Vermont phÅ“nix. [volume] (Brattleboro, Vt.) 1834-1955, 1878-06-28
lesson. oruhe bankrupt Law.

Iftum the New York Iimcsl
Ever sine, the question Of repeating the
Bankrupt law has been before Congress, there
has been hurrying up of the insolvent, and
of those who had anything to gain or escape
by becoming insolvent while yet there was
time. With the effect of the repeating net
postponed until the LIST Of September, this
process will 80 on and illustrate in the most
forcihe manner the evils Of the system Of tn
~ bankruptcy Men who are indifferent
honest" and fud that il is likely TO prove
troublesome aud embarrassing for them TO
meet all their obligations, and very convcn-'
lent to get rid Of them without payment in
full, 50 rs to start even once more will take
occasion to suspend and make n composition
with their creditors, as the law allows. Those
who are really fused up aud have no hope
of saving anything from the wreck, will re-
sign themselves to the regular course of pro-
cecdings and allow the officers of the court
and the attorneys ON either side to make an
| equitable distribution among themselves Of
whatever assets there may be. Creditors
who have ground for fearing that the proper
ty of their debtors will be placed beyond their
reach will take the initiative with II view to
SECURING what they can, rs preferable to the
risk of getting nothing And the unscrupu-
lous, who are disposed TO resort to insolvency
for purposes of fraudulent gain, viii make
the best Of the time left Them increase their
liabilities rs much as possible by getting all
the credit thCy can, diminish their available
assets 10y placing property in friendly hands
where it can Ice recovered when the storm is
over, and cheerfully petition for declaration
of voluntary bankruptcy The registers and
the attorneys who make specially of this
class of business will accumulate cases enough
to last them for years, and the courts viii be
incumhcred with questions of bankruptcy UNI
der the old act long after a new and altogcth-
er different one has gone into effect. The
depressing prospect of intorminable delay
and dread of the effects of this last scramble
for fees and costs out of the wrecks, will in
duce creditors TO agree still more readily to
easy terms of composition, and thereby fur
thrr fatten the cormorants that gorge them
selves ut the expense of others.
There will come an interval with no national
bankrupt law, and that will give us new
form of experience. There will be no special
encouragement to become iusolvent for no
one can be discharged from his debts without
| payment, but it will never be safe for the
debtor to be caught with property in his pos
| session. The inoXurable creditor will swoop
| down upon him with an execution and take 1t
away. The law will wind its meshos about
| him and will not let him 90 until ne has paid
| the uttermost farthinr. and tint it will be eN-
trtnely difficult for him to accomplish, rs he
! will be permitted TO accumulate no capital
and have no stock On hand without its being
| liable to seizure. On the other hand there
| will he no such thingas curing an equitable
distribution of the debtors substance among
those whom he owes. One may succeed in
| eNactng payment in full and another may get
| nothing. The brother-iu-aw. the ueighbor,
and the personal friend will be taken care of
at the expense of the distant and unrelated
| customer. In State where there is II local
| bankrupt law. adcbtOr may get discharge even
| without the knowledge of "a man to whom lac
owes money in another State, and the latter
| can obtain no redress, unless. indeed the
| bankrupt ventures beyond the jurisdiction Of
| his STAT. and by that time b, may have moth
| ing to w upon. While this condition of
| things viii not encourage bankruptcy, it will
make the administration of equity impossible
| in cases where insolvency is inevitable.
What are the lessons to t., derived from
| this most uudeslabl, experience; First, it
shows the evils Of ou undue expansion of
| credit. When business was active and profit
| able under the stimulus Of an inflated and de-
| preciated currency people were so eager to
! extend their operations and take the largest
| advantage of the prevailing profits that they
readily granted time for payment they trust
cd everybody and took great risks. This
made the collapse which reaction was sure to
bring all the more violent and disastrous. and
| 1t made 1t almost impossible TO return TO prln-
ciples Of prudence and caution Credit was
given because it had been given before or
| because the embarrassment of the debtor
made it necessary to hold him and try to ex-
tricate him. One venture was sent after an
other in the hope Of saving both. Easy cred
it had become custom before, and now it
became almost a necessity but at the same
time it promoted new and continued failures
and gave the opportunity for fraud of which
so many were ready to avail themselves. Had
business been conducted more on n cash ba-
sis there would have been less unwholesome
expansion, there would have been a less vio-
| lent reaction. there would have been far few