The daily gazette., 1878-09-03
From Yesterdays Late Esis,..
Exit tho Bankrupt Law.
A DAY OF BITTER RxPERIENcE ",
TOO CONFIDING CRKDIrnRs

DAY OF BITTER RxPERIENCE Fob
! TOO CoNFIDING CREDITORS.
From the N. Y. Herald OF Sunday.
The Bankrupt law expired yesterday,
after an existance of over eleven wears.
having gone into operation In 1867 and
been amended in 1874. Three hundred
and ninety-four petitions were filed yes-
terday in this city, making the total num-
Der since the law was established $3.50.
These new cases and those which were
in process OF settlement before the differ
ent registers in bankruptcy will require
at least two years time before they can
be all wound up. An estimate of liza
billtles OF the bankrupts based on a calcu-
lations OF an average indebtedness of fS5O.-
OOO, which the rate for the past two wears
indicates, places the amount at 1915, ,OOO.-
0e0.
NO estimate can be given of the assets
rs rule they were very small, the great
majority OF the petitioners having dispos-
ed of their assets, either by assignments
TO the creditors or transfer 10 Relatives
and friends, before they appeared in bank
ruptcy In cases where there were small
assets the expenses generally swallowed
theh' up ana the creditors look in vain
Tor dividend. There were numerous
cases in which the creditors received only
one per cent dividend and in some the
dividend was as low as one-sixteenth of
one per cent. Twenty-Five per cent was
considered very large, fifty per cent was
an exceptional case and when the assets
reahzed 100 cents on the dollar il was an
iso.ated instance. In one case, brought
Dy Messrs. Cham berlain, Carter & Eaton
iass year. the creditors were paid in full
These figures do not refer TO composi-
ton cases, where firms settled with their
creditors and continued in business; there
were 400 composition cases entered on
the DOCKS, but some are still pending. A
great objection to the law was the heavy
expenses attached to the proceedings.
which made 1t impossible for a really
roor debtor to take advantage of the
'benefit of the act" The fees alone
amounted to nearly $500 before a dis.
charge was granted, and then the LAWYER
had TO be paid his fees in addition to that
sum. The average cost of getting through
bankruptcy was thus about S40O, which
would make the total cost in this CITY
since the law has been in vogue, to the
bankrupts, nearly ST.. 100000.
The estimate does not include the ex-
penses attached to realizing upon the as
sets conveyed by the bankrupts for the
benefit OF their creditors. One thousand
dollars was frequeno fee to prominent
lawyers to carry firm or individual
through, and prominent builder, who
has just applied for relief, gave his attor-
ney a check for 81 900 to cover all expen-
s., In composition cases the firms usli-
ally based their calculations on an ex-
pense of $1,000, and in one prominent
case of this kind, IL is currently reported
that the expenses of the proceedings
amounted to $1,000.
IL can therefore readily be understood
that lawyers who promised to get a det-
tor through from $50 to slO0 knowingly
deceived their clients. 1t was frequen-
NY common practice TO pay the first
fee OF 9l5 90 in order TO have the case
entered on fife at once, and then let the
balance OF the deposit, amounting to $50
which goes to the register, to be charged
on account and to be paid as soon as they
could raise the money. No notice was
taken of case at the offices of the var
ious registers until their fee of $50 was
paid After that the expenses were
swelled up by the marshalps fees for
notices to creditors, advertisements Of
meetings, &c, fee for the assignee, and
also the clerks fees on final Discharge, all
OF which came out of the pocket of the
unfortunate debtor, that is if there was
any pocket left A fee for every step
taken was apparently the purpose of the
law, and this was one main reason in
urging its repeal