The Washington times., 1902-04-20
EXPLAINS BANKRUPTCY
Law AMENDMENTS
Mr.. Ray Declares They Are in
Interest of Honest Debtors.
Compiled From the Views of Business
Men-Application Not to Be Made
But Once in Six Years.

In a statement made yesterday, Mr..
Ray. chairman of the House Committee
on the Judiciary, explained the origin and
scope of the amendments to the bank
ruptcy bill. recently reported by that
committee.
In the last days of the Fifty sixth Con-
gress,'' he said, Il introduced a bill pro-
posing certain amendments to the bank
ruptcy law. Soon thereafter | sent about
$1,000 inquiries to leading wholesale and
retail dealers, lawyers, manufacturers,
etc. throughout the United States asking
their opinion of the bankruptcy law and
as to the desirability of the amendments
awhether in their opinion the law should
| be retained or repealed.
Answers. representing about 10000
different firms, merchants and business
men, were received prior to the meeting
of the Fifty Congress. over ninety
per cent of these advocated the retention
of the bankruptcy law and approved the
amendments proposed.
Resolutions From Business Men.
During this Congress resolutions repre-
senting thousands of other business men
and representing nearly all of the credit
mems associations, business associations,
ETC.. throughout the United States have
been received. advocating the retention of
the law and the amendments suggested.
The general expression is that the law is
the best ever passed.
1T was in obedience to this demand,
coming from all sections of the Union.
that the Committee on the Judiciary rec
commended with substantial unanimity
the amendments which are substantially
the bill sent out at the close of the Fifty
sixth Congress.
"One of these amendments proposes to
allow unincorporated companies to take
the benefit OF the act, and also permits
corporations engaged principally in manu-
featuring, trading. printing publishing
mining or mercantile pursuits, to take
the benefit of the act as a voluntary
bankrupt under certain restrictions
Another amendment provides that the
bankruptcy of a corporation shall not re-
lease its officers, directors or stockhold
ers as suci from any liability incurred
under the laws of a State or Territory of
the United States.
Four Grounds for Refusing Discharges.
THE proposed amendments state four
additional grounds for refusing a dis
charge to a bankrupt: First, having OBJ
tained property on credit or material un-
der false statements; second, having made
fraudulent transfer of any part of his
property: third. having been granted or
in, han vii
six years: and fourth, having refused 10
obey any lawful order of the court or
to answer any material question approved
by the court.
Every honest man will recognize the
necessity for these amendments. and no
honest man will object to their being
written into the law. The bankruptcy
law is not for the benefit of the dishon-
est and was never intended to be, nor
should any dishonest person be dis
charged from his debts. provided, of
course, that such dishonesty has tainted
his business transactions.
mo person Should be permitted to take
the benefit of the law oftener than once
in six years. In some localities the law
has been brought into disrepute by per-
sons who have made a profession of run
ming in debt and then taking the benefit
of a bankruptcy law. We propose to put
a stop to this.
Main Objection to Law.
The main objection to the law as it
now stands has been made to the sub
division. of section 81. known as 81 G..
Under that section the Supreme Court
held in substance that all payments
made on account within four months OF
the bankruptcy were preferences and
must be returned before the creditor could
prove up the balance Of his claim. This
was held where the payments were made
and received in good faith and made upon
items of account long past due. The pro
posed amendments correct this. The pro-
posed bill also gives concurrent jurisdic-
ton to the State and United States courts
cover property belonging to the bankrupt
"As the law now stands there is a
practical denial of justice in those locali
ties where, owing to the Overcrowded
condition of the State courts, cases can
not be brought to trial within a reason
able time In some jurisdictions it has
been found hopeless to reach the trial
of such a case within two years of the
time the suit was brought.
1T is readily seen that such delays tend
to bring the law into disrepute. as the
estate cannot be wound up and dividends
made until such litigations are disposed
OF"