“SPOILED BY SUCCESS”

Sun (Auckland), Volume I, Issue 296, 6 March 1928, Page 9

“SPOILED BY SUCCESS”

YOUNG BUILDER’S FAILURE OVER £4,000 DEFICIENCY “Spoiled! by success,” was how the official assignee, Mr. G. N. Morris, described Trevor Deane, a bankrupt contractor of Southern Cross Buildings, who faced a meeting of over 30 of his creditors this morning. He was subject to a long examination covering his business transactions, at the conclusion of which a committee was set up to make further investigations. At the outset tho assignee explained that, as he had onty received Deane’s books at closing time last evening, and his statement an hour before the meeting, he had had no time to go into “this most involved bankruptcy.” A deficiency of £4,183 was revealed in bankrupt’s financial statement. He owed debts amounting to £11,305, and his assets totalled £7,122. BANKRUPT’S EXPLANATION. In a statement Deane said that he began building operations in July, 1925, without capital. By an arrangement with a firm of solicitors all the accounts incurred by him were to be guaranteed. Having built many bungalows under this arrangement he considered that he was doing well. About March, 1926, he was informed by his solicitors that there was a deficiency of £2,000. He believed this to be the result of building too cheaply, discounting of second mortgages, agents’ commission, and legal costs. The solicitors were his only creditors and they agreed to his carrying on. They were still keeping his books. Later a considerable improvement was shown. Deane’s explanation went on to give details of many contracting ventures on a large scale. In order to secure business lie evolved a plan wherein he held a stall at the Auckland Winter Show to advertise his bungalows. By securing a continuous flow of Government grants he hoped to carry on a comprehensive building trade in small homes. As a result of this advertising scheme he got more orders than he could fulfil, and his prospects were bright. Owing to certain innocent misrepresentations regarding some sections he was selling for his solicitor, he lost about £SOO. At the Winter Show last year he booked building contracts to the value of £41,000. Had he been granted sufficient time he would have been able to make a profit of £3,500. The major portion of his losses were the result of unfortunate timber-milling ventures. If creditors had not forced his bankruptcy lie would have been able to pay everything. PREVIOUSLY A CARPENTER Cross-examined, bankrupt said that ho was 27. Before he commenced contracting in 1925 he worked on wages as a carpenter. Although in March, 1926, he was £2,000 in arrears, after a year’s trading his balance sheet in March, 1927, showed him to be £3,000 to the good. Deane estimated that he lost between £7OO and £BOO as a result of taking over a suite of offices in the Dilworth Building at £ 6 a week, whereas previously he paid 15s a week elsewhere. The change was made really for the better display of his plans and for the expansion of his business following the successes of the Winter Show advertising. In reply to Mr. T. N. Holmden, bankrupt said that he first realised his position during the Christmas holidays. In the previous November he believed himself in a strong position. Deane was examined at some length regarding two timber-milling ventures for supplying himself with timber for his contracts. He admitted having no experience in timber work and said he made a thorough mess of one venture. Summing up, Mr. Morris said th€ire had been some contention as to whether bankrupt should have filed. It might still be possible to compromise and annul the bankruptcy. “This man has apparently been spoiled by success. He has had a certain amount of success and thought |e could carry on when others around him w*ere failing.”