A FINANCIAL MYSTERY

NZ Truth, Issue 1195, 25 October 1928, Page 11

A FINANCIAL MYSTERY

Four Thousand Vanishes Into Air Within Two Years (From "N.Z. Truth's" South Auckland Representative.) Somebody lied. Who, neither the creditors nor the Official Assignee was able to determine. But that either the bankrupt orjhe architect interested m ihe case deliberately perjured himself is certain. The bankrupt, Walter W. Scott, a well-known contractor, is considered bp the assignee, on a rough computation, to have got ricfm some way or other, of £4000 m two years, or approximately £40 a week.

HOW, was not ascertained, nor did the bankrupt throw much light oh the position, more than to say that he lost it on unprofitable contracts. He did make one very serious assertion, however, that he had paid a secret commission of £200 to -the architect for the Morrinsville Hotel, one G. L. Burmester, of Te Aroha, for securing him the contract. This assertion was strenuously denied by the architect, who said it was made out of pure malice. Scott, about 1926, undertook a number of contracts including the building of a theatre at Paeroa, a billiard saloon there, as well as a. private house, and an hotel at Morrinsville. He also did a lot of work for the British Imperial Oil Company. When he commenced these contracts he was worth, roughly, about £1500 His deficiency is now about £2600, He kept no books, although he handled about £25,000 during that time and his creditors are endeavoring to ascertain w,hat his position really is. Scott himself did not assist them very much m this, as he prepared no schedule and no statement. He did state, however, that a considerable amount of money was still due to him on the various contracts, but an accountant who some time ago took oyer the assignment of the estate found that arty moneys due had been eaten up by lien holders and that thero was nothing to come to Scott. His assets, which he had estimated at about £8465; really boiled down to nothing. They ' had vanished m the steam of a financial hotch-potch. ** The architect of the Paeroa theatre and the Morrinsville Hotel jobs, G. Li Burmester, along with his solicitor, J. C. Carroll. . attended the second meeting of creditors by invitation. There was a. sharp exchange be- ; tween Scott and Burmester over the duties of the arbitrator, who was appointed m connection 4 with the theatre job. Scott said his duties were to consider certain sub-contrdcts, but BUf-

overseer . recommended by the architect. On the Paeroa job he allowed himself to be soft-soaped into doing a far better job than he should have done. He admitted that m a job which he did for Mrs. Keller, of Paeroa, he mixed it up with another transaction which he had with her and that he allowed her to retain £700 of the contract money as a cash payment on the other deal. It was true that this money really belonged to his creditors, although he did not realize this at the time. Burmester was then put on oath. In answer to Lawyer J. F. Strang, representing bankrupt, witness denied that he received a secret commission of £200 from Scott. Counsel: Why do you think Scott would, say this? Burmester: I consider it a malicious accusation. "Witness said he had two banking accounts and had several agencies m different tdwns m Waikatd and the King Country. These agencies were really for the benefit of contractors. Lawyer Strang: If Scott swears that on the day after you made him the first progress payment m respect of the Morrinsville job, he cashed the £1000 cheque and handed ydit £200, and that you requested him to break it down as you did not want the money m such large denominations, will you deny it? Witness (emphatically): Yes. Counsel: If Scott's son says he saw his father hand you a bundle of notes on that day will, you deny it?— Certainly. Asked if he was prepared to have all his cheques investigated,, witness said he was. Lawyer Johnsott: Is it not a fact that all the sub -contracts Were bumped up to make up this £200? Witness denied that this was so and said he objected to questions of that nature. • " Lawyer Carroll said the suggestion