TRADES' PROTECTION ASSOCIATION.

Temuka Leader, Issue 9413, 1 June 1882, Page 2

TRADES' PROTECTION ASSOCIATION.

A very fair number of the members of the above Association assembled last Tuesday evening in the Star Hotel to consider the ad visibility of suggesting to Parliament the necessity of altering the present bankruptcy laws. Mr Franks was voted to the chair. The Chairman explained the object of the meeting, and read the following resoution—"That in the opinion of this meeting, the Debtors and Creditors' Act Amendment Act should be further amended so as to provide that no debtor should file for a les3 sum than £IOO, and that when having filed he shall be entirely in the hands of his creditors ; and that no bankrupt shall obtain his discharge without the consent, in writing, of a majority in number representing at least three-fourths in value of the joint creditors ; also, that no solicitors' fees shall be payable out of the debtor's estate without the consent of a majority of the creditors." This resolution was pretty stiff, but it needed to be so, as, in nine cases out of ten the bulk of the estates were swallowed up by lawyers.; : Mr Hayhurst said that would be dealing with an evil before it occurred. It would be better to deal with it so as to prevent its occurring. He deprecated giving credit to Tom, Dick, or Harry. A stranger coming into Temuka would get more credit in one month than he would get for ten years in London. Mr Mendelson wished to know what they had been called together for. He had been invited to come, as he thought", to explain the Debtors and Creditors' Act, and if eo it was as good to proceed at once. The worst part of that Act was the power given to judges, under clause 19, to make rules. The Act was right enough, but the rules the "judges made destroyed it. These rules rendered it necessary to go to a lawyer on all occasions, and the lawyer? got the greater part of the estate between them. The trustees had no power to pay money •xcept by an order of the Court, and it cost about £7 to get that order. If merchants who understood business had framed these rules instead of the judges, the result would have been different. He pointed oat that the clauses of the Act did not necessitate the employment of a lawyer, that the rules made by the judges alone rendered it necessary, and that clause 19 of the Act was the key to the whole mischief. Mr Twomey suggested that they should go to business in some definite form. If Mr Mendelson thought clause 19 was the keystone of the evil,- he ought I to) move a resolution suggesting such, alteration! as ho thought advisable. '-""""

Mr Mendelson said it was a serious matter, and ought to be given due consideration. Mr Twomey reminded Mr Mendelson '/ that he was not going to make a law, that "■•*■ he was only goiDg to make a suggestion. It was better to put something definite before the meeting than remain all night discussing the clauses of the Act, and come to no conclusion in the end. He liked some suggestions Mr Hayhurst :■ threw out at last, meeting with regard to ..'making it criminal to incur debt under certain conditions, and it would be as well that Mr Hayhurst should read his propositions. Then they could select ' whatever they thought best. . Mr Hayhurst then read the following : "No bill of sale to be of any value to the party taking same over any property unless the debtor giving same has given notice to all his creditors, seven clear days before, of his intention of doing so." The Chairman "said he had drafted a resolution somewhat similar. It was as follows :—"That the law regarding bills of sale should be materially altered, and to the effect that no bill of sale shall be held good against creditors unless registered within seven days of the date of its execution, nor unless seven days notice shall have- been given to each and every creditor of the person giving the bill of sale with a particular account of his indebtedness at least seven days before the execution ot such bill of sale." Mr Hayhurst continued to read as follows : "Any party wishing to open an aceoant with any other party shall be asked by the party who is to give credit to the party wishing to open such account if he or she owes any money to any other party at that date ; if so, how mach, the answer to be entered in a day book, if one is kept; if no.day book is kept then it shall be taken down in writing and signed by both parties, dated, and a stamp fixed, witnessed by a third party. If any creditor neglects to make entry in his day book or take down in writing the opening of such account with any debtor he Bhall have no benefit out of the debtor's estate ' if he should become bankrupt. " Any party wishing to obtain credit for more; than £2O, shall, if required to do so by the creditors, before getting any more credit make a full and true statement if he is surety for any party for money or fulfilment of any contracts. "When he, the said party, seeking credi* is liable to have to pay money, the ; , answer to be taken down in writing, and witnessed; if more credit is given.same as ! in resolution No, 2. "Any party seeking credit, and reputsd to have property of his own at the time of getting such credit, and fails to pay for the goods obtained, and it : being discovered that the said party has mace over such property to some other party or parties, or has sold the Bame, and not be able to account for the money received for the same, shall be deemed guilty of fraud. "Any debtor being unable to meet his engagements with his creditors, and it can be proved thit such debtor has wasted his money by gambling, or drinking, or in any other wasteful manner, shall be deemed guilty of fraud. ■ • * " Any party makijg a false statement to another man for the purpose of obtaining credit, and the statement taken down in writing—at the time of making the same—by the creditor, and witnessed by a > third party, shall, be deemed guilty of fraud..!' Mr Mendelson condemned Mr Hayhurst's proposals at great length, If the proposal respecting bills of sale were put into force it would be as well to repeal Chattels Security Act altogether. As regards the idea that every man wanting credit would be required to make a declaration, it was absurd. Suppose Mr Hayhurst wanted some money from his banker, would he like to make a declaration as to what he owed. ■ - Mr Hayhurst said that evidently Mr , Mendelson was very much attached io bills of sale. There were some people who did well by them, and perhaps that was the reason Mr Mendelson had such a great affection for. them. There were Home men who did not give credit without fixing the borrower somehow, others trusted men more, and he wanted to prevent the former from getting the best of the latter. He wanted to make men more honest. His proposals would be a ; means of preventing it to a certain ex- . tent. ■■; . Mr Lee wished to draw attention to the large number of debtors who had • '.; filed for a less sum than £IOO. There ' were no less than 14 in the Gazette of the •"'27th, whom it was a well known fact the Act was never intended to protect. ; As soon as a debtor owes £3O it is easier for:him to pay £lO to a lawyer when the „"" Act allows him £25 worth of goods. He "' also referred to the system of small contractors, 'urging that creditors should ■ be paid out of the contract money, and instanced how the Road Board had always . declined any creditor's claim. Mr Twomey said that tradesmen encouraged small contractors by giving them credit. They could not prevent ' small contractors from taking contracts. To do so would be interfering with the liberty of the subject. He would suggest ihat some resolution should be put before the meetiogi

i Mr Lee then read the first resolution eubmitted by the Chairman, Mr Siegert seconded it. Mr Mendelson opposed it, and moved the following amendment —"That a Bankruptcy Act bo so formed that the management bo entirely under the control of mercantile commissioners." Mr Twomey was very glad to see Mr Mendelson bringing something forward. Mr Mendelson reminded him of Mr Snodgrass, in the Pickwick pipers, who never introduced a motion into the Pickwick Club, but opposed everything that was brought forward. Opposition seemed to be the ruling passion with Mr Mendelson. The amendment he now proposed wa3 so vague and indefinite that no one could understand it. Artemus Ward once said that he would go round to explain his jokes if people could not see tl.em. If they adopted the amendment • it would be necessary for them to send Mr Mendelson to Wellington to explain it, because no one could understand it. If Mr Mendelson had pointed out that all the corruption in the Act arose from the power given to the judges under Clause 19, and suggested to transfer these powers to a commission of mercantile men, his amendment would have been intelligible, and he (Mr Twomey) would, probably support him, but as it was he could not. Besides, it was no amendment of the original resolution, and could only be looked upon as one of a series of resolutions, '■...-• Mr Mendelson declined to make the suggested alteration. Mr Kussell seconded the amendment. The Chairman ruled that the amendment was out of order. Mr Hayhurst said before the original resolution was put he wished to make a few remarks. He disapproved of the £IOO restriction, and read several bankruptcy notices from the Mercantile Gazette where the liabilities were over £IOO and the assets nil. If there was a bankruptcy Act at all it should be for the poor as well as tha rich. He moved—- " That the words that no debtor should file for a less sum than £IOO be struck out of the resolution." \ Mr Twomey seconded the amendment. | Mr Lee again urged that the Bankruptcy Act had never been intended for laboring men. It was only intended for tradesmen who happened to meet with misfortune. After some further discussion the amendment was carred, and the ,original motion as thus amended was declared carried. Mr Mendelson being the only one who abstained from voting in its favor, Mr Twomy said he had taken a great fancy to the suggestion made by Mr Mendelson and had drafced a resolution which he hoped would be understood and would not render it necessary to explain it in the way the artist used to explain his pictures by writing underneath them "this is'a house," or whatever the subject might be. The resolution he would propose Was as follows : "That this meeting desires to point out that much of the evil of the Debtors and Creditors Act arises from the fact that under clause 19 judges are given power to make rule 3, and that by these rules the spirit of the Act is defeated in-as-much as that it gives too much benefit to the solicitors at the expense of the creditors, and would suggest that the making of rules be left in the hands of a commission of mercantile men instead of the judges." The Chairman thought this resolution would nullify the one already passed. Mr Twomey explained that it would not; The creditors would have power to deal with the estate in conformity with that resolution; AH the proposed resolution aimed at was to make rules for the guidance of creditors. They need not be afraid of having commissions appointed in every town. There would-be only commissioners appointed in one town who would make standing rules, not for tbe guidance of one bankruptcy case, but for all cases and for all parts of the colony; , Mr Lee seconded the motion, and it was earried unanimously. Mr Mendelson not voting either way. ■■■•■. Mr Hayhurst next moved the resolution regarding bills of sale read in the begtning of,the meeting by the Chairman. Bills of sale, he said, were the most dangerous of all transactions. Credit was notgivento an individual but to what he possessed, and it was not right that all other creditors of an estate should be shut out by a bill of sale given to a favorite creditor. He referred at some length to the evils of bills of sale, and said that the resolution was a step in the right direction. Mr Siegert seconded, the resolution. Mr Mendelson said they were going entirely in the dark. It would be better to repeal the Chattels Securities Act altogether than surround it with such conditions. He pointed out that resolutions already carried placed the estate in the hands of the creditors : that no bill of sale cctild scand good unless given two months before filing a declaration of bankruptcy, and then referred to Judge Ward's judgments on the subject, : Mr Bolton pointed out a case in which a bill of sale had been held good although given for a past debt, and within two months of the giver becoming bankrupt, and where the pressure only consisted of being asked for pay--1 ment of the debt., 1

Mr Twumoy said the question was not whether Judge Ward's judgments were correct or not. The/ were considering now whether the laws referring to bills of saie required .alteration, and if they did they should alter thern. It was absurd for Mr Mendelson to say that it would be better to repeal the Chattels Securities Act altogether, if they were to restrict its operations. This was nonsense. All laws were made up of conditions, amendments, provisos, etc., and why not amend the Act in question as well as any other. It seemed to him that Mr Mendelson had a peculiar affection for bills of sale. It would be interesting to know what motive Mr Mendelson had for the great desire he exhibited to keep the bills of sale, as bad for fixing up people as they were. Could it be thac what Mr Hayhurst had said about the great affection which Mr Mendelson had for bills of sale was correct. (Laughter.) As for the objections raised by Mr Mendelson about one man in Auckland wanting to transact business with a man in Invercargill, and that seven days would not be enough time, for them to register a bill it was very silly. It showed what a.bad case he had to defend when he had recourse to such an argument. Mr Mendelson had said that bills of sale should be given two months previous to bankruptcy or they would not stand good against creditors, but experience had shown this was not a fact. A man had only to say he gave the bill under pressure and it was all right. Mr Mendelson defended his pets very badly, because .probably they were so bad that they could not be defended. The motion was then put and carried unanimously. Mr Mendelson again t being alone in his opposition to it. Mr Mendelson then left the room, evidently in disgust. The Chairman said there was another matter he wanted brought before the meeting. It was a resolution, as follows—" That with a view to the encouragement of the industries of the; colony both agricultural and mechanical, this society would respectfully suggest to the Legislature" the advisability of abolishing the Pipperty Tax and substituting therefor an Income Tax, and a tax of say one shilling per acre per annum upon all uncultivated freehold agricultural land in the Colony." Such property.had been improved tenfold by the money' expended on public works foj the last eight years, and it escaped comparatively free from taxation under the property tax. It was unjust that industries should be taxed while this escaped. For instance, theKaiapoi Woollen Factory, of which they all might be proud, was taxed to the extent that it had to pay over £IOO a year., This was stifling industry. It would be more just to drive these people who. bought land cheap to plough it, or make them sell it. There were 437,000 acres in 16 estates in South Canterbury that gave each estate an average of 27,.)00 arid a tax of one shilling per acres on th'is land would give £25,000 a year. Half that he would give to the General G6vernment,ahd half to County Councils to make bridges, roads, etc. He noticed, that several, members of Parliament were favorable to his view, arid how was the time to urge the question. Mr Hayhurst moved the resolution as read by the Chairman. He begrudge d. paying property tax on land he had improved, while land that had not;cost it owner's one penny..escaped. It was well known that improved land w»b not equal to land that had never been ploughed. The only way in which he differed with the resolution was that it did not go far enough. He would much prefer to see 2s per acre placed on it. It had irnproved £8 per acre for the last eight years, while its owners had done nothing to improve it. As to an Income Tax it was said to be inquisitorial. In America they make every one state the amount of his income, and then it is published. This makes people state the exact amount,' or if they did not their neighbors compelled them to do so, He would suggest that the same plan should be adopted here.' - * : .Mr Lee seconded the resolution," If the Levels station had been divided into 250-acre allotments he believed that the products, etc., would yield 1 through the Custom House and railways a revenue of £14,000 a year. The motion was carried unanimously. It was then resolved—" That copies of the above resolutions be sent to the various Chambers of Commerce throughout the colony asking for their endorsement or suggesting amendments, and afterwards sent to the Committee appointed by Parliament to consider I such makers*"

The meeting tlien adjourned, with the usual vote of thanks to the Chairman.