LENIENT BROTHERS

Sun (Auckland), Volume III, Issue 623, 27 March 1929, Page 10

LENIENT BROTHERS

£9GO BOOK DEBTS DUE TO THEM OWN BUSINESS FAILED Two brothers, who conducted a motor business unsuccessfully in Tauranga, admitted to the official assignee, Mr. G. N. Morris, this morning that they had given credit too freely. Reviewing the debts of Gilbert W. Nichols, engineer, and Donald P. Nichols, mechanic, before their creditors, Mr. Morris said: “It is simply a question of bad debts with this firm. Over £9OO worth is due to the bankrupts. “You have given credit too freely on the small capital you possessed,” he told the bankrupts. “If I collected all these amounts, you would be practically square, but I am not sure that the book debts will bring all they are expected to.” Mr. Morris went on to say that the bankrupts had apparently not taken steps to find what their position was. They had been much too easy with those who owed them money. But there has been an element of carelessness in their conduct of the business.” No resolution was passed, and Mr. Morris will take steps to realise the assets. The firm’s statement showed that business was begun in August, 1924, with £6O in cash and work tools. Conditions were difficult, through lack of capital, and the business was he % back by bad debts. Work connected with two other motor agencies assisted, but it was lost in April, 1928. Two more garages opqned and the firm began to lose ground. The bankrupt suffered through two debtors becoming bankrupt. Finally the stock and the trade were seized and sold for back rent. A petition for bankruptcy became necessary. Gilbert Nichols told the assignee that he had actually managed the business. The joint financial statement showed debts to unsecured creditors reaching £1,314 5s 7d, assets £994 10s sd, and a nominal deficiency of £319 15s 2d. G. W. Nichols owed only £2 Is 6d, and gave his assets as £295 7s Gd, leaving a nominal surplus of £293 6s. D. P Nichols said that he had no personal debts or assets. Mr. Morris remarked that the cash book showed no record of expenditure since September, 1927. and of receipts since July, 1928. “I’ll want your explanation for this,” he told Gilbert Nichols. Bankrupt: Well, I am not a bookkeeper myself. Mr. Dyson (for bankrupts): He has a receipt book. Air. Morris: Where is it? Bankrupt: It is not necessary. “If that is so,” said Mr. Morris, “there carinot be much in it.” Bankrupt said that he had the bo:% at his home.