Page:1902 Encyclopædia Britannica - Volume 26 - AUS-CHI.pdf/163

 BANKRUPTCY

135

lishing local Bankruptcy Courts in certain districts in Ireland, and an Act passed in 1889, applying the main provisions of the English Act of 1888, relating to preferential payments in bankruptcy, to Ireland, no material change has occurred in the Irish law of bankruptcy, which therefore continues to be regulated by the two leading Irish statutes of 1857 and 1872, together with the Irish Debtors Act, 1872, and corresponds in its main features to some of the older English enactments, with modifications adopted from the English Act of 1869. It may be pointed out, however, that the system of liquidation by arrangement and composition without the approval or control of the court, which proved fatal to the success of the latter, has not at any time been imported into the Irish law. The Deeds of Arrangement Act of 1887, which has been already discussed above under the head of English bankruptcy legislation, also applies in its main provisions to Ireland, and as supplemented by the Irish Deeds of Arrangement Amendment Act of 1890, places the law relating to this branch of insolvency procedure upon a similar footing in both countries, so far as regards the publicity of such deeds. The last-mentioned Act also requires a similar registration of all petitions for arrangement under the Bankruptcy Act of 1857. Bankruptcy Legislation in the British Colonies and India. Since the passing of the English Bankruptcy Act of 1883, there have been numerous acts of legislation affecting the law of bankruptcy in the British Colonies. In some of these the principles of the English Act have been more or less closely followed, the main distinction being that the control and supervision which in England is vested in the Board of Trade and its officers, are in the Colonies vested in the local courts and specially constituted officials acting under their control. For general information on the subject of Colonial and Indian bankruptcy legislation down to a recent date, reference may be made to the Sixteenth Annual Report to Parliament by the Board of Trade, dated 1st August 1899, and to the subsequent annual reports of that department, which contain interesting resumes of the principal features of the various acts at present in force in the British Colonies and in India. (j. sm.*) Bankruptcy in the United States. The United States Bankruptcy Law of 1867 was repealed in 1878. For the twenty years following, until 1898, the only insolvency laws in the United States were those of the separate States, in which there has been little change; they varied much, especially as to dissolving attachments and preferences and granting discharges. In 1898 these laws were again superseded by another general United States Bankruptcy Act. The especial objects of this Act were the securing of discharges from debts to all insolvents not guilty of fraud, and promptness and economy in the settlement of estates. The provisions as to discharges from debts are much more liberal than in any former Act. Any bankrupt may have a discharge from his debts unless he has committed some crime punishable by imprisonment under the Act (viz., concealment of property or perjury), or with fraudulent intent and in contemplation of bankruptcy destroyed, concealed, or failed to keep books from which his true condition might be ascertained. No dividend to or consent of the creditors is required. A preference, or conveyance to defraud creditors, or spending or wasting of property, or loss by gambling before the adjudication, is no ground for refusing a discharge. Discharges do not affect the following :—taxes, judgments for frauds, false pretences, or wilful injuries ; debts not scheduled ; debts created by embezzlement or misappropriation, either as an officer or by one acting in a fiduciary capacity. Compositions approved by a majority in number and amount of the creditors, and confirmed by the Irish Bankruptcy Legislation. judge, may be enforced ; and the bankrupt, upon depositing the With the exception of an Act passed in 1888 for estab- consideration for the composition, and money to pay the preferred

and public rates and assessments), the Legislature also practically abolished this use of the process of cessio, and the process itself would probably have become obsolete, but for certain changes effected by the Act of 1881, which have given it a different and more extended scope. Among these changes may be noted (1) the extension to “any creditor of a debtor who is notour bankrupt,” without reference to the amount of his debt, of the right, hitherto limited to the debtor himself, to petition the court for a decree of cessio, the prayer of the petition, whether presented by the debtor or by a creditor, being “to appoint a trustee to take the management and disposal of the debtor’s estate for behoof of his creditors ”; (2) the discretionary power given to the court upon such petition to award sequestration under the Bankruptcy Act, in any case where the liabilities of the debtor exceed j£200 ; and (3) the right of the debtor to apply for his discharge under similar conditions to those obtaining in the case of sequestration. An important modification of the law relating to discharge which equally affects a debtor under the Bankruptcy and Cessio Acts, is also effected by the provision of the Act of 1881, Avhich requires, in addition to the concurrence of creditors, the fulfilment of one of the following conditions—viz., “ (a) That a dividend of five shillings in the pound has been paid out of the estate of the debtor, or that security for payment thereof has been found to the satisfaction of the creditors ; or (b) That the failure to pay five shillings in the pound has, in the opinion of the sheriff, arisen from circumstances for which the debtor cannot justly be held responsible.” Orders of cessio are only made in the Sheriff Courts, and when made, the court also appoints a trustee, who conducts the proceedings without the control exercised by the creditors in a sequestration. Under these conditions it will be seen that the original purpose and constitution of the process of cessio has entirely disappeared, • and it has now become a modified form of official bankruptcy procedure, with a less elaborate routine than in the case of sequestration, and one perhaps more suitable to the smaller class of cases, to which in practice it is limited. The Bankruptcy Frauds and Disabilities (Scotland) Act of 1884 applies to sequestrations and decrees of cessio the criminal provisions of § 31 of the English Bankruptcy Act of 1883, relating to the obtaining of credit for £20 and upwards by an undischarged bankrupt, without disclosure of his position. It also places the law relating to the disqualifications attaching to such bankrupts on a similar footing to that of the English Act. The Judicial Factors Act of 1889 contains a provision calculated to check excessive costs of administration, by requiring that where the remuneration of a trustee under a sequestration is to be fixed by the commissioners, intimation of the rate of remuneration is to be given to the creditors and to the Accountant of Court before being acted on, and the latter officer is empowered, subject to appeal, to modify the same if he deems it expedient. It may be pointed out that the Deeds of Arrangement Act of 1887, which applies to England and Ireland, does not apply to Scotland, and there is no analogous provision requiring registration of private deeds of assignment for the benefit of creditors as a condition of their validity in that country. Finally, it is to be noted that the office of Accountant in Bankruptcy, which was established by the Bankruptcy Act of 1856, has under the Judicial Factors Act of 1889 been abolished, the duties being merged in those of the office of Accountant of the Court of Session.