SHOPKEEPER’S FAILURE

Taranaki Daily News, 30 April 1931, Page 11

SHOPKEEPER’S FAILURE

NEW PLYMOUTH BANKRUPTCY DEPRESSION AND HIGH RENT. RECENT SLACKNESS IN TRADE. Attributing his failure to the depression and to the fact that the rent for his Devon Street premises was too high, a fancy goods dealer, Alax Alendels, met his creditors before‘the D.0.A., Air. J. S. S. Medley, in New Plymouth yesterday. There was £474 3s 2d owing to unsecured creditors and about three weeks’ rent was unpaid, while the assets included stock valued at £5OO, cash in hand £26 15s 2d, and ten Blenheim oil shares. The following creditors were represented: Alessrs. J. Avery, Ltd. (Mr. A. Avery), Sargood, Son and Ewen (Mr. Cook), Taranaki Herald Co., Ltd. (Mr. F. S. Varnham). Mr. C. E. Monaghan appeared for bankrupt. The Jmmediate discharge of the bankrupt was favoured by .the creditors. As it had seemed when bankrupt filed, said Mr. Aledley, that if the stock were sold by auction there would be very little for the creditors, he had decided to carry on, and already about £lO2 had been taken, while the overhead expenses against that amount had been only about £2O. Alendels had been employed to run the business at a salary of £5 a week. Three girls who were also employed were excellent saleswomen. It . was resolved on Air. Avery’s motion to employ Alendels at a salary of £5 a week until such time as the D.O.A. closed the shop. He was to be supervised during that period by the D.0.A., in whose Imnds were left the auctioning of the fixtures and balance of the stock after the sale.

BANKRUPT’S STATEMF -. T.

In his personal statement Alendels said that he had commenced business in Devon Street, near Liardet Street, in premises owned, he thought, by Alessrs. Eberlet and Morgan in November, 1928. He had £3OO capital which was put into stock. He had paid a rental for a start at £3 10s a week, but this -was subsequently reduced to £3. The initial venture proved successful and in July, 1929, he moved across the street to the present premises, which were-owned by Air. W. H. Broome, from whom he took a lease. His rental in the new premises amounted to £3l 17s 5d per calendar month. The business there was quite successful and warranted the payment of the rent. The business had continued to improve throughout the summer months of 1929-30, and the fiist indication he had of a slackening was in the latter part of the winter of 1930. At that time he was still able to malie a living and pay his way. About six months previously his business started to go back. This period was the beginning of the depression. At the time he was under the impression that the set-back would be. of a temporary nature only, and that with the approach of the summer months and the Christmas and holiday trade he would rapidly be able to consolidate his business again. However, it turned opt that the depression had come to stay and he eventually realised that in the best interests of his creditors his proper course was to advise them of his position. He was further influenced in doing this owing to the approach, of the winter months, during which in his opinion thepe was every indication of a very lean period. He approached _ his landlord with a view to the reconsideration of his rent, but nothing could be done.-

About that time he was being pressed by one of his creditors, to whom he owed £75, and he immediately wrote to all creditors pointing out the position and making certain suggestions as to the realisation of his assets. However, one creditor obtained judgment against him for £75, and although he indicated to him through his (Solicitor that he did not propose to allow him to obtain preferential treatment, he chose to issue execution, which left bankrupt vvith no other course but to file his petition. ,SCHEME OF REALISATION. The scheme of realisation which he had in mind was to conduct a closing down sale and by cutting his stock almost to cost, he anticipated a rapid realisation of the stock and a subsequent distribution pro rata among his creditors. Most of his creditors had agreed to this course, and he set about carrying the scheme into operation. He spent a small sum'in advertising and notified the fact of a realisation sale by bills on his windows. He had on.y started the carrying out of the scheme when the bailiff entered and he filed. The D.O.A. was at present continuing the realisation in the manner in which he started and could supply the meeting with the details to date. He attributed his failure to the general depression "and to the fact that in consideration of the times his rent was excessive. He had drawn from the business on an average £5 a week for his living expenses. He was single and had no dependents. His life was insured but the policy had lapsed. The only ehar»o he had were ten in the Blenheim Oil Wells. _ When he ascertained that the cietlitor with the judgment proposed proceeding to execution, bankrupt, on the advice° of his solicitor, withdrew his money from the Commercial Bank 'n order that it could not be attached by legal process and so that his assets as they then stood would be available for equal distribution among his creditors. He considered this action only right because he had advised his creditors that he did not propose allowing any one of them to obtain preference over the others. , Examined under oath, bankrupt said there was £5OO worth of stock on March 15 and there would be about £3OO worth left. He felt certain that if he were allowed to continue the sale he would get much more than Os Sd in the £l. He had live years’ lease of the shop from July 1, 1929. for which he was paying at the rate of £6 per week plus rates. On the motion of Mr. Avery.it was resolved that the amounts owing 'to each of the creditors thould not be published. The. list of unsecured creditors was

as follow, except where otherwise mentioned all being of New Plymouth: John Avery, Lt<T.; Rodger Importing Co Ltd., Christchurch; Sargood, bon and. Ewen, Ltd., Auckland; Donald Stuart, Ltd., Dunedin; Arthur Cocks and Co., Wellington; Avey Taylor, Ltd., A uck_ land; Taranaki Herald Co., Ltd.; Taranaki Daily News; A. Walker, V\ eßington; Bing, Harris and Co., Ltd., WelI'.ngtoii; Bannatyne and Hunter, Ltd., Wellington; Bagrie and Howie, Ltd., Auckland; Chas. Watts, Wellington; M. Wiseman and Co., Ltd., London; H. Bullivant and Co., Ltd., Christchurch; Arthur Clarke, Ltd., Wellington; Frank Duncan and Co., Ltd., Auckland; Excelsior Supply Co., Ltd., Wellington; lairbairn, Wright and Co.. Wellington; L. j. Qillon and Co., Auckland; Gordon and Chapman, Wellington; Hooker Bros., Ltd.; Hardwicks and Robertson, Ltd.,

p Isaacs and Co., Wellington; R. F. Jollana and Co., Ltd., Wellington; A. H. Miles and Co.. Ltd.,. Wellington; Novelties, Ltd., Wellington; Owen', Rayner, Ltd., Auckland; SuJJings Bros., Ltd.,

Wellington; Fred Sladen and Sons, Ltd., Christchurch; Tanner Bros, Ltd., Wellington; Wood- Sign . Service-. J. Yock and Co., Ltd., Auckland; McGill and Co., Auckland.