THE BANKRUPTCY LAWS.

Poverty Bay Standard, Volume I, Issue 166, 25 June 1884, Page 2

THE BANKRUPTCY LAWS.

Mr. Mac Andrew knows a good deal of things political; but we should say nothing of things commercial. Our canny Scot is not a merchant, nor a tradesman, nor a dealer in “ unconsidered trifles,” or he would not gtve utterance to the nonsense which is reported of him. Mr. Macandrew tells the people of New Zealand that were there no Bankruptcy Act there would be far fewer bad debts, far fewer failures, and men would be much more cautious in giving credit and more careful to satisfy themselves as to the character and circumstances of those whom they trust. These sayings are quite true. But all commercial countries must, of necessity, have bankruptcy laws of some kind or other. The best writers on finance that we have in New Zealand speaking to the subject say:—“ Credit is in reality the life and soul of business, and unless we revert to the customs of primitive man, and resort to barter in all commercial transactions, business must be conducted on the basis of confidence. A variety of circumstances beyond the control of the individual trader land him occasionally in insolvency; all bankrupts are by no means so in consequence of dishonest dealing, reckless trading, or extravagant expenditure. If there were no bankruptcy laws, how would those unfortunate in business obtain relief—once unable to meet their engagements, they would be ruined with no chance of recovery. As for the creditors, it would be a case of first come first served, the creditor who. was able first to put in force a judgment would take the whole assets —in practice the bank or the money lender would invariably swoop the ’pool. Then, again, consider the class of men who would thrive on the arrangement of private compositions. Can it be doubted but that agents in insolvency would swarm in every convenient centre, in whose hands estates would be made to melt like butter in a dog's mouth. The Bankruptcy Act may not be perfection, who shall say it is—but at all events there is under it a fair chance of assets beiug realised and divided amongst creditors, which the open character of the proceedings enable the commercial public to form a judgment in each particular case. The honest man has a chance of reinstating himself, and the ingenious rogue the possibility before him of a penal sentence.”