IN LIQUIDATION

Waikato Times, Volume 117, Issue 19515, 2 March 1935, Page 9

IN LIQUIDATION

A HAMILTON COMPANY. REALISATION OF ASSETS. WINDING-UP PETITION. Some facts relative to the operations of tiie Phoenix Trading Company, Hamilton, were disclosed ‘ in the Supreme Court, Hamilton, yesterday, when a petition was brought before Mr Justice Fair asking for the wind-ing-up of the company. The petition was opposed by the Wellington Woollen Manufacturing Company, a principal creditor, and B. R. Long, manager of the concern and another creditor.

Mr C. L. Mac Diarmid represented the executors of the Choat Estate, a guarantor of the company, Mr Johnson appeared for the Wellington Woollen Company, and Mr A. iL. Tompkins for Long. In asking Ilis Honour to adjourn the case for three months, Mr Johnson said the Phoenix Trading Company was registered in Wellington, and its head office was latterly transferred to Hamilton. Its operations consisted of a house-to-house canvass of men’s ololhing, sales having been made on the instalment plan. Business was carried on at a loss, and as at December, 1933, the accumulated book debts were £7200, and these had to be drastically written down, leaving net assets of some £I2OO. The Wellington Woollen Company was the principal creditor for £5700, the Phoenix Company’s only other liability being some £SOO as salary, claimed by B. R. Long, who was manager and canvasser of the concern. The Woollen Company held a debenture and a guarantee by the late W- A. Choat, whose executors were the petitioners. Delay Desirable.

Continuing, counsel said that on February 20 the Woollen Company appointed a receiver. They believed that to get the best realisation it was desirable to keep the company in operation and employ Long as a reduced salary to collect debts. The personal aspect of the business was most important, as all the customers were known to Long. The Woollen Company' considered that the winding up should be delayed for three months to enable the realisation of the book debts.

Mr Mac Diarmid explained that his clients were involved with contingent debts for £ISOO, as well as other liabilities, and they believed that if Long carried on and liquidation was not now effected the position of the company would get worse. It was considered that the Choat Estate would be prejudiced if an adjournment were granted. MF Tompkins ' contended that all parlies would be prejudiced by immediate winding-up.

Ilis Honour stated that the information before the court.was inadequate. Evidence of the income and past records of the company should have been set forth with greater detail and precision. It seemed to be in the inleresis of the Wellington Woollen Company that the business be brought to a close in a way which would produce the most from the assets. lie could not see how a short adjournment would seriously prejudice the petitioner. An adjournment was accordingly granted till April 12.