The Providence news. (Providence [R.I.]) 1891-1906, 1905-12-02

who have attempted to carry through n
compromise and secure n release from
all the creditors Of n failing debtor fan
bear witness TO Its practical impossible
ity. The successful completion Of n
compromise Is confined TO very small
and very rare cases,
TIIE ASSIGNMENT METHOD.
There are left then two chief methods
OF settling an estate. The first OF these,
assignment. ia more or less familiar TO all
OF us. The theory OF the common law
assignment I'm brief Is that the debtor had
transferred all OF his property to some
person by him selected I'm trust for the
purpose OF paying his debts.
The assignee IL governed by the ordinary
rules governing a trustee, lie Is chosen
by the debtor and Is not as a rule acting
under the orders or authority Of any court
nor is ne subject TO instructions from
the creditors. He has practically a free
hand I'm the management of the estate and
TO reach him for malteasance or non-feas-
ance I'm office is a matter OF considerable
difficulty and attended by the delays al
ways Incident 10 an ordinary equitable
proceeding.
There are TO be sure In some states,
Rhode Island included. certain provisions
governing the conduct OF common law
.assignees. but those provisions as far
as supervision by the court is concerned
are seldom availed OF and TO all practical
-rfttiHtp -The assignee Is
practically an autocrat I'm the handling
or the business entrusted 10 his care.
POTENT WEAPON FOR FRAUD.
The expense which he incurs in its
management. the charges which he him
self makes and the details OF his manage
ment are entirely within his control, and
81 is because of these facts that a com
mon law assignment Is one OF the most
potent weapons for fraud ever put into
the hands of a dishonest debter.
My point Is that the selection OF an as
signee BY the debtor and frequently be-
cause OF close relationship or friendship,
and the freedom from accountability and
responsibility IS a strong temptation TO
careless management by the ZONES as
signee and q sure invitation to theft by
the dishonest assignee and dishonest debit
or, In his result reports from various
states of the workings OF common law
assignments practically all agree. From
the standpoint OF the honest debtor tho
assignment offers no advantages either in
speed or expense OF settlement and n any
creditors refuse 10 release him he is I'm
no better position than before ne failed.
THE BANKRUPTCY SYSTEM.
With such conditions existing we come
10 th0t rpethod Of administration which
is most practical FOR every day purposes
IN The settlement OF insolvent estates.
namely, a bankruptcy system either state
or national. Tho majority report admits
That these are the alternatives.
\ state system must OF course be con-
lined 20 tho limits Of a state or territory.
II cannot in It's administrator extend be
those limitations except BY consent
OF the nonresident creditors. Each state
having "a system win differ sometimes I'm
principle. always I'm details and working
from the syatems adopted by other states
u when 90 this is added the fact that
but IA states had any such system prior
10 1898. the imposslblity 81 establishing
a series OF satisfactory state systems for
our country Is apparent.
our means ~ Communication by tele-
phone and telegraph. our rapid transit
by rail- and boat. all Impress upon one
the fact that business ~ no longer con-
nnod 10 the limits Of any one state nor
can II be 30 confined. In 1898. Just prior
10 the enactment OF the present Federal
law. ~ states and territories were more
or les familiar with the common law
assignment n made use OF a for the
purposs OF settling estates. not under