New-York tribune., 1899-07-23
NEW BANKRUPTCY LAW.
OPINIONS OF LAWYERS AND REFEREES
AS TO IT'S MERITS.


,ouyers and merchants to form opinions regarding
,ba new Bankruptcy law. Some. II is true. say
,,bat the test is not sufficient that the last few
x,onths have been altogether too prosperous for
che advantages disadvantages OF any bank
.,,n,cv law to show themselves clearly that COM
,rerce must wait until hard times come again TO
discover whether the new law fills the bill. Never
,heless public business opinion has fairly well
orystaillzed on the matter There seem 10 be two
s,,s OF views, two opposing camps-one declaring
,hat the law works badly and should be wiped out
~ existence; the other that, all things considered
:, looks as II II would turn out well and prove a
s fsirly good act.
OF course. courts and referees have hardly settled
themselves to business yet. That is there
points OF practice and interpretations that need
decisions and precedents TO be established before
all can go along smoothly. Decisions are piling up
each week. and the way is growing smoother for
attorneys and clients Though thousands of bank
rupts all the Union have been applying for
discharges ever since January !, there has been
little new bankruptcy business. The bulk Of the
cases were old ones. OF bankrupts Of long ago
sssetess who simply wanted discharges and relief
from judgments. The freeing of these was only
form and this law provided for just such
cases nearly all who applied obtained the desired
relief. Now that this rush is over. or nearly So
and the courts settling down into their routine
bankruptcy business. referees carefully scru-
tlnizlng each case. and many application is be-
this law being almost exclusively debtors law
there ways Of constituting 1t 80 that the debtor
does not have everything his own way.
AN INTERESTING CASE
notable example IN this regard is the case of
Hattie Hyman. on which Judge Ernest Hall has
just handed up his report Hattie Hyman. Judge
Halls report states. conducting business on a
capital OF $4,000, failed to keep correct books of
accounts and. leaving all in the charge of her
Co ma ger
knowledge Of her affairs The business failed, the
capital being largely dissipated by the husband
manager in Wall Street and Mrs. Hyman applied
FOR a bankrupt's discharge the ground that she
had no knowledge Of what was going on.
The case is Interesting and important enough TO
give portions of Judge Halls opinion
IF wife can furnish the capital and establish
business ana appoint her husband manager and
agent without control and take no part in the busi-
ness but keep herself IN profound ignorance OF all
its affairs. and the husband can keep false books
of account and so obtain credit absolutely un-
Justified by the real state of the business and can
thus escape the responsibility imposed upon other
debtors by the act the provisions Of the law. far
they relate TO grounds of refusal of discharge,
are nullihed and set at naught and premium Is
offered to persons not TO do business for them
selves but to employ agents, who will take all the
responsibility and relieve their principals from all
the penalties Of the forbidden practices under the
act.
Such. in my opinion. not the intention OF the
act. II the bankrupt fit TO keep herself In
ignorance Of the condition of her business, and or
the manner of keeping books. she should suffer the
consequences; the business was hers and the books
were hers and It was duty which she owed TO
creditors to that the books were properly kept
so that intending creditors might not be deceived
and for failure to do this she should be held to
the penalties prescribed by the act. and should not
be discharged"
HIS STORY NOT ACCEPTED.
Another extremely interesting that the mer-
cantils world is talking a great deal about is that
Of the man seeking discharge in bankruptcy who
calmly tried account for 81 900 of assets by stat
ing that because Of dispute with the paying
teller Of his bank he drew this money out In cash
one afternoon and lost II In streetcar on his way
bone The referee decided, and the decision was
sustained by Judge Addison Brown. that this tale
Eas altogether too improbable for belief. and the
bankrupt ordered to hand over the money or
take the alternative Of being imprisoned for fraud
According TO this decision and practice" said
Edwin Blumenstiel junior partner of the law firm
Of Blumenstiel & Hrsch, there are ways or get
Ring around a debtor that never had under the
old law. Then. unless we could prove fraud we
could do nothing. and in a case like this. the money
reported gone, could do nothing There would
have been nothing to attach, you see. No, this
new law, with the decisions that now coming
forward will work out well for the creditors as
FOR the debtors The only thing is that there are
hardly enough decisions yet TO have 1t In prac-
Ucable running order"
CONFIDENCE IN THE NEW LAW.
Judge Ernest Hall takes the view that the new
law Will work well in all its details Getting
for the in which there are no assets
he has found 20 be. the whole, one OF the most
difficult of matters Judge Brown has proposed a
very excellent thing" says Mr.. Hail. that in as
many cases as is possible each referee select the
same trustee for all of these cases-some man Of
responsibility, and man who Is known, so that II
the Court wants him in connection with any one Of Of
can put its hands on him In many @ or @ SuGh Ca, cases
Of managtng clerk. But matters like this will get
Strengthened out as time goes on Inc law Is , cer-
with fairness the creditor and TO his advantage
SMALL ASSETS IN MOST CASES.
Georgs G Holt who has handled as referee some
bs the most important cases that have yet come up.
one In particular where the assets amounted 10
nearly $4,000 while ne thinks that the law
general is success. says that too few new BANK
ruptcy cases have come up as yet for him 10 speak
positively as TO its workings A copy Of the report
Washington, sent off on June oO presenting d auu-
lated statement of the six months OF his referee,
chip showed on examination that in no case had
the exceeded 5lz per cent OF tne s
and thai tbe amounts paid out in dividends was a
hardly to be considered decimal Of the wnoiei NJ
Holt we shall be able to tell better how fhe Jaw
will work Al present It seems that neyhans wa, ~" the
we'll The composition provisions are perhaps d ;ne
best thing about It, These allow man 10 DC hst us
charged from bankruptcy after making gi me Pc 81
his creditors No longer is he held 70 payinms ynt a
large percentage of his liabilities IL MS crsuto M =,
afresh This win surely be an adyantatge oornsa
THE proceedings so far have largely cI conGet 20
the V,inins ont OF old debts and the canceIing oi
old Judgments II is the newer 6ankrIpity ysSoSd
be and we have really had too few OF these YET
ARGUMENTS AGAINST THE NEW LAW
I'll. oro,,,,snts Of those who believe the new law
Is a failure were related concisely by Stilln'an +
Kneeland. Judge Advocate General OF New-Iork ,I
Mr. Kneeiand said: THE consensus OF opiiiioh
among mercantile lawyers and the business houses
that were Instrumental in passing the b"nA' s. p.'