Public ledger. [volume] (Memphis, Tenn.) 1865-1893, 1878-06-07
How the French Law Treats Bank
FuDfs,


An interesting paper on the French
bankrupt law, prepared by Mr.. r Il.
Hitt, was read before the Social Science
Association in Cincinnati last week.
The most striking difference between
that law aud any similar law in this
country is that the French law contains
stringent provisions for the protection of
creditors, and it places the bankrupt
under a condemnation more or less
severe according to the circumstances of
bis failure.
In France, when a man, without any
intention to defraud his creditors, an.
nounces that be canno pay his debts, he
is required to make at once 20 the Tribu.
nal of Commerce a statement of his
assets and Liabilities, A judgment of
bankruptcy is then made public, aud the
management OF his affairs is put in
charge of one Of the members Of the
tribunal and Of one or more sy ndics who
represent the creditors. From this time
the bankrupt can acquire no property
and make no contracts, and all suits
brought against him are SUSPENDED ex-
eept those Of holders Of mortgages aud
privileged creditors. When the verifca
ton Of claims is finished the creditors
ara called together and they decide
whether the bankrupt shall be put
10 charge Of his business in order that
he may endeavor to pay his debts, or
whether his assets shall be disposed Of
for the creditors benefit. An agree.
ment may be made by creditors repre-
sentiug three.fourths OF the claims free.
ing the bankrupt from liability for any
part of claims against him, If no such
agreement is made the syndics proceed
TO settle up bis estate, the creditors de-
Gliding whether any allowance should be
granted for the support of the bank
rnpts family. When a Gual report is
made the creditors decide whether be is
"eXcusgble' or 'inexcusable." If the
former, only hi5 existing effects can be
reached; if "inexcusa5le" any creditor
may begin legal proceedings against his
person.
Even when a bankrupt has acted hon.
orably and is freed from any further pc
cuniary liabilities he is made to feel the
effect Of the losses which be has caused.
Until he has made good all these Losses
he is deprived of his rights Of citizen
ship, be canno vote, or be elected ia
office, or cit on a jury or be a broteF OF
90 on change, So seriously is this dis.
grace felt that sons have been known tC
make good, after the death Of their
fathers, the losses which the latter have
caused 10 order that their coed namt
might be restored.
The dishonest bankrupt fares much
worse, and dishonesty in this case il
strictly defined. Under it are ~classec
bankruptcies caused by ~extravagant ex
penses, by losses in speculative under
takings, by purchases made in order ia
resell below the market price, by i'm
proper engagements undertaken on &C.
count of other persons, where books are
kept Improperly, where the fact is con.
cealed that a mans wife's dowry was
kept as q separate property, and where
the bankrupt has not complied with the
provisions Of the bankrupt law. Such a
bankrupt is punishable by fine and i'm.
%prisonment and a perpetual forfeiture oil
his political rights.
So stringent a law as this would be
st%renuously oppo;ed in this country; but
our experience under the present law has
proved the necessity of greater protec,
ton for creditors than is now afforded.
The proposal to repeal our national law
entirely would never be accepted so gen.
orally as it is by men who give credit il
that law protected them against debtors
who use it only as q means OF freeing
themselves from honest obligations; and
if the law could be so amended as to fix
on the bankrupt some sort of disgrace
the business of the bankrupt courts
would be greatly lessened.