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Decisions of the Superior Courts of New South Wales, 1788-1899

Lyons v. Neilson [1841] NSWSupC 42

insolvency, surgeon

Supreme Court of New South Wales

April 1841

Source: Sydney Herald, 24 April 1841

LYONS V. NEILSON - SAME V. SAME. - AND DUGUID V. SAME. - The insolvent in these cases was John Neilson, described in his schedule as surgeon and druggist, late of George-street. After his examination had been commenced, it appearing that the trustees to whom he had assigned his property for the benefit of his creditors, had refu[s]ed to give him the use of his books in order to enable him to complete his schedule, he was remanded till Tuesday, an order being made by his Honor on the trustees to place the said books in the hands of the insolvent's brother, in order that he might make up a list of all the debts, goods, &c. assigned by the insolvent to these trustees who being also creditors, and claiming a preference were ordered also to make out a list of their claims. The insolvent attributed his insolvency to giving large credits, and having met with extensive losses within the last twelve months.

Stephen J., 27 April 1841

Source: Sydney Herald, 28 April 1841


TUESDAY. - Before MR. JUSTICE STEPHEN. - JOHN NEILSON, surgeon, late of George-street, an insolvent who had been remanded on the preceding Friday, in order that he might furnish his detaining creditors with an account of all the property which he had assigned to trustees for the general benefit of his creditors, was again brought up, when Mr. Holden, the Secretary to the trustees, produced a documentwhich he had drawn up from the insolvent's books since the latter was remanded, from which it appeared that the insolvent's debts and liabilities amounted to 10,000, while his assets were estimated at £9490. Mr. Holden also informed the Court, that the insolvent's books not having been properly kept, it was impossible to make out a correct statement of his affairs; and Mr. Salting, one of the trustees, informed the court that they were in such an irregular state, that neither the trustees, the insolvent, nor any one else, could make out any thing like a correct statement; so much so, indeed, was this the case that, in his opinion, it would take any man six months to put the books in proper order, and make out the accounts. At the same time, he did not see that any benefit could arise to the detaining creditors by keeping the insolvent in custody, as the latter, by his deed of assignment, had denuded himself of all property, of every description, both here and elsewhere, for the benefit of his creditors.

            His Honor said, that such was his opinion also, but still as the insolvent had not complied with the order of the Court, it was at the option of the opposing creditors to press the Court for his being confined until he did so.

            Mr. Want, who appeared for the opposing creditors, objected to the insolvent being discharged, as his schedule had not been amended in the way which his clients were entitled to expect it would have been; besides, as it was reported that the insolvent had prepared to leave the Colony, he did not see that this was a case in which his clients were called on to show any indulgence; he had also reason to believe that the assignment had been made long before it was published, and if such was the case his clients, as well as others, may have credited the insolvent to an extent which they would not otherwise have done had they been aware of the existence of that deed.

            Mr. Goddard, who appeared for the insolvent, submitted that there was no evidence that the insolvent had contracted any new debts or come under any new liabilities, since the assignment had been executed, and by the cross-examination of the insolvent showed that the bills referred to by Mr. Want were not new liabilities, but merely renewed bills for old ones, of which the insolvent had been able to clean off a part.

            His Honor suggested to Mr. Want the propriety of his clients falling in with the rest of the creditors, as from the statement given in, it appeared that there was nearly as much as would cover the whole of the debts and liabilities.

            Mr. Want said before he should determine on what course to pursue he should like to ask a few questions of the insolvent, when he elicited from him that the watch mentioned in the schedule was not the gold watch which the insolvent used to wear, but a silver one, and which he had sold since he went to Gaol, in order to get accessaries and little odds and ends settled. That the insolvent had given the gold watch referred to, to his brother instead of wages, as the latter had been some years with him and had got no other return for his services.

            Mr. Goddard for the insolvent submitted that there had been nothing elicited which at all militated against the honesty of his client, and trusted that those who opposed him would consider the infirm state in which his client was, and whether it would not be more advantageous for them to consent to his discharge, in order that he might assist the trustees in arranging his affairs and getting the assets collected, so that the whole might be equitably divided among his creditors.

            Mr. Salting stated to the court that, in his opinion, if the estate was properly managed it would enable the trustees to pay 20s. in the pound to every creditor.

            His Honor said there was certainly nothing before the court affecting the honesty of the insolvent; but still he might have been imprudent, or have squandered his estate improperly. He then asked the insolvent if he had not, particularly within the last six months, been frequently drunk: this was denied; but the insolvant admitted that his affairs getting into their present state had caused him to act as he otherwise would not have done. The insolvent also admitted that he was at present, and for some time past had been labouring under great nervous excitement; but denied that it had been either caused or aggravated by drinking; he also denied that the late illness he had been afflicted with was delerium tremous, it was an entirely different affection; he also denied that it was ever his intention to leave the colony, which he had a witness to prove; he also complained of having been much neglected by those who ought to have seen him since he went to gaol.

            Mr. Salting stated that it was not the intention of the insolvent to have absconded from the colony, although had he left it for a time until he had recruited his health and become able to mange his affairs, in his opinion it would have been better for all concerned. With regard to the treatment of the insolvent since he was taken into custody, he informed his Honor that so long as the business was in the insolvent's name, the trustees had allowed Mrs. Neilson such sums as were necessary for the support of her and her family, and he had reason to believe that the insolvent's vituals had been daily sent to the gaol to him, but it was the express order of the trustees that no money should be supplied him.

            His Honor trusted that whatever evils the insolvent had already been subjected to by his imprudence or irregularity would not be thrown away on him, and as he had conceded that there was a general impression abroad that he had been addicted to drinking, whether well or ill founded, that he would by his future couduct show that his embarrassments were in no way caused or aggravated by intemperance to which he feared many of the cases of insolvency which have occurred are mainly to be attributed.

            Mr. Want having consented to the insolvent being discharged, he was accordingly liberated.

            The Court then adjourned.

Published by the Division of Law, Macquarie University