A meeting of the creditors of A. and R. S. Gilbert, boot manufacturers, Moor-road, Rushden, was held on Tuesday at the offices of Messrs. A. C. Palmer and Co., chartered accountants, Northampton. Mr. James Page, Wellingborough, presided.
The statement showed unsecured liabilities £719 14s. 4d., of which £654 10s. 7d. was due to trade creditors, £23 16s. 7d. to the bank (overdraft), and £41 7s. 2d. cash loan. The net assets totalled £207 1s. 9d.
Mr. H. Claude Palmer, F.C.A., stated that the bank overdraft was partly secured. There was a joint assurance policy on the lives of Mr. and Mrs. Gilbert, which must be considered as collateral security. A cash loan of £40 and interest were due to Mrs. Gilbert, wife of the senior partner. The partners were A. Gilbert, father, and R. S. Gilbert, son. Dealing with the trading account, Mr. Palmer stated that from January, 1922, to October, 1923, the sales were £7,044, and the gross profit £578. The gross profit was 8.1 per cent., a proportion that was simply ridiculous. Discounts equalled 5.3 per cent., leaving less than 3 per cent. gross trading profit, and after all expenses were charged there was a net loss of £233 before either partner drew anything for wages. The partners put into the business £100 on January 21st, 1922, £414 on February 6th, 1922, and £40 on March 21st, 1923. To that, for book-keeping purposes, had been added interest £45. The partners drew in wages £535, or about £3 a week each. There was a small item of £29 6s., rent of private house, to debit of capital account, and a loss of £233 had been made in business. In that way the whole of the capital had disappeared, and the capital account was £198 on the wrong side. To that excess of liabilities over assets as at October 22nd, 1923, were added the various items written off in the statement of affairs, making the total deficiency £512 12s. 7d.
The partners were formerly associated with the Steadfast Boot Co., Ltd., which had been dissolved. On severing their connection with the company each received £200, and used the money in January, 1922, to commence their business, first in Oakley-road, and later in Moor-road, Rushden.
Mr. Palmer gave particulars of what he called a peculiar transaction with the bank. Until July there was no overdraft, but about that time, being in need of more money, they obtained the promise of a friend to guarantee £200. No documents were signed, and when the overdraft amounted to £200 the bank approached the guarantor, but without success. In order to meet the requirements of the bank, the debtors paid in a number of sums, until at the present time the bank wanted £19. Mr. Palmer expressed the opinion that the procedure had been quite innocent, and there had been no idea of giving preferential treatment, although it was rather unfortunate for the general body of creditors.
Mr. C. W. Wing (Messrs. Simpson and Mason, solicitors, Rushden) offered, on the debtor’s behalf, a composition of 6s. in the £ at three, six, and nine months, the last instalment to be secured to the satisfaction of Mr. Palmer.
The Chairman and another creditor expressed the opinion that the debtors were thoroughly honest, but feared, unless a better gross profit could be made, that it would be a mistake for them to attempt to continue.
A resolution was passed accepting the offer, with the proviso that if it failed to go through a deed of assignment should be executed to Mr. Palmer.