BANKRUPTCY

Poverty Bay Herald, Volume LIII, Issue 16372, 21 June 1927, Page 10

BANKRUPTCY

C. G. PIESSE'S STATEMENT According to the statement of Christopher Gisborne I'iesse, public accountant, of (lisliorne, and who lias died his pelilion in bankruptcy, his failure mainly was due to the fact that he had financed others in business. A lengthy statement detailing the position is given below, the list of creditors having been published yesterday. "1" had been in business on my own account as a public accountant and estate agent for just over 20 years, when I closed down in September, 1020. During the major portion of that period I had been very successful, but since the slump in 1921-22 my business and investments have been very seriously affected. In 1919 Mr. T. B, Spence and I started my brother, Mr. W. V. Piessc, in a jewellery business. The first year was quite good, but after that the business began to fall off, and in December, 1922, we were compelled to take the business over, Jin ally disposing of it in February last to Mr. A. ,1. Cox for £2200, which resulted-in a loss of £2300, my share being £!l.">(),' leaving me in debt to Mr. Spence for £621 18s 4d. x "In .1920 I put £2OOO into a local business which showed splendid prospects. An investigation of the books of this business covering a period of live years showed an average net annual profit of over £llOO. I considered this a lirsl-chiss investment. The, slump, however, came in the following year, and very soon this business was a losing proposition. I sold my interest in .1924, receiving in part payment a half-share in a farm of 150 acres at Muriwai.

"As business in the estate agency was very bad in 1923, I decided to remove from Lowe street into Gladstone road. This entailed an expenditure of £2OO. Thinking we had passed through the worst period, and that things would improve, I launched out into a large advertising campaign in the first year. My lease of the Lowe street office expired in 1921, but as 1 had started a fresh firm I considered it only honorable to admit liability for a further term of five years. This term ran out in September, .1920*, during which time (three years) the old offices were vacant except for a short period. This accounts for the debt of close on £SOO to Mr. Fred Hall. "In the same year a builder in Tauranga induced me to finance him in building operations at Tauranga, where things were much better than in Gisborne. As his business had been profitable to mo in years gone by, I consented. Several houses were built, and disposed of, but after a time lie owed me a considerable sum of money which he could not repay. To save myself from serious loss I accepted properties in payment, all of them substantially encumbered. Arrangements were made to build another house, and •on the strength of representations made my banker in Gisborne advanced a further £4f>() for which I was responsible. Early last year I was informed that, the house had not been built, only the framework having been erected. I immediately saw my banker, advised him of the position, and transferred the amount then due, viz., £4BO, to my private account. Several transactions wore afterwards made by the builder, which required the presence of his Gisborne solicitor in Tauranga to complete. He was to receive in settlement a sum of £ISOO, out of which I would have received the sum of £SOO. Arrangements were then made to take the solicitor through to Tauranga, but we found the road blocked by a big slip beyond Motu, and were unable to proceed. The consequence was that this business fell through, and I have never .received payment. "The property at Muriwai, already referred to, was held by Mr. A. G. Beets and myself in ecpial shares. We leased this under a share-milking agreement. The first year we made a small loss, but the second season was disastrous on account of the drought which so seriously affected this district. Last. August we sold the place to.'Mr. J. H. Smith at a loss of over £2500. Mr. Smith assumed all liabilities for outstanding accounts. As soon, however, as ho had .taken possession the first mortgagee took action to sell up, as the mortgage was overdue. Fresh arrangements -were made, but Mr. Smith could not see his way to continue'. His default cost us a further loss of close on £SOO. "Mr. Beets and myself were also interested in a slice]) run of 1979 acres at Whitikau. This was lightly encumbered. An arrangement was entered into for me to buy out my partner, who was to accept town properties for his share. Mr. T. B. Spence offered to guarantee me up to £3OOO. This sum would have paid all my unsecured creditors, and would have been sufficient to 'farm the block. As, however, it was impossible to raise the money, we had to sacrifice the farm for £IOOO. As Mr. Beets finally decided not to take my property, I am still indebted to him for £127 16s sd.

"It was in January, 1920, that I realised things .were getting very serious. To carry out the various projects .1 had in hand had necessitated mortgaging all my properties, and then the fact of ray having to take numerous properties over to save the money invested, only made this worse. Daring that month a commission of £<>f>o earned in the previous month was through failure of the purchaser to complete. Following this were the isorious losses oil the farms. Later the loss ofi £llsO in respect to the business of Spencc and Co. All this time the land agency business was diminishing as the slump continued. "In August, 1026, I called my creditors .together, and put my position before them, when it was suggested I should be given 12 months to enable some of the properties, to lie realised, in expectation of an improvement in .the property market. Two months later Mr. A. J. Cox, proprietor of Ormonds Motors, issued bankruptcy proceedings against me. Messrs. Allen Bros, and .Tohnstone were acting in conjunction with Mr. Cox. 1 was successful in having these proceedings adjourned for three months, and in the meantime sold the business known as Kpence end Co., jewellers, to Mi'. Cox, whereupon he withdrew the petition F'ince that time I have been repeatedly threatened with fresh proceedings by Messrs Allen Bros and Johnston*;,