A meeting of creditors of Messrs. A. T. Nichols, Ltd., painters and decorators, of 4, Alfred-street, Rushden, was held at the offices of Messrs. J.T. Parker and Son, solicitors, Church-street, Wellingborough, on Tuesday. Mrs. D. E. Clarke, a director, presided.
Mr. T. H. Sanders, F.S.A.A., incorporated accountant (of Messrs. James and Sanders) gave a report. It was pointed out that the company’s former auditors had joined H.M. Forces, and that he had been asked to prepare the statement of affairs. The company was incorporated on October 24th, 1938, with a nominal capital of £500 divided into 500 shares of £1 each, for the purpose of taking over the business formerly carried on by J. L. Nichols and Mrs. D. E. Clarke, trading as “A. T. Nichols,” painters and decorators, 4, Alfred-street, Rushden.
This business had been duly registered under the Business Names Act on 29th August, 1934. The issued capital of the company was £161, representing the capital in the business taken over at October 24th, 1938. On the balance sheet there was a liability of £600, being monies advanced on loan to the firm by one of the partners (Mrs. D. E. Clarke). This liability was taken over by the company, and £50 of this loan was repaid on 1st May, 1939, and the balance of £550, together with interest accrued, was shown as a liability in the statement of affairs.
The accounts for the company’s first trading year ended October 31st, 1939, showed a loss of £204, but a subsequent investigation had shown that this should have been £239. The loss for the second year to October 31st, 1940, was £689. In both years there was a gross loss. The directors stated that the heavy loss in the last year was accounted for by the fact that contracts were undertaken about October, 1939, for the Rushden Urban Council. The costings for the work were apparently based on old prices, and there were under-estimates.
Mr. A. T. Nichols, who was the father of the directors, worked for the company, and a director, Mr. J. L. Nichols, also worked in a productive capacity. Another director, Mrs. D. E. Clarke, gave clerical assistance, and the amount paid to her also covered rent and rates of the business premises, which were owned by her. The remuneration paid to these individuals during the two years was as follows :- Mr. A. T. Nichols £208 13s. and £210 15s., Mr. J. L. Nichols £219 19s. and £219. Mrs. D. E. Clarke £76 19s. and £73 5s., totals £505 13s. and £503.
The statement of affairs was presented, showing total liabilities of £984 6s. of which £12 6s 5d. income tax, was preferential, leaving unsecured liabilities of £971 19s 7d. The assets were estimated to realise £190 6s 9d. and after deducting the preferential creditor of £12 6s 5d. there was a balance available of £178 0s 4d. , subject to casts of realisation.
It was also reported that the company had held an extraordinary general meeting, and that Mr. T.H. Sanders was formally appointed liquidator.
Some discussion followed as to the explanation of the heavy loss in the last year, and the directors were criticised for not having met the creditors earlier in the year. The explanation was regarded as unsatisfactory. It was intimated that Mrs. Clarke would defer her claim of £559 in favour of the creditors. The trade creditors over £10 are as follows :- H. P. Hodge, Ltd., Rushden, £170; Mr. Alfred Gray, £163; Nichols and Clarke, London, £28; Inland Revenue, £24; Messrs. J. T. Parker and Son, Wellingborough, £17; and Messrs. Adshead Ratcliffe, Belper, £11.
The creditors’ meeting confirmed the appointment of Mr. T. H. Sanders as liquidator, and appointed the following three creditors to form a committee of inspection: Mr. A. C. Wright (Messrs. Hodge Ltd.), Mr. Alfred Gray, and Mr. J. C. Parker.