DISTRICT COURT.

Wairarapa Daily Times, Volume 5, Issue 1550, 3 December 1883, Page 2

DISTRICT COURT.

MASTERTON—SATURDAY,

[Bofore His Honor Judge HardCASMie]

C. I. Worth applied for an order of discharge, Mr Devino appearing in support of the application. The. following trustees' report was then read: The liabilities of this estate were £355 Is 4d. The assets consisted chiefly of hotel book debts about i 290 15s, and unexpired term of license of Eailway Hotel £2O i in all £310155. The book debts (the debtor admitted) were utterly valueless. The license itself had only a collateral value, and consequently thero were in reality no assets/ as shewn by the debtor. The furniture in the hotel the debtor made over to his wife by bill of sale aome months before his bankruptcy. I took legal opinion as to the validity of the bill of Bale, I was advised to contest it and to take possession of tho stock and furniture on.bohalf of the creditors, I did so, The debtor behaved in a very hostile manner, He tried to eject the. bailiffs by force, and I. had to place a sufficient number of them in the house to retain possession. After incurring heavy legal expenses I sold our claim io the furniture and stock, in fact all tlie estate, to his wife for Cs Bd'in the pound and a sum of £SO towards legal expenses incurred. This is' a case where no consideration is due to the debtor, inasmuoh as he came into tho district as a re put ed sub b tan tial man, obtaining credit from tradespeoplei who wore under the im-. pregsionthatthegoodsandchattelsinuieby' the debtor were his.own, and.he obtained credit readily.' In his examination he stated that lie had divested himself of all : •his proporty, to tho extent of thousands, in favor of his wifo, excepting a leasehold which ho valued at £IOO, ■ Since then he has been carrying on business in various places and failed to pay his way. I convened a meeting on 21st May to consider his application of discharge, R. V, Smith, brewer, moved that the meeting be adjourned to a future date, as he (being the largest creditor) intended opposing the debtor's discharge, for reasons he would give at the adjourned meeting. R. V. Smith did not oppose the debtor, stating that he was not aware that he had to lodge his opposition paper with the court before the sitting of the District Court. R. V. Smith stated hiß ground of opposition to be that the debtor had boasted that he had " dono" his creditors after all, and that tho bank book handed over io me did not represent the. takings of the hotel. Taking into consider&tion that the debtor incurred the bulk of his liabilities within two months of his bankruptcy, and. that his wife has paid some of his creditors (Smith and Wilson) in full, I think he has not shown satisfactory cause for becoming baukiupt I cannot recommend his discharge, especially in reviewing the whole of this case, wherein the debtor handed over as assets worthless bad debts (admitted by himself to be worthless) to hiß creditors, while all realisable property of any valae he made over to his wife, casts suspicious : surroundings on the whole of his transactions.- The net dividend paid lo creditors was 5s 5d in the pound, as per balance sheet attached. M. Casemero, Creditors' Tfu'stee.

The debtor was then put into the box, and in answer to tho Court, said the Bank of New Zealand is a secured creditor to the amount of- £397, advanced in April, 1881, to purchase things when I went into the hotel. Tho things wero the furniture and goodwill. The security given were, deeds the private property of Mrs Worth for sections', in Wordsworth-street and Sussex square, Wellington, at Fitzherberton and Petone, and a deed of gift. to. Mrs Worth of Christchurch properties, which had been sold, and the money re-invested in the sections named. Messrs Smith and Wilson are secured creditors for spirits and stores. I gave them no security till they pressed me, and then I gave thom a bill of sale, In May, 1882,1 found the house did not pay, and I asked Nathan to let me go out of it or reduce the rent. I went out of the house in April, 1883. Smith and Wilson pressed me in January last, and I gave them a bill of sale over the stock only, The stock was then worth about the amount of their claim—£B3; Thoy did not act on the Bill of salo, because the Trustee disputed it, and another arrangement was made. The amount of Nathan's claim for insurance. is not specified in the list of liabilities.

The Court: If you want to bo discharged from your debts it must be specified. Debtor continued: E. Y. Smith's account was for beer, Caselberg's for stores, There is a liability of £l5O to the Bank of Australasia, I became one of three sureties who wero securities for an advance to the Kuripuui Hall Company. Ido not know whether the others have paid it. The Court: Your total liabilities are £892, including secured debts and contingent ones? . Debtor: I don't think so!

The Court: Against these you retain apparel and tools £25, the amount the law allows you to retain, and book debts, £75. The bills payable, what: are they' Debtor: Some are bills given for old' Taita debts. . Some are good. The arrangement finally made with the creditors was that my wife should purchase the estate from Mr Caselberg (the Trustee) for the sum of £167 6s 2d. The sale was to terminate all logal proceedings on both sides. The license was under the agreement transferred to Mrs Worth in February last. The furniture was handed over to her. It was encumbered by a bill of sale to Mrs Worth for £4OO, dated August, 1883, which was not pressed. Before this arrangement was several bailiffs were put in,' Nathan put in one, Mrs Worth another, and the Trustee a third in the first instance, and afterwards one or two more. That.was how expenses were run up. I did not try to eject them, but made them all as comfortable as I could. Caselberg anticipated that his bailiff would be opposed, but the only thing done was that tho bailiffs in a friendly way stopped each other from removing goods. Mr Devino: The right of the Trus : tee was contested on purely technical grounds. The debtor continued in answer to the Court: I was formerly by trade a master plasterer. When in Christchurch I settled property worths about MOO on my wife. In the following year 1868 1 went through the Court, and obtained my discharge, The debt

was incurred in tlio morvtjjs of..,December,;,and January,; About tbftt-tiihf llost money by purchasing tho privilegea of the Foresters and Caledonian.. Sports, Just before that time I rented 5000 aores from Mr Bunny at'£loo a year. Smith and Wilson have not received out of my estate anything beyond tho dividend of six and eightpence. If tho dividend paid to creditors was only five and fivepence, the difference must have gone in expenses. In answer to Mr Devine, the debtor said he did hot incivase the number of creditors befon. filing. He had. a running account with Caselberg, who piished'him at .i time when he could have sold the hotel and paid his creditors. -... ■;

To the Court : The Furniture had been sold subsequently to pay off liability to the Bank,

To Mr Devine: He did not come into the district under any false pretences. When- ho found the hotel would n,ot pay ho took to farming. The Trustee expressed no dissatisfaction with the way in which ho had carried ou his business. Ho said tliat Mr Smith was the only creditor who was opposed.to him, and when the dividend was paid he would have nothing to do but apply for his discharge. Mr Devine: Does your Honor want any more evidenco ?

The Court: No I »'.Mr.CaSelberg: lamsubpcennedyour Honor,' " . The Cqurt: I shall be glad to hear . the Trustee if he is examined.

Mr Caselberg' deposed, that lie was trustee in the debtor's estate. He believed'that the creditors were dissatisfied because the . debtor was ostensibly, a. man of moans.. It was known that he had settled £2,000 on his wife. When he went into the hotel he did not know that he purchased with his wife's money. Ho regarded the book debts in the estate as valueless,

Mr Devino: You got £163 for them.

Mr Caselberg : Yes, but that was because I contested the bill of sale. When I went through tho lists of dobts I said," Where is this man who owes £5, and the answer was, "In the Gulf of Carpentaria" or some other remote region, Some of the debts were barred by the statute of limitations, I had no animus against the debtor, but was annoyed that ho should open an account with me just before he filed. Wilson, of Smith and Wilson, told mo that they had been paid in full, Mis Worth having made the balance up for for them subsequently. Thomas Parsons, brewer, called proved that he was arranging to purchase tho hotel when a pressure was put upon the debtor, He had agreed to the compromise of six and eight pence in the £. Mr.Devine: Was it the wish of the creditors that the debtor should receive his. discharge. The Court J' That wish could only be expressed in a statutory way. Mr Caselberg: Will your Honor call Mr B,.Y.Smith? ,

R, Y. Smith, called, deposed that debtor dealt with him for a small amount—say from £5 to £lO per month—till the last two months that he was in business, when his account ran up to £B7. Mr Carr, his banker, informed him that Mr Worih had given a bill of sale to Smith and Wilson, and in consequence of.this information he spoke to Worth about his position, Tho debtor then said that if he Would trust' him to the end of the month he would pay him every shilling.

Mr Devine: Did he complain about the quality of your beer.

Witness : He did once.

Mr Devine: When he first went into business he was compelled to take it from you 1

Witness: Yes.

Mr Devine: Did he afterwards complain to you of tho quality of Parson's beer?

Witness: Yes. Mr Devine: Did you agree to tho compromise! Witness:.l objected to it until it was arranged that expenses wore to bo added to the six and eightpence. Mr Devine submitted that nothing had been shewn in the evidence to prove that the debtor was not entitled to bis discharge. If there, had been negligence it was on the part of the trustee. .

The Court said that it appeared from tho evidonce of the debtor himself that for twelve months after he found the house was not paying, he had incurred heavy liabilities, and assured his creditors that he was solvent. The discharge would be granted, but it would only take effect at the expiration of six months.

The Court was then adjourned to (wo o'clock. AFTERNOON SITTING, His Honor took his seat at nine minutes past two (nino minutes late), •The first application was that of George ■Augustus Fairbrother, Mr B. N, Sandilands, appearing in support of the application, No opposition was offered. His .Honor remarked that the debtor asked to be relieved of some £SOO of debts without giving anything in return. His assets were only £2O, which represented goods ho was entitled to retain. However the creditors appeared willing to lelievo him, There was a technical informality in the application to the certificate recommending the discharge. was not signed by the Creditors' Trustee, The discharge was granted on the understanding that the oversight be remedied by filing an affidavit within three days,

The application of Samuel Hunter was next heard, Mr Sandilands appearing for debtor. This case was a peculiar one from the fact that not a single creditor had taken tho trouble to prove iu the estate.

•In reply to his Honor, debtor Mated •when he took over bis late business from Mr T. Hooker, be gave him a bill of sale oyer the whole of his stock-in-trade. He built baths in connection .with his business at a cost of. ,£220. This caused his filing, as the contractor pressed for his money. His liabilities were £IBO, and his assets nil. Mr. Hooker had realised on the bill of sale •He did not know how much Mr Hooker got, whether more or less than his claim, fie had no capital whatever when commencing business. The discharge was granted,

Christian Madfien'a 'appliofttlon war next considered,' % Beard appearing for the debtor, The. report of the Trustee (Mr M, Caselberg) was read as follows ' The liabilities of this estate were £232 8a of unseoured creditors; the assets consisted of tho equity of redemption of two properties. I ultimately sold the same to P, Madsen (the bankrupt's brother) for £126 4s, which enabled me to pay a dividend of 8s 6d in the £ after deduoting ail expenses as per annexed balance sheet. The expenses in this estate amounted to L 27 9a, being in my opinion out of all proportion to the sum realised, caused to some extent by the vexatious action of the bankrupt's solicitors, compelling me to employ the services of another solicitor at- an expense of L 8 before I could obtain payment for the properties, as the correspondence will more fully show, I think this is a case where no sufficient, or satisfactory reason is given for the cause of bankruptcy, The debtor, in his first examination at the court house, acknowledged his having been in regular work, taking contracts, which were all of a payablo nature. Shortly before his bankruptcy he employed Messrs Beard & Gray to convey his Beotion of 40 aores at Mauriceville to his father-in-law (P. Neilsen) in exchange, for a small section (one-sixth of an acre) with a cottage on it at Masterton, this being of considerable less value after taking into consideration the mortgages existing on both properties, inasmuch as the debtor incurred a portion of his present liabilities to build a good house on the 40 aero section before making the exchange. He also handed over io his father-in-law horses and cattle, purporting to be in lieu of money lent to him by his father-in-law, P. Neilsen. producing I.O:U.'s ante-dated to prove his indebtedness, although - ! his countrymen (neighbors) assured me that the said P. Neilsen was not in a position to lend monoy. This leaving a suspicion in my mind as to the bona fides of these transactions, especially as he evinced great reluctance to bo examined on these matters, in response to ray communications to call at my office to be oxamined, his solicitors invariably replying instead. At his first examination on being questioned what he did with a large cheque he received from the County Council he stated that he paid Messrs Beard & Gray L 8 for an account ho owed them, and Lls hep:iid to them to get himself "white washed." He accounted for the remainder of tho money by stating that ho got married, and that he lived at the rate of one pound per day. Taking into consideration all tho faots of this case I cannot recommend his discharge, and I think as. a protection to the trading community this case should be dealt with on its merils, Taking into consideration the large amount of money ho expended on his legal advisers (who persistently tried to force his creditors to accept a composition of 5s in the £) the amount would have been a large asset in his estate, and obviated the necessity of his filiug. Messrs Beard and Gray have proved in tho estate for a further sum of fG lOi 2d. I find I cannot file the balanco sheet in this estate as I have still some monoy in hand, eome of the creditors not having called for their dividends, but will place it in the hands of the Court if desired. M. Caselberg, Creditors' Trustee,

Mr Beard stated in reply to the remarks of the Trustee concerning tho debtor's solicitors, that the delay and expense was caused solely through tho Trustee not keeping to the written agreement he had made with the debtor's brother.

The debtor was submitted to a long examination by His Honor as to what he had been earning ire, He stated he had lost money by his contracts. He had handed over cattle to his father-in-law for money he owed him for bushfalling. in 1881. He handed the cattle about three months before failing,

To Mr Beard: Some little time before filing ho had been suffering from a broken leg which had him up for about 6 months.—Discharge was granted.

Messrs Witt next applied for their discharge for liabilities incurred through starting a flax-mill which had turned out a failure through creditor? pressing for payment, k, forcing them into the Bankruptcy Court, In reply to His Honor, Mr Beard stated the debtors sought to be relioved from their individual as well as their joint debts. His Honor could not see how this could be done, as the declaration of insolvency was a joint one, and did not state they were jointly and severally unable to meet their engagement,?. Thos. H. Witt, one of the creditors, was sworn, and stated that the £2OO owing to Mr Hammerich was for money advanced to pay labor. Spent £IOO in machinery, Mr Hammerich had a bill of sale over the machinery, which he had since sold and realised £IOO on it. Had been in the business about 12 months, and he owed £4O or £SO before going in, Had about £7O, and instead of paying his debts he went into tho flax mill business.

The discharge was granted. The application of John W. Leahy, bootmaker, was next taken, Mr Skipper appearing for the applicant, An informality in the papers filed caused a suspension of the proceedings and tho application was again hung up, His Honor kindly stating that to enable if possible tho omission to be remedied, ho would adjourn to 11 o'clock on Monday morning. If the applicant was still in no better position, the affair was to be adjourned to the next regular sitting. This morning Mr Leahy's papers being in no more perfect state than on Saturday, the application was adjourned to next sitting. The Court then adjourned,