LIABILITY OF SONS

Sun (Auckland), Volume II, Issue 380, 14 June 1928, Page 13

LIABILITY OF SONS

BUILDER S BANKRUPTCY NOVEL QUESTION RAISED

The question of whether sons of a bankrupt were liable to creditors was raised by the official assignee, Mr. G. N. Morris, at a meeting of creditors of Alexander Meiklejohn, a builder, of Mount Albert, yesterday.

Bankrupt gave price-cutting and depression in the building trade as causes of his failure. Debts totalled £1,115, and assets £499—a deficiency of £ 616. lie stated that the trouble arose about two years ago, when he failed for five months to sell a house which he erected on speculation. After bankrupt had been examined by the assignee, creditors expressed the opinion that bankrupt had been honest in his dealings. Mr. Morris said it was evident that there was little hope of bankrupt paying much off his debts, but the question could be rightly asked if the sons were not liable to some of the creditors, as bankrupt had traded under the title of Meiklejohn and Sons. Bankrupt said that he had only traded under that name in order to give his sons a little standing, and to put manly ideas into their minds. Creditors all dealt with him. The assignee replied that although that may have been the case, a firm allowing bankrupt credit would naturally assume that bankrupt’s sons were in partnership with him unless definitely told otherwise. Bankrupt explained that no partnership existed between him and his sons. At one time he had four sons worknig for him, but as trade fell away they had to go, and now only two sons held what could be characterised as good positions, one being in Wellington and the other in Auckland.

The position did not look very homeful for creditors, said the assignee, and he suggested that the meeting should be adjourned in order that those concerned might discuss the question of the liabiiitj' of the sons, which was rather novel. The suggestion was adopted, and the meeting was adjourned. ______