Unsuccessful Omnibus Finance.
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A meeting of the creditors. of The Motor Trading and Contract Corporation; -Ltd., was called for 29th January at the Carey Street Offices of the Board of Trade. There was not a quorum, and the proceedings were adjourned for A week. The statement of affairs submitted showed the financial position of the company to be as follows :Liabilities, seven unsecured creditors _,16,839 6s. Sd. (all estimated to rank); assets, book debts (four debtors), ./._;28,429, 'estimated to produce nothing. The deficiency account shows general expenditure in carrying on business as follows :Amount discharged, L-1,779 .3.s.; due at date of winding up order, 4926 us. ltd. (including k2oo :for directors' fees). Bad debts now written off by the directors, 4;28,429 19s. 3d. ; preliminary expenses, Lt6o -35. id.; loss on promotion of London Standard Motor Omnibus Co., Lid., ...4;6,638 tbs. 8d. Total, sL._;37,934 13s. I ; less gross profits on sale of .buses, 4;12,088 75. 3d.; less claim for -damages for -chassis supplied defective, 4-9,000. Deficiency., .4;16,846 Gs. 8d. in his observations, the Official Receiver states that the winding up order was made on 28th August, 1907, upon a • creditor's petition, and the statement of :affairs was submitted on 31st Deccanber, 1907, by Messrs. Alfred Suart and John Baptiste I3ardach, directors of the .company. The company was registered • on 14th March, 1906, with a nominal .capital of Z20,000, divided into shares
of each, its objects being to acquire • from Mr. Alfred Suart, the promoter and vendor, his interest in certain agreements relating to the supply of -motor omnibus chassis, and to promote a company to work motor omnibuses. . Mr. Suart has acted as a director and . controlled the company's business
• throughout its existence. The only shares issued were those to the signatories; who were the nominees of Mr. Snort. The company promoted the London Standard Motor Omnibus Co., lid., which was registered on 3i St March, 1906, with a nominal capital of -£250,000, for the purpose of running motor omnibuses. The company guaranteed to supply the Standard Company with 200 motor omnibuses at an agreed price, and it was to receive, for its services and expenses in connection with the promotion, ;66,51so in cash and 6,000 fully paid shares. According to the books, the consideration for the promotion-"serisiees and expenses appears to have been satisfied. The 'Standard Company issued a prospectus inviting public subscriptions, but the issue was unsuccessful; and, as the directors of the Standard Company refused to go to allotment unless capital to the extent of .4;25,000 was subscribed in cash, the company, through its nominees, _applied for 9,400 shares to make up the required amount. Of the 9,400 shares in the Standard Company above referred to, 3,000 are still registered in the name of one of the nominees, who claims a lien upon them for calls paid by him amounting to s6;1,760. The remaining 6,400 shares and the 6,000 shares which. formed part of the payment to the Trading Company in respect of the flotation of the Standard Company, were issued in the form of share warrants to bearer. Mr. Suart stated that he sent these share warrants to a person in Paris for sale on behalf of the company and that no account as to their disposal had been received. This Was denied by the person receiving the shares. The company appeared to have supplied motor omnibuses to the Standard Company, to the London and Westminster Motor Omnibus Co., Ltd. (a company promoted by Mr. Suart), and to firms in Rotterdam. In all cases, difficulties had arisen owing, it was alleged, to the faulty construction of the omnibuses. Mr. Swift stated that most of the omnibuses, which appeared by the hooks as having been supplied _ to the two companies mentioned, were in fact supplied to a company named " Motor Vehicles, Ltd.," which supplied them to the omnibus companies under hire-purchase agreements, the companies having no funds with which to purchase them outright. With the exception of a few transactions in the company's name, the whole of the financial operations had been conducted by Mr. Suart, who appeared by the books to have received, in cash and bills of exchange, sums amounting to upwards of ..‘62,000. He claimed to have paid, or was under obligation to pay, on the company's account, ,.":71,260 and eturned himself as a creditor for .4;9,254 2s. Yid. Included in the sum of ,4,71,260 above mentioned are items amounting to ,*18,612 9s. 6d., in respect of advances to the London and Westminster Omnibus Co., Ltd.. These advances appeared to have been made by Mr. Suart without any authority from the company or the directors ; in fact, Mr. Suart seemed to have regarded the company's business as his own and to have acted accordingly. The Official Receiver remarked that the whole of the transactions of the company required the closest investigation. On 1st August, 1907, a meeting of shareholders appeared to have been held and a resolution was passed for the voluntary winding-up of the company. The failure of the company was attributed by Mr. Suart to the inability of the London and Westminster Motor Omnibus Co., Ltd., to repay the loan
advanced to them. Included in the book debts returned were sums which formed the subject of litigation. The Official Receiver remarked to those creditors who were present that Mr. Suart had been in absolute control ;of everything. It was not only a case of a " one-man company " but, " oneman two or three companies." In the ordinary course of events the estate would he wound up by the Official Receiver. A proxy had been lodged by Mr. Suart in respect of his claim upon the company, in favour of his being maintained in office; but the Official Receiver said he did not propose to ac cept the proxy. •