The Evening Star SATURDAY, AUGUST 28, 1875.

Evening Star, Issue 3904, 28 August 1875, Page 2

The Evening Star SATURDAY, AUGUST 28, 1875.

Yesterday we omitted to staie the Bill shortly named the Debtors and Creditors Act is entitled " An Act for the Relief of Debtors and for the better Security of Creditors." This title explains the intention of the Act. We have indicated the process by which the estate of an debtor can be sequestrated and the machinery provided for realising and distributing the assets amongst his creditors. Inevitably trustees must be armed with some authority over a debtor and over those who owe him money, in order to realise the estate. It is, therefore, provided that on notice in writing being given a debtor must attend a trustee, and assist in making out the accounts of an estate. The trustee is empowered to examine, on oath, the debtor, his wife, and family, or any person known or suspected to have possession of any portion of his estate or to owe him money, and require them to produce any documents they may hold relative to his monetary affairs. On refusal or I neglect to comply with the requirements of the trustee, the Court may apprehend the delinquent and examine him. The trustee can seize or authorise the seizure of property divisible among the creditors. Among other powers, the Court on the application of a trustee, for three mouths after date of haug the liquidation resolution, may order letters by post addressed to the insolvent to be delivered to the trustee. A debtor may be arrested by warmnt of the Qourt, and his property .seized, should 1 there be reason to suppose that he is going abroad to avoid examination, or to remove goods to delay possession being taken of them, or to conceal or destroy them or any of his books or documents, or should he remove pi operty above the value of five poimds, or without good cause fail to atteu:; any examination required by the trustee.

Clauses 34 to iiS, both inclafcive, relate to proofs of debts by creditors, and appear to provide for every contingency that experience has pointed to as probable, to facilitate realising the assets of an insolvent, dividing them among Ins creditors, and preventing fictitious or fraudulent claims being entertained. Clauses GO to CS, both inclusive, explain the consequence* of a " liquid iwon resolution." Liquidation is to commence from the date of it, unless it is proved that a debtor has committed an act of baukr-iptcy within twelve months anterior, when liquidation is t<< commence from Cm' date. The detail of consequences nvaly states that the property of the insolvent is vested in

the trustee on behalf of the creditor*, and gives them specific powers to deal with it. By the 74th clause settlements made on wife or children after marriage are void if executed two years before insolvency, or at any time within ten years should the affairs of the settler be subsequently placed in liquidation, unless the claimants can show that the settlor was, at the time of making the settlement able to pay his debts without trenching on the property comprised in tb/s settlement. Clauses 75 to 78, Koth inclusive, relate to preferential claims, and guard against fraudulent preferences. The eleven clauses from 71) to 89, both inclusive, prescribe the diities of trustees in reference to distribution of insolvent estates. Employes of an insolvent will be entitled to threo months' wages in full if owing, and be permitted to prove for amounts owing beyond; workmen will be entitled to one month's wages at current rates, with similar privilege; apprentices will be liberated, and at discretion of the Court a return of the whole or part of premium paid may be made. Clauses 90 to 92 deal with the mode of closing an insolvent trust estate, and give power to the debtor or creditors to require a special meeting of creditors should they be dissatisfied with the conduct of the trustee.

_ The remaining clauses deal with the rights of the debtor after liquidation of his estate. By the 93rd clause, when the liquidation has been declared closed, the debtor may apply to the creditors for an order of discharge, who, if satisfied that all his property has been surrendered, and that he is not likely to b(6 prosecuted under the provision of the Fraudulent Debtors Act, "shall by special resolution " grant it. If the order is refused, the application may be renewed, and if the debtor be dissatisfied, he can appeal to the Court, which is empowered to confirm or reverse the resolution of the creditor.'?, and decide that the order be granted. The effect of an " order of discharge" for the time being releases the debtor from all debts provable under liquidation, unless they have been incurred fraudulently or by breach of trust, or are debts due to the Crown. It is not to affect the partner of a debtor. An order of discharge is not intended, however, to release a debtor from all further obligation, for by the 98th clause, after-acquired property will be liable in respect to claims proved under" liquidation. If at any time tho Court may decide that, consistently with reasonable provision for maintenance of his family and the payment of debts contracted subsequently to his discharge, the debtor is able to pay any sum towards the discharge of his former obligations, he may be summoned to appear and be examined as to his ability to pay, whether in or out of New Zealand. If the service of the summons be not effeoted, a notice requiring him to upperu- is to be inserted in the ' Gazette,' and in one or more newspapers circulated at his place of abode. The reraaiuing clauses empower the Court to make an order for payment by the debtor of a part or the whole of the deficiency of the insolvent's estate from after-acquired wealth, appoint a receiver, in default of payment sequestrate his estate, and distribute the proceeds pro rata among the former creditors.

lc will be seen, that this Act deals J merely with civil processes; that it | gives no facilities for the white-washing ■ filing of schedules now so common ; that even a composition with creditors 1 does not release a debtor from his obligations, and thus there is no temptation to get rich by repeated failures; and because creditors have so much greater power placed in their hands than heretofore, the probability is they will take increased interest in the liquidation of bankrupt estates. It must not be supposed, however, that it is contemplated to free fraudulent debtors from liability to criminal prosecution ; but this is provided for in a separate Bill, to which we shall give attention at a future time.