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

In re Solomon [1850] NSWSupC 9 [insolvency]

insolvency

Supreme Court of New South Wales

Dickinson and Therry JJ, 20 February 1850

Source: Sydney Morning Herald, 21 February 1850, Supreme Court Collection, vol. 3, pp 66-67

INSOLVENCY JURISDICTION.

BEFORE their Honors Mr. Justice DICKINSON and Mr. Justice THERRY.

IN THE ESTATE OF JOHN SOLOMON.

The CHIEF COMMISSIONER had granted the above named insolvent his certificate, no one appearing on his Court to oppose the granting of the same.

On last Wednesday week he was about to move that it be confirmed, when leave was obtained on behalf of Messrs. Lyall, Scott, and Co., to file grounds of opposition to its confirmation.

In the mean time the following grounds have been filed:---

1 st . That the insolvent had not made a full and fair disclosure of his property;

2 nd . That being a person engaged in trade, he had omitted to keep reasonable accounts or entries of his receipts and payments.

Notice was also given that certain evidence given before the Commissioner would be relied on in opposition.

Upon the case being again called on to-day, the evidence taken before the Commissioner was read. It appeared that the insolvent, who could neither read nor write, was carrying on the business of a publican near the Haymarket; he also bought and sold goods of various descriptions. He never kept any accounts beyond some loose memoranda of some of his transactions. Towards the end of the last year, and just prior to his being declared insolvent, he said he had a sum of £260 set apart in two tin cash boxes, which were locked up in a drawer, and in a room situated up stairs, the room also having been locked. Whilst the money was so locked up, on a day, about ten o'clock at night, the day not actually being sworn to, he swore that that sum was stolen; the cash boxes being found shortly afterwards empty in the neighbouring pound. Upon the happening of the robbery information of the fact was given to a number of persons who were in the house at the time merry making, as well as to the police; but no clue to the robbery was given. In consequence of this robbery, it was sworn by the insolvent that he was compelled to sequestrate. Prior to the robbery he said he was in a condition to pay all his creditors in full.

Shortly after the robbery he sent a circular round to his creditors, whose claims amounted to £600, offering them 5s. in the pound. This not being accepted, his estate was sequestrated, and has since only paid 8d. in the pound on the proved claims.

Mr. DARVALL, now, on behalf of the opposing creditors, showed cause against the confirmation of the certificate. He contended, in the first place, that by the insolvent not having kept books---reasonable books---of account, on this ground alone he had made himself liable to the punishment pointed out by the Act, viz., the refusal of his certificate. The insolvent himself admits that no correct accounts were taken, and the question was, looking to those that were kept, are they sufficient, so that any one might by going over them ascertain what had been the amount of and nature of the dealings and transactions of the insolvent during any given period? He submitted that they would turn out to be deficient in that respect.

Secondly and lastly, he contended that the insolvent had not made a full and fair disclosure of his property. It was evident that the whole story as to the robbery was a mere concoction, and monstrously improbable. It was evident that the money alleged to have been stolen was still in the power of the insolvent. The learned counsel commented upon various inconsistencies in the accounts of the supposed robbery, as detailed in the affidavits, to show it was a mere fiction.

Mr. BROADHURST, for the insolvent, on the other hand, said, considering how ingenious burglars are, and how frequent have been of late offences of that nature amongst persons wishing to buy an outfit for California, the robbery mentioned by the insolvent did not seem so improbable as argued by the learned counsel. As to the alleged discrepancies in the affidavits, they would upon inspection turn out to be merely substantial truth under circumstantial variety, and therefore entitled to the more weight. Had the circumstantial account given by the insolvent been untrue, the creditors could easily have disapproved them, they have not done so, nor, on the other hand, offered any affirmative evidence that the insolvent had not made a full and fair disclosure of his property; he said no presumption unfavourable to the insolvent ought to be drawn from the fact, that though he offered a composition in the pound of five shillings, yet when the estate is wound up, it only yielded eight-pence in the pound. The property may have been overvalued by the insolvent; he may too have intended to have paid the composition out of future earnings.

As to the second ground of complaint, he submitted that the books kept by the insolvent's family, and now produced, were such reasonable accounts contemplated by the Act, considering that the insolvent could not read or write, and considering the nature of his petty business. It could not be expected that every petty dealer should keep his accounts as clearly and as fully as the first merchants of the colony. To deny such a petty dealer his certificate because he had not so kept his accounts, would work great injustice to him, for he may not of himself have sufficient education to do so, and may be too poor to employ others to do so. In conclusion, an affidavit of the insolvent was read, to the effect, that he had done nothing to disentitle him from receiving his certificate.

His Honor Mr. Justice DICKINSON said, that the Chief Commissioner had mentioned to the Court a case, the circumstances of which were similar to those of the present, and where the Court had directed the case to be remitted to the Chief Commissioner to be adjudicated upon. In accordance with the case, their Honors were of opinion that the present case should be remitted also. Considering the way in which the unopposed application for a certificate came before the Chief Commissioner, he was right in the manner in which he had adjudicated; but, considering the now opposition, it is nothing but right that he should exercise his own discretion in the matter before the Court decided whether that discretion had been properly exercised.

The case was accordingly remitted.

Published by the Division of Law, Macquarie University