BANKRUPT. 



409 



risk of the consignor, have been sold by him to third 

 persons, may be claimed by the consignor, if it has 

 not been paid to the bankrupt, or passed into the ac- 

 counts between him and the consignor. The simple 

 bankrupt (that is, he who is convicted of mere negli- 

 gence) is liable to imprisonment for a time not less 

 than one month, nor more than two years. The frau- 

 dulent bankrupt is condemned to hard labour (tra- 

 vaux forces) for a definite time. 



By the English statute of 6 Geo. IV., it is made an 

 act of bankruptcy for a debtor to depart the realm, 

 remain abroad, leave his house, shut himself up in 

 his house, suffer himself to be arrested for a debt not 

 due, yield himself up to be put in prison, suffer him- 

 self to be outlawed, procure himself to be arrested, 

 or his goods to be attached, or make transfers ot 

 his lands or goods, with intent to defraud his credi- 

 tors. So it is an act of bankruptcy in a debtor, on 

 commitment for debt, to lie in prison 20 days, or es- 

 cape from prisdh. A man may become a bankrupt, 

 also, by declaring himself such at the bankrupt office. 

 Where the debtor does not so declare himself bank- 

 rupt, proceedings are commenced against him as such, 

 on petition to the chancellor, by one creditor to the 

 amount of 100, or two or more to the amount of 

 150. And in case the petitioners do not establish 

 the bankruptcy, they are liable for the costs of the 

 proceedings, and damages to the party petitioned 

 against. The act extends to aliens, denizens, and wo- 

 men. On a petition being made, the lord chancellor 

 appoints commissioners, to take charge of the body, 

 lands, and effects of the party petitioned against. 

 These commissioners proceed to take testimony that 

 the petitioners are creditors, that the debtor is a mer- 

 chant or trader within the meaning of the statute, 

 and that he has committed an act of bankruptcy. 

 These facts being established, they adjudge that 

 he is a bankrupt, and give notice thereof in the Lon- 

 don gazette. The commissioners are invested with 

 ample powers for getting possession of the bankrupt's 

 person and effects. They assign all his property, 

 real and personal, to assignees appointed by them- 

 selves, and these assignees subsequently assign it over 

 to other assignees, appointed at the second meeting 

 of the creditors, in case of such other assignees being 

 so appointed, and approved by the commissioners. 

 Creditors, whose debts are not due, are allowed to 

 prove them, discounting interest. Sureties and bail 

 for the bankrupt, when they pay the whole debt for 

 which they are bound, may represent their claims un- 

 der the commission, and receive the dividends that 

 would otherwise have been assigned to the party to 

 whom they pay the debt, even if it is not paid until 

 after the commission issues. Persons holding poli- 

 cies of insurance signed by the bankrupt, may also 

 present their claims, and if the contingency, whereby 

 they would be entitled to a loss, happens before the 

 commission is closed, their claims will be allowed. 

 An annuity creditor is also admitted to prove ; like- 

 wise suret/es on an annuity bond, and any creditor 

 whose debt depends upon a contingency, if the con- 

 tingency take effect pending the commission. The 

 conveyance made to the assignees will transfer to 

 them, for the benefit of the creditor, all goods of any 

 other person in the possession of the bankrupt at the 

 time of the failure, and, by permission of the owner, 

 reputed to belong to the bankrupt. Conveyances and 

 transfers made by the bankrupt after he shall have 

 been insolvent, except upon consideration of mar- 

 riage, or other good consideration, are void, and the 

 property so transferred is disposed of by the assig- 

 nees for the benefit of the creditors. The assignees 

 may, at their election, assume any subsisting lease 

 held by the bankrupt, or any agreement by him to 

 purchase lands. The bankruptcy dissolves articles 



of apprenticeship entered into with the bankrupt, 

 and if he has received any apprentice's fee, on ac- 

 count of taking an apprentice, a part or the whole of 

 it is returned by the commissioners. The assignees 

 may execute any powers vested in the bankrupt, 

 which he might have executed for his own benefit. 

 If the bankrupt was trustee of property, the chancel- 

 lor appoints others in his stead. Conveyances by, 

 and contracts and transactions by and with, the 

 bankrupt, bonafide, and executions levied more than 

 two months before the issuing of the commission, 

 though after the act of bankruptcy, are valid if the 

 other party had no notice of the previous act of 

 bankruptcy. Payments made at any time before the 

 bankruptcy are also valid. The creditors appoint a 

 receiver of the money, the proceeds of the bankrupt's 

 property. The money must be vested in exchequer 

 bills on interest, if so directed by the commissioners. 

 The first dividend is made at the end of twelve, and 

 the final one at the end of eighteen months. In case 

 the bankrupt does not surrender himself within forty- 

 two days after notice, or appear, as required, from 

 time to time, to be examined on oath before the 

 commissioners, or does not discover all his property, 

 or deliver up all his books and papers relating there- 

 to, or conceals and embezzles property to the value 

 of 10, or papers relating thereto, he is deemed 

 guilty of felony, and liable to be transported for life, 

 or for a term not less than seven years. During his 

 examination, an allowance is made to him for the 

 support of his family. The bankrupt is absolutely 

 discharged from all his debts and liabilities subsisting 

 at the time of his becoming bankrupt, in case of his 

 obtaining, and the lord chancellor's allowing, a cer- 

 tificate of four-fifths in number and value ot creditors 

 to the amount of 20 each, or, after six months 

 from the time of his last examination, of three-fifths 

 in number and value of such creditors, or nine-tenths 

 in number, that he has duly surrendered, and in all 

 things conformed to the requisitions of the act. All 

 contracts to induce creditors to sign the certificate 

 are void. But, if it be a second case of the debtor's 

 bankruptcy, his certificate will not exempt his future 

 property and earnings from liability to his creditors, 

 unless the dividends amount to fifteen shillings in the 

 pound. A bankrupt who obtains his certificate, if 

 the dividends amount to ten shillings in the pound, 

 js allowed five percent, on the amount, not exceeding 

 400 ; and if the dividends amount to twelve shil- 

 lings and sixpence in the pound, he is allowed seven 

 and a half per cent., not exceeding 500 ; and if the 

 dividends amount to fifteen shillings in the pound, he 

 is allowed ten per cent., not exceeding JE600: but if 

 they are less than ten shillings in the pound, he is 

 only allowed such sum as the assignees and commis- 

 sioners may think fit, not over three per cent., nor 

 exceeding 300. But the bankrupt is not entitled 

 to a certificate, if he has lost, in gambling, within 

 twelve months, 200, or js?0 in any one day in that 

 time ; or if he has lost 200 in stockjobbing, or has 

 caused false entries in his books, and mutilated or 

 falsified papers to defraud his creditors, or connived 

 at any person's proving a fictitious debt under the 

 commission. If the bankrupt or his friends propose 

 a composition which is accepted by nine tenths of 

 his creditors in number and value, the commission of 

 bankruptcy will be superseded. 



Law of Bankruptcy and Insolvency in Scotland. 

 1 . Bankruptcy of persons engaged in trade. By 54 

 Geo. III. c. 37, a judicial proceeding, called seques- 

 tration, is authorized to be issued by the court of ses- 

 sion, on the petition of an insolvent trader or manu- 

 facturer in Scotland, with concurrence of a creditor 

 swearing to a debt of 100, or of a creditor to that 

 amount without the concurrence of the debtor, pro- 

 3r o 



