BANKRUPTCY ACT.

Dominion, Volume 2, Issue 482, 15 April 1909, Page 7

BANKRUPTCY ACT.

SUCCESTEO AMENDMENTS. : RESOLUTIONS OF CHAMBERS OF COMMERCE. ' The committee appointed by the confer- , ence of Chambers of Commerce to consider \ the question of amendments in the Bank- i Tuptcy Act brought up its report at the i meeting of the Conference yesterday after- < roon. , 'i'ho eifect of tlio resolutions sub- ! mitted by the committee |Was explained by Mr. M. Myers, of the legal firm of Bell, | Myers, and Bell, who had kindly given the . conference the benefit 'of his professional ! experience in the working of the law. The following is the text of the resolutions drafted by the committee: — 'l'his conference,-having considered a lumber of questions raised with regard to the ■ Bankruptcy Act and allied Acts, is strongly : of, opinion: (1) That the administration of the present : bankruptcy system has loon, and is, ex- . tromely unsatisfactory, and in many respects : . defective, . chiefly for the reasons— (a) That the estates of bankrupts in many cases have'been'unduly sacrificed. i (b) That there'is very frequently undue . delay, in the'realisation of estates. . ' ,/c) Meetings of- creditors have not been called with sufficient frequency, and credithave not had sufficient- voice in the administration- of estates. (d) Tho above and other defects are. inseparable from a system that is administered by officers who have not had a commercial training, or who are not possessed . of the required business knowledge and capacity.' , In expressing these-views the conference , freely admits -that • some of the officers who • have from time to time administered the Bankruptcy Act, have been unexceptionable in every respect,! and ,-tlie conference does not wish to bo .understood as condemning as a whole the various officers who ' have from time to timo administered the Act. (2) That it in essential, in-the interests of traders 'and of the public generally ifliat the Government should tin asked to take i steps either •to improve the administration o f the bankruptcy law as it now exists, or preferably to alter tho , scheme of administration' completely. In tho' latter event-, this conference suggests some'such scheme as tho following:— (a), That a system-be provided for with cne .-central control of all bankruptcy and insolvency business. . . . (b) That, in lieu .of administration by official assignees -and their ■ deputies, estates in bankruptcy should bo administered' V.y s approved and'registered trade assignees with statutory powers; such assignees to be subject'to the..central control above mentioned. The conference recognises that the -proposed i alterations involve very great-difficulties, and tho consideration of - numerous matters of ' detail, At .this stage the conference cannot do;more.than submit to the Government merely - the heads of its proposals, leaving matters of detail to bo considered by the Government and its officers in the event of the Government approving the proposed alterations. .(3) That, apart from the . question of administration, there are numerous matters in the Bankruptcy Act and allied Acts that require, amendment. The principal of such matters are as follow:— (a) In the interests of commercial morality, and for the purposes of record, it is desirable that all assignments for tho benefit of creditors and all insolvencies should be registered, and that a complete record' of the same be kept either by the RegistrarGeneral or by some Other dffioer at Wellington..-. . _ (b) That statutory provision should bo. irade for the compulsory registration of all instruments, including bailments; and further provision that an unregistered instrument shall bo void for all purposes except, perhaps, in the case of bailments of, or hirepurchase agreements' respecting, such articles "as pianos,'sewing machines, bicycles, " cash-registers,';otc., -, not, exceeding , in value. > say, £30. The provisions .of tho order and disposition clause -of tho Bankruptcy Act should bo altered in such a <vay as to prevent their- t-oing over-ridden by any custom respecting • furniture and other articles acquired on the hiro purchase system. _(c) In the event of compulsory registration of.all instruments not .being given effect to, then a .creditor, who takes possession of chattels under an unregistered instrument within three months prior 'to an adjudication of bankruptcy on tho part of a debtor, should bo made to.surrender, for the benefit of the debtor's, estate, the goods so seized or the proceods of sale thereof. ■ (d) The conflict between Section 29 of the Chattels .-Transfer Act, 1908, and sub-section * of Section 29 of the Bankruptcy Act, 1908, should be put right. ( e )'ln'..Section 27 of the Bankruptcy Act there should be a provision enabling tho creditor (where a debtor ha3-absconded) to'file a petition in. any Court in the district' where the creditor resides: It could also be'provided that, immediately after adjudication, the proceedings shpuld be transferred to the district wiioro tho debtor rositles. (f) The"- provisions of the Act' relating to public examinations might bp simplified: for instance, public examinations might be dono away with, "and it might bo provided that statements made at - any examination before an assignee might be used for all purposes. (g) I& is suggested that the provision relating ■to composition 'might be made less cumbersome than at present. ' c (hj It has > also been suggested that the penal, provision, of tho Act should iipeciiicaily estate such books of account as shau bo cons'ldered an irreducible minimum for any person to keep. ... (ij.lt-is also ,'suggested that somo of the matters mentioned m the penal section should bo oilences.irrespective ot whether or not tlio debtor is adjudged bankrupt. i>'or. instance, , absconding ' sub-paragraph (u) of fcjection. 138). (j) Itls-'suggested that Section 79, Subsecuoa I,. 5 of tue, Bankruptcy Act, 1R)8, relating to: frauciuJeiit preiwence bo ox tended so tuat paynientej ctc.j made/or securities given, by any debtor to protect tho guarantors or sureties of tho uootor or .any creditor shall (in addition to tlie other cases inentioncd m, the said sub-section) be deemed fraudulent •and void against the Oilicial Assigneo if the person mailing, taking, paying, or sutt'erin" the same is adjudged bankrupt within three months thereof. (k) That every trader bo compelled to ascertain his position every year at a certain date by taking stock and drawing up a balance-sheet. ' • (I) That it be constituted an act of bankruptcy if a trader sells his business and stock, or the principal, part thereof, and allows -one or more particular creditors to receivo payment in respect of a past debt without notice, being given to ; other creditors, ■tnd that, if any payment be made to creditors .under such circumstances, such payment'shall be deemed to be a fraudulent preference. (m) That a landlord's preferential claim for rent in bankrupt estates should be abolished, or, at least, reduced for a much lesser period than at present. (it) AH insolvent estates of deceased persons. should bo administered by tho officers administering the bankruptcy laws, and not by the Public Trustee, and creditors should have> a voice in tho administration. of such estates which they have\ot, at tho present m insolvent estates administered by the rublic Trustee. (o) In all ease 3 where a certificate has been obtained from tho Crown Solicitor under the Act for a prosecution, all tho costs, including the costs of bringing the dobtor back to iNciv Zealand, if ho.has absconded, should be paid by the Crown. If desired, an amendiw Act could provido,. in order to meet this oxpe.nse, for an additional ono per cont. com. mission to be charged on tho assets in all bankrupt estates. Tho resolutions were adopted, and it w,u ngreod, on the motion of* llr. G. Shirtcliffe that copies of the resolutions bo forwarded to the Prime Minister and tho Minister foi Justice. A special vote of thunlcs way aecorded (< Mr. Myers for his valuable assistance to thi conference.