CHAMBER OF COMMERCE.

Globe, Volume XXII, Issue 1970, 17 June 1880, Page 3

CHAMBER OF COMMERCE.

A special meeting of tho Chamber was held at 3 p.m. yesterday, to consider certain suggestions agreed to by the committee for amendments in the Bankruptcy Act. Present —Messrs G-. Gh Stead (president), T. B. Craig, J. Inglis, Cameron, Mitchell, W. H. Hargreaves, Btruthers, Cunningham, Connal, 8,. Walton, McDaugal, Graham, Cuff, Robison, Pavitt, Peacock. The President said that members present would gather from the advertisement the object of tne meeting. The committee had had two meetings, resulting from telegrams addressed to him by Hon. J. N.Wilson, chairman of the committee on the Bankruptcy Act in the legislative Council, and Mr Downie Stawart, chairman of a similar committee in the House of Representatives. The questions forwarded to him by these gentlemen for answer were proposed by the committee to be answered as follows :

1. " On whos9 application a debtor should be made bankrupt ? —The Act of 1876 gives power to both debtor and creditor to filo a petition in bankruptcy under oertain circumstances, and is sufficient. 2. " By whom the bankrupt's estate should be administered ?—The estate should be vested in the Registrar until meeting of oreditors appoint trustee or trustees, who need not necessarily be creditors, as in Act 1876, hut every trustee or trustees should be compelled to file with the Rogistrar of tho Supreme Court every six months a complete debtor and creditor account of the estate, with a written statement of its position and prospects, or become liable to a heavy penalty. The Court to provide rules and decide penalty for non-fulfilment of conditions. Every trustee should be made to keep a separate banking account for each estate, and pay all monies into that aooount, and when ho files the details of the estate's transactions he should be compelled to hand in the Bank book with all vouchers made up to date. 3. " The circumstances which should disont title a bankrupt to his discharge ?—Tho Acof 1867 is sufficient for this, beginning at clause 120. 4. " Whether any, and if so, what alterations should bo made in tho law relating to bills of sale ?—The present law remain in force, but should be amended as follows to meet the resolution passed by the Chambor as follows : —The practice of taking transfers of fire policies by way of security, without taking any security over the goods insured, ought to be made illegal, and the transfers of policies ought to be included under tho Bills of Sale Act, and registered accordingly, and be made subject in all respects to tho provisions of the said Act relating to asaignments of personal chattels, including bankruptcy. 5. " Whether tho right of distress for warrant should not be modified]? —Clause 83 of the Act 1876 gives a right of distress for rent after the bankruptcy for twelve months. Bents for town properties should be preferential for six months, and country properties twelve months, 6. " By whom a bankrupt shall be prosecuted, and whether any fund ought to be

created out of which the costs should be paidP —The Grown prosecutor, if instructed by the trustee or trustees, or upon an order being given by the Oouit. All unolaimed dividends and other estate gurplusses should be put to a fund out of which the cost of all prosecutions should be paid, as far as practicable; the balanoe, if any, to be provided at the public expense.

7. " What claims should be treated as preferential ?—ln clause 106 of the present Act, a clerk is entitled to six months' salary in full, but a workman is entitled to only two months. We oannot see why there should be any difference. We would make them equal by giving them three months' salary, and allow them to prove for the balance. 8. " Whether the present mode of arrangement by deed should be continued ?—Yes. 9. " Whether any debtor should not jbtaii> his discharge after open hearing in Court ? Yes. And any creditor should be able, either in person or by his solicitor, to oppose his discharge. A bankrupt not getting his discharge should bo liable to be sued, or his goods seized by the trustee at any time. "We would suggest that any creditor writing to tho trustee should be entitled seven days after to soe a clear statement of and position of any estate." Ho perhapß should say that they were indebted to Mr Walton for the main suggestions of these answers, and the committee had gone carefully through them, the result being that two-thirds of Mr Walton's suggestions had been adopted. The committee had desired before sending away their answer to receive from the Chamber their approval or otherwise of their suggestions. Ho might also say that he .had received a valuable suggestions from a leading solicitor in the city, which he would read to them. [Tho President then read a suggestion as to the powers to be granted to trustees to search for concealed property.] He had read the recommendations of the committee as to the answer they should send, and it would now be open for any member who desired to do so to move any amendmont he thought necessary, prior to the answer being sent to Wellington. Mr Inglis said that he thought it was right to answer the question very muoh in the direction of the report. It was not, he understood, the intention of the Government to make a new Act, but rather to amend the present one and leave the formation of a new one jto a future Parliament. If the Government had not prepared any Bill for tho present session they would not have time to do so now, and henco he would support the proposals of the committee. The general bearing of the answers were in the direction they had always as a Chamber gone. In 1870 the matter was before the Chamber, and they had done a great deal in it. The Act before the present one was to a large extent the work of the Chamber, and in that their suggestions were carried out. In 1872 the committee of the Chamber reported on the Bill, and spoke of the amendments introduced into it at the request of the Chamber. Again, in 1876, the Chamber dealt with Mr Bowen's Act, expressing their opinion that it was not such an one as would conduce to the welfare of the community. It would, therefore, be seen that the Chamber had discussed the subject time after time. Mr Ball had said that the question for discussion really was whether the Act was based on a right basis or not. This was just what the Chamber had held, and he was glad to see that the commit! ee had followed out this line. Now with reference to the suggestions he must say this, that the present method of appointing trustees was not such a one as enabled the oreditors to have a voice in the matter. This was due mainly to the canvassing whioh was carried on by accountants in the city, and prevented the creditors having a voice in the appointment of trustees. What he would like to see would be an amendment in the Act providing that no proxy should be received for creditors living within fifteen miles of the place of meeting. This would put a stop to the system now obtaining of canvassing. Ab regarded the leaving of the making of the rules to the judges, he was opposed to this being done, as considerable inconvenience was found by having to apply to the Court for rules. Mr Walton said that Mr Inglis was somewhat in error in stating that the Chamber had a hand in tho making of the Act before this one. This was Mr Bowen's Act. The one now in force was the amended Act, which had to be substituted for Mr Bowen's Act, which was found to be unworkable. Now, with regard to the Acts, he said this, that the Aot of 1867 was of the beßt Acts which had ever been brought in in New Zealand, giving protection both, to debtor and creditor. Besides this, the very point mentioned in the suggestion of the solicitor read by the president was provided for in this Act of 1867. Respecting the touting spoken of by Mr Inglis, he might say that it appeared to him that any one who could get nothing else to do went in for being a trustee in bankruptcy. If a person were appointed, say, as official trustee, to hold possession of property until the oreditors met, or, as an alternative, that the official trustee should be the trustee of the estate, thiß praotice of touting would be done away with. The official trustee could be called upon to account at any time, as he must produce accounts and bank books to the Registrar. For the reason that there wanted to be some authority between the bankrupt and the oreditors, he was in favour of the appointment of an official trustee. The rate of his commission was fixed, and if the Government were going to bring in a new Act, they should ta'ta the Act of 1876 as the grand basis upon which to found it. They had already done so by taking some portions of it. The President suggested that it would be better to read the questions and answers seriatim.

This was agreed to, and the questions and answers read.

The first answer was passed nem con. On the second answer being put, The President said that the committee had considered the question of the appointment of an official trustee, and had arrived at the conclusion that this would lead to as much touting as now for estates worth anything. Another point was, that the creditors being possessed of the knowledge of the class of goods dealt in by the debtor, would be quite able to carry on the business, or to deal with the goods quite as well, if not better, than a trustee who was not technically acquainted with the class of trade. The checks on the trustee spoken of were provided for in the answer of the committee.

Mr Walton said he desired to point out that if the official trustee did tout it would be respectable touting, at any rate. Tho experience gained by attending the meetings of creditors was, that they appointed the largest loser in the schedule as a matter of sympathy, rather than a question of ability. His experience was that trustees were appointed on the ground of a large creditor without ability, rather than a small one with ability. At present creditors' trustees were a myth, and they could not get at them. In fact the present Act was totally inadequate to deal with the matter.

Mr Inglis spoke against the appointment of official trustees.

Mr Bobison thought it would be as well to require that a certain guarantee should be given by every one who applied to be appointed as a certificated accountant. It might be that they did so ; if they did not, it was necessary they should be. Mr Hargreaves supported Mr Inglis' vjewß as to the appointment of official trustees, qb very many had crept in when official trustees existed. The creditors ought to be enabled to deal with what was really their own property without interference by an official trustee. He hoped therefore that the Chambor would take notice of the touting practice which existed, and deal with it if possible. In doing this he should be prepared to see that certificated accountants should have any privileges the Government might give them. He might Bay that this proxy nuisance had become a perfect scandal. Only the other day tho creditors had to pass a resolution before going on with their business requesting a person to leave the room. Mr Harby agreed with Mr Bobison and Mr Inglis, but he could not see that proxies could be done away with altogether. The difficulty might be got over by limiting the number of proxies held by any one person at a meeting. The President said that perhapß tho boat way to deal with the matter would be to decline to take proxy votes for the election of a trustee outside the general body of creditors. Mr Connal moved—" That the proxies held at any mooting by persons outside the general body of the creditors bo limited to two." Tho President pointed out that to be in order Mr Connal's motion must be put in a form enabling it to be added to the answer. Mr Harley suggested that the question of proxies should be dealt with in a separate olause. He [would desire to move after the words "asin the Aot of 1876," the insertion of the words "but who must be a certificated accountant or accountants in bankruptcy.'

Mr Robison having spoken as to the necessity of certificated trustees in bankruptcy, who were appointed trustees, giving security, Mr Connal moved—" That after the words •as in the Act, 1876,' the following words be inserted, ' That no person present shall hold more than two proxies.' " This motion placed all in the same position, which he thought was liberal.

Mr Inglis seconded the motion. Mr Robison said he thought the limiting of the proxies would have a very prejudicial effect. He thought the Chamber should pause before passing 'suoh a resolution as this. They were really trying to do by Act of Parliament what should be done by the good sense of the people themselvee. If people were foolish enough to give proxies to individuals wh did not deserve that confidence, they must t psefc to suffer. On being put the motion was deolarod to be carried on the voices.

Mr Walton demanded a division, which took place as follows :—For 7, against 6. The answer as a whole was then put and carried.

The remainder of the answers as drafted by the committee were then passed without comment.

On the suggestion of the committee, at the end of the questions, Mr Cruig pointed out that by rule 43 of the Supreme Court any creditor on payment of one shilling could demand to see a statement at any time. Mr Walton said that he thought this rule was most inconvenient, as it gave a trustee no time to make up a statement, particularly in a largo estate. He wbb in favour of the suggestion of the committee being carried out. After some further discussion, the suggestion of the committee was adopted. Mr Walton moved the following being, the suggestion of a solicitor of the city read by tho president, as to search for concealed property by the trustee—" That it be a recommendation to the committee of both Houses that the clauses in the Act of 1867 with reforenoe to the powera of search for concoaled property by the trustees be included in the present Act." Mr Cunningham thought it would be better to send a copy of the suggestion of the solicitor to the Government, and allow them to frame clauses upon it. Mr Pavitt agreed with Mr Cunningham. After some discussion, Mr Walton withdrew his motion.

Mr Cunningham then moved—" That the suggestion of the solicitor be embodied in the reply of tho committee to the joint committees of Parliament."

Mr Walton seconded the motion, whioh was carriod.

The President said he wished to bring before tho Chamber the fact that if a debtor was examined on oath before a trustee, and that he swore falsely there was no moans of punishing him. He had a case the other day where he knew the man was swearing falsely, but their solicitor advised them that there could be no punishment for it. After some discussion, Mr Robison thought that tho following would meet the cose—" That it be suggested to the committee of both Houses that any debtor swearing falsely before any trustee when examined shall be liable to the same punishment as if he had sworn falsely before a magistrate." Some further discussion ensued, and ultimately, Mr Walton moved—" That the attention of the Government be called to an omission in the Act, there being a provision for examining a debtor before the trustee, and none for punishing him should he swear falsely." Mr Robison seconded the motion, which was agreed to. This terminated the business of t'ae meeting.