IN BANKRUPTCY.

Taranaki Daily News, Volume LIII, Issue 106, 12 August 1910, Page 2

IN BANKRUPTCY.

PUBLIC EXAMINATION OF T. CLARE At the Courthouse, New Plymouth, on Wednesday, Thomas Clare, of Waitara, a bankrupt, was publicly examined before Mr. Deputy Registrar Terry. Mr. T. S. Weston appeared for the Deputy Official Assignee, and Mr. 0. K. for the bankrupt. The bankrupt, sworn, said that this was his first bankruptcy, but twenty years ago he made a deed ol arrangement- with his creditors, paying (j s od in the £. He had nothing oul oi Uie estate himself. Four years ago he nad nothing, but was working native lauds under agreement with the n.un.s. He had liabilities at that time, but did not >we very much. For ifteen years he had owed money, which he had oeen trying to square up. The statement as to secured creditors contained in his return to the Official Assignee was correct. The estimated value of the securities was £602. He presumed mey had not realised that sum, but he had thought they would. Part of what he had put down as secured had been seized for rent, and another portion was seized under ibill of sale/before he filed. He did not know what was lelt for the unsecured creditors, but believed there would be very little, from what he nad heard, and he did not know whether the assets as collected would cover the costs of the bankruptcy. For the past 15 years he had carried on by means of cropping and farming generally, t>y contracting, and by means of borrowed money. The cropping had not more than cleared expenses on the whole, and some years he had not cleared expenses. Out of farming generally he had made! a. little profit. He had sold his contracting business to his son four years ago for £2l. It had- not been very profitable. His present involved position, in the face of having made a little profit out of farming and contracting he attributed to illness and death in his family, following immediately upon the arrangement he had made with his creditors 20 years ago. During the whole 20 years he had repeated illness in his' family, and two deaths. Being in financial difficulties he had recourse to borrowing on promissory notes at high rates of interest,—a course that he had pur'sued all through, more or less, but he did not tell the lenders that he was in financial difficulties. He had borrowed £5 5s from Young, £lO 5s from Hellier, £2O 5s from .Lake, £7 from W. H. Jury, and £lO6 from the estate of W. J. Cleave. These moneys were 'borrowed just prior to last harvest, with the exception of Cleave's amount, which was borrowed two years ago. He had l borrowed and paid as long as he could. Instead of paying the tradespeople he lived upon them, and used the money derived from his business and by borrowing to retire promissory notes. The £452 which he borrowed from secured creditors had gone into his ordinary business. He did not know whether it was honest under the circumstances to borrow money without telling the lenders his position in this light. If he had died there would have been his life, insurance money, £250. Had he toot been pressed for his rent he would -have beenvable to pay something like £ 200 more to his creditors by the sale of his interest in some native land he was occupying. Whilst he was lying ill in 'New Plymouth, his landlady distrained on his sacks of grain for rent, and Mr. John Reeves seized his horses under an unregistered! bill of sale. His wife had advanced 'him sums of money from time totimeybtti he oontdnot say how much from memory. Some of it he had paid back. He built a house for his wife in Waitara. To do so he obtained credit for timber, joinery and material ; generally, but he did not think these amounts were included in his list of creditors. , Some of the money borrowed from Mrs. Cleave went into his general business, and he afterwards built her a ; cottage out of his general fund, which included borrowed money. Being a carpenter himself, he built the cottage with his son's assistance, only the latter drawI ing wages. He had kept only note-books I and his bank book, no cash-book or ledger. He did not think it ; would be possible for the Official Assignee to make a correct statement of bankrupt's affairs from his books. He could not tell his exact- position when he became bankrupt, and could not tell nearly how he stood at that time, for he was-in a complete fog about it, owing to his illness. His son was a creditor to the extent of I £220 for bills he had (backed. He could not say whether his son knew his finanI cial position when he induced him (his i son) to back the bills, and he had not 1 thought it necessary to explain to him. . Mr. Weston: Very right and proper for a father w 1$& in his son when he gets the chance!

Joll Bros., he resumed, Were creditors to the amount of £34, being for material for a house he was building at Waitara. They pressed for payment, and bankrupt believed he "told them that as soon as he had threshed his grain they would be paid. He also told them they would foe paid out of the turnips, but the natives to»k possession of the land, and- the turnips went to them. He .told Joll Bros, that Mrs. Clare would see them paid, and she had endorsed a promissory note for the house, which note they were now holding. Mrs. Clare had made an assignment for the benefit of her creditors. He owed Mr. Snell £35. He could not remember telling Snell 'he could pay £3 for every £1 he owed. Frequently borrowed money from Snell, but could ciot remember making excuses to him for not repaying when money became due. The debt referred to in his statement was for money lent and for rent. He believed that Snell held a -promissory note from bankrupt and Mrs. Clare for the amount of the debt. He did not tell Snell he believed that his crops would come out grand enough to pay everybody. His house and section and his wife's house and section were _ adjoining properties. He lived on his wife's section, and had done so for three years. He didn't know of one creditor to whom he had mentioned this fact. Hellier was his most recent creditor, and his claim was for money lent a/bout six months ago. He didn't tell Hellier of the amount of money he was owing when he borrowed, Gave Hellier a promissory note, payable on demand. j Mr. Weston: This is a remarkable case, a most remarkable case. _ Continuing, the bankrupt said he had had no reasonable pr probable expectation of being able to pay the same when due, or at the time it was borrowed, as well as all his other debts, but if'• his grain had not been seized for rent, and the land occupied by him had not been re-taken by the Maoris, he should have ibeen able to reduce his debts' by £2OO or £3OO. Lake's debt was the next latest, contracted from six to eight months ago, by borrowing. He didn't, tell Lake of the amount he owed, or that he owed any at all, and his prospects of repaying were about the same as in Hellier's case. Jury's debt of £7 was an advance made against chaff to be delivered, of which he delivered £4 worth. C. T. Rundle's debt was contracted in part two or three years ago, the latest portion of it probably about 18 months ago. Mrs. .Clare was responsible, hei thought, for about £BO of it. His posi-l tio* when the borrowed from Rundle was

bad, and it went from bad to worse. He didn't remember telling the lender that his position was ~ unsatisfactory. He used the money for general purposes, probably some of it went in repaying previous loans. Borrowing to repay previous borrowing had been his practice for several years. His contracting busi-! ness, which was confined to carpeiicenng! and bridge-building in Waitara and !New Plymouth, was not a success. He kept no books other than those previously mentioned, with the exception of a bill book, which he had lost. The statement of his position (produced) was prepared by his son-in-law, Mr. R. Pepperill, since the bankruptcy petition was filed. He was present when Mr. Pepperill told Mr. Medley that the figures were only approximate, as he had had no proper books of accounts to work from. Somej three or four years ago he borrowed i £3OO or £4OO from Mr. John Reeves on ! the security of a bill of sale over horses i and cattle, mostly of his own breeding. | This debt was reduced, he believed, to j £ 120, and then to secure the £l2O he! gave a fresh bill of sale over some of the stock that had been included in the first bill of sale. Mr. Roy, acting for Mr. Reeves, prepared this bill of sale. Within a week, he thought, of his filing he went to Mr. Roy's office and told him of his intention to file, and asked what was his (bankrupt's) position with regard to the bill of sale. Mr. Roy said that he would have to send out and take possession of the stock. Nothing further took place in Mr. Roy's office. He believed he asked Mr. Roy to act in his bankruptcy, but he declined,. as Mr. Reeves was one of his clients. He could not say when the seizure of the horses and cattle under the bill of sale took place for the stock was at Waihi and he was ill at New Plymouth. His son had been acting as agent for Mr. Roy in caring for the stock since. He did not know whether his son seized under the bill of sale, but he did not think so. Some of the stock included in the bill ol sale had been sold. There was a p*ap and harness included in the bill of sale, which was sold two or three months ago for £l2 or £l4. He could not say what remained unsold. Before his grain stacks were sold he was not pressed by his landlady for rent. He had thought it his duty to tell Mr. Roy of his impending bankruptcy. He did not file earlier, as he had hoped to sell his interest in the native land. With the proceeds of this, as well as from the harvest and the equities of the two propeiiies at Waitara and Moturoa (estimated to produce £-100 and £2O respectively) he had intended to call his creditors together and place himself in their hands. He had paid £2O on the Moturoa property, but expected to get £IOO oui of it. This was two l months before the bankruptcy. Twelve months previously he had thought of the probable necessity of calling them together after the harvest of 1910. The crops for that year •were 15 acres of wheat, 15, acres of oats, and from 30 to 35 acres of turnips. The wheat prospects were good until Christmas time, when a south-easter blighted the grain. The oats were a little better. The turnips took the "fly,' and the prospects became worse than he had expected. His state of impecuniosity existed for 15 to 20 years, but he had kept no books other than th'ose mentioned in his examination for the past two of three years. Examined by Mr. Stead: He was an intending applicant for the old age pension: His statement to the Assignee that he was solvent five years ago, was made in error, and was due to a mistake with regard to a bill of sale held by Mr. Reeves. The examination lasted for over four hours.