BANKRUPTCY COURT.

New Zealand Times, Volume XXXII, Issue 5024, 1 May 1877, Page 3

BANKRUPTCY COURT.

Monday, April 30. (Before his Honor the Chief Justice.) IN RE H. E. TONES, A DEBTOR. Mr. Barton appeared to upset a certain deed of arrangement ; and Mr. Allan, on behalf of the arranging and assenting creditors, to support it. , Mr. Barton went into a number of_ transactions prior to any meetings of creditors, and impeached them as being fraudulent and entered into with a view of giving preferential claims to certain of the creditors. Coming to the deed of assignment, he contended it was bad, because it had not been assented to by the requisite majority in number and value. The 138th clause of the Bill provides; “The deed shall be deemed to be completely executed when it has been assented to by a resolution in writing, passed by a majority in number representing three-fourths in value of the creditors of the arranging debtor present or represented at a meeting of creditors convened for that purpose or at any adjournment thereof.” By another clause it directed that the “ requisite value ” shall be computed by deeming a person a creditor for the amount of his debt provable in bankruptcy, after deduction of the value of all securities for the same held by him on the debtor’s property ; but there is to this clause a proviso, setting forth that if the deed provides for the payment in full of all creditors whose respective debts do not exceed £lO, that class of creditors shall be excluded in such computation. The deed in question did contain such a provision, and Mr. Barton contended that the deed had not beenassented to by the requisite majority In value, inasmuch as the claims of secured creditors had not been included in the computation; and further, inasmuch as many of the persons included in the computation as creditors were not really so, as they were not at the time' of so assenting holders of the negotiable instruments in respect of which they had proved. The total of the debts in respect of which creditors had proved amounted to £3IBB, thus £2391 would be the required sum. Creditors whose united debts amounted to £2421 had proved, and so far that was sufficient, but the claim of Mr. W. B. Rhodes for £450, and that of the Bank of Australasia, which held bills to the amount of £Bl7 discounted by them on account of Beck and Tonks, had not been allowed for in making up the total amount, thus the requisite majority in value had not been obtained. Neither had the requisite majority in number been obtained. There were twenty-nine creditors in all, of whom sixteen were creditors for amounts not exceeding £lO in value. Nothing in the Act prevented these persons having the right to vote in order to constitute the majority in number ; but only ten out of the twenty-nine had signed. Mr. Barton also objected that the deed was fraudulent inasmuch (1) as it provided for payment of a composition of ss. in the £, whilst the estate could pay 7s in the £ ;, (2) that under it Mr. Tonks and Mr. O’Shea, two of the creditors, would be preferred jb the others ; (3) that it was not executed ,in good faith between the debtor and his creditors. Incidentally a mass of smaller objections were made, and the learned counsel had not quite .concluded when the Court adjourned.

, The Courtat its rising adjourned till WedneS' day next.