BANKRUPTCY LAWS.

Nelson Evening Mail, Volume XV, Issue 213, 7 September 1880, Page 4

BANKRUPTCY LAWS.

The Committee on Bankruptcy Laws report; says that they are satisfied that the laws in force in the colony are unsatisfactory and open to grave abuse and productive of much injustice. They believe that no Bankruptcy Law will prove satisfactory unless based on the following principles— (a) That on a debtor finding that he is unable to meet his liabilities in full, all his property should be immediately placed under the control of his creditors, (b) That such property should be realised with all convenient speed, and the nett proceeds distributed pro rata amongst the creditors, provision being made for the payment of certain preferential claims in full, (c) That a debtor who has acted honestly is entitled to immediate discharge from his creditors, (d) That a debtor who has been guilty of fraud should be prosecuted as a criminal, (c) That the legal proceeding to attain these ends Bhould be of a simple and inexpensive character, consistent with efficiency. The Committee believe that no new law 'Bhould be passed which is not intended to be final. In addition to the above suggestions the Committee report that they recommend that all judicial duties, such as granting adjudications, discbarges, &c, be performed by Judges of the Supreme Court or District Courts. An official assignee should be appointed by the Government in connection with each Court, every such assignee to find ample security for the due discharge of his duties. Creditors should have power to appoint one or two trustees to act along with the assignee, and tbe trustee should be bound to pay all monies to a separate trust bank account in the particular estate, and should, under no circumstances, be allowed to use such monies for purposes other than connected with tbe estate. No deed of agreement should be entered into except under bankruptcy, and only with consent of threefourths in value of all the creditors. Provisions relating to property in the reputed ownership of the debtor should be abolished. A landlord should rank preferentially for rent not exceeding six months up to the date of bankruptcy. The provisions of the recent statue , in regard to future acquired property should be introduced. No bill of sale should be of any avail against a trustee in bankruptcy, except to the extent of a bona fide present advance. Judges of the Supreme Court should have power to determine questions of fraudulent preference, and also on tbe examination of a debtor commit|him for trial without any other preliminary proceedings being taken. The committee are of opinion that a Judge of the Supreme Court, and perhaps District Court, should have power summarily to sentence iio imprisonment for any term not exceeding twelve months, with or without hard labor, any debtor who (after full opportunity of defence) has been proved guilty of fraud or other misconduct. The committee thinks that without such a provision no great improvement in commercial morality can be looked for. There is a well known and natural reluctance with juries to convict for offences against the bankruptcy laws.