bankruptcy refuses to bring an action, a creditor may get leave to use the trustee's name on indemnifying the trustee against costs (Re Mason, Ex parte Osborne, 1864, 10 L. T. 355), but the trustee ought not to allow his name to be used unless the proceeding is for the benefit of creditors generally (Re Zucco, Ex parte Cooper, 1875, L. R. 10 Ch. 510). Examples of personal rights of action, which do not pass to the trustee, are a right of action for slander (Re Wilson, Ex parte Vine, 1878, 8 Ch. D. 364), for seduction of the bankrupt's daughter (Howard v. Crowther, 1841, 8 M. & W. 601), for annoyance or inconvenience to the bankrupt (Rose v. Buckett, 1901, 8 Mans. 259; Brewer v. Dew, 1843, 11 M. & W. 625), for damages for wrongful dismissal (Bailey v. Thurston, [1903] 1 K. B. 137). Damages recovered by the bankrupt in such a case belong to the bankrupt himself, and cannot be intercepted by the trustee unless they have been invested in property (Re Wilson, Ex parte Vine, supra).

Real Property. With regard to immoveable property the rule is this. If the bankrupt is entitled to immoveable property situate in any of the British dominions, such property vests in the trustee, subject to any requirements of the local law as to a transfer (Callendar, Sykes & Co. v. Colonial Secretary of Lagos, [1891] A. C. 460). If the bankrupt is entitled to immoveable property situate in a foreign country, such property, being subject to the lex loci rei site, will not vest in the trustee (see Dicey, Conflict of Laws, 443 et seq.); but the bankrupt may be ordered to execute a conveyance of such land on the motion of the trustee, and if he neglects to do so he may be committed (In re G. W. Harris, 1896, 3 Mans. 46). If a debtor has, before his bankruptcy, contracted to buy or sell lands, his interest, whatever it is, passes to his trustee, subject to all equities (In re Scheibler, Ex parte Holthausen, 1874, L. R. 9 Ch. 722-726); but the trustee is at liberty to disclaim, if the contract is an unprofitable one (see p. 44).

The vesting of a bankrupt's property in his trustee will not, however, disentitle the bankrupt to deal with the contingent surplus of his estate, e.g. by mortgaging it, provided he does not purport to deal with the property vested in the trustee (Re Evelyn, Ex parte General Public Works Assets Co., 1894, 1 Mans. 195; Bird v. Philpott, 1900, 7 Mans. 251).

As to the powers of a bankrupt, the trustee may exercise all powers in respect of property which the bankrupt might have exercised for his own benefit, except the right of nomination to an ecclesiastical benefice (B. A. s. 44 (2) (ii.)). But some powers are personal to the bankrupt, and are not, like his property, divested by bankruptcy (Smith v. Wheeler, 23 Car. II., Vent. 128).

Income, Pay, Pension.-If the bankrupt is a beneficed clergyman, the trustee may obtain a sequestration of the profits of the benefice (B. A. s. 52); and he-the trustee-is entitled to go on receiving such profits, though the clergyman has obtained his discharge, until all the debts proved have been paid in full (In re Chick, 1879, 11 Ch. D. 731; Lawrence v. Adams, 1896, W. N. 158). In the case of officers of the army or navy who become bankrupt, or of civil servants, the Court may, with the consent of the chief officer of the department, order so much of the salary as it thinks fit to be distributed among creditors. Similarly, in the case of officers in receipt of a pension, or half-pay, the Court may order part of the half-pay or pension to be applied for the benefit of the creditors (B. A. s. 53). The pay must be pay received in respect of personal services (Re Ward, [1897] 1 Q. B. 266), and it must be received as a matter of

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right. In exercising its discretion under this section, the Court regards the policy of the State, that valour should not go in rags or an ex-judge ply a broom. The Court has the same jurisdiction where a bankrupt is in the enjoyment of any other "salary or income:" if he is an actor, for instance, under an engagement (In re Shine, [1892] 1 Q. B. 522), or a commercial traveller (In re Brindley, 1887, 4 Morr. 104), or an editor of a newspaper (Wadling v. Oliphant, [1896] 1 Q. B. 145), or a chaplain to a workhouse (In re Mirams, 1891, 8 Morr. 59), or a retired Indian officer (Re Saunders, Ex parte Saunders, 1895, 2 Mans. 201, 361), or a retired judge of a Crown colony (Ex parte Huggins, 21 Ch. D. 85), or a surgeon-dentist (Re Rogers, Ex parte Collins, [1894] 1 Q. B. 425). A purely voluntary allowance made to a debtor is not "salary or income" (Ex parte Wicks, 1881, 17 Ch. D. 70).

AFTER-ACQUIRED PROPERTY.-The words of the property section of the Bankruptcy Act (s. 44) include not only all such property as may belong to or be vested in the bankrupt at the commencement of the bankruptcy, but all property which may be acquired by or devolve on him between the commencement of the bankruptcy and the date of discharge. The Courts have, however, laid down the principle—qualifying the strict words of the statute by what may be called the common law of bankruptcy-that, until the trustee intervenes, all transactions by a bankrupt after his bankruptcy, with any person dealing with him bona fide and for value, in respect of his after-acquired property, whether with or without knowledge of the bankruptcy, are valid against the trustee (Cohen v. Mitchell, [1891] 25 Q. B. D. 262), and transactions may be bona fide though the person dealing with the bankrupt knew of the bankruptcy, and that the trustee was unaware of the accruer of the property (Hunt v. Fripp, 1897, 5 Mans. 105); but the principle laid down in Cohen v. Mitchell is meant only for the protection of persons dealing with the bankrupt in ordinary course, and where the bankrupt is carrying on business as ostensible owner without interference by the trustee. It does not give a superior title to creditors in a second bankruptcy over creditors in a first, unless there has been some laches or acquiescence by the trustee in the first bankruptcy-some conduct which entitles the subsequent creditors to say, "You must not set up your right against us" (Re Caughey, Ex parte Ford, 1876, 1 Ch. D. 521; Re Clarke, Ex parte Beardmore, [1894] 2 Q. B. 393; Re Johnson Johnson, Ex parte Matthews & Wilkinson, 1904, 11 Mans. 14; Re Burr, 1901, 84 L. T. 327 ; Pickard v. Sears, 1838, 6 Ad. & E. 469; Wadling v. Oliphant, 1876, 1 Q. B. D. 145, 147). The principle of Cohen v. Mitchell, supra, applies to chattel interests in land (In re Clayton & Beaumont's Contract, [1895] 2 Ch. 212), but not to real estate (In re New Land Development Association, [1892] 2 Ch. 138; London and County Contract, Ltd., v. Tallack, 1903, 51 W. R. 408). In re Vanlohe, Ex parte Dewhurst, 1872, L. R. 7 Ch. 185, is a good illustration of the rule. There an undischarged bankrupt took a house for six months at £5 a week, payable in advance, and paid the £130 out of a sum of £200 received by him as compensation for being turned out of an appointment which he had got since the bankruptcy, and the Court held that, though the trustee might have intercepted the £200, he could not follow it into the hands of the landlord.

Personal Earnings.—An impression long prevailed that the personal earnings of a bankrupt did not pass to his trustee, but the Court of

Appeal in Re Roberts, Ex parte Roberts, 1899, 7 Mans. 5, held this idea to be erroneous, and said that no such doctrine could be maintained in the face of sec. 44; and see Re Hancock, Ex parte Hillearys, 1904, 11 Mans. 1. The element of truth in the error is that the trustee cannot, in Lord Hardwicke's words, "hire out the bankrupt;" compel, for instance, a bankrupt with a special gift for bone-setting, to exercise his talent for the benefit of the creditors (Re Hutton, 1884, 14 Q. B. D. 301). The earnings of a surgeon-dentist (Re Rogers, Ex parte Collins, [1894] 1 Q. B. 425); of a billiard-player (Re Roberts, Shoolbred v. Roberts, 1900, 7 Mans. 388); of a patentee from royalties (Re Graydon, [1896] 1 Q. B. 417); of a surgeon-apothecary (Elliott v. Clayton, 1854, 16 Q. B. 584); of an architect (Emden v. Carte, 1881, 17 Ch. D. 768), have all been held to belong to the trustee, less such part of them as is necessary for the maintenance of the bankrupt and his family.

REPUTED OWNERSHIP.-What is known as the reputed-ownership doctrine is perhaps the strongest example of the aid which the law of bankruptcy gives to creditors. That law is not satisfied with seizing the debtor's own property to pay his debts. It seizes also property of which he is not the real, but only the reputed, owner. This doctrine is as old as the reign of James I., and is now embodied in sec. 44 (2) iii. of the Bankruptcy Act, 1883. The sub-section makes divisible, as "property," among the bankrupt's creditors, "all goods being, at the commencement of the bankruptcy, in the possession, order, or disposition of the bankrupt in his trade or business (that is to say, for the purposes of, and as connected with, his trade or business, Colonial Bank v. Whinney, 1885, 30 Ch. D. 261), by the consent and permission of the true owner, under such circumstances that he is the reputed owner thereof;" so that, to put it plainly, the law takes A.'s goods to pay B., C., and D., who are no creditors of his, but of X.'s. The equity of the creditors is based on estoppel. As James, L.J., said in Ex parte Wingfield, 1878, 10 Ch. D. 591, 594: "If goods are in a man's possession, order, or disposition, under such circumstances as to enable him by means of them to obtain false credit, then the owner of the goods, who has permitted him to obtain that false credit, is to suffer the penalty of losing his goods for the benefit of those who have given the credit." It is not necessary that the reputed owner should have actually obtained credit upon the goods. It is enough that credit might have been obtained (per Lord Blackburn, Colonial Bank v. Whinney, 1886, 11 App. Cas. 426, 436). The reputed-ownership doctrine applies to separate goods of a partner in the possession of his firm, with his consent (In re Pulsford, 1879, 8 Ch. D. 11), but not as between a dormant and ostensible partner.

Things in action, other than debts due, or growing due, to the bankrupt in the course of his trade or business, are excepted; and in the Colonial Bank v. Whinney, supra, the House of Lords decided that the expression "things in action" is not to be read in a narrow technical sense, but comprehends, for example, shares in a railway company. Shares and patents and copyrights, and policies of insurance and debentures, and such personal property of an incorporeal nature, are not visible and tangible, so as to give an appearance of false credit. Trade debts are different. They are known to exist, they are entered in the books of the trader, and persons dealing with him give him credit on the faith of them. Thus, where B. bought A.'s business as a wine merchant,

and A., not being paid, got a receiver appointed of the book debts, and then B. became bankrupt, the debts were held to be in B.'s order and disposition as reputed owner, except as to a part, being debts of which A. had given notice to the debtor of his title (In re Tillett, 1889, 6 Morr. 70). Consent by the true owner is essential to bring the case within the reputed-ownership doctrine. Whether there has been such a consent is a question of fact on the circumstances of each case (Hamilton v. Bell, 1855, 10 Ex. Rep. 545). Goods comprised in a registered bill of sale, which at the commencement of the grantor's bankruptcy are in the order and disposition of the bankrupt in his trade or business, are none the less in his possession "by the consent and permission of the true owner" that the bill of sale holder has been prevented from seizing the goods by reason of the statutory prohibition in sec. 7 of the Bills of Sale Act, 1882 (Re Ginger, Ex parte London and Universal Bank, 1897, 4 Mans. 149; Re Elliott, Ex parte the Trustee, 1901, 84 L. T. 325). Goods may be in the order and disposition of a person in his trade or business, though the goods neither originally belonged to the bankrupt nor could have lawfully been pledged or sold by him, e.g. stands or models for the display of mantles used by a milliner in her business with the consent and knowledge of the true owner (Sharman v. Mason, 1899, 7 Mans. 10), but samples sent to show to a customer, e.g. by a silversmith to an agent, will not pass to the agent's trustee (Re William Watson & Co., Ex parte Atkin, [1904] 2 K. B. 753). There can, of course, be no consent without knowledge (In re Caughey, 1875, 1 Ch. D. 521, 528). The bankrupt, for the clause to apply, must be in sole possession of the goods as reputed owner.

The reputation of ownership is a presumption arising from possession, and, like other presumptions, may be rebutted by proof of a trade custom displacing the inference. Such a custom must be one known to traders generally, and not merely to persons engaged in a particular trade (Re Goetz, James & Co., [1898] 1 Q. B. 787), and should be tried by a jury, not on affidavit evidence (Re Jenson, Ex parte Callow, 1887, 4 Morr. 1; Re Barnett, Ex parte Reynolds, 15 Q. B. D. 169). There is a custom, for instance, for hop merchants to retain hops purchased by their customers (In re Taylor, 1885, 2 Morr. 268). Every one is supposed to know the custom, and no one, therefore, ought to give the hop merchant credit on the faith of his possession. This is the theory of law. There is also a well-known custom to let pianos out on hire (Re Blanshard, Ex parte Hallersley, 1878, 8 Ch. D. 601). The custom in the printing trade of hiring machinery (In re Thackrah, 1888, 5 Morr. 235), the agistment of cattle by farmers (In re Woodward, 1886, 3 Morr. 75), and among hotel-keepers of hiring furniture (Crawcour v. Salter, 1881, 18 Ch. D. 30), are other instances. But the custom of furniture dealers to let out furniture on a three years' hire and purchase agreement does not disentitle the general public to assume that an ordinary householder is the real owner of the furniture which is in his house (Re Fowler, Ex parte Brooks, 1883, 23 Ch. D. 261).

DISCOVERY OF DEBTOR'S PROPERTY.-When a receiving order has been made against a debtor, one of the first difficulties with which the official receiver or the trustee is confronted, is to ascertain what the property of the debtor consists of and where it is. A debtor's statement of affairs is generally inflated and often unreliable. Unscrupulous debtors on the eve of insolvency have many means of withdrawing their

property from their creditors, by a secret trust or colourable transfer. In the case of debts, the policy of the unjust steward receives constant illustration in bankruptcy. From the earliest times the law of bankruptcy, and the energies of those who have administered it, have been directed to secure a full disclosure of his property by the bankrupt. So vital a matter was this felt to be, that, under 5 Geo. II. c. 30, death was the penalty awarded to a bankrupt not surrendering, or embezzling, his estate to the amount of £20-a penalty subsequently commuted, by 1 Geo. IV. c. 115, to transportation for life or seven years' imprisonment. The Bankruptcy Act, 1869, introduced, and the present Act has adopted, a machinery for defeating the arts of fraudulent debtors, and compelling as complete discovery as possible of the whole of the debtor's estate. To this end it authorises the Court (s. 27) to summon before it the debtor or his wife, or any person known or suspected to have in his possession any of the estate or effects belonging to the debtor, or supposed to be indebted to the debtor, or any person whom the Court may deem capable of giving information respecting the debtor, his dealings or property, and to require any such person to produce any documents in his power or custody relating to the debtor, his dealings or property. If any person so examined admits indebtedness to the debtor, or possession of any property belonging to the debtor, the Court may order him at once to pay the debt or deliver up possession of the property to the official receiver or trustee (B. A. s. 27 (4) (5), B. R. 93); but the Court has no jurisdiction to make an order under the section for delivery up of goods in the possession of a person as agent for another (Re Davis, Ex parte Goodman, 1898, 5 Mans. 329). This right of discovery may seem an inquisitorial power; but it is to be remembered that the debtor is asking the aid of the Court to release him from the burden of his indebtedness, craving a great privilege, and the first condition of granting him such relief is uberrima fides on the debtor's part in every respect, and, as to his property in particular, full disclosure and surrender. First principles of moral obligation of this kind are, however, of course ineffectual with dishonest debtors, and the law is therefore compelled to resort to a machinery for extorting discovery, like that contained in sec. 27.

As to who may apply for discovery, the Act says, "on the application of the official receiver or trustee;" and where the official receiver or trustee is willing to do so, he is no doubt the proper person, just as in the winding-up of companies the liquidator is prima facie the proper person to examine as to assets, etc., under sec. 115; but the trustee may not be willing to do so, and in that case a creditor (In re Russell, 1872, 26 L. T. 226) may apply, but at his own risk as to costs, unless the Court gives him them. The trustee, at all events, cannot oppose the application. It may be, too, that the trustee himself is wanted to give discovery (Ex parte Crossley, 1872, 13 Eq. 409; Ex parte Sheffield, 1879, 10 Ch. D. 434). It is not intended-so much is plain on the authorities -that a creditor should use the powers of this section for his private benefit (In re Easton, 1891, 8 Morr. 168). He is bound to show that some benefit will result to the estate or to creditors (In re Willson, Ex parte Nicholson, 1880, 14 Ch. D. 243), as where a creditor is examined as to his proof.

The debtor is not entitled to attend the examination (In re Beall, Ex parte Beall, [1894] 2 Q. B. 135); but notes of the examination are taken,