SUPREME COURT.—Bankruptcy.

Auckland Star, Volume II, Issue 416, 11 May 1871, Page 2

SUPREME COURT.—Bankruptcy.

THURSDAY, RfAY 11, | [Before His Honor Sir G. A. Arney, Knight, Chief Justice.] . The usual weekly sitting in Bankruptcy was held this morning, when the. following cases were heard:— Re Edward Marsh Williams.—Mr. James Russell appeared for the bankrupt, who was unopposed.—The bankrupt was a magistrate in the Bay of Islands district, and became involved in litigation in consequence of a decision given upon wliat was known at the time as the " Hokiauga grog-selling case." On the 28th July his assets were £1293 17s. lid., and the liabilities £1178. But to the verdict against him, £500, the costs of maintaining the action, and travelling expenses, was to be attributed the bankruptcy. The petitioner passed his last examination, and was discharged. Re Albert Eaton : Deed of Arrangement.—This was an application by Mr. Brookfield for a declaration of complete execution of a deed of arrangement, by which the arranging debtor undertook to pay half-a-crown in the pound. All the formalities prescribed by the Statute had been complied with, except the filing the affidavit of residence.—His Honor made the necessary order, subject to the filing of the affidavit of residence. Re William Swtnton Laurie.—Mr. MacCormick appeared to examine.—Mr. Hesketh was counsel for the bankrupt.—The case was part heard before the vacation. The exami-. nation by Mr. MacCormick had been concluded, and the examination by Mr. Hesketh had been commenced. The ca?e stood adjourned to the 4th of May, but was further adjourned to this morning.—Mr. MacCormick said he was instructed to examine on the last occasion with respect to ihe mortgage. The Bank of New Zealand were now perfectly satisfied of the bona fides of that transaction. —His Honor: You mean the mortgage to the mother. I must say that the lady's evidence and her great respectability struck me with the conviction that she was merely a mother who was assisting her son to the extent of her little means. She entered upon the transaction, I think, with the folc object of assisting her son, and, I may say, I thiuk it was a transaction which she ought not to have been led into. It L», I think, to be regretted (hat persons will enter into trade with little capital except what is represented by transactions of the kind. I myself have no doubt about the bona fides of the transaction itself. —Mr. MacCormiekJsaid if he should find it necessary to oppose the bankrupt's immediate discharge, it would be on the ground of trading with insufficient capital, and what might, appear from the result of the examination in respect to the bill transactions.—Examination resumed by Mr. Hesketh: The last bill examined about was that for £472 133. lOd. On the 17th May I had some largo payments to make, which I could not meet I had, however, about £1300 worth of goods. I could only sell the goods at a sacrifice of at least one-third. I told Mr. Abbot, who had previously often offered mo assistance in the way of loans of money, what my position was. I asked him if he could assist me, as I did not wish to sacrifice my goods. He said he could not give mo cash, but offered to give me his promissory note for £500, for which he asked me £25. This latter proposition I demurred to. The bill was to have four months' currency. I was sued on thi3 bill. The negotiation was dropped, and renewed a dnv or two afterwards, when the terms were reduced to £12 10s. I gave him a bill of £500 as an acknowledgment of the debt, and a promissory note of £12 or the accommodation. The bill for £500 was simply to show the debt, and not to be used. Mr. Abbt said he would not use it. I discounted Abbot's bill for £500. I had one more bill of Abbot's current at the time. I saw the manager of tho Bank of New South Wales, who knew about the bill —that is, he knew what I was going to put the proceeds to. He told mc that I might draw a cheque on the Bank of New South Wales, in favor of the Bank of New Zealand, for the money, upon a bill that was lying over in the last-mentioned bank. The payments I had to make by the 17th were to retire a promissory note of James Mackay, jun., for £64 17s. 4d., also a bill of S. H. Meyers, for £182 ss. lOd. Both these bills had. been dishonored. .My account was overdrawn £6L 7s. 4d. I paid the Bank of New Zealand, in consequence of which £140 worth of goods came into my hands. I sold these goods; the bill for them was deposited in the Bank of New South. Wales, and was paid. The sum I paid to the Bunk of New Zealand wa3 £354 os. lOd. Tho bill was, of course, discounted, and went into my account. These facts show how my credit-balance was reduced to £383. This transaction was in the nature __ of a loan from Abbot, for which T paid him £12 10s. — His Honor: The force this evidence is meant to have is that the bankrupt says, " So far as I am concerned, I never intended to set two bills floating which would enable Mr. Abbot to go into the world."—Mr. MacCormick: 1 think it is rather too much to put the words into witness' mouth, that because the manager of the Bank of New South Wales knew what wa3 to be done with the proceeds of this bill, therefore he knew of the nature of tho transaction between the witness and Abbot.—-' Witness .—Mr. Abbot told mo he had spoken to the manager on the subject. The manager knew I was to give my bill to Abbot as an ■ acknowledgment of the debt. -Tho £500 bill was not met at maturity. It become due on the 17th of September." I did not meet it because I heard of the failure of Messrs. Abbott and Smith—of each of them. -This is one of my liabilities. There is the bill of £280 Gs. 7d.. I had a payment to make on the 4th May of £455 Is. 9d. io Mr. Abbot. That was for the bill which included the £472. The •bill was given in February. It was given to Abbot in exchange for Mr. Smith's promissory note to Abbot — Abbot asked me to exchange. Neither of them could meet the bill. I got Smith's note to Abbot in exchange for mine to Abbot. Mine came due''to Abbot on the 4th of May, and I had to meet it. On the 3rd May Iliad bills and cash to tho extent of £481. Three of these bills I offered for discount, but the Bank would only discount tme of them, viz., Mr.

Holdship's for £131 8s sd. The proceeds of that, with thecash imhand, would amount to a credit balance of about £2501 I expected tobeableto discount the other notes. The markets were vety bad. It was impossible to sell for cash. I requested Mr. Abbot ro renew the £455, or to lend me to tile extent of £230. , I also asksd him for £50 he owed, me. He agreed tefpay me, but he gave me a bill for £280<!lnstead of £230. I discounted the bill, and took up the one for £455..Smith's bill which I took from Abbot was not met, and it was renewed for £472 13s 2d: I met my own bill, and this one stands as'one of my liabilities. I had many conversations with the manager of the Bank of New South Wales with respect to Mr. Smith's position. He told me that Smith was sound, and that I might safely have transactions with him. He spoke of Mr. Smith in this way up to about the end of June. But his reply to the question at ihe last mentioned date showed me there was a doubt upon his mind. These circumstances of course only took place when talking about business matters generally. - About the 18thr of May I had a conversation with the_ manager about Mr. Abbot. Ho remarked that the £500 bill was j a perfectly good bill. About July I went to tell the position of my affairs to the manager, as I had heard of Mr. Smith's failure. Abbot told me that he would lose about £6,000 by it. I presumed that Abbot's position would be affected by Smith's failure.—His Honor : Is it known whether Mr. Abbot paid £6,000 into the Bank of New South Wales ? because one would like to know what it means, whether it was an actual loss, or whether it was such a loss as would be implied by variation in price of scrip.—Witness : I believed Abbot to be worth £10,000 or £12,000 ; if not in hard sovereigns, in property, &c, after payment of his debts.—His Honor: I do not mention it cynu-ally; but one is so much in the habit of hearing of persons being losers of large sums of money, it is desirable to know what is the real position of parties in an inquiry of this kind. Left sitting.