The Sun.
London, England, 1833-03-30 00:00:00

COURT OF CHANCERY.-(THIS DAY.)

YOUNG v. THORNTON.
THORNTON v. YOUNG.

Sir EDWARD SUGDEN applied this morning in this
case, upon motion, on behalf of Mr. Young, that he might be
at liberty to bid at the sale of three-fourths of The Sun news-
paper, which, under an order of the Court, was appointed to
take place on the 2d of April, and that the debt due from the
concern to him, to the amount of B,COOI. and upwards, might
be taken as the security for and in lieu of the deposit of 15
per cent. stipulated by the conditions of sale to be paid by the
purchaser. The Learned Counsel observed, that the Court
would recollect that under the Decree of the Court the
three-fourths of the paper, the property of the bankrupt,
were ordered to be sold. The Master, as usual, had
issued the particulars of sale, and by those particulars it
was stipulated that the person or persons who should be allowed
the best purchaser of the bankrupt's shares, should make a de-
posit at the time of sale with the said Master of 15 per cent.
on the amount of their purchase moneys; that such person or
persons should, within a week of the day of sale, enter into a pro-
per security to be approved of by the Master for the payment into
the hands of the Accountant-General to the credit of the
causes of the residue of the purchase-money as the Court
should direct. The object of Mr. Young was, being the
owner of the other share, in the first place, to have the
liberty to bid at the sale, which all parties were desirous he
should do, and that, having a large sum due to him from
the concern, which would be set off in settling the accounts
as far as the sum would go, that that sum should be
considered in lieu of the deposit which he would have to make,
if he became the purchaser, of 15 per cent.
The LORD CHANCELLOR—On the value of the amount
proposed to be given for the shares
Sir EDWARD SUGDEN—Yes.—Now the affidavit of
Mr. Young stated, that he had put in his examination to the
interrogatories, exhibited before the Master, by which it
appeared that on the balance of accounts from the
commencement of the co-partnership between the deponent
and the bankrupt Patrick Grant, to the bankruptcy of the said
Patrick Grant; including the moneys received from, or paid to,
or on account of, the said Patrick Grant, with interest to the
26th day of January, 1833 ; and from the bankruptcy of the
said Patrick Grant, to the 26th day of January, 1833; including
debts now remaining due on account of the said Sun News-
paper to other persons, for which this deponent is personally
liable; there was due to this deponent from the said Sun
Newspaper, in the whole, the sum of 11,0001. and upwards, the
proportion whereof, in respect of the said Patrick Grant's
three-fourth shares in the said newspaper, amount to the sum
of 8,0001 and upwards,
Saith, that the accounts directed to be taken by the said de.
cree, have been submitted by the consent of all parties, and
with the approbation of the said Master, to the examination
and investigation of Mr. Kitchener, the official assignee under
the commission of bankruptcy awarded and issued against the
said Patrick Grant; the said Mr. Kitchener did, by writing
under his hand, beating date on or about the 23d day of March
instant, as this deponent has been informed and verily be-
lieves, certify to Mr. Briggs, the solicitor of the assignees of
the said bankrupt, that, " from the commencement of the
partnership, to the bankruptcy, a balance will be due to Mr.
Young, meaning this deponent, on Mr. Grant's, meaning the
said bankrupt's three-fourth shares of the Sun Newspaper,
with interest to 26th January, 1833, amounting to 5,2481. I3s. 4d.
Also due to Mr. Young, meaning this deponent, at the date of
the bankruptcy, on Mr. P. Grant's, meaning the said bankrupt's
separate account, with interest to the 26th Jan., 1833, 836/. Os. 9d.

The LORD CHANCELLOR—This motion, I suppose, is
opposed. Are the other side here?

Sir E SUGDEN—Yes, my Lord. That in pursuance of the
said decree, the said Master has directed the shares of the said
bankrupt, Patrick Grant, In the said newspaper, called The
Sun, to he sold before him on Tuesday, the 2d day of April next.
And this deponent believes that it will greatly benefit the
bankrupt's estate if he be allowed to bid for the said shares;
and in the event of his being declared the purchaser thereof,
that he be required to make deposits and give security only in
respect of that portion of the purchase money which may ex-
ceed the sum of 8,7951. 16s. 7d., so certified to be due to him as
aforesaid. He admitted that the account was not yet taken,
but by the examination of Mr. Young it was sworn that the
sums appearing to be due to him were correct. That lode--
pendently of the two sums of 5,299/. ss. sd. and 9961.
iSs. Id. due to Mr. Young ; a further sum of 5,0001. and
upwards was due to other persons, on account of the paper on
the 26th January last. Independently of this, Mr. Kitchener
in his certificate had stated that he had minutely and delibe-
rately investigated all the accounts, and after paying a great
compliment to the accuracy with which they were kept, states
them to be highly satisfactory to him. The nature of the debt
due to Mr. Young was this—first, the payment of debts by
Mr. Young, which were owing from the paper, the sums ac-
tually expended on the paper, and certain sums of money ad.
vanced to Mr. Grant previous to the bankruptcy, and the
expenses since the bankruptcy up to the present time. The
paper having been materially damaged in consequence
of Mr. Grant having set up a rival paper, the ex-
penses of the paper were very large, and its income, on
looking at the accounts, appeared to be exceedingly
great. But in consequence of the rival paper, established by
Mr. Grant, not only was the paper largely in debt to Mr.
Young, but to other individuals, to the amount of upwards of
5,0001. It did not appear, by the examination of Mr. Kitche-
ner's account, what was the exact proportion of the debt, to
be borne by the bankrupt's estate; but Mr. Young being the
solvent partner, he was responsible for those debts, and the
creditors looked to him, and him alone for the payment of their
debts; neither did it appear what part of the debts due at the
bankruptcy of Mr. Grant remains unpaid ; the whole of those
debts, within a fraction, however, was in one person, and he
was willing to give an undertaking to the satisfaction of the
Master, to take the responsibility of Mr. Young, and place
the whole in Mr. Young, making him the sole creditor.
Mr. Young would therefore be placed in the same situation
as a Mortgagee, and would not be called upon to pay a deposit
or give security, because he had already sums owing him by the
concern far exceeding the amount of the required security, the
interest which he had in the estate would insure his doing that
which would answer the purposes and object which the Court
had in view, namely, to insure the execution of the contract
made by the party who had purchased the estate. The Court
had still entire dominion over the property, and there was this
advantage from Mr. Young's purchasing it, that he had so
much interest in it, and so much at stake, as to afford to the
creditors a certainty of having a perfect security for the com-
pletion of their contract. The Learned Counsel had no doubt
of the Court's acceding to his motion. . . _

Mr. JEMMETT was on the same side; but did not think it
necessary to address the Court. _ .

Mr. PEPYS appeared for the assignees. He said that with
respect to the first part of the notice, he was not
prepared to offer any objection ; but as to taking the supposed
debt due to Mr. Young as a deposit, his clients had a ♦ery
great objection indeed. The order of the Court had distinctly
prescribed the terms on which the purchaser was to enter into
possession of the property—namely, that of making a bona
fide deposit of 15 per cent on the amount of the purchase_
money. These were not the terms approved of by the Master,
but the terms laid down by the Court.

The LORD CHANCELLOR—I perfectly recollect that
I considered the case very much after I took the papers
into the country, and my object was, if possible, to pre-
vent fictitious biddings. I saw enough in the case that looked
very suspicious, and that was a good deal observed upon in the
course of the argument, to suppose that an attempt might be
made in that way. It was to prevent that—it was not as against
Mr. Young, I intended that 15 per cent. should be paid.
Mr. PEPYS said there had been a good deal of fictitious
bidding.

The LORD CHANCELLOR—Aye, but if people bid now,
they must come forward with the money.
Mr. PEPYS said that was very true, and would be the case
if any stranger were to bid and be declared the purchaser ; but,
if this motion were to be granted, it would not be so as regarded
Mr. Young, because he would have nothing to pay. The in.
tention was to have a real bidder, and that the contract should
afterwards be completed. If the motion were to be granted in
the terms now proposed, Mr. Young being already in possession,
there would be no pressing motive whatever upon him to go on
to a completion of the sale—the motive which would press on
any other purchaser. Then with regard to the account
itself, in point of fact, there had been no account taken at all.
The statement of the accounts only appeared on Mr. Young's
Own affidavit, and the certificate of Mr. Kitchener, the official
assignee. They stated that the amount now alleged to be due
from the concern, appeared as the result of their examinations
of the books ; but no books, nor any vouchers, that could be
properly attended to, were before the Court. At the date of
the bankruptcy, there was a sum of 5,2451. due from Mr.
Grant to Mr. Young, as appeared by the account A. After the
bankruptcy, Mr. Young had gone on with the business, and
since that time there had been a loss, in carrying on the paper,
to the amount of no less than 3,6141. according to the
present statement of the accounts. Mr. Young having
gone on with the concern without the sancticn of the assignees,
he was responsible to them for any profits that might have
been made, but he could not call upon them in respect of any
loss incurred after the bankruptcy. There seemed to be a con.
siderable sum upon the accounts which Mr. Young claimed to
be due to him from Mr. Grant, in respect of his private account.
With regard to any thing of that sort, Mr Young could only
stand as an ordinary creditor against the bankrupt.
Sir E. SUGDEN assured Mr. Pepys that he was under a
mistake, because the sums alluded to were sums drawn out of
the concern by Mr. Grant.
Mr. PEPYS said that his clients had no means of
judging of the nature of the account, except from Mr.
Young's own statement and Mr. Kitchener's certificate,
and from them it appeared to him that the part of the account
to which he referred could only be considered that in respect of
which Mr. Young was entitled to stand only as a common cre-
ditor of the bankrupt. On the whole, there being a very press-
ing interest in Mr. Young that no sale should take place at all,
and as that interest would be very much facilitated by the grant-
ing of this motion, he (Mr. Pepys) trusted that the Court would
order him, if he became the purchaser, to pay down a deposit,
just as a stranger, if he became the purchaser, would have
to pay.
Mr PALEY followed on the same side.

Sir E. SUGDEN replied. lie felt rather surprised at the
statements of Mr. Pepys, that his client could not be in a bet-
ter situation than he was at present. lie was surprised, too,
at that Learned Ger.tleman's statement, that Mr. Young was
carrying on the paper without the authority of the Court, and
that his client, Mr. Young, was not entitled to eome against
any body for the loss, but only the profit. Any person coming
into the concern as purchasers of Mr. Grant's 3-fourth shares,
would enter it subject to all Mr. Young's rights ; and
ae to the manner in which the paper had been