt, and the legal gentleman showing no disposition to give the advantage of his absence to the enemy, a truce was come to, and the meeting. adjourned, after a six.,hoursZ. sitting to no purpose. . .The appointment of a trustee m the. estate is still a matter for future settlement.