BANKRUPTCY OF MR. O'SHEA.

New Zealand Times, Volume XXXII, Issue 5051, 1 June 1877, Page 3

BANKRUPTCY OF MR. O'SHEA.

. On the 19th of May, a meeting of creditors in the estate of Mr. James O'Shea wag held at the Chamber of Commerce offices. There was a very large attendance, most of the leading merchants of the city and the banks being represented. After considerable discussion, it was agreed that Mr. O'Shea should meet a committee the next day, aud that the committee meet again in the chamber at 2 o'clock in the afternoon, Mr. O'Shea stating that he thought it probable he would be able to pay 7s. b'tl. in the £ by sacrificing what belonged to his wife. In accordance with the above resolution, a meeting was held on the 20th, and the following composition accepted:—Mr. Schultze to pay ss. in the £ cash, and give bills at 4, 8, and 12 months for 2s. 6d., with S per cent, interest, these terms to be embodied in a deed, to be prepared at once by Mr. Buckley as solicitor for Mr. O'Shea, and revised by Mr. Quick as solicitor for the creditors.

On the 28th May another meeting was held, which being of principal interest, we report in ull, as follows: Amongst those present were—Messrs. Tolhurst, Anderson, Schultze, Mclntyre, Mao douald, Moeller, Ledger, Bannatyne, Krull, W. G. Turnbull, D. T. Stuart, A. P. Stuart, Cook, Sawer, Keeves, Duncan, and others. Mr. D. Andeuson having been voted to the chair, said the meeting had been called by Mr. Qoick, solicitor for some of the parties, as he understood for the purpose of bringing some fresh matter before the creditors, and he would ask that gentleman to explain what the meeting had to do. Mr. Quick said unfortunately he had not convened the meeting for the purpose of placing fresh matter before them, but simply to report progress, if the word process might be used. A week had elapsed since the last meeting of the creditors, and nothing whatever had been done, so that he thought it his duty to convene a meeting of creditors to lay before them the position of affairs, and invite them to state what should be done. In accordance with the resolution passed at the last meeting, Mr. Buckley and himself had set to work to prepare a deed of composition; but when it came to the question of Mr. Schultze signing it, he had for some reason or another declined to have anything to do with it, and the composition therefore had never been settled in its most material part. Under these circumstauces, he would like to know what the creditors intended to do. His feeling was strongly in favor of compelling Mr. O'Shea to file his declaration of insolvency at once, because up to the present time no act of bankruptcy had been committed, and the creditors were really not in a position to deal with the estate. Mr. O'Shea was to them just as an ordinary individual who owed them money, and they were unable to lay a single finger on any of his assets. Such a state of things it was most undesirable to continue, and it was high time that the creditors took some definite step to protect their own interests. That was why he had called them together. He might state that if a declaration of bankruptcy were filed, there was no reason why a deed of arrangement should not bo agreed upon afterwards. The Act provided for such a course, and a deed of arrangement after the bankruptcy would place the creditors iu exactly the same position as they would be in under a deed without bankruptcy, while in the former case there would be the advantage that the estate would be properly liquidated, and the interests of the creditors thoroughly protected. Mr. Schultze said that when he came to inquire into the settlements of Mrs. o'Shea's property, he was surprised to find that neither she nor the trustees under the deeds had any power to place him in possession, or to give him a sufficient security for the money he would have to find in guaranteeing the 2s. Gd. in the £. He had been thus advised by his solicitor, and must decline to undertake any guarantee. Mr. Kiiur.r, asked Mr. O'Shea whether he had any other proposition to make to the creditors, or whether he could find any other person to guarantee the money ? Mr. O'Shea said he was not in a position to make any further proposal, and as he had only learnt of Mr. Schultze's refusal on the previous day, he had not had time to negotiate with other persons. The position of the settlements which Mr. Schultze objected to was a matter of opinion among the lawyers. He believed that arrangements might be made by which ample security could be given. His wife and the trustees were quite ready to do everything in their power to that end. However, Mr. Schultze had declined to have anything to do with it, aud had the meeting not been called, he should have endeavored to get some one else to afford the required guarantee.

Mr. Kuull: Does your own lawyer find any difficulty in tbe matter?

Mr. 6'Shka : My own lawyer says it could be done.

Mr. BaHtox said he might state that lie

had been looking into this matter; first, ha\\n<j examined the securities at the instance of Kr! Schultze, whom he had advised that he coull not enter into this undertaking in such a way as to be fully secured. Ho had advised him to withdraw from it, and Mr. Schultze had done so. After that, Mr. O'Shea—in fact, that morning —had asked him to come to that meetingf. And after some inquiry he had found himself able to say that he thought he could assure anyone that the undertaking could be entered into with safety. Mr. Bell : How long would it take to get a. deed which would secure any person entering into the undertaking. Mr. Bahtojt: I can't profess to say, but I think it could be done. Mr. Bell: Would it take three months ? Mr. Barton said it was not at all a clear matter. He had merely suggested to Mr. O'Shea that if he got another person to make a proposition to tha creditors, he (Mr. Barton) thought he could satisfy such person—o£ course he knew nothing about the values o£ the properties—of a way in which he could obtain full security. The meeting must accept his statement just as it was, because it was very evident that he could not make explanations before a public meeting of creditors. Before sitting down, he might say that ho could corroborate what Mr. O'Shea had said as to Mr. Schultze having but on the previous day definitely decided to decline to guarantee the 2s. (id. in the £. Mr. Krull referred to the fact that at a previous meeting Mr. O'Sht-a had stated that Mrs. O'Shea was willing to give up all her property with the exception of one place—• where she was living—worth about £7OO, but if it was found to be above that value, then she would take that sum. Perhaps Mr. O'Shea. would them a list of the properties Mrs. O'Shea was willing to give up? Mr. O'Shea said he had such a list, and gave some few particulars ; but said Mr. T. Iv. Macdonald had full information on the subject. Mr. Macdonald said, by request of some creditors, he had that morning visited and inspected the properties. Town section 682, with house and stable upon it (the residence of Mrs. O'Shea), he valued at about £SOO ; he believed it would bring fully that sum. Section 683, with cottage thereon, let at 15s. per week, he valued at £7OO. Section 680 he valued at £350, but upon this there was a mortgage of £SO, so that it represented an asset of £SO. A section in Tasman-street he set down as being worth £6OO, though he believed it would realise more than that were it cut up into allotments. Then there were 2S gas shares, £7 paid up, and 19 new issue, £1 paid up, £215; the total being £2215. Mr. O'Shea observed that money had been raised on the gas shares. Mr. Macdonald said even then the property would represent upwards of £2OOO. Mr. Krull inquired if debtor had any property at Marlborough ? Mr. O'Shea replied that he had not.

Mr. Macdonald said he believed there were properties at the Hutt and in Manners-street. Mr. O'Shea said there were, but the mortgages were such that the properties did not represent valuable assets.

After some conversation as to what should be done, Mr. Bell said it seemed to him that the best thing to be done was that some creditor; should get a judgment against debtor and then petition the Court to declare him bankrupt. Subsequently some arrangement might be come to ; but the first thing to be done was to prevent debtor temporising with his creditors from time to time, as he had done up to the present. Mr. Quick remarked that obtaining a judgment involved a matter of sixteen days, and since Mr. O'Shea had over and over again stated that he had placed himself quite in the Hands of his creditors, he (Mr. Quick) should like to see a resolution passed requesting; debtor to declare himself bankrupt. Captain Thomas said he happened to be one of those creditors whose bills had come duo two or three days before Mr. O'Shea suspended payment. His bill amounted to £3OO, and ho exceedingly regretted that he had not issued a writ immediately upon that bill being dishonored. He could see plainly that a good deal of delay would have been obviated thereby. Mr. Barton said as far as Mr. O'Shea was concerned he had no objection to file a declaration of insolvency immediately, and it was rather hard that gentlemen should speak on the assumption that Mr. O'Shea was in anyway opposing or likely to oppose the wishes o£ the creditors. If the creditors desired that he should sign a declaration in the room it would be done.

Mr. Booklet then handed in a telegram he had received from Mr. Selwyn Smith, of Christchurch, which the Chairnlan read. It expressed surprise that Mr. Schultze declined to carry out his engagements, aad hoped that he would reconsider his decision. If he did not do «o Mr. Buckley was instructed to oppose the estate being put into so long as there was a possibility of 7s. 6d. in the £ being obtained. Mr. O'Shea said he was desirous that the creditors should get all that was possible, and he had been and still was prepared to afford them every facility to that end. But he suggested, and the suggestion was prompted by the experience he had gained in connection with bankrupt estates, that they were likely to get much less it they put the estate into bankruptcy than if they settled the matter by means of a deed, ashad been agreed upon at the last meeting.

In answer to a question, Mr. Schultze said he had nothing more tosay. He adhered to his decision not to have anything more to do with the matter. Captain Thomas said he had not the slightest doubt but that Mr. O'Shea was willing to do everything he possibly could to facilitate matters for the benefit of the creditors, but he had felt grieved to see the time frittered away, and he suggested that there should either be an absolute assignment or the debtor should file his petition. He was in favor of the former, because he feared if the latter were adopted the substance would be frittered away in litigation. Mr. Quick said creditors seemed to be under the erroneous impression that if the matter was placed in bankruptcy it would necessitate the frittering away of the estate, but it necessitated nothing of the kind. There was no necessity for appointing any official trustees. Trustees could be elected from among3t themselves just as in the case of a deed of assignment. Subsequently the creditors would have their choice as to whether they would take the estate out of bankruptcy or allow it to be liquidated under the provisions of the Act. The expense wouldbeidentical.butthe creditors would have greater security. Captain Mclxtyre thought a great deal too much time had been lost, because if the resolutions arrived at by the last meeting had not beeu carried out, it became the duty of the creditors to take further steps. If Mr. Quick were correct in stating that a deed of arrangemight be agreed to after a declaration of insolvency, he thought they could not do wrong in asking Mr. O'Shea to file such a declaration. He mentioned that the Dunedin creditors were iu favor of the case going into Court, and then moved that Mr. O'Shea be requested to file a declaration of his insolvency this day.

Mr. 11. J. Duncan seconded. Mr. Buckley moved an amendment to the effect that Mr. O'Shea be requested to assign all his property to trustees. Captain Thomas seconded. The amendment was put, but only the proposer and seconder voted for it, and the resolution was carried almost unanimously. The meeting then adjourned.

Tho meeting of the creditors of James O'Shea will be held, under the provisions of tho Bankruptcy Act, on Monday next, at 2 p.m., at the Court House. Meanwhile, Messrs. F. A. Krull and G. Thomas have been appointed trustees. __