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of any fraudulent intention of the seller is not an act of bankruptcy. So a deed, by which F. one of two traders in partnership, conveyed his separate estate to trustees, for the joint creditors of both, the joint creditors agreeing that the traders should continue in possession of their stock, and carry on their business with a view to retrieve themselves; and that upon their paying 48. 6d. in the pound by certain instalments, they should receive a general release; it was holden that it was not an act of bankruptcy; and that it was properly left to the jury to say, whether the deed was executed bona fide to enable the traders to retrieve themselves, or was executed by F. with intent to defraud his separate creditors.

It must be observed, that it is not competent to those persons who have signed the fraudulent deed”, or to those who, without executing, have assented to the deed, and are privies to the transaction, to set it up as an act of bankruptcy. A commission was sued out on the petition of A. B. founded on an act of bankruptcy in December, and it appeared, that in the preceding October, the bankrupt by a deed to which A. B. was a party, assigned all his property: it was holden”, that the assignees (although A. B. was not one of them,) could not avail themselves of this deed as an act of bankruptcy in order to recover money subsequently paid by the bankrupt, inasmuch as the creditors represented by the assignees derived all their rights under the commission from the petitioning creditor, who was a party to the deed. But where a commission of bankruptcy was sued out on a fraudulent deed, upon the petition of a creditor who had not concurred in such deed, but who was chosen assignee, together with other creditors who had concurred and were privy to the fraudc; it was holden, that it was not any objection to an action brought by them as assignees for the recovery of part of the bankrupt's estate, that some of the assignees had concurred in the fraudulent deed, the petitioning creditor not having so concurred. An asignment by bankers (then in failing circumstances, and who had stopped payment) of their estate and effects to trustees for the benefit of their creditors, is an act of bankruptcyd, although the assignment be made merely for the purpose of making an act of bankruptcy; the trustees not being

z Bamford v. Baron, 2 T. R. 594. n. C. J., S. P. 1 Holt's N. P. C. 13. S. C.

cited by Eldon, C. exp. Harcourt, 2 This last was the case of a petition-
Rose, 213. See also Prosser v. Smith, ing creditor.
Holt's N. P, C. 442. and exp. Gane, b Tope v. Hocking, 7 B. and C. 101.
Mont. and M'Arth. 399.

c Tappenden v. Burgess, 4 East. 230. a Hicks v. Burfit, Winton Lent Ass. Jackson v. Irvin, 2 Campb. 49.

1812. per Chambre, J. 4 Campb. 235 d Simpson v. Sikes, 6 M. and S. 295. n. Back v. Gooch, ib. 232. Gibbs,

privy to the purpose for which the deed was made. By stat. I and 2 W. 4. c. 56. s. 42. no commission of bankrupt shall be superseded nor any fiat annulled, nor any adjudication reversed, by reason only that the commission, fiat, or adjudication has been concerted by and between the petitioning creditor and the bankrupt, except where any petition to supersede a commission for any such cause shall have been already presented, and shall be then pending. This statute applies to concerted commissions, &c. only, and does not include9 concerted acts of bankruptcy-But by the 7th section of 6 G. 4 c. 16. one species of act of bankruptcy, viz. a declaration of insolvency, though concerted between the bankrupt and a creditor, is rendered valid by express enactment.

A. having contracted with a canal company to build works on the canal", as their engineer, purchased, with money advanced by the company, timber and other articles for that purpose, which were deposited on the premises of the company. Being considerably indebted, he borrowed of the company a further sum of money to pay his creditors the full amount of their debts, and as a security executed a bill of sale of his effects, which were then lying on the premises of the company, and delivered them by the delivery of a copper halfpenny. It was insisted, that the bill of sale was fraudulent, because the possession remained to all appearances the same after as before the conveyance, and the bankrupt continued to gain a false credit as the owner of the goods ; but the court held, that possession of the goods having been delivered to the company at the time of the execution of the bill of sale, as far as possession under these circumstances could be given, the deed was not fraudulent. The statute does not require that the conveyance should be made in contemplation of bankruptcy, it is sufficient if it be made voluntarily, in order to give a preference to particular creditors, to the prejudice of general creditors 6. Formerly, the act of bankruptcy drew the line of separation between that property which might be disposed of by the bankrupt, and that which was vested in the assignees; afterwards it was established, that if a trader, in contemplation of bankruptcy, make a voluntary disposition of his property, with a view to give a preference to a particular creditor, such disposition is void. This doctrine of voluntary preference was not distinctly laid down until the case of Harman, assignee of Fordyce v. Fisher,

q Marshall v. Barkworth, 4 B. & Ad.

508. r Manton v. Moore, 7 T. R. 67. 3 Pulling v. Tucker, 4 B. and A. 382.

cited by Patteson J. as in point in Botcherby v. Lancaster, 1 Ad. & El. 79.

in 1774. Cowp. 117. It was there stated in terms for the first time; and it may be considered as an excrescence on the bankrupt laws which is to be watched, and not extended , nor to be acquiesced in unless strictly proved. The cases prior to Harman v. Fisher, viz. Alderson v. Temple, 4 Burr. 2235, and Martin v. Pewtress, 4 Burr. 2477, were cases of gross

and palpable fraud. The case of Harman v. Fisher was this :Fordyce, at five o'clock in the morning, just going to commit an act of bankruptcy, ordered his servant to take a letter containing certain bills to a creditor in discharge of a debt, and in the letter he tells the creditor that he has the honour to shew him that preference which he conceives is certainly his due. About an hour afterwards, Fordyce absconded and went to France. This was holden to be void, Lord Mansfield, C. J. observing, that this was done “pursuant to no contract: in performance of no obligation; in no course of dealing ; without the privity of the creditor, or call on his part for the money, and without the probability of the notes being delivered before an act of bankruptcy was committed.” Then followed the case of Rust v. Cooper, where it was expressly stated, that the goods were delivered in contemplation of bankruptcy and in order to give the defendant a preference. But even there, Lord Mansfield says, “ If in a fair course of business a man pays a creditor who comes to be paid, notwithstanding the debtor's knowledge of his own affairs, or his intention to break, yet, being a fair transaction in the course of business, the payment is good; for the preference is there got consequentially and not by design.” So if a creditor call for payment before the intention of voluntary preference can be accomplishedų, it is sufficient to take the case out of the rule. So a transfer of property made under the apprehension of a prosecution for forgery, is valid X. In Poland v. Glyn, 2 D. and R. 311. and 4 Bingh. 22. n. Abbott, C. J. told the jury, that the object of the bankrupt law being to divide the whole of the bankrupt's property equally amongst his creditors, if a tradesman found himself in such a situation, that in the judgment of any reasonable man a bankruptcy was inevitable, no voluntary payment by him could be good. The jury found for the plaintiff, the assignee of bankrupt; and the court refused to disturb the verdict ; Bayley, J. observing, that it is a rule, that if a person be in such a situation, that he must be presumed to think bankruptcy probable, then if he makes a payment with a view to put one creditor in a better situation than the rest, such payment cannot be supported. But see Flook v. Jones, 4 Bingh. 20. and Fidgeon v. Sharpe, 5 Taunt. 545, in which last case, Gibbs, C. J. says, “by the common law, he [a trader] may pay any one: the general effect of the statutes on the subject of bankrupts, is, that all payments made before bankruptcy are legal and valid, but a certain class of cases has arisen, in which certain payments have been supposed to be made in fraud of the bankrupt laws, and are therefore fraudulent and void. But I find in all the cases, from Fordyce's to the present, the fact found, that the act was done in fraud of the bankrupt laws: it must be an act then, not only that in effect contravenes the bankrupt laws, but it must be done with intent to contravene them and in contemplation of bankruptcy. The innocence or guilt of the act depends, then, on the mind of him who did it; and it cannot be in fraud of the bankrupt laws, unless the actor meant it should be so.” And in the concluding part of the same opinion the C. J. Gibbs thus observes, “The court agree with Lord Mansfield's doctrine in Fordyce's case, that the thing must be intended in fraud of the bankrupt laws. The contemplation of insolvency is one step, and affords a strong presumption towards the contemplation of bankruptcy, but it does not go all the way.”

t See the opinions of Parke J. and Pat

teson J. in Morgan v. Brundrett,

5 B. & Ad. 296, 7. to this effect. u Bayley v. Ballard, 1 Campb. 416.

But see Cook v. Rogers, 7 Bingh.

446, and post p. 206. x De Tastet v. Carroll, i Stark. N. P. C.

88. Lord Ellenborough, C. J. B. R. M. T. 56 Geo. 3. S. C. on motion for N. T. Atkins v. Seaward, Winton Lent. Ass. 1819. Holroyd, J. S. P. See also Reed and others v. Ayton, i Holt, N. P. C. 503. and Arbouin v. Hanbury, 1 Holt, N. P. C. 575. S. P. y Crosby v. Crouch, 2 Camp. 166, 11 East, 256.

B. a bookseller y, in September 1807, applied to the defendant, a pawnbroker, to discount three bills for him, which he had drawn upon C. and D. The defendant gave him cash

them, but soon after becoming suspicious of B.'s credit, he asked him, whether they were not accommodation bills: B. answered that they were. The defendant then required some security to be put into his hands, in case the bills should not be paid when they became due. In consequence of this application, B. at different times, between November and February, deposited with the defendant various parcels of books to the value of about 300l. for the purpose of being sold for his benefit, if the bills should not be duly honoured by the acceptors. These books were chiefly brought by B. in a hackney coach in the evening. It likewise appeared that he had compounded with his creditors two or three years before, which circumstance must have been known to the defendant who had lent him money to pay the stipulated composition. B. committed an act of bankruptcy in the beginning of March, and the commission was sued out

against him on the 17th of that month; the bills then remaining in the defendant's hands unsatisfied. It was contended, on the part of the plaintiffs, that the defendant had unduly obtained possession of the books by a voluntary preference. Lord Ellenborough: “How is this a case of voluntary preference? The bankrupt parted with the books upon the defendant's importunity. The bills were not due, but the bankrupt was liable upon them, and the defendant had a right to ask for further security. The defendant had not a right of action when the books were deposited with him; but the bills constituted a good petitioning creditor's debt, and might have afforded him the means of compulsion. Strictly, only the acts of a trader subsequent to his bankruptcy are void. Precedent acts supposed to be in contemplation of bankruptcy have likewise been invalidated ; but this is an excrescence upon the bankrupt laws. The cases upon the subject have gone far and far enough, and I am not disposed to give them any extension. If the debt had been due here, the preference certainly would not have been fraudulent. It wants voluntariness in which the fraud consists. The consideration upon which a payment made to an importunate creditor of a debt actually due has been allowed to be valid, has not been that he might resort to a suit to enforce payment, but that his demand repels the presumption that the bankrupt upon the eve of bankruptcy made a distinction among his creditors, and spontaneously favoured one of them to the prejudice of the rest. A demand of further security for a debt not yet due has the same effect; and in neither case is there any fraud upon the bankrupt laws, on which ground alone transactions previous to bankruptcy can be set aside.” Plaintiffs nonsuited. On a motion to set aside the nonsuit, the court were of opinion, that the delivery of the goods did not constitute an act of voluntary preference, so as to render it fraudulent and void ; that in order to constitute such voluntary preference, two things must concur: first, that the delivery should be voluntary on the part of the bankrupt; and, secondly, that at the time of such delivery, there should be a contemplation of bankruptcy. In the present case, the proposition for giving further security, came from the creditor, and not from the bankrupt. Hartshorn v. Slodden, 2 Bos. and Pul. 582. was cited as in point; see also Smith v. Payne, 6 T. R. 152. So where money was advanced by A. to B. for the purpose of enabling B. to execute an order for the E. I. Company upon an agreement that A. should receive the money for the order, and repay himself, and A. did so receive it; this was

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