MUSGROVE-THOMPSON BANKRUPTCY.

Dominion, Volume 2, Issue 439, 23 February 1909, Page 5

MUSGROVE-THOMPSON BANKRUPTCY.

STRONG REMARKS BY JUDGE -■• .■■ CHAPMAN. ; . -.•'; , In passing sentence of imprisonment to A. R. Musgrove and A. Thompson, bankrupts, of Feilding, his Honour,, Mr, Justice Chapman, took occasion'to deliver some strong romayks on the general aspects of "the bankruptcy, the central features of which-were reckless trading and. irregular methods of business. . '.; . ■■: ' .-• ■ ' ■:':.'"■ ■

The jury's verdict (says the "Feilding Star"), , was as follows':—As regards' Musgrove, guilty' of incurring debts without reasonable expectation of being able to pay ..the samo; .failing '. to keep proper books and rash and hazardous speculation; not guilty of obtaining credit'by false balance-sheets. As to Thompson/ guilty of failing to keep proper books, and acquitted oh the other charges. In delivering sentence,, his Honour said he did-'-riot think it right to extend the provisions of the Probation Act to a case of this kind. The penal clauses of the Bankruptcy •Act were passed with the definite object of calling the attention of traders to the cense■guences of irregularity in - business proceed- , ings. ■' Continuing, he said: — '■ . . '■'"The , Legislature has thought fit,to stamp 'as.criminal the reckless incurring of debts by persons who have no reasonable ground for: expecting to pay ; the same. , -Also, for obvious, reasons,' it' has been.thought lit. to mark as penal the offence of failing to keep proper books such as will readily disclose the state , of affairs of a;.debtor. . If ,1 were to accede to the suggestion that you are entitled to -.probation , you are first offenders I -would-.be going a long way to nullify t the provisions of the Act, Because, as far as my observation goes, the men I have had the misfortune to try have always been r.en, 'of good character, and men who were free from criminal taint—men who had , not committed the offence with' the object of stealing money or stowing ..it. away,-.but who had committed, the offence with the.object of getting .means to pay.' their creditors! -. That kind of misconduct, according to the Legislature, must not go on. It is penal to carry on on a' false basis. .The very de-, fence that.was raised in this case-—that the statements : that were made were made in ignorance..of the . true:state of affairs, and; that the' debts -were ..incurred in. ignorance of the ' true : . state.-'. : of . affairs is -one that : could not have possibly been:.suggested,had there been proper!books' in. , existence, showing approximately, the position in which you stood. .1 am not going to set aside the. provisions "of theV'Act, 'and I Would ;be doins so .if T extended the. provisions to you." . .'...■■ '.' •.; " " : ',!.'.-•'

, Bis Honour went on to.say thaVhe did not! think there were- no cases in which the' Pro-! bation Act- might be enforced in connection with bankruptcy proceedings.: '.For instance. a partner, living'at' a. distance might, be in: ignorance of the true state of the affairs of' his firm. But. both, in 'this' case had means of knowing the position. Neither offences of which they-were found guilty, were committed under stress of temptation on a particular day, but. extended over a considerable period. "You have been found to , haye incurred this -long.string of debts, over a considerable period! Obviously that is the meaning of the.verdict, and I don't see how. any conscientious jury, could have arrived at" any other conclns'ion. As -to 'the , books, you have failed from start to ■finish to keep .them .properly. 'You.never seemed to have realised that' your business >'as : a.continually, losing one, and I give you credit-for not having .realised'that.it was.so ..Even if the ram 'transaction "at. | .'Melbourne had. succeeded,. you. would still have been.hopelessly-insolvent.':' ; : ' "I must put, the stamp of the, (Court upon an offence of 'this.'kind... I do not intend, to pass., an'.,'extravagant sentence,' but at the. same'time I cannot' pass : a merely: nominal sentence. People must be\ impressed,with the .danger in similar hnsiriesses.in not keeping proper, books. I; altogether- disagree with ;the suggestion ! that ■ because" books' are" expensive to keep they should not be' kept. 'That would inflict a' great ■'injustice on' those, •who did kriep books. <■ Under" the'' circu'mstances'the'.loiTe'st sentence I can pass is the 'one' li'Sntend'-'to'.'pass.'". You,'-' Albert "Robert will'bo sentenc'ed' ! to''-f6ur moijtiis , ' impri'sbrimeritV'and you;' Albert' Thompson'," to' two months' , imprisonment:- .In"order to mark this out-from'.a' casojri'which sordid fraud'is' ■ charged, I make .these sentences'without hard 'labour', ''j '•,"•' ;.'■'■" .■..■.':■/'"■.■•:■■'. .'./:■-.■:...