410 



BANKRUPT BANKS. 



vided the insolvency liave been followed by imprison- 

 ment, absconding, or taking sanctuary, or by the 

 execution of certain judicial warrants, if lie he privi- 

 leged from arrest. By this process, the whole estates 

 ami effects of the debtor, real ami personal, are placed 

 under sequestration, lo liie eil't cl of being made over 

 to a trustee, as soon as the creditors can meet and 

 ch(He a fit person ; tor which purpose a day is ap- 

 pointed, and notice given in the gazette. The pro- 

 peny is in the meantime managed by a factor. :ip- 

 pointeil by the creilitors ; and the trustee, when 

 chosen, has i he whole property assigned to him, and 

 is entitled to recover, for the benefit of the creditors, 

 nil property ami effects made over to confidential 

 I..T-OIIS after insolvency, or conveyed to creditors in 

 -atixfaction or security of previous debts, within two 

 months before sei|uestnition or imprisonment. The 

 trustee's duty is to bring the whole estate to sale, 

 with certain precautions ; to receive ami investigate 

 the claims of the creditors, and to reject or admit 

 them, subject to review of the court of session by 

 summary petition. At certain appointed times, he is 

 required to make successive dividends, till the whole 

 funds shall be exhausted. The debtor and his family 

 must submit to public examinations, on oath before 

 the sheriffof the county in which his trade was carried 

 on ; and he may receive a judicial protection from 

 arrest, if four- fifths of his creditors in number and 

 value shall think him entitled to it, and the trustee 

 shall certify his conduct to be unexceptionable. And 

 on the same conditions he may, after a certain time, 

 be discliarged of all his debts by the court, after 

 hearing any creditor in opposition. The whole may 

 also be superseded by composition, if such be assented 

 to by nine-tenths of the creditors in number and 

 value. 2. Bankruptcy of persons not engaged in 

 trade. By a statute 1696, c. 5, the Scottish parlia- 

 ment provided, that any person insolvent and impri- 

 soned upon caption, or taking sauctuary,or absconding, 

 or defending himself by force against arrest, shall be 

 deemed a bankrupt ; and the effect of this is, 1st, that 

 no preference given to one creditor over others within 

 two months previous to the bankruptcy shall be effec- 

 tual ; 2d, that all attachment of goods, debts, c., 

 within the same term, shall be unavailing to give 

 preference to the creditor using them ; 3d, that the 

 debtor may apply to the court of session to be dis- 

 charged from prison, after a month's imprisonment, 

 on making a complete cessio bonorum, or surrender 

 to his creditors of all his estates and effects ; the 

 court having power to judge of his right to such dis- 

 charge, ana to prolong bis imprisonment, or rather 

 to refuse his discharge, according to his conduct. 

 His future acquisitions are liable to be attached by 

 his creditors. 



In Holland, there has existed, since 1643, in Am- 

 sterdam and other commercial cities, a court (Kamer 

 van desolade Boedtls), consisting of an equal number 

 of lawyers and merchants, who assemble twice a 

 week, to take cognizance of the bankruptcies that 

 may occur. When a person becomes insolvent, this 

 court appoints two commissioners (a merchant and a 

 lawyer,, to take charge of his affairs, who, with a 

 secretary, immediately repair to the bankrupt's, seal 

 .p and make an inventory of his property, take pos- 

 session of his books, &c. The following day, they 

 assemble the creditors living in the place, and make 

 a report ; at the same tune assigning certain days 

 for the future meetings of the creditors. Two or 

 three creditors are now appointed to take possession 

 if the property of the bankrupt and administer it, 

 and attend to the substantiation of claims. From 

 this time the bankrupt has a month to propose an 

 hceord to his creditors, which the commissioners 

 make known to creditors, abroad and at home, by 



public advertisements. If a creditor has any objec- 

 tions to it, he must urge them strenuously. To have 

 any respect paid them, they must be made by a 

 principal creditor, whose claims amount to one fifth 

 or one sixth, or by two or more, whose joint claims 

 amount to one twenty- fifth. If no accord is effected, 

 the bankrupt is declared insolvent by the commis- 

 sioners, his property is put in trust, and the former 

 sci|uestmtors are changed into trustees, who, with 

 the aid of a book keeper, proceed to the examination 

 of claims. The insolvency is now reckoned from 

 the sequestration, and all transfers, &c., made in the 

 fow VBdu previous, are regarded aa null and void. 

 These trustees now ascertain the amount of property 

 and debts, and make a dividend, though the last 

 dividend must be made eighteen months after the 

 assignment. The allowance made the bankrupt is 

 from three to ten per cent., in proportion to the di 

 vidend; but it can never exceed 10,000 florins. If 

 the bankrupt is not found chargeable with fraud, he 

 may obtain a certificate, which must be signed by 

 the trustees, and the creditors, at least one half in 

 number, and five-eighths in value, or five-eighths in 

 number, and one-half in value, and which not only 

 restores him to his former standing, but secures him 

 from all sul>sequent demands of former creditors. 



Denmark, also, has a distinct court of distribution 

 (Skifteret), which appoints trustees, who divide the 

 estate of the bankrupt among the creditors, under 

 the approbation of the court. No creditor can be 

 appointed a trustee. 



In Sweden, the debtor, from the time of giving 

 notice of his insolvency, must keep his house. The 

 creditors of the place and neighbourhood are forth- 

 with called together; the bankrupt makes oath of 

 his property ; and the estate is given, in provisional 

 trust, to two or more men. All the creditors are 

 now publicly invited to prove their demands at the 

 end of six months. The creditors must appear, be- 

 fore, twelve o'clock, on the fixed day; their informa- 

 tion is read, and, if possible, on the same day, oath 

 is made of the justice of their claims. Two trustees, 

 chosen by the creditors, now take charge of the 

 estate. Three weeks after the first meeting of the 

 creditors, a second takes place, and, fourteen days 

 afterwards, they are again assembled, and receive a 

 dividend. 



All these laws are more judicious than the common 

 German law on the same subject, which is, indeed, 

 in commercial cities, frequently superseded by special 

 law. The delays and expenses of the German bank- 

 rupt system are carried to a great extent, and even 

 the most equitable judge is often unable to prevent 

 fraud and abuse. The tedious public citations ; the 

 various processes of liquidation ; the admission of 

 legal measures, involving delay ; the frequent dis- 

 putes respecting right ot priority; all these have 

 the effect of inspiring merchants, foreigners especi- 

 ally, with a dislike ot the system, and inducing them, 

 if possible, to come to a voluntary composition. More 

 than half the estate of the bankrupt is often exhaust- 

 ed by the costs, or by the unavoidable delay of its 

 conversion into money, and there are instances of 100 

 years having elapsed before a final settlement. The 

 punishment of negligent and fraudulent bankrupts is 

 usually confinement in prison or the workhouse. 



BANKRUPTCY, NATIONAL. See National Bank- 

 ruptcy. 



BANKS, Sir Joseph, baronet, a distinguished natural- 

 ist, was born in Lincolnshire, 1743. He was sprung 

 from a family of Swedish origin, which had settled 

 in England a century before, and from which the 

 attorney and tragic poet John Banks was also descend 

 ed. He studied at Eton and Oxford till 1761. He 

 then visited Hudson's bay, for the purpose of making 



