The Providence news. (Providence [R.I.]) 1891-1906, 1904-02-06

which his creditors rely for payment.
Five days is no more than n reasonable
time 10 enable absent or distant creditors
to receive the notice and act upon II, IL
they need TO.
Stocks OF merchandise do not iuctuate
In value TO an appreciable extent within
a period OF 1vs days. and IL does not
seem improper TO ask that Ave days no.
tice OF such sale be given to creditors.
particularly. as In most often the case.
when portions OF the very merchandise 10
be sold were furnished by them, for
which they have not been paid.
TO PREVENT SECRECY.
The plain purpose OF the statute 10 to
prevent the fraudulent midnight sales Of
stocks OF goods. which ere familiar 10
every merchant and every lawyer. The
effect OF the statute is to prevent secrecy
and undue haste In the sale OF stock In
bulk.
The essence OF the act Is the notice 10
creditors. This gives TO the wholesaler
an opportunity TO ascertain whether the
transaction As an honest or fraudulent
one. IL enables him to ascertain whether
the merchandise TO be sold IL upon sd-
vantageous terms. Ii let's daylight into
the transaction. and II such sale is an
unjust or fraudulent one. IL gives CT sdi-
tors an opportunity TO exercise such
rights as they may have TO prevent H.
II Is common knowledge that such sales
are often. perhsps usually. made with the
intent and ef.ct 10 defraud creditors.
Haste and secrecy are essential to fraud.
They are not usually essential To an
honest sale.
The merchant should have the safe
guard that merchandise purchased. TO be
disposed of et retail, should be so sold, In
the ordinary and usual prosecution OF
the rets:!ar's business. but II such re-
taller desircs to dispose Of his stock In
bulk. his creditors should have notice cf
his intention, and should have reason
able period in which 10 investigate the
terms and conditions OF the proposed sale
credit man can anticipate almost
everything that may happen 10 retailer,
and discount IL, except sudden sale or
his merchandise out OF the ordinary
course: that Is impossible To forecast
IS CONSTITUTIONAL.
The Massachusetts, statute was before
the Massachusetts, judicial court I'm De-
cember last. solely upon the question OF
| its constitutionality. and in January there
was handed down the unanimous opinion
OF the court sustaining its constitution
ality.
The court said in part:
THE purpose OF the legislature evidently
was TO provide for creditors protection
against a class OF sales which are fire.
quenty fraudulent. and which leave
| creditors with no means OF collecting that
which they ought to receive.
"The statute deals only with sales In bulk
| OF a part or the whole OF stock OF mer-
| chandlse which are not made In the or
dinary course OF trade and In the regu-
lar and usual prosecution OF the sellers =
| business IL does not interfere with the
transaction OF ordinary business. but re-
| lates to unusual and extraordinary trans
| fers In substance II declares mat
sale OF this kind shall not
be made without first giving 10 creditors
an opportunity 10 collect their debts. 50
far as the property TO be sold might en-
| able them to collect, or without subse-
| auently making satisfactory provision for
the payment of these debts. A sale made
| In violation of the statute Is void only az
| aRainst creditors. and II the vendor o
| debts are paid. the sale cannot be inter-
| fered with"
PROPOSED BULK LAW"
Section I. The sale in bulk of any part
/ or the whole OF a stock OF merchandise,
| otherwise than in the ordinary course OF
/ trade and In the regular and usual prose
c,rtion of the sellers business, shall be
| fraudulent and void as against the credi-
| tors Of the seller, unless the seller and
purchaser. ct least FIVE days before the
| sale make a full. detailed inventory.
showing the quantity and. 90 far a. pos
| sible with exercise OF reasonable diligence.
| the cost price TO the seller OF each article
TO be included in the sale and unless
! the purchaser demands and receives from
the seller a written list OF names and ad-
dresses OF creditors Of the seller. with tho
| amount of indebtedness due or owing TO
! each and certified by the seller under
| oath. TO be, to the best OF his knowledge
| and belief. a full accurate and complete
| list of his creditors and Of hts indebted
ness; and unless the purchases shall. at
least Ave days before taking possession
! OF such merchandise, or paying therefor.
notify personally or by Registered mail
every creditor whose name and address
are stated In said list. OF tho proposed
raie and Of the price, terms and conditions
| thereof
| Sec 2 Sellers and purchasers under
this act shall include corporations. asso-
| Citations, co-partnerships and individuals,
burt nothing contained In this act shall
| apply 10 sales by executors. adminfstra-
tors. receivers, assignces under voiun-
tary assignment for the bcnef1t OF crodi-
tors. trustees in bankruptcy, or by any
public officer under judicial process.
Sec. a This act shall take effect upon
it's passage.
OTHER SPEAKERS.
Mr. Charles BIRD secretary of the Bos-
ton credit men. told OF the experience
thew had In his city In getting the "BurA
law" passed that tho local aasocfa tfun
might have the benefit Of Its researches
He stated that q large number Of btssi-
ness men Of repute were secured to ex-
press their views regarding the need Of
the passage Of such legislation and thai
he found that their efforts were Of great
help when the matter came mp for action
Mr.. Morgan then answered the ques
tions OF tina interested ones In the audi.
ence and succeeded In making most OF
the points very clear
There was a vote Of thanks rendered tc
the Boston credit men for their efforts
in presenting this matter so dearly
Mr.. Littleheld moved the adoption OF
a resolution indorsing the securing o.
legislation similar to that IN effect "
Massa chusetts II was so voted unani
mousiy and the presiding oficsr. Mr.
Bush was appointed to name com
mittee to secure the passage OF the law
Mr.. AinsIey Of Boston stated he wai
much gratifed at the action ana eait
/ ~, .uob law waa greatly needed m