JUDGE’S DECISION.

Patea Mail, 28 July 1882, Page 3

JUDGE’S DECISION.

(THIS day.) His Honor Judge Rawson gave decision in this lengthy case this morning. He said this was a motion to make ababsolute a rule nisi calling on the debtor, his two sons, the trustee, and others, to shew cause why a resolution carried at a general meeting of creditors on the 7th Nov, ’Bl, for selling the estate with all rights of action to James Patterson for L7OO, should not be declared void, on the ground of fraud, and also on the ground that the sons could not prove for their full claim of L 478 10s against the estate, as the debtor was in partnership with them ; and on other grounds. At the conclusion of the one* sided investigation in New Plymouth there appeared a strong prima facie case, not only against the debtor and his sons, but against the great body of creditors, including most of the tradesmen and several settlers in and near Patea. Therefore he had, without reluctance, made an' order for the further investigation of what appeared to be an iniquitous swindle, the main object of which appeared to be to defeat Mr North’s claim against the estate. In this lengthened and complicated case, extending over 21 days, he might have shown some impatience at what appeared tc be an unnecessary waste of time. He was not sorry, however, to find now that human nature is not quite so bad as had been painted ; and that the proceedings in the case had not been of that all-round fraudulent nature which he was at first inclined to believe. The learned counsel who had pursued this case on behalf of Mr North had not failed for lack of talent or perseverance, hut because the facts were against them. As far as the trustee is concerned, the strong impression left on his mind is that Mr Cowern has honorably, faithfully, and impartially discharged the duties of his office, in what be conceived to be the best interests of the estate, and there is not a single reflection to be made against him in this case. He was satisfied also that Mr North had persistently worried the trustee to such an extent that it would be contrary to human nature if the trustee had not shown some impatience. He had been astonished that such a very large number of suspicious circumstances which would not apparently bear the test of cross-examination should yet have been so clearly and unhesitatingly explained, particularly where the sons and the debtor were concerned. He bad no hesitation in coming to the conclusion that a partnership did not exist between the father and sons since the time they came of age ; and such interference in the business as the debtor exercised was only such as might be reasonably expected. He was satisfied that the claims of the sons against the debtor are as a whole genuine and hona fide ; and that the particular sums were provable under the bankruptcy, although of course only one vote should have been exercised upon them. As to the disputed proofs of debt, John Patterson’s : claim for £44 12s 3d must be struck out. The claims of H. A• Arthur and H. E. P. Adams ho had no doubt about ; but Mr Read’s claim (Wanganui)] is doubtful. Mr Farrah’s claim of £IOO should be admitted ; at least the greater part of it. The resolution of creditors disposing, of the estate having been carried by a large majority in number and value, must be upheld. It seemed preposterous to suppose that the sons would have given such extensive credit to the natives if they had not had the father’s guarantee, and their claim for goods supplied must be admitted. The transactions were loose, no doubt. The offer of £7OO for the estate was one which the creditors were clearly justified in accepting. They had a right to please themselves in selling their right of action, and accepting a smaller dividend, rather than go into a speculation in trying to get more by a doubtful process. In conclusion, he was of opinion that the wholesale charge of fraud had completely broken down, from the, absence of facts to support the theory set up by counsel ; and this rule must be

discharged, with costs and; the witnesses’ expenses, to be taxed. POINTS OP LAW. MriHughes tasked his Honor to ’give special rulings on the law points involved. Judge : This is my judgment ; you must take it as it stands. Mr Hughes : Do I understand that you rule on the first motion that the sons could appoint a proxy, they they being also present ? Judge: I rule as I have given judgment. Mr Hughes : I would ask you to extend a little consideration to my client. We do not dispute the soundness of your Honor’s decision on the question of fraud ; but the law points involved are matters on which we can insist upon a definite ruling. On. the first point, I would ask distinctly whether you rule that Mr Sherwood could appear as proxy when the parties themselves were present ? Judge : I shall refuse to give any further judgment. Mr Hamerton: It appears to me the decision is on the facts. Judge : I decline to hear any further argument. Mr Hughes made several more attempts to get a ruling, saying he had prepared 25 questions on points of law, but the Judge repeated his refusal, and closed the matter by calling on the next rule. SECOND MOTION. : SECURITY FOR COSTS. ' Mr Hughes : I appear on behalf of Mr North. Mr Hamerton : I appear on behalf of the persons who have to show cause. Mr Hughes : I would like to give your Honor notice at once that I propose to appeal, Mr Hamerton : If notice is lodged; I shall require security for £SOO to cover our costs in the upper Court, and the present costs paid before the appeal. They will amount to £2OO. Mr Hughes: If my friend objects to further inquiry Mr Hamerton : I court inquiry. Judge : N«w as to this next rule. Mr Hamerton ,* I am prepared to go on. But in this next rule it appears to me they are working for Mr Patterson, who has bought the estate with all rights of action. Judge : I consider the resolution of the creditors valid, and I certainly shall not make this rule absolute. Mr Hamerton ; This is simply Mr North’s application, and he has stated that he is acting for his own creditors, I don’t know where the coats are to come from. Mr Hughes : If your Honor undertakes to say that this rule will be against us, we are prepared to stop the proceedings, but the responsibility must be with your Honor. Mr Hamerton : This motion asks for a rule directing the trustee to sell the property for the benefit of creditors. The creditors have done that already by selling the estate to Mr Patterson. If Mr North wants more than that, he might prosecute all these gentlemen criminally. I ask security for costs. Mr Barton argued from Home decisions that they could go on without giving security for costs. Judge : I don’t propose to order that they shall give security for costs. lam going to order that they shall pay the costs of the first rule, before going on with the other. I don’t mean to hear it to-day. It is impossible that I can remain longer. Mr Barton : Our witnesses are in attendance to-day, and if the other side wish for an adjournment we should have costs of the day. Mr Hamerton said he was ready to proceed. Judge : I will adjourn the case at once to next Wednesday three weeks. DEBTOR’S DISCHARGE. Mr Hamerton applied for the debtor’s discharge, in accordance with, notice. Mr Hughes': We appear to oppose the discharge. Mr Hamerton ; No notice of opposition was filed within the proper time. Mr Hughes ; It was filed within six clear days instead of seven. Judge : If not filed within the proper time, it is not filed at all. Mr Hamerton : I object to Mr Hughes being heard in opposition, as he is not properly before the Court. Judge : I am quite satisfied that the debtor is entitled to his discharge. An immediate order of discharge will be granted. Some applause in Court was quickly suppressed.

COSTS. Mr Hughes applied for costs of the preliminary investigation at New Plymouth. Judge allowed these costs to be charged against the estates to be taxed in the usual manner. Mr North, who appeared excited, said : The case shall be taken before the House in Wellington, to have a proper investigation. ' Judge : Be quiet. Mr Hamerton : The trustee points out to me that if this decision is upset on appeal, and he has paid away the money to creditors in the meantime, he may 7 be called on to pay again out of his own pocket. This closed the proceedings.