Huntsville gazette., 1891-02-07
THE BANKRUPTCY BILL.

Have Been Unpopular.
WASHINGTON, Feb. 3.-Hon. George
w. Stone, the Chief Justice of the SUI
preme Court of Alabama, who is noted
by reason of the soundness of his views
upon the subject of the integrity of
commercial transactions, and whose
views upon Jurisprudence are always in
teresting and instructive, was called
upon by reporter at Montgomery,
Ala, with a result as follows:
In reply to the question as to whether
he had exa mined and considered the
Torrey Bankrupt bill, which had been
passed by the House of Representatives
and is now pending in the Senate, the
eminent gentleman said: Eyes, have
examined that measure, and consider it
very much better act than either OF
those of 1910 or 1867"
When asked as to the reasons of the
unpopularity and consequent repeal of
the former bankrupt laws, he answered.:
''There were several reasons. Remote
ness from the place of holding the bank
rupt courts deferred many creditors
from giving proper attention to the
prosecution of their claims, and the re-
suit was that many of them, particu-
larly the small ones, failed to partici
pate in the distribution of the assets.
The districts were and are necessarily
large in territory, and the former stat
utes made inadequate provision for a
trial at any other than the one place in
the district provided by law for holding
the bankrupt court. Trying the ques-
tions at such remote distance from
the scene of the banl1rupt's business
dealings, greatly facilitated fraud on
the part of the bankrupt, by relieving
him of that vigilant watchfulness
which creditors, under more favorable
conditions, would have exercised in ref
erence to the banl1rupt's accounts, and
| to their claims against the State. An
other grave objection to the former
statutes was the enormous expense at
| tending their administration, because
| of imperfect machinery, and because
the administration was, in large de-
gree, intrusted to incompetent and
frequently corrupt officials. My obser-
walton was confined chiefly to Alabama
and to parts OF Louisiana, in which,
if the assets were not large, nothing
worth computing ever reached the cred
itors; and if large, the dividend was
shamelessly reduced by unauthorized
| charges. The pending act is great inn
| provement on the old statutes; first, in
simplifying the machinery and reduc
| ing the expense, and second, in provid-
1rl(c haf y.fa fa1
of them, may be prepared for hearing
before referee, whose sitting may be
ordered to some point near the home of
the bankrupt, and, consequently, to a
place which will generally be conven-
| lent to creditors. l would suggest that
this duty be made imperative"
Speaking of the provisions of the
pending bill the Judge said: Viewed
from a moral standpoint / doubt the
policy of voluntary bankruptcy; but the
principle is probably SO rooted in the
public mind that to oppose that would
defeat all bankrupt legislation. A bank
rupt system has two aims-to prevent
fraudulent preferences by securing to
| all the creditors alike an equal participa-
tion in the bankrupt's assets. 1t treats
all collectable debts, save those of pub
lie nature, as of equal dignity and
binding obligation. This is strict hon
esty. It's second aim is, to restore to
honest debtors, who are borne down by
their obligations, the power and privi-
iege of employing their energies and
business qualifications in acquiring an
honest living, and thus adding to the
general welfare.
1.-THE great benefit of a bankrupt law
is found in it's prevention of fraudulent
preferences, no matter in what form
they may be attempted. And the de-
mand for such prevention against all
business or money corporations is, Gn
my experience and observation, just as
imperative as when the attempt is made
by natural persons. Incorporated capi-
tai is frequently perverted to pernicious
| uses and the demand for protection
against fraud should meet hearty re-
sponse from the law-malzing power.
| Let business corporations be made sub
| ject to involuntary, but not to voluntary
bankruptcy
| When his attention was called to the
| fact that there is now pending in the
Senate resolution to strike out the in
voluntary provisions of the bill and
leave it simply voluntary measure, he
said, in a very earnest manner: ''The
enactment of purely voluntary bill
would, in my judgment, make it possi-
bic for the prrpetration of the grossest
frauds. The ,,candals incident to both
of the laws administered while i
was a pract toner arose chiefly
out of the voluntary provisions of the
bill; that is to say, those cases in which
proceedings were instituted by credit
ors resulted in most part in either the
defeat Of the proceedings or the admin
istration of the estate, while there
were many cases in which parties de-
iberately prepared to go voluntarily
into bankruptcy and succeeded in
the consummation of their intent in
such manner as to engender the belief
that the proceedings were fraudulent
and that unfair advantage had been OBJ
tanned by the bankrupt over his credit
OrS -