IN BANKRUPTCY

New Zealand Times, Volume XXXVII, Issue 8340, 29 January 1913, Page 2

IN BANKRUPTCY

ESTATE OF L. U. CHAFFEV. SPECULATION IN LAND. A meeting of creditors in the bankrupt estate of Leslie Urbane Chaffey was held at the Official Assignee’s office yesterday morning. Mr Douglas Jackson appeared for tho bankrupt, who, in bis sworn statement, said his wife bought a property in Goldie’s Brae in 1906 for £1250. The purchase was arranged by a first mortgage for £750 (in which be was a covenanting party) to the Bidwell trust at 5 per cent., a second mortgage for £125 to tho vendor (McManaway) at 5 per cent, (in which he also joined), and the balance, £385 (increased by charges and interest to £405 6s), for which ho was also liable, was arranged by his wife and himself giving a promissory note to Messrs Gualter, Dykes and Co. This amount had been reduced to £lB9, and the second mortgage was repaid. A second mortgage was raised in 1910 by his wife and himself borrowing £2OO from Mr Pearson at 8 per cent. This property was sold owing to his wife being advised by her trustees not to pay any further interest, and the property was bought in by Mr Pearson for the amount of his mortgage and one quarter’s interest thereon. Although Mr Pearson appeared as a creditor in his statement, he should have no difficulty in disposing of the property at such an amount as would not require him to prove in the estate. It would be seen, therefore, that a heavy loss resulted through this dealing. In April last, acting under legal advice, he signed an agreement undertaking to indemnify his wife against any claim Pearson might have against her, but he did not I anticipate he would have any reason to take action against either of them personally. With tho £2OO borrowed from Mr Pearson in 1910 at the urgent request of his wife, who refused to live any longer in Goldie’s Brae, ho personally purchased a> property at Hataitai from Mr Gill for £llOO. This was arranged by taking over a mortgage of £6OO at 5J per cent., and Mr Gill leaving £3OO at 7 per cent. Those mortgages were re-arranged in April, 1912, by obtaining a first mortgage for £750 at 6 per cent, and giving Mr Gill a second mortgage for £l6O at 7 per cent. At the same time he borrowed, from Mr McGrath £SO, being the cost of re-arranging tho mortgages and paying arrears of interest. He personally received no cash from Mr McGrath. This property was sold on the 15th inst. under conduct of tho Registrar to Mr Gill for £952, thus leaving Mr McGrath without security. This transaction meant another loss of about £l5O. He had purchased a section adjoining the above property at Hataitai, with a cottage in course of erection theieon for £720. A first | mortgage was given to Mrs Halley for £450 at 5i per cent., and a second mortgage to Mr O’Donnell for £270. He paid O’Donnell £25 by instalments, and a further sum of £2O 10.3. The rent ho obtained was sufficient almost to pay the instalments of £26 10s, and Mrs Halley’s interest. This property was to ho sold by O'Donnell through tho Registrar on tho 12th prox., and ho did not expect to receive any proceeds over and above the charges. It would therefore he seen that a groat deal of money had been lost over these

three properties. The cost of furniture in the vwo houses had also contributed to his present position. From the property in which they lived at Hataitai his wife removed all valuables and effects (costing at least £300) with the exception of such as realised at auction some £7O. Out of this sum he gave his wife about £3O, and with the balance he paid tradesmen’s accounts. He obtained nothing for himself. Although for the last live years, his annual income had averaged £260. and his wife’s from £l5O to £2OO, he found himself getting further into debt. His wifo was almost constantly under medical treatment. Ho called a private meeting of creditors in November last, and they accepted an offer of 10s in tho £. Those who had claims against his wife reserved recourse against her in addition to his offer. Hr McGrath was not present, and ho later refused to agree to the compromise, and subsequently took proceedings, which forced him to file. No one else had pressed him. Tho worry pertaining to his affairs had caused a complete breakdown of his nervous system, and ho produced a certificate from his medical adviser as to his physical and mental state. Ho would do his utmost to carry out any reasonable offer of his creditors.'

The Assignee said tho liabilities wore put down at £722, but another £56 sequently received. There were no asquently received. There were no assets.

In reply to a question he said they could proceed against bankrupt’s wife.

The bankrupt said that the smaller items amounting to £4 10s were her debts.

Mr Jackson: Tho bankrupt has not seen her for four months and does not know where she is.

The meeting was then adjourned sine die to allow tho bankrupt to make an offer.