BANKRUPTCY.

Gisborne Times, Volume XXI, Issue 1712, 31 March 1906, Page 3

BANKRUPTCY.

SMITH AND SCOTT'S ESTATE.

The first meeting of eroditors in tho estate of Smith and Scott, builders, was hold yesterday afternoon. Amongst those present were: The Deputy Assignoo (Mr J. Coleman), and Messrs G. Evans, G. I£. Paeloy, T. Morrison, Stafford, Callaway, A, Wade, Wallaeo, V. Barker, and E. j. Chrisp (for dobtors). Tho assets in tho estate woro estimated at £379, liabilities £9lO 10s 7d, dofiaionoy £531 10s 7d. Mr Soott was first examined, Mr Smith boiog asked in the meantimo to loavo tho room,

Me Soolt, ono of (he debtors, stated ho had been 12 months in business with Mr Smith, and had no capital. Mr Smith advanced £5 to pay the deposit oo Mr Judd's oontraot. Tho firm bad been in a large way of business, and got plenty of work to do, all oontrsots. Some pa'd and some did not. We had a heavy loss on Mr Blaak’s oontraot foe building a house at Pakowhai. Tho amount was £641 10s, with extras, We lost about £175 on it. We lost about £4O on Leslie's. I think tho others all oloarod tbomsolves. What dc you oonsider tho oauss of your bankruptcy ? Debtor: That wo took too much work in hand. Assignee: How would that oauso it ? Debtor: So many jobs oould not be looked after, and it oost more for wager than it should have dene. Do you think you had fair pricos ? Yes ; one or two were low. Was Black's too low? Not if I could have gone on with it. Was Leslie’s too low ? It would not have been if there was not so much interference. How do you mean yon paid too much for wages ? Because it was more than I pxpreted, especially Black’s, I think £7O or more was paid than ought to have been paid for wages. The men may not thick so, but I do

Is thera any other oausa ?—No. What have been your personal draw' ings ?

Debtor ; Under £2 a week for eaob of ns all through. This last month we drew nothing. _ What books did you keep ? (An oxer* Oise book was prodaosd, debtor adding that be also kept small note-books in his pooket.) The Bohedule, he said, contained all the assets. In reply to Mr Chrisp, the Assignee said £133 had been paid into Court oat of Leslie’s money. Mr Chrisp (for debtors): Mr Stafford was vory good to-you at fir-t ?—Yes.

Mr Ghriep ; How much did you pay Mr Stafford ? 5- Mr Morrison : Is it right to ask that question ? The Assignee : Yes. The amouot was stated ie be £360. In reply to Mr Stafford, debtor said he did not koow what his partner had in the bank when they started; he bad not asked him.

Did yoa say it was your experience against his capital ? Debtor: No. I said that my partner was finding the deposit, aod that he had a few ponods in the bank. Did you not say he had a good nest egg in the baok ?—No, I said he had a few pounds there, and wa3 finding the money for the deposit. Yon said, " All right, I will let you.have what you wanl.” Did you not eay he had a considerable amount of money ?—No. I could not, beoanee I did not know what he had. I could not tell you any more than fly in the air wbat be had.

Has he any there now?—l could not tell you. I only wish I had some there, and you would have it. There is 10s lying there against the estate. Mr Stafford: Did you not say it was jour experience against his money ? Mr Chrisp: He has said no three times already. Mr Stafford: I want to get at it in different ways.. Did you not always say to me you would have a profit ou all your businsss ?

Debtor: So I thought I would. I am not the first man who has made a mistake in the line. , You never led me to beliove there wbb fikely to be any loss ? Nor did I think so tnyaelf until six weeks ago. Coaliauing, debtor, in replv to Mr Htaffard, said ho had stated about February 7tb, that there was £llOO coming in from the contracts, and £9OO would build {frem On the 10th, when he had notice of lien from Wade and Gray, he had with his partner gone into accounts, and told Mr Stafford there was plenty for everybody. Ho thought there was. If he had kaown then what he knew now he would have stopped the lot of the jobs. Mr Stafford : You have already said you have no other assets except those iniiladed in the statement ? Yes ; nothing oxoept the furniture. Debtor was then closely questioned ae So plant valued at £3O purchaeed from Allan and Jooes, and declared that tho •slant had been returned next day because it was not suitable for the work. Mr Stafford : You did not submit a list |iiq me of the plant you bought ?—No. ijjae question was thrice put and an: swered in the negative. Mr Stafford : All right 1

Dtbtor : It is all right. Farther questioned debtor said be had not shown Me Stafford the prioe list of the plant, bat had told him he intended to jive money on the plumbing for the Hospital job. Me Stafford : Did you not show the bill to me ?—No. . Me Stafford : Then how would I know about it ?

Debtor: 000 oan hear many things. I hear things mentioned in the Btreet 1 did not know. Not a solitary penny was pa'd for the maohines ; they were returned because they ware no good. 'Mr Stafford then closely questioned debtor aa to whether he had not removed certain pieces of timber, and sash frames, 0 whion he positively replied in the negative,; All he had taken was a load of fire*Wqod pieoes. He knpw staff bad been re; njoyed, and had informed the Assigneeanyone could get into the ahec}. He would swear he had removed nothing exoept the firewood. Mr Stafford: Oan you tell me your losses on billiards ? Debtor : I never played billiards ia my life. . On gambling ? I don’t gamble. I put a shilling or two on a horse race, and will put it on as long as I live. Have you not been in the habit of gambling ? No, I don’t play billiards, I back a horse and will do it again. Mr Stafford: What do you casaa by that ?

Debtor : If I hive a pound I put i& on if I have five shillings I put it on, It ii my own money. Have you not been in tbo habit o gambling ? Debtor: I will work for you for three solid months for nothing if you can bring a man to prove it. Mr Stafford : It is very susp : oious— Debtor : I neverMr Stafford : All I can says is that I have seen you in the company of bookmakers aod such people. Dobtor: You might be in the company of a man carrying a Bible under his arms who will rob the widow and orphans next day. Mr Barker said that time wa3 being , unnecessarily occupied. Debtor: I don’t like slurs. Mr Morrison: I don't think a dobtor should question a oreditor; he should answer questions. Mr Stafford (to debtor): Too question I ask is—Have you gambled ? Debtor: Not at all, except horse-racing. Stafford : Have you made losses i Debtor: No, I have lost nothing. Asked by Mr Siafford why ho bad not finished Leslie’s Omtraot, debtor said that when creditors crime in with liens and took poseession it was their place to finish it—he handed it all over to the creditors. Mr Stafford: You have been walking about the streets' while they have been paying men to fioish the jobs. Debtor: I don’t know about paying ■ them, Did not your solicitor employ men to finish the job ? Debtor : There were four braokets to go ■up ; I asked two of the men to do it, and whether they thought they would not get tbeir woges and did not do it I don’t * Ajioow.. - -

Mr Stafford : Don’t you think you might have done it yoursolf and saved the creditors a few shillings ? Debtor said ho had done thorn for tho creditors. Ho had sout a mau to tho Alexandra ton rooms, and had got to pay him out of his (Jobior’t) own pocket. Don’t you lkink you should have finished Leslie'sl Dobtor : It was finished. Mr Stafford : Tho oroditora have to pay for that. Dobtor said if the oroditora took on themselves to do things a j ked for by tho I arohitoot nnd not included in the contraot, I ho wos not going to do it. Mr Stafford again wanted to know why the brnokets woro not fiuisbod, nnd Mr Pasloy said that for tho sake of three hours’ work tho whole job had boon stuok

up. Mr Stafford said that while thore woro a few things wanting done at tbo Alexandra tea rooms, debtor was loafing about tbo streets instead of finishing the job. Have you boon in tho habit of going to the theatre ?—Yes. Have you bocn eaoh night to tbo theatre unco your bankruptcy'.•’—Yes, but not with my own money. Mr Stafford : Wto o money '? Debtor: My son’s, aud ho works for it. Mr Stafford : I think I will loavo tho field to some othor creditor, Mr Darker : I understand debtor to sry ho did not include private effoots, whioh should be included in case of a deficiency. In roply to tho A-sigoeo, debtor said ho had not put down the furniture, but bo had kept tho private accounts out of the list, hoping to pay tbom. Tbo piano.was purcbasod by his eldest daughter aad sou, and after her death was handed over to tho son. The rost was worth about £2O. Same had been obtained from Grundy and Shennan, and was not all pa'd for yet. Th 9 private debts ho bad left out were those of tbo butoher and the bsker. He hopod to pay them —he hoped someday if ho had luck to pay all tho creditors. He would do his best. (A creditor laughed.) One gentleman laughed, but he would pay if bo could. In reply to tho Assignee, debtor said he did not know it was necessary to inolude the furniture in tho schedule. In reply to Mr Barker, debtor admitted that he had told the Alpha Sawmill Company that ho would pay them, when he received the £2OO from the hospital contract, aad on the strength of that had obtained a further supply of goods. Mr Evans questioned debtor as to bis banking aocount, and how it came that his banking book showed only £946, while he had received £2.381. What hal become of that ? Debtor’s explanation was that the rest had been paid away in oasb. Cbrques had been oashed and wages paid. Mr Evans, after further questions on this point, said it was a suspicions thing that the balances in the bank-book agreed to a penny to the 27tb. It looked as if it had been worked nicely to fit in. Debtor : All the reoeipts are there. Mr Evans: Where? Am these the only books you bave got ?—Yes. Well, yon have not proper beoks at all. Your losses were L 250 ? Debtor : I cannot say to a penny, Well, say to a tenner. In your statsmeat you put L 531, uow you tell us your losses were only L 250. Debtor said other amounts would make up the total, Mr Evans Baid when debtor oame to him for timber be bad distinctly questioned him why he bad not got this t'm bar at Mr Stafford’s, and Scott hal replied that he had wanted some wtather boards to go on with at the hospital, and Stafford had not sent them. Had not debtor in reply to a question as to whether he owed Mr Stafford money, replied, " Not one penny piece ?” Debtor : I could not tell you, beoause I did.

Me Evans : You did, and on that representation we gave you credit, It is no good talking over that. Debtor : No, it’s no good talking. Mr Evans : It strikes me we (Evans, Nield and Go.) were in the same bos as the Alpha Sawmill Company. You misrepresented your position lo us. Debtor : I did not. Mr Evans: You did, goiDg by your own words. Debtor: I told them I would give them the money when I got it. Mr Evans : If someone else did not get it. You oame to us with a chfque for JG3O, asked us to bold it beck, which we did, and wa let you have more goods on that. You knew very well the money was not in the bank. Deb:oc : I told you it was not there. Mr Evans : You told us it would be there on Saturday. Debtor: And it would have been there. Mr Evans : I think you ought to have been ashamed of yourself. 11 Hear, hear,” edded Mr Stafford. " Can you tell me the date of the cheque ?” Mr Evans said it wos about the 3rd of March, and was to be presented on the 10th.

Mr Stafford said that week he had oalled at Soott’s house to esk him when he would let him have some money. Did you not tell me you had £IOO cash in your pocket then ? Debtor: I said I bal a £IOO cheque. Mr Stafford : What has become of that ?—it was never paid into the bank. Debtor : Mr Evans got £6O of that. Mr Stafford : Bcott told me he gave you a obeque for £3O, which bad to be met on the following Saturday, and had been dishonored. Be told me he had £IOO cash in his pocket at the time. Debtor : I oan account for every peony. Mr Stafford : You oan account for every penny you ever had. Mr Morrison : You promised to give me £3O of that, anl I did not receive a penny. Debtor: You g t your chare, Tom, as well as any of them. If they all got as good a share as you some of them would not be so far out. I told you there was none for you, and you went and tried to stop it. Mr Morrison: Which I hope I have done. Didn’t the architect tell you that out of that £IOO there was £25 for the painter 2 Debtor : Be might have said so, but not to me. Mr Morrison : When I asked you in the street if yon had aDy money for me, wbat did you say ? Debtor: I aaid you could not have it. Mr Morrison: You told me to go to b .

The Assignee called lhe speakers to order. Debtor said be had drawn the hundred pounds from Mr Oolemao ; £6O had btoa paid to Mr Evans, and £lO went in wages and small accouuts. Mr Morrison : Was there £6O worth of timber on that contract ? Debtor said the contract had not been kept separate. Money drawn from one oontract had gone to pay wages in another. Mr MorrißOD : I don’t want a tale about that,

In reply to Mr Evans, debtor siid he could not say bow much timber he had used from his firm for that oontract. Mr Stafford ; Did you not tell me you would rnako LIOO out of the Alexandra tea rooms oontraot ? Debtor : I thought I could. Mr Morrison: Have you paid mo any money on that V Debtor: I oould not toll you that. Mr Morrison : I could tell you no. Debtor said be had not fold Mr Morrison and showed Mr Webb figures to prove that he was £2OO or £3OO to the good. Did you not induce us to become bondsmen for £SO in the Coast oontracts by those statements '! Debtor : I might have said I bad £2OO —my memory must ba bad or yours is that way. Mr Morrison : I think yours must be very bad. Tho position is simply this. You put me and tho other man io the position that wo may lose, through taking your werd, £SO on three different contracts. Do you call that honest ?' Debtor: Woi o you not willing to do it ? Mr Morrison : We did it cut ot kindness through misrepresentation, 1 Debtor : There was no misreprosenlation,

Mr Barker : When did you first realise you wtro not able lo meet your liabilities ?

Deb'or: When the first lion was put on Les-lt&’d contract. Mr Evans: You told us you would pay everyone. Debtor: Yes, I thought I oould. Mr Stafford ; Yon said you had £llOO coming to you ?—Yes,

S I Woll that egreoa with what Mr Morrison . I says you told him. In reply to Mr Morrison dobtor statod positively that ho did not go to anyone oleo to booomo suroty. Mr Morrison : I know you did. I Further questioned dobtor said bo had mentioned tho matter to Mr Wade, but had not askod him straight out to go surety, Mr Wade : Did you not oomo to our I shop and ask mo to put my namo to I '• this pieco of paper ?" I askod him what it was, and ho said “ only a piece of pnpor, surety for tho eobool job at Toko* Ima u.” Did you not say that ? I mentioned to you about tbo sohool. What was my reply ? I oannot remombor. Did you uot oomo in a seoond timo ? Debtor : No. Mr Wade : Well, all I oan eay is you f did. I

t Debtor : I would like lo ask you a . quosticn. Assignee : You cannot do that. ( Being reminded of a conversation as to Mr Morrison having signed for Morrison I Bros, debtor said that was on tho first visit, not tho second one. Mr Wado went on to show that tho I putting of a lien on was not undue prosuro, but had been done because of I dobtor’s breaking his promises to square I up for the Murewai job. Debtor denied that he hod promised to I square up on tho Murewai job dirootly I tho arohiteot went out, and would Itt I Leslie’s stand. “ You got yours, at any I ra!o,” ho added. Mr Wade had not asked I ' him if there was a preference on Blaok's. I ” You have got every penny of yourp,” ho oddod. I Mr Wade : By putting a lien on. Dobtor : I am sorry all tho creditors I are not paid as well. j JMr Wado : If we woro paid in full we I would have a few pounds more. I ] John Smith stated he had bo:n in busi- I

ness for about olovoo months with Mr Soott as contractors. He bad about L 25, and Mr Soott had nono. Some oontraots paid, and others did not. They lost about LlO on Little’s contract; about LSO on Black’s. He did not know cf any more. Their average drawing would bo about L2 a week each. Scott was supposed to have boon keeping the books, the one produoed and a couple of pooket books. Scott could show by the pooket books what had been made or lost. He (Srnitb) oould not acoonnt for tbo bankruptcy. Assignee : You trusted entirdy to Scott ?—Ye?. Assignee : Did you cot know whether he na3 keeping proper books'? Debtor : When I went up he would explain them to me. Seemed to be going on all right up to tbo finish. I did not understand anything about books, I have no pars n»l property. Mr Stafford : Are you aware Mr Soott told me you had a pretty fair baDkiDg account when you started ? Debtor: All I had wasL2s in the bank. He was not aware that Soott had represented that he had a good banking account. He had taken all his money out of the bank to pay accounts. Mr Stafford : Did I not always impress on you to keep a proper banking account and pay everything through the bank ? Yes

Have 1 not given many of the accounts to you personally ? Two, not more than three. It is not bo long Bgo I told you you ought to send them to me. In reply to the Assignee, debtor said he did not know they were bankrupt until just about the time. In reply to Mr Evans, debtor eaid he had woiked and Scolt was to look after the business portion. He had paid up to Ll 5 out of hta own money in wageß. Mr Stafford : Do you remember, when I said I must have money or there would bo trouble, you promised me the first LIOO out of the Alexandra tea rooms ? Yes.

And another LIOO out of the hospital ? ■Yea.

Mr Stafford ; Do you remember going through the accounts and Scott oomiDg and telling mo that there wa3 plenty of money for everybody ?—Yes. You Bay you baye only lo3t about L6O ?

Debtor : The bosks look different when made up. I would like to know where tbo money has gone.

You think it right for the oreditors to try and point out ? Yis. Have you a bicycle and horse ?—I have a bioycle. Mr Wade: Is it a fact that up to a fortnight ago you bad a baoklog account of LlO ? —Yes, I drew the money to go home.

Mr Stafford: You are willing to give the savings bank book to Mr Coleman ? Yes.

Tenders for the completion of the hospital contract were opened. The original contract was L 785 ; L 340 was received on acocunt, deposit LlO, and there were liens of L 371 lls lOd, The balance of the con. tract was L 455. The tenders received wore: Qaoenin and Bjland L 589, Mackrell and Colley L 599, Haisman aDd Son L 669. Mr Natusch had said he believed the work could be done for the balance if day labor were employed. Mr Stafford : There is nothing in tho ooniract. The liability would be about L 950.

Mr Chrisp explained that he was only appearing formally for the debtors, Be was really appearing for creditors. Mr Barker said the bankruptcy was one demanding the strictest enquiry, and the creditors generally would agree to this. The Alpha Sawmill Co. would Bgree to anything decided on. Apparently the debtors had been getting goods by misrepresentations. It was a matter of criminal law, and if people were allowed to do this no trader would be safe. A man’s word must be considered worth something in busicers. Mr Stafford asked if a bookkeeper would be requited. Mr Barker thought no more expense should bo incurred, and the Assignee said debtors had to furnish a statement. There were no books to examine, Tenders for the were (received ae follows : Baisman and Son Jj\2, F. Stafford Ll 3 10s (accepted) The meeting was adjourned for a fortnight,