Evening star., 1933-01-11
HOOVER MESSAGE
URGES REFORMS IN
BANKRUPTCY LAWS
President Would Permit Re-
organizations to Prevent
RuinouS Liquidations.
PRESENT PROVISIONS
HELD DESTRUCTIVE
Chief Executive Declares Need for
Change Warrants Request for
Emergency Action"

In second special message to Con-
gresS in as many days, President Hoover
today made a plea for emergency
action" in revision of the bankruptcy
laws In order to avoid present-day
wholesale forced foreclosures.
The President cited the urgent neces-
sity for revising these laws, contendins
this would have an important bearing
upon the whole economic situation. He
asked specifically for an immsdiata
alteration of existing law to facilitate
the relief Of debtors who seek the pro-
lection of the court for the purpose Of
readtusting their affairs with their
creditors"
Mr.. Hoover pointed out in this mes
sage that while it is desirable that Con-
greSs should waste no time in dealing
Win this subject, because of its enner-
sency nature, he Is anxious that the
more important portions, such as i'm
mediate relief from foreclosures and
bankruptcy sales, should be disposed az
IN the meantime.
Several Bills Pending.
The President said that under ex.
lstlng law, even where maiorities of
the creditors desire to arrange eo11i-
table readjustments with their debt
ors, their plans may not be consIln-
mated without what he described an
prompltlve delay and expense. This.
ne said, Is usually brought about bv
the obstruction Of minority creditors
who oppose such settlements In ths
nope nope tnat the fear of ruinous nquida-
slon VIII induce the immediate settle.
ment OF their claims.
Present processes of forced uu,lida.
ton are proving utterly Destructive
OF the interests Of debtor and credit&
alike" he said.
Several bills are pending IA Con.
gress designed to Hberalise ths EhYlks
ruptcy laws. Senator Hastings, Rsuub,
Lcan, OF Delaware, has one before The
judiciary Committee which would per-.
init an individual or partnership "a
escape the stigma Of bankruptcy by
authorizing reorganization, with tha
consent of a percentage Of stockholders.
conferences are proceeding between
Judiciary Subcommittee Of the House
ana Senate, with the object ~ eettinR
satisfactory bill In shape.
Text Of Message.
The Presidents message today fol-
lows in full:
"on February 20 last addressed the
Congress on the urgent necessity for
revision Of the bankruptcy laws, and
presented detailed proposals to that
end. These proposals were based upon
most searching inquiries into the whole
subject which had been undertaken by
the Attorney General at my direction.
While 1t Is desirable that the whole
matter should be dealt with, some por-
tions Of these proposals as an ameliora-
tion OF the present situation are proving
more urgent every day. With view to
early action. the department, comnait-
tees and members Of the Congress have
been collaborating In further develop
ment Of such parts Of these proposals
as have, out of the present situation, be-
come OF most pressing need. I urge that
the matter be given attention at this
session, for effective legislation would
have most helpful economic and social
results IN the welfare and recovery of
the Nation
The process Of forced Liquidation
through foreclosure and bankruptcy
sale Of the assets Of individual and cor
porate debtors, who through no fault
OF their own are unable in the present
emergency to provide for the payr..ent
OF their debts in ordinary course as
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