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Students' Casqs.

The Students' Cases are omitted this month, on account of the large amount of space required for the Epitome of Statutes. They will be made up in our number for next month.

CHANGES MADE BY THE BANKRUPTCY ACT, 1883.

By T. EUSTACE SMITH, Barrister-at-Law. In the small compass allowed me for this article, I cannot state fully all the changes made in the system of dividing a debtor's estate amongst his creditors, and only propose to point out the most important and radical changes. The simplest plan of doing this will, I think, be to shortly state the various stages of a bankruptcy under the new Act, giving special attention to those proceedings which are new. In order to carry out this plan, I shall assume that the reader has some practical acquaintance with the Act of 1869, and shall give no detailed account of proceedings which are common to the old Acts.

The fundamental alteration made by the Act of 1883, is that there are to be no petitions for liquidation. Bankruptcy proceedings are initiated by a petition presented by the debtor himself, or by a creditor against him. Where the petition is presented by a creditor, it must allege that an act of bankruptcy has been committed by the debtor.

Acts of Bankruptcy.

The acts of bankruptcy under the Act of 1883, are virtually the same, as under the Act of 1869, except: (1.) That the levying any execution against a debtor by seizure and sale, will be an act of bankruptcy, irrespective of the amount of the sum in respect of which it is levied, and irrespective of the fact of whether the debtor is or is not a trader. (2.) That the debtor's summons of the Act of 1869 is not re-enacted, but in its place a creditor who has obtained final judgment against a debtor may serve on him a bankruptcy notice, requiring payment of his judgment debt. The debtor, on being served with the notice, must, within seven days of service, comply with it, or prove to the satisfaction of the court, that he has a counterclaim or cross-demand, equalling or exceeding the amount of the judgment debt.

(3.) If the debtor gives notice to his creditors that he has suspended, or is about to suspend payment of his debts.

The Courts.

The London Bankruptcy Court is to be united and consolidated with the Supreme Court of Judicature. (Secs. 92, 93.) The London Bankruptcy district is to comprise the City of London and the districts of the Metropolitan County Courts, formerly comprised in the London Bankruptcy Court. (Sec. 96, and schedule III.) The County Courts are still to retain their jurisdiction throughout the county. (Sec. 92.)

Where the Petition is to be presented.

If the debtor against or by whom a bankruptcy petition is presented

(a) Resides or carries on business within the London Bankruptcy district for the greater part of the six months immediately preceding the presentation of the petition, or

(b) For a longer period during those six months than in the district of any county court, or (c) Is not resident in England, or

(d) If the petitioning creditor cannot ascertain the residence of the debtor.

The petition is to be presented to the High Court.

In any other case the petition is to be presented to the County Court in the district of which the debtor has resided, or carried on business for the longest period during the six months immediately preceding the presentation of the petition. (Sec. 95.)

Petitions by either debtor or creditor cannot be withdrawn after presentation without leave of the court. (Secs. 7 & 8.)

The amount of the petitioning creditor, or creditors' debt or debts, must still be £50.

Receiving Orders,

Upon the presentation of a petition by the debtor, the court will immediately make a receiving order. Where the petition is presented by a creditor, the court, on proof

(a) Of the debt,

(b) Service of the petition, and

(c) Act of bankruptcy,

May make a receiving order. (Secs. 7 & 8.)
The effect of the receiving order is

(1) To constitute an official receiver (the official receivers are officers newly created by the Act), receiver of the property of the debtor.

(2) To prevent any creditor from pursuing any remedy against the property or person of the debtor without leave of the court.

(3) To prevent any creditor from commencing any action or other legal proceeding against the debtor without similar leave.

The right of a secured creditor to realise his security is, however, expressly reserved to him. (Sec. 9.)

The official receiver may, on the application of a creditor or creditors, appoint a special manager of the debtor's estate or business. (Sec. 12.)

Proceedings consequent on Receiving Order.

A general meeting of the creditors is summoned to be held not later than 14 days (unless the court otherwise orders), after the making of the receiving order. The meeting is summoned by the official receiver, who is to give not less than seven days' notice of it in the London Gazette, and in a local paper, and he also is to send as soon as practicable to each creditor mentioned in the debtor's statement of affairs, a notice of the time and place of the meeting, (Sec. 15, and rules 1-3 of the 1st Schedule.)

The debtor is to make out, and submit to the official receiver a statement of his affairs, verified by affidavit, showing the particulars of his assets and liabilities, and the names and addresses of his creditors. It must also show the securities held by the creditors, and give particulars of them.

This statement must be furnished within three days from the date of the receiving order, where the petition is presented by the debtor, and within seven days from the date of the order, where the petition is presented by a creditor.

The statement can be inspected by any person stating himself in writing to be a creditor. The inspection may be made personally, or by agent. Any person untruthfully stating himself to be a creditor, is liable for a contempt of court. (Sec. 16.)

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The proxies are to be in a prescribed form-are to be issued by the official liquidator, or after his appointment by the trustee. Every insertion in the proxy must be in the handwriting of the creditor. Proxies may be general or special

General, i e., a proxy given to any person in the creditor's regular employment, in which case the proxy must itself state the relation in which the person named in it stands to the creditor. Special, i.e., a proxy to any person to vote at any specified meeting or for some specified purpose. The proxy must be deposited with the official receiver or trustee before the meeting at which it is to be used.

A creditor may appoint the official receiver his proxy,

A person holding a proxy must not vote in favour of a resolution which would place him, his employer or partner in a position to receive remuneration out of the estate. A person holding a special proxy to vote for himself as trustee may do so. (Schedule I., rules 17, 18, 19, 21 and 26.)

Secured Creditors.

A creditor holding a current bill of exchange or promissory note, must treat the liability of all persons liable thereon, antecedently to the debtor as a security in his hands, and estimate the value of such liability, and for the purposes of voting, but not of taking a dividend, he must deduct such estimated value from his proof. (Schedule I., rule 11.)

The trustee or official liquidator may within 28 days after the proof of a secured creditor has been used at a meeting, purchase the security for the benefit of the creditors, at the value estimated by the creditor—plus 20 per cent. A creditor may, before he has received a notice from the trustee to give up his security, revalue his security, but where the security is so re-valued, the trustee need not give the extra 20 per cent., but may take the security at its estimated value. (Schedule I., rule 12.)

The trustee, if he is not satisfied with the value put on a security by a creditor, may require it to be offered for sale. The terms and conditions of the sale are to be settled by the trustee and creditor, or if they cannot agree, by the court. On the other hand, a secured creditor may require the trustee, by notice in writing, to elect whether he will redeem the security, and if the trustee does not elect to redeem within six months, he loses his right to do so. (Schedule II., rule 9.)

Compositions or Schemes of Arrangement. Any composition or scheme of arrangement must be accepted by a special resolution. (Sec. 18.)

A special resolution means the same in the Act of 1883, as in the Act of 1869, i.e., a resolution passed by a majority in number, and three-fourths in value of the creditors present at the meeting, either personally or by proxy, and confirmed by a resolution passed (by a majority in number and representing three-fourths in value of all the creditors who have proved) at a subsequent meeting. And it must subsequently be confirmed by the court. (Sec. 18.)

The subsequent meeting confirming the special resolution cannot be held until after the public exami nation of the debtor,

Adjudication of Bankruptcy.

The debtor is to be adjudicated bankrupt. (1.) If the creditors resolve by an ordinary resolution (that is as under the Act of 1869-a resolution passed by a majority in value of the creditors or their proxies present at a meeting), that he should be adjudicated.

(2.) If the creditors pass no resolution. (3.) If they do not meet.

(4.) If a composition, or scheme of arrangement is not accepted or approved within 14 days after the conclusion of the debtor's examination, (the 14 days may be extended by the court). (Sec. 20.) The Trustee.

After the debtor is adjudicated bankrupt, a trustee is appointed by an ordinary resolution.

The trustee has to give security to the satisfaction of the Board of Trade.

The Board of Trade may appoint a trustee, if the creditors do not do so within four weeks from the adjudication. The creditors may, however, subsequently substitute a trustee of their own choice for the one appointed by the Board of Trade. (Sec. 21.)

If the court is satisfied that any solicitation has been used by, or on behalf of a trustee or receiver in obtaining proxies, or in procuring the trusteeship or receivership, the court may order that no remuneration be paid to such person. (Schedule I., rule 20.)

The provisions of the Act of 1883, relating to the committee of inspection (Sec. 22); the power of the creditors after adjudication in bankruptcy, to accept a composition (Sec. 23); and the powers of control over the person and property of a debtor (Secs. 24-27), do not materially differ from the provisions

of the Act of 1869.

Discharge of Bankrupt.

A bankrupt will not be able to apply for his discharge until after his public examination.

The application for the discharge is to be made in open court.

On the hearing, the court will consider a report which has to be made by the official receiver, and it can grant or refuse the order of discharge, or suspend its operation, or it can grant an order of discharge, subject to conditions with respect to the earnings or income of the bankrupt.

If the bankrupt has committed any misdemeanor under the Bankruptcy Act, or Debtors' Act, the court must refuse his discharge.

In any of the following cases the court will refuse the discharge, suspend its operation for a specified time, or make the order, subject to the conditions before mentioned.

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(c)

(d)

(e)

(f)

(g)

(h)

has traded, knowing himself to be in

has contracted debts without reasonable expectation of paying them.

has brought on the bankruptcy by hazardous speculation or extravagant living.

has put any of his creditors to expense by frivolous defences to actions.

has given an undue preference within three months before the date of the receiving order.

has before been bankrupt or made a statutory composition with creditors.

has been guilty of fraud or fraudulent breach of trust.

The Order and Disposition Clause.

The only alteration made in the order and disposition clause, is that it applies only to goods "in" the bankrupt's "trade or business " (Sec. 44), and not to all the goods in the trader's possession as under Sec. 15, sub-sec. 5 of the Act of 1869.

Effect of Bankruptcy on antecedent transactions.

An execution creditor cannot retain the proceeds of an execution levied against a bankrupt's goods, unless he has completed the execution by seizure and sale, or in the case of an attachment of a debt by receipt of the debt.

Executions.

When the sheriff sells the goods of a debtor for a sum exceeding £20 (including legal incidental expenses) the sale must, unless the court otherwise orders, be by public auction, and must be publicly advertised for three days next preceding the day of sale.

A writ of elegit is not to extend to goods.

A writ of levari facias shall not be issued in a civil suit. (Sec. 145.)

Remuneration of the Trustee.

The remuneration of the trustee is to be fixed by an ordinary resolution of the creditors, or if the creditors so resolve by the committee of inspection,

The remuneration is in the nature of a commission, of which one part shall be payable on the amount realized, and the other on the amount distributed in dividend.

The Board of Trade fixes the amount of remuneration, where one-fourth in number or value of the creditors dissent from the resolution, or where the bankrupt satisfies the Board that the amount of remuneration is unnecessarily large. (Sec. 72.) The vote of the trustee or his partner, clerk, solicitor, or solicitor's clerk, either as a creditor, or a proxy for a creditor, is not reckoned in the majority required for passing a resolution affecting his remuneration. (Sec. 88.)

Appeals.

Appeals lie from the orders of a County Court Judge to the Court of Appeal, and not to the Chief Judge in Bankruptcy.

From the High Court (which now takes the place of the London Bankruptcy Court) to the Court of Appeal.

Appeals from the Court of Appeal can still be made only by leave of the Court of Appeal, and still go to the House of Lords. (Sec. 104.)

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(2.) There is no committee of inspection, but the official receiver must procure the sanction of the Board of Trade in all cases where a trustee would require the sanction of the committee of inspection.

The creditors may, however, at any time by a special resolution appoint a trustee in the place of the official receiver.

Power of the County Court to make an administration order instead of an order for payment by instalments.

Where a judgment has been obtained in a County Court against a debtor, and the debtor cannot pay the amount forthwith, and alleges that his whole indebtedness does not exceed £50, the County Court may make an order providing for the administration of his estate, and for the payment of his debts by instalments or otherwise-and either in full or in part. This order does not become invalid if the amount of debts be subsequently found to exceed £50.

The registrar of the County Court may, on the request of a creditor, where it appears that the debtor's property exceeds £10 in value, issue execution against him. No fee is paid on such execution. The debtor's household goods, wearing apparel, and bedding of himself and his family, and the tools of his trade, not exceeding in the whole £20 in value, cannot be seized.

The administration order protects the debtor from all adverse proceedings by his creditors, except by the leave of the court.

The costs of administering the debtor's estate under this order are not to exceed 2s. in the pound on the total amount of debts. (Secs. 121, 122.)

Administration in Bankruptcy of Estate of person dying insolvent.

A creditor of a deceased person whose debt would have been sufficient to support a bankruptcy petition, may present a petition asking for the administration of the estate of the deceased debtor.

An order for administration will not be made until the expiration of two months from the date of the grant of probate or letters of administration, unless (a) With the concurrence of the legal personal representative.

(b) The creditor proves that the debtor committed an act of bankruptcy within three months prior to his decease..

A petition for the administration of the estate of a deceased insolvent, is not to be presented after proceedings have been commenced in any court of justice for administration. But the court administering the estate may, on proof that the estate is insufficient to pay its debts, transfer the proceedings into the bankruptcy division.

One section (Sec. 170), applies to proceedings under the Act of 1869. It provides that no composition or liquidation by arrangement, shall be entered into or allowed without the sanction of the court, or registrar having jurisdiction in the matter.

STUDENTS' STATUTES.

AN EPITOME OF STATUTES OF IMPORTANCE TO STUDENTS, PASSED DURING THE SESSION 46 AND 47 VICTORIA.*

46 VICT., C. 3.

Explosive Substances Act, 1883.

(Commencement of Act, 10th April, 1883.) Sec. 2. Any person who unlawfully and maliciously causes by any explosive substance an explosion of a nature likely to endanger life or to cause serious injury to property shall, whether injury has been caused or not, be guilty of felony, and liable to penal servitude for life, or for any less term (not less than the minimum term allowed by law), or to imprisonment with or without hard labour for a term not exceeding two years.

Sec. 3.-Any person who within or (being a subject of Her Majesty) without Her Majesty's dominions unlawfully and maliciously

(a) Does any act with intent to cause by any explosive substance, or conspires to cause by an explosive substance an explosion in the United Kingdom of a nature likely to endanger life or to cause serious injury to property; or (b.) Makes or has in his possession or under his control any explosive substance with intent by means thereof to endanger life, or cause serious injury to property in the United Kingdom, or to enable any other person by means thereof to endanger life or cause serious injury to property in the United Kingdom,

Shall, whether any explosion does or not take place, and whether any injury has been actually caused or not, be guilty of felony, and liable to penal servitude for a term not exceeding twenty years, or to imprisonment with or without hard labour for a term not exceeding two years, and the explosive substance shall be forfeited.

Sec. 4. (1) Any person who makes or knowingly has in his possession or under his control any explosive substance, under such circumstances as to give rise to a reasonable suspicion that he is not making it or does not have it in his possession or under his control for a lawful object, shall, unless he can show that he made it or had it in his possession or under his control for a lawful object, be guilty of felony, and liable to penal servitude for a term not exceeding fourteen years, or to imprisonment for a term not exceeding two years with or without hard labour, and the explosive substance shall be forfeited.

(2.) In any proceeding against any person for a crime under this section, such person and his wife, or husband, as the case may be, may, if such person thinks fit, be called, sworn, examined, and cross-examined as an ordinary witness in the case.

Sec. 5.-Any person who within or (being a subject of Her Majesty) without Her Majesty's dominions by the supply of or solicitation for money, the providing of premises, the supply of materials, or in any mauner whatsoever, procures, counsels, aids, abets, or is accessory to, the commission of any crime under this Act, shall be guilty of felony, and shall be liable to be tried and punished for that crime, as if he had been guilty as a principal.

It is endeavoured here to epitomise as much as possible, and it is only intended to give those portions of the Acts which appear of use to Law Students.-[ED. L. S. J.]

Sec. 7. (1.)-If any person is charged before a justice with any crime under this Act, no further proceeding shall be taken against such person without the consent of the Attorney-General, except such as the justice may think necessary by remand, or otherwise, to secure the safe custody of such person.

46 & 47 VICT., C. 28.

The Companies' Act, 1883.

(Commencement of Act 1st September, 1883.) Sec. 4. In the distribution of the assets of any company being wound up under the Companies' Acts, 1862 and 1867, there shall be paid in priority to other debts,

(a) All wages or salary of any clerk or servant in respect of service rendered to the company during four months before the commencement of the winding up not exceeding fifty pounds; and

(b) All wages of any labourer or workman in respect of services rendered to the company during two months before the commencement of the winding up.

Sec. 5.-The foregoing debts shall rank equally among themselves, and shall be paid in full, unless the assets of the company are insufficient to meet them, in which case they shall abate in equal proportions between themselves.

Sec. 6.-Subject to the retention of such sums as may be necessary for the costs of administration or otherwise, the liquidator or liquidators or official liquidator shall discharge the foregoing debts forthwith, so far as the assets of the company are and will be sufficient to meet them, as and when such assets come into the hands of such liquidator or liquidators or official liquidator.

NOTE. This is applying the Bankruptcy rule to the winding up of companies. It should, however, be noticed that it was some time ago decided that by the 10th sec. of the Judicature Act, 1875, the bankruptcy rule, that servants' wages should be paid in priority to all other debts, was extended to the winding up of a company (In re Association of Land Financiers, 16 Ch. D., 373). It seems, therefore, that this statute is simply declaratory, and may be said to be passed for the purposes of definitely settling the point. See as to the application of the 10th sec., and the numerous conflicting decisions thereon. (Snell's Principles of Equity, 6th edition, 263, 264.)

46 & 47 VICT., C. 31 Payment of Wages in Public-houses Prohibition Act, 1883.

(Commencement of Act, 20th August, 1833.) Sec. 2.-In this Act, the expression "workman," means any person who is a labourer, servant in husbandry, journeyman, artificer handicraftsman, or is otherwise engaged in manual labour, whether under the age of 21 years or above that age, but does not include a domestic or menial servant, nor any person employed in or about any mine to which the Coal Mines Regulation Act, 1872, or the Metalliferous Mines Regulation Act, 1872, applies.

Sec. 3. From and after the passing of this Act, no wages shall be paid to any workman at or within any public-house, beershop, or place for the sale of any spirits, wine, cyder, or other spirituous or fermented liquor, or any office, garden, or place belonging thereto or occupied therewith, save and except such wages as are paid by the resident owner or occupier

of such public-house, beershop, or place to any workman bona fide employed by him.

Every person who contravenes or fails to comply with or permits any person to contravene or fail to comply with this Act, shall be guilty of an offence against this Act.

And in the event of any wages being paid by any person in contravention of the provisions of this Act for or on behalf of any employer, such employer shall himself be guilty of an offence against this Act, unless he prove that he had taken all reasonable means in his power for enforcing the provisions of this Act, and to prevent such contravention.

Sec. 4.-Every person who is guilty of an offence against this Act shall be liable to a penalty not exceeding ten pounds for each offence; and all offences against this Act may be prosecuted, and all penalties under this Act may be recovered by any person summarily in England in the manner provided by the Summary Jurisdiction Acts, and in Scotland in the manner provided by the Summary Jurisdiction (Scotland) Acts, 1864 and 1881.

46 & 47 VICT., C. 38.

The Trial of Lunatics' Act, 1883. (Commencement of Act, 25th August, 1883.) Sec. 2.-Where in any indictment or information an accused person is shown to be insane, the jury shall return a special verdict, to the effect that he was guilty of the act or omission charged against him, but, was insane, and the court shall then order the person to be kept in custody as a criminal lunatic, at Her Majesty's pleasure.

NOTE. Of course this Act makes no practical difference, as the same substantive result ensued under 39 & 40 Geo. III., c. 94, sec. 1, and 3 & 4 Vict., c. 54, both of which provisions are repealed by the above statute. As to what will amount to insanity, see McNaughten's case (10 Cl. & Fin., 200). See also Harris' Criminal Law, 2nd edition, p. 22.

46 &47 VICT., C. 47.

The Provident Nominations and Small Intestacies Act, 1883.

(Commencement of Act, 25th August, 1883.) Sec. 5.-A depositor in a savings bank, not being under 16 years of age, may by writing under his hand delivered at or sent to the office, nominate any person, not being an officer or servant of the directors (unless such officer or servant be the husband, wife, father, mother, child, grandchild, brother, sister, nephew, or niece of the nominator), to whom any sum, not exceeding one hundred pounds, which may remain due to such depositor at his decease may be paid at such decease, and may from time to time revoke or vary such nomination by writing under his hand similarly delivered or sent; and on receiving satisfactory proof of the death of a nominator, the directors shall pay to the nominee the sum due to the deceased depositor, provided it does not exceed one hundred pounds.

Sec. 7.-If any member of a registered trade union, entitled from the funds thereof to a sum not exceeding one hundred pounds, dies intestate and without having made any nomination which remains unrevoked at his death, such sum shall be payable, without letters of administration, to the person who appears to a majority of the directors, upon such evidence as

they may deem satisfactory, to be entitled by law to receive the same.

Sec. 8,-If a member of any society who is entitled to make a nomination under this Act or the Acts hereby amended is illegitimate, and has died intestate, and without having made any such nomination subsisting at the death, the directors may pay the sum which such member might have nominated to or among the person or persons who, in the opinion of the majority of them, would have been entitled thereto if such member had been legitimate, or, if there are no such persons, then the deposits shall be dealt with as the Commissioners of the Treasury may direct.

Sec. 9. All payments made by directors under the powers aforesaid shall be valid with respect to any demand of any other person as next-of-kin of a deceased member, or as his lawful representative or person claiming to be such representative, against the society or savings bank, or the directors, but such next-of-kin, representative, or claimant shall have remedy for recovery of such money, so paid as aforesaid, against the person or persons who shall have received the same.

Sec. 10.-If sum, dealt with under aforesaid powers exceeds £80, the directors must before payment over, satisfy themselves as to what duty is paid thereon, Any nomination or payment under this Act is not to affect the liability to probate duty.

NOTE. This Act may prove of considerable practical importance. The nomination allowed under sec. 5, forms in a certain sense an exception to the law of wills, and should be carefully noted. Secs. 7 & 8 are both also important in their way.

46 & 47 VICT., C. 51.

The Corrupt and Illegal Practices Prevention Act, 1883. (Commencement of Act, 25th August, 1883, but only to continue in force till 31st December, 1884, unless continued by Parliament.)

Sec. 4.-Where on the trial of an election petition the court reports to the speaker that corrupt practice, other than treating or undue influence, has existed to the candidate's knowledge, or that the candidate has himself been guilty of treating or undue influence, such candidate's election shall be void, and he shall be for ever incapable of sitting in the House of Commons for that particular county or borough.

Sec. 5.-If the court reports that candidate is guilty by his agents of corrupt practice, then his election to be void, and a like incapability shall ensue as specified in sec. 4, for a period of seven years from the date of the report.

Sec. 6.-Provides the following punishments:(1.) Committing any corrupt practice other than personation, misdemeanour, imprisonment, with or without hard labour, for not exceeding one year, or fine not exceeding £200.

(2.) Personating or aiding or abetting therein, felony. Imprisonment, with hard labour, for not exceeding two years.

(3.) In addition, any person convicted, on indictment of any corrupt practice, shall be incapable, for seven years, of being registered, and voting as an elector, or of holding any public or judicial office, or of being again elected to Parliament, and should he have been elected, on conviction, his election is vacated.

Secs. 9, 10.-Any person voting or procuring an other to vote, knowing of inability to do so, or any

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