The Sun.
London, England, 1861-02-26 00:00:00

THE SUN, LONDON, TUESDAY EVENING,

IMPERIAL PARLIAMENT.

HOUSE OF COMMONS.-(YESTERDAY.)
BANKRUPTCY AND INSOLVENCY BILL.

The house then went into committee on this bill.
Claus! up to 133 were agreed to.
On clause 134,
Mr. SCHOLEFIELD proposed after the words, "the
Bank of England," to insert " or such bank as the creditors
at such meeting may direct." He said no harm could be
done by this. The creditors were dealing with their own
money, and it seemed but fair they should choose where it
should be invested.

Mr. MURRAY said ho would propose an amendment
which would come before that of the hon. member. He
proposed to leave out the words, "not necessarily retained
for current expenses," he thought the retention of those
wards would leave a loop-hole for the assignee keeping
money in his bands which ought to be in the bank.
The ATTORNEY-GENERAL thought the words

C necessarily retained for current expenses," imposed a great
check. The inconvenience of striking out the words would
be that the creditors' assignee would be compelled to pay
every small sum ho received, even down to £5, into the
bank, and he could not get anything out without going to
the official assignee, and the result would be that costs
would be incurred for getting out every £5, £lO, or £2O, as
it might be required.
Mr. GUY N said there was a great deal of observation
abroad as to the largo balance that would be kept in the
Bank of England on this account. He was not prepared to
say that some commission ought not to be charged by the
Bank, but at the same time It ought to be regulated.
After a few words from Mr. AI RTON and Mr. Epwrx
JAMES, the amendment was negatived.
Mr. MURRAY remarked that the last return showed

lat the average balance in the Bank of England standing

in the name of the Accountant-General of ifankruptcy was
from £BO,OOO to £100,003, and they charged for keeping
that account between £3,000 and £4,000 a year. There
was no charge for receiving the money, but they charged
ss. per cent. for paying it out. As the Bank had always so
large a balance in its hands, be thought no charge ought to
be made for paying the money out.
The ATTORNEY-GENERAL said he hoped some ar-
rangement might be made with the Bank by which this
charge might be reduced. At the same time it was but
fair to the Bank to state that these payments were made in
different parts of the country, and there certainly ought to
be some percentage to the Bank for making these payments,
The hon. gentleman might rest assured that this subject
would not escape his attention, and that great care would
be taken in endeavouring to make a more advantageous ar-
rangement, With regard to the amendment proposed by
the hon. member for Birmingham, he was sorry he could
not consent to it. When the alteration was made by which
official assignees were appointed, the system of having
private banks was entirely put an end to, and he thought
rightly, for under the old system when the creditors chose
the bank they were never able to ascertain whether certain
sums of money might not be left in those banks undistri-
buted. Accordingly when the new system was introduced
the official assignees exerted themselves, and they found
very large sums of money that were retained by different
bankers throughout the country who had profited by the
retention of those moneys for an indefinite period of time,
and which the creditors would never have heard of but for
this new arrangement. He could not by any means con-
sent that money should be loft in the hands of private
bankers. He thought it very injurious to permit
bankers to bid as it were for creditors' money by offering
them an amount of interest. He hoped the committee
would adhere to the present practice in this respect, which
ensured to the whole body of creditors every shilling that
was paid in, which might not be the case if the money was
left in the hands of private bankers.
' Mr. SCHOLEFIELD said he shouldnot press his amend-
ment against the opinion of the Attorney. General, and ho
withdrew it.
The clause was then agreed to.
On clause 135, which provides that the official assignee
shall collect debts under £lO,
Mr. PAGET moved to insert, after "due to the estate,"
the words, "as the creditors' assignee shall require." He
thought the realising of the assets would be best accom-
plished by the creditors' assignee.

The ATTORNEY-GENERAL said alittle consideration

would probably satisfy the hon. gentleman that his amend-
ment would never answer. Take a debt of £l5O or £5OO,
and suppose the creditors' assignee instructed the official
assignee to get it in ; who was to employ the solicitor ? The

creditors' assignee would have virtually to do that, and
therefore the proposal was merely a long roundabout pro•

cess with regard to the collection of large debts. With re-
gard to small ones, however, the case was different. The,
official assignee had a number of clerks, and accordingly as,
soon as a man was bankrupt he would send round a circular
to persons who owed the estate trifling sums, and require
them at once to pay ; or, in the event of their not doing so,
he would proceed against them by summons, or would have
recourse to the county court. He would rather give the
whole duty into the hands of the official assignee than leave
it on the indefinite footing proposed.
Mr. PAGET requested that the clause might be post-
poned.
The ATTORNEY-GENERAL said if the hon. gentle-
man had any well-considered clause he might on the report
move to substitute it for the one now in the bill ; but to
postpone the clause would only lead to confusion.
Mr. BOLT observed that if the proposal of the bill were
some well-defined scheme of making the official assignee,
paid by salary, act under the supervision of the creditors, it
would be intelligible. But as the bill stood, with the divided
functions of the two assignees, he was afraid it would not
be found to work well.
The ATTORNEY-GENERAL said there never had
been more prophecies of failure than with regard to the
Testamentary Jurisdiction Bill; and yet no laNt.had been
found to work more quietly or more efficiently than that.
He thought there ought to be an efficient audit of both
assignees' accounts ; and it was a simple process for obtain-
ing that audit which excited the alarm of the hon. and
learned gentleman.
Mr. AYRTON suggested that some difficulty might be
experienced under the clause in case of a business being
carried on by the creditors, and he therefore recommended
the insertion of the words " if the assignees should so
require."
Mr. COLLIER thought the clause was better as it stood ;
and it was then agreed to.

On clause 141, " Pay, half-pay, and pension of bankrup'
to be applicable for creditors."

Mr. AYRTON moved that it be omitted altogether. By
a subsequent clause (163), power was given to make any
future property of the bankrupt available for the payment
of his debts, provided that he had been guilty of any mis-
conduct towards his creditors. This clause was, however,
an absolute one, and was quite irrespective of any question
of conduct. He (the hon, gentleman) could not see any dis-
tinction between the position of a public servant and the
servant of a railway company or a private merchant. If the
bankrupt had anything in the nature of property, let it be
made liable in the same manner as other property ; but he
did not perceive how a remuneration for services to be per-
formed could come under that designation. Ho did not desire
however, to deprive the court of the proposed power; only
let it be made a general one, applicably to all persons alike,
and not merely to persons in the public service. - •
The ATTORNEY-GENERAL said the clause was copied
almost verbatim from the Ist Vic. c. 110, s. 156, the present
Insolvent Act. The principle was that when a man pos.

ceased halfpay, or a retiring pension, or a settled salary for
life, it was net right that ho should be left to enjoy the
whole of it while his creditors remained unpaid. There
was in fact no difference between a salary of £l,OOO a year
for life and a life estate of £1.,000 a year, except that in
justice to the public service the possessor of it ought to be
allowed sufficient for his maintenance, so that he might be
able to fulfil the duties of his office. As to making the
clause universal, it must be remembered that persons in
private employment only held t he'r situations durante bone
placito, and were liable at any time to be dismissed. It would
therefore be idle to attempt to deal with their incomes. The
only question was whether the clause went far enough;
because, in the case of retiring salaries, it was doubtful
whether the whole ought not to be taken like any other life
interest.

Mr. AYKTON said the principle of the Insolvent Act
was wholly different from that of the present bill; and
therefore the hon. gentleman's reasoning from analogy did
not apply. Under the Insolvent Act a person only ob' ained
security from arrest, and did not get clear from his liabilities;
but the principle of this bill was that on giving up all his
property the bankrupt should be entirely discharged from
his debts.

The ATTORNEY-GENERAL said that retiring pen-
sions were not permitted to be assigned except with the
consent of the department. This therefore could not be
made part of the general assignment of a bankrupt's pro-
perty', and must be dealt with specially. Under the old law
the' insolvent might be called up do anno in annum, and
ordered to set apart so much of his salary as the court might
think fit. The present bill would give power to deal with
it once for all.
The clause was then agreed to.
Clause 142, " Sequestration of profits and benefices."
Mr. AYRTON objected also' to this clause. The salary
of a clergyraan was no property of his own, but was in-
tended for the benefit of , his parishioners ; and it was of
the utmost importance that ho should continue to receive
it, to enable him to discharge the duties of his office. He
thought the COMMiSBiOIIMI had the best right to the fund,
and it ought to bo preserved for their sakes.
Mr. COLLIER said he did not see why clergymen should
be cxerripted from the necessity of paying their debts more
than other people. It seemed to him to be only an extension
Of the preloding clause, which related to pensions.
The ATTORNEY-GENERAL was pleased to find that
the hon. and learned member for the Tower Hamlets was
so great a friend to the clergy. But he thought the interests
of the clergy would bo best' consulted by making no invi-
dious distinction. When a sequestration took place, the
bishop stepped in, and an appropriation, was made of part
of the emoluments, in order to-pay the stipond-ot curate;'
Ho had introduced a similar provision into this clause.
Mr. AYRTON said that if the Attorney-General had )

given the bishop a‘poWer to remove from his post a clergy-
man who should beeothe bankrupt, he should have been
much obliged to him. But he objected to a man remaining
in his parish whilst the money contributed by the parish-
ioners to his support was being spent elsewhere.
Mr. MALINS said he thought his hon. and learned friend
(Mr. Ayrton) had mistaken the object of the clause. This
clause was merely a transcript from the Insolvent Act,
which had been always found to act very well in this respect.
Mr. E. JAMES said he thought his hon. and learned
friend had misconceived the effect of the clause. Clergy-
men were often subscribers to banks and other institutions,
which sometimes failed. In fact, clergymen might become
bankrupt by misfortune, and it would plainly be a great
injustice to deprive them altogether of their livings on that
account.
The clause was then agreed to, as were clauses from 143
to 159 inclusive. •
After clause 159,
Mr. E. JAMES moved to insert the following clause :
" If any bankrupt shall be liable under any covereint or
agreement to keep on foot any policy or policies of insurance
effected on his own or any other life, the amount or value of
such liability shall be ascertained by an actuary or other -
wise, as the court may direct, and the creditor entitled to
the benefit of such covenant or agreement shall be admitted
to prove against the bankrupt's estate fur the sum which
shall be so ascertained."
Agreed to.
On clause 163, fixing the rules as to granting orders of
discharge,
Mr. MALINS suggested that power ought to be given
to the chief judge to grant certificates to bankrupts who
have been without them, and were imprisoned for tWelee
months.
The AttORNtY-GEXERAL said that he considered
the bill went far enough in that direction Alter/dee
Mr. WALPOLE urged that in all cases where the hank-
rupt was to be placed on trial for misdemeanour ho ought
to have the benefit of a jury. He moved the omission of
the words in the clause, " if the bankrupt should require it."
The ATTORNEY-GENERAL said that in many cases
of misdemeanour they could not have a trial by jury with-
out considerable inconvenience and expense. Many bank-
rupts would prefer charges of this nature being disposed of
by the chief judge or commissioner without the interven-
tion of a jury. Ho hoped the amendment would not be
pressed.
Mr. ROEBUCK thought .the clause as it stood might,
when the bankrupt demanded to be tried by a jury, create
alfeeling of antagonism in the mind of the judge.
The ATTORNEY-GENERAL believed that no such
feeling would enter the mind of a right-thinking judge, but
that, on the contrary, ho would be most anxious to avail
himself of the assistance of a jury.
Mr. WALPOLE said that he would not, after the ex-
planation of the Attorney-General, press his amendment.
Mr. SCHOLEFIELD thought that where a bankrupt
omitted to keep proper books of account, such omission
ought to be taken as wilful intent to conceal the true state
of his affairs.
Mr. GREGSON suggested as one of the offences for
which imprisonment not exceeding 12 months ought to be
inflicted be, where a bankrupt carried on trade not only by
means of fictitious capital but with the aid of accommoda-
tion bills for which no value was received.
Mr. ROEBUCK asked was it possible that trading could
be carried on without accommodation bills ?
The ATTORNEY-GENERAL said that accommodation
bills to a certain extent might be right in many cases. The
difficulty connected with them was where they were used
is excess, and substituted for actual capital. He could not
agree in the suggestion of the hon. member for Lancaster.
Mr. MALINS was of opinion that when a bankrupt had
been punished for an offence against the bankruptcy law,
and when the terms of his punishment had in all respects
been satisfied, he ought then not to be excluded from all
,N further chance of redeeming himself again in circumstances
by any severe operation of the act, but ought to be restored
to society, and at liberty to pursue his industry and enter-
prise in trade again.
The ATTORNEY-GENERAL said he saw no reason
for altering the provisions of the bill in the manner which
his hon. and learned friend had suggested. It was a well-
known fact that a bankrupt, after he had gone three or four
times through the court, rose from each fall he had in trade
with renewed vigour, and was again ready to embark innew
enterprises ; and it was in order to protect creditors and
honest traders that those provisions in the bill which his
hon. and learned friend thought too stringent were intro-
duced. He should therefore adhere to his resolution of
leaving the clause as it stood.
Mr. ROLT said that if his observation was right, a great
deal of what they called traders' dishonesty arose from the
fact that the trader knew that if he succeeded he would
keep the gains; but if he failed, his future property would
be safe. At present a non-trader was free from that; but
by putting them upon the same footing, the result would
be the same in both cases. He must, therefore, protest
against the tenor of this bill, as calculated to introduce, in
relation to non-traders, a distinction that might hereafter
act,as an incentive to and result in dishonesty. He thought
the power proposed to be vested by the bill.in the hands of
the chief judge with respect to any property which a non-
trader might at any future thee come into receipt of was
not sufficient.
The ATTORNEY GENERAL could not concur in the
observations made by his hon, and learned friend, and he
considered that when the debtor delivered up all that he
was Possessed of at the time of the bankruptcy to the cre-
ditors was all that, in such a state of circumstances, should
be required of him. He thought that when creditors gave
accommodation to young men with facility, it might lead
them into extravagance and profligate habits of life, and
that some check ought to be put to such proceedings, when
r the credit was known to be given only because the creditors
knew that the young man was likely at some future time to
come in for property, and bo in a position to discharge his
obligations.
Mr. SELIVYN said that by the provisions of the Insol-
vent Debtors Act a power was vested in the court to take
cognisance of any property that a party might come into at
a future time, and in peculiar circumstances to deal with it,
subject to certain conditions, for the benefit of the creditors.
He thought that that power might be left by the provisions
of this bill in the hands of the chief judge.
The LORD ADVOCATE said that in. Scotland they
had had for about five years a system similar to that pro-
posed to be introduced by his hon. and learned friend, and
they had found none of the disadvantages which had been
spoken of. No extreme cases of persecution or hardship
had occurred. The true objects of a bankruptcy were to
make the whole estates of a bankrupt available for the pay-
ment of his debts equally among all his creditors, and that
was a fact which had been lost sight of in the course of the
present discussion. Another object was the discharge of the
honest debtor from all future liabilities. He could not con-
ceive any benefit to arise to society by allowing a man who
had been unfortunate to have this chain around him, per-
haps all I, ie life, simply for the chance, that he might pus •
sibly earn something fur the benefit of his creditors. F.
appeared to him, therefore, that there was no just objection
to the clause as it stooge,
Mr. MALINS agreed with the general principle just laid
down, that the two great objects of a bankruptcy law
should be to produce a ccssio bonortws and a general dis-
charge. In that respect he did not see that there should
be any distinction made between traders and non-traders,
because when persons gave credit to non-traders they had
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means of the debtor, but upon the expectation of property to
which he might afterwards become entitled. Nothing could
be more abominable than the system of credit in use among
money-lenders who gave credit to extravagant young men
entitled to succeed to property, and the greater the discou-
ragement given by the law to these speculators the better it
would be for society. But the fact was that the bill, as it now
stood, (lid give power to the court, in certain case, where the
transactions of tho debtor had been tainted with fraud, to
make any future acquired property liable for the payment of
his debts. As to the supposed or alleged hardship in the
case of non-traders, those who were conversant withethe
actual practice in the courts, knew that nothing was so easy
as for non-traders to got up a colourable and fictitious
trading, and thus entitle themselves to all the benefits of
the bankruptcy. A few years ago a young nobleman, son of
an earl, and entitled to large property, in order to get rid
of his debts, petitioned as a brickenaker—that was, he turned
over seine clay, made a few bricks, sold them, ant then
came before the court as a trader, and received a discharge
in full. The law of debtor and creditor ought to be the same
for all.
Mr. MELLOR supported the clause as it stood.
Tho clause was then agreed to.
On clause 164,
Mr. WALPOLE said he had given notice of an amend-
ment to omit the clause which gave the chief judge the
power to send cases of misdemeanour to be tried in the cri-
minal courts. That appeared to him to be contrary to the
general principle of the bill, which was that the new courts
should be competent to deal with all matters brought before
them ; and on that simple ground he hoped his hon. and
learned friend would consent to the omission of the clause.
Tho ATTORNEY-GENERAL said the clause referred
not only to the chief judge, but also to the comAssioners,
and it was thought better to give the district commissioners
the discretionary power of sending cases of misdemeanour
to the assize courts, for this, among other reasons, that the
persons so dealt with might not in the country be able to
obtain the services of counsel to defend them. Ho thought,
therefore, this was a very proper clause, and trusted his
right hon. friend would not /moss his objection.
After a few words from Mr. ROBBLI CK and Mr. MELLOR,
Mr. WALPOLE said he must frankly admit that the
reason given by the Attorney-General in favour of this dis-
cretionary power had made a sireng impression on his
mind, and he should therefore withdraw his opposition to
the clause ; which was then agreed to, as were the follow-
ing clauses up to and including 175.
On clause 176, which relates to the appeal against the
order of things.
Mr. MALINS said he thought the clause ought to secure
a right of appeal to the bankrupt as well as the creditors.
The ATIORNEY-CiENERAL, said ho had very oreu