LAW REPORTS.

Dominion, Volume 3, Issue 801, 26 April 1910, Page 9

LAW REPORTS.

IN BANKRUPTCY. PROFESSIONAL MAN AND HIS TRADESMEN'S ACCOUNTS. DISCHARGE WITHHELD. "ASSIGNEE ACTED RIGHTLY." Sitting in Bankruptcy yesterday, Mr. Justice Cooper heard ■ an application in' connection with the bankrupt, estate of Colin Andrews, arohitect, of Wellington. The 'Official Assignee (Mr. A. Simpson) was present, and Mr. T. Neave appeared for bankrupt, in support of a motion for discharge. . • The Official Assignee objected to granting a discharge, because- (1) bankrupt,had. not kept proper books; (2) he had been, living extravagantly. His Honour remarked that the assets were only nominal and the liabilities were heavy. From the report of the Official Assignee Andrews had received .£1250 in three years, and he owed £Hi. " Mr. Neave said : that tho; circumstances of. the bankruptcy wero unusual.' Until three years ago, Andrews had been in the employ of firms of some standing. Ho met with an _ accident, and had to borrow money with which to keep his family. .Thus handicapped he began business on'his own account, with a debt of £iU. According to his statement, of affairs, at the end of three years (February last) he owed £Ul 15s. 9d. He had had for personal use, .£730 in those three years. ' ■■ ' , His Honour, after perusing the.bankrupt's list of his liabilities, remarked that a very large amount of the. .£523 owing to unsecured creditors Was owing to grocers, tailors,. drapers, a butcher, a milkman, and" other tradespeople who ought'to have, been paid week by week. Mr. Meavo said that.Andrews had been' dealing -with the same tradespeople for 20 or 30 years. A number of them had been-.present at the meeting of creditors at Which a resolution was passed recommending his discharge. Another resolution was passed giving back the furniture to his Wife. . . : The Official Assignee: The resolution Was proposed by' Mr. Davis, a creditor to the extent of £17, and seconded by Mr. Hill, a creditor of IBs. Mr. Neave: The solicitor for tho principal creditor (£148): said that, if he had held a proxy, he would have seconded the resolution. Evidence as ,to Andrews's financial position was given by Arthur Thomas Clarke, 1 accountant. He stated that Andrews kept only.a: diary', besides his bank pass-book. He .would have'been wise to 'keep a ledger, he thought. From an investigation of the accounts, witness had ascertained that Andrews had spent ,£730 on' personal expenses in three years, and there was a sum which he had had to include as "unexplained expenditure." Mr.. Neave: Has his position improved mnce he , began : business?— Witness: 'Three years ..ago M7i 8s 6d. was owing. The deficiency now is £iii 3s. 9d. Tho creditors of 1007 are practically tho .snnio as those to whom nioney is owing now." His Honour said that, from the deficiency account prepared .by.. Mr. Clarke, it appeared that Andrews had received, in three years, the sum of : and after paying rent, advertising,, salaries, etc., lie had had .£732,t0 live on. This was the net amount which He had • had to live oh, and nothing had to bo deducted for rent..

. Mr. Neave': That .is the burden of tho complaint now. I think the bankrupt will be'abb to .show that, under the circumstances, he has not been living extravagantly. ■~'.. ..Andrews-, examined in the witness-box, stated.that he had a wife? and five children dependent i upon liim. Three other members of .the. family were grown 1 up. Prior to 1907 he-Had- been employed by .various firms at a ' salary of .£2O per nuflith.' o cycle accident, which confined' him in the hospital for six- months. He found it necessary to borrow/ to pay expenses and charges on the .Oriental Bay-property which he. had * bought.- The last three years a,;.hard struggle, as there had'' : been ; a good deal- of sickness in;his family. He was strictly temperate in his habits, and had not spent £29 on tho family in the past three years, on anything, apart from the common necessaries of life. Ho had been dealing >-with the, same tradesmen for years, and none cf them had complained that he was spending his.money and not paying them. . The "unexplained expenditure,"'referred to'-hy Air. Clarke, .had gone in the purchaso-of articles for which his Wife had paid cash. . '

His Honour: But you owe. the bootmaker £22. ; •■':;' Bankrupt: I have dealt : with the same bootmnker.'for .35 years.' His Honour, expressed the opinion that a man earning' £250 ought not to run up accounts, like, these simply because he said that he could not practise economies. He should live within his income. 'It appeared that ho had not paid his milk . bill.for about two years. Ho had hot paid his dentist,.his grocer, his draper, or his tailor. A man, because' his income was -'small, had ; no■right. to live upon his tradesmen.'. Bankruptcy did not interfere with his-profession, and perhaps he was. ■ .prepared .to • do something for these'tradesmen?, Mr. Neave:. From what I know of the bankrupt, I-feel' confident that" every effort, will be put forward by him to pay off' theso debts. ' ■ His Honour said that, if a. discharge were granted in:, this, case, it would go forth as a precedent that a man gotting £250 a year net might nevertheless .file, and avoid liability for the debts'he' hod incurred with numerous tradespeople. Mr. Neave' replied this bankruptcy disclosed some unusual.circumstances. His Honour: He owes even for the hat he wears: "C. Hill, 18s. 6d.," and for the clothes he has on: "M 10s." There, is M 3 for clothirip alone, , and he owes money on.his piano—surely a luxury. The Official Assignee: The piano was on the hire system, and it has gone back to the piano company. ~ His Honour remarked that tradesmen's accounts amounted to £120. 'As for the resoliitipn passed at the Inst meeting of creditors, his Honour paid little attention to it, seeing that there 1 were 47 creditors,' end only: 10 had been present at the •meeting. .■.'-, His Honour expressed tho decided opinion that this was not a case in which an immediate discharge should be granted, ft would bo an extremely bad precedent. Mr..Neave: Would your Honour adjourn tho. application in order that the Official Assignee may call a .meeting of, the creditors; and it could be ascertained what can be done by the bankruptf His Honour said that he would grant tho, 'adjournment, with pleasure, for that purpose, and, after the Court's expression of opinion, creditors would know that a discharge would not-be granted readily. His Honour considered that the Official Assignee had acted rightly in the matter. The case was adjourned until the first Bankruptcy sittings in July, when application might bo renewed.

OTHER PETITIONS. An application was made by Mr. H. P. Von Haast that Gini Angclini, settler, of Wellington, should be adjudicated a bankrupt. Mr. T. Noave' appeared for the debtor; and hearing of the application was adjourned until May 3. Jfr. A. H. Hindmarsh appeared-on. behalf of Gordon Gibson, City Council employee, who petitioned that Frank C. Matthews,, commission agent,, should be adjudicated a bankrupt, l'ho order for adjudication was made. A discharge was granted to Georgo Morris, dairymen, of Wellington, for whom Mr. Levi appeared. The Official Assignee offered no opposition. Charlotte Castendyk, bonrdinghousekeepor, of AVellineton, for whom Mr. A. Gray appeared, was granted a discharge. Appearing on behalf of a petitioning creditor, Mr. Fair moved in the direction ,of having Edward John Falkner, telegraph operator, of /Wellington, adjudicated as n bankrupt. Tho debtor attended, and asked that the matter should be- adjourned, stating that he could find tho money in a week. The cose was adjourned until Friday. A motion for an order authorising the refund of Court fees in connection with the case of John Holmes, merchant, late of Wellington, but now of Sydney, was l struck out.

- Mr. Levi, appearing for William George Somerville, bankrupt solicitor, of Wellington, applied, for the review of an alleged refusal by the Official admit certain proofs. His Honour: V r ou cannot prejudice tho estate. The Official Assignee: Oli, no; there will be no dividend. Hearing of the matter was adjourned until the next silting of the Court. Application fur a discharge having been made by Caroline Cullcn, boardinghousekeeper, of Wellington, his Honour romarked ' that ihe petition must stand over until certain preferential claims for wages had been .satisfied. /'■ In regard to the bankruptcy, of John .Morris Scknpiro, furniture-maker, application was made for the setting aside of a mortgage to one Hall Kenny.as a fraudulent preference. Mr. H. V. Von Haast (acting for Mr. Myers) supported the motion, and Sir. P. Levi appeared for the bankrupt. His Honour agreed to hear the application on Thursday. ■ A discharge was applied- for by William Edmund Bateman. cabinetmaker, of Tawa Flat, for whom Mr. T. Neave appeared.. The Official Assignee, said that bankrupt had got into debt, while trying to establish ..a- homo at Tawa Flat.. In his spare time, he had been building a house r and most of his debts had been, incurred, for timber. He had not reckoned on being out of employment. His •Honour painted out that the bankrupt had filed only a month ago, and the case would be adjourned until the next sitting, in order that time might be. allowed for preferential claims for wages (if any) to bo put in.