Page images
PDF
EPUB

that purpose vests in a trustee (m). The adjudication order is then forth with published in the London Gazette, and in such local papers as may be prescribed ; and the production of a copy of the Gazette, containing a copy of the order, is made conclusive evidence of the debtor having been adjudged a bankrupt, and of the date of the adjudication (n). We may further observe here, that a debtor may also be adjudicated a bankrupt, either (1) for failing without reasonable excuse to submit to the official receiver his statement of affairs hereinafter mentioned (sect. 16); or (2) for default in the payment of any instalment due in pursuance of any composition or scheme of arrangement arrived at as hereinafter mentioned (sect. 18) ; or (3) on the application of a judgment creditor (under the Debtors Act, 1869, s. 5) for a committal order against the debtor (s. 103).

III. The proceedings subsequent to the adjudication or receiving order.—Having now shown upon what grounds and in what manner a debtor is adjudicated bankrupt, we have next to advert more particularly to the proceedings which take place after such adjudication, or after the receiving order has been made, other than the matters relative to the realisation and distribution of the bankrupt's property by the trustee (which will be considered incidentally in treating of the effect of the bankruptcy on the debtor's property), and other than the bankrupt's discharge (which will be the last subject for consideration in an ordinary bankruptcy).

At the first meeting, the creditors, if they then resolve that the debtor shall be made a bankrupt, proceed to appoint some creditor or other fit person to fill the office of trustee of the bankrupt's property (0) ; and to appoint from among the creditors fit persons, not more than five nor less than three in number, who shall form a committee

(0) Sect. 21.

(m) Sect. 20. (n) Ibid.

of inspection, for the purpose of superintending the administration of the bankrupt's property by the trustee (p). In case the creditors neglect at such meeting to appoint a trustee, the Board of Trade appoints one until such time as the creditors shall have made the appointment ; but the creditors may leave it to the committee of inspection to make the appointment (9). The first meeting is, as a general rule, presided over by the official receiver (or his nominee) (r), in whom the property of the bankrupt vests, from the date of the receiving order, until some other trustee is appointed (s); and at the first or any other meeting, or at any time after the adjudication, any creditor may prove his debt, by an affidavit which is sent (prior to the appointment of the trustee) to the official receiver of the court, and (after such appointment) to the trustee himself. And no person is entitled to vote as a creditor, either at the first or at any subseqkent meeting, unless he has first duly proved his debt in the prescribed manner (t).

The trustee has to give security to the satisfaction of the Board of Trade, and his appointment only becomes effective upon,

and as from the date of the certificate of the Board of Trade (u); and such certificate is conclusive evidence of his appointment(x). The property of the bankrupt thereupon passes out of the official receiver and vests in the trustee, but the trustee remains subject to the control of the Board, which is rendered effective by the following (among other) provisions of the Bankruptcy Act, 1883. The trustee is required, not less than twice in each year during his tenure of office, to send to the Board of Trade an account of his receipts and payments as trustee ; and the Board of Trade is to cause the accounts so sent to be audited ; and for the

p) Sect. 22.

(9) Sect. 21, sub-s. (6); In re Finney (1870), L. R. 6 Ch. App. 79.

(r) First Schedule, rule 7.

(*) Sect. 54.
(1) Second Schedule, rule 2.
(u) Sect. 21.
(32) Sect. 138.

purposes of the audit, the trustee is to furnish the Board with such vouchers and information as the Board may require ; and the Board may at any time require the production of, and inspect, any books or accounts kept by the trustee ; and when such account has been audited, one copy thereof is to be filed and kept by the Board, and the other copy is to be filed with the court, and each copy is to be then open to the inspection of any creditor, or of the bankrupt, or ot' any person interested (sect. 78). Further, the trustee is required, as often as may be prescribed, and in any case not less than once in every year during the continuance of the bankruptcy, to transmit to the Board of Trade a statement showing the proceedings in the bankruptcy up to the date of the statement, containing the prescribed particulars, and made out in the prescribed form ; and the Board of Trade is to cause the statements so transmitted to be examined ; and is to call the trustee to account for any misfeasance, neglect, or omission which may appear on the statement, or in his accounts, or otherwise ; and may require the trustee to make good any loss which the estate of the bankrupt has sustained by his misfeasance, neglect, or omission (sect. 81). If at any time the trustee keeps in his hands for more than ten days any sum exceeding 501., he must pay interest on the same at the rate of 201. per cent. ; he is liable, moreover (unless he can satisfy the Board of Trade as to the retention), to be dismissed from his office without remuneration.

The duty of the creditors' trustee chosen and approved as above is, generally, to exercise his best discretion in the management of the estate until the bankruptcy is closed, and until he (the trustee) has obtained his release (y). Until that event, the trustee may from time to time summon general meetings of the creditors, for the purpose of ascertaining their wishes ; he may also from time to time apply to the court for directions, in relation to any

(y) Sect. 82.

particular matter arising in the bankruptcy ; and, as the bankruptcy proceeds, he consults with the committee of inspection as to his proceedings. And with a view to the full and due realization by the trustee of the assets of the bankrupt, authority is specifically given to him, by the Bankruptcy Act, 1883, to exercise divers powers either of his own authority or with the sanction of the committee of inspection. Thus, he is to have power of his own authority to sell all or any part of the property of the bankrupt (including the goodwill of the business, if any, and the book debts due or growing due to the bankrupt) by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels ; to give receipts for any money received by him, which receipts shall effectually discharge the person paying the money from all responsibility in respect of the application thereof; to prove, rank, claim, and draw a dividend in respect of, any debt due to the bankrupt; to exercise any powers the capacity to exercise which is vested in the trustee under the Act, and to execute any powers of attorney, deeds, and other instruments for the purpose of carrying into effect the provisions of the Act ; to deal with any property to which the bankrupt is beneficially entitled as tenant-in-tail in the same manner as the bankrupt might have dealt with it, including the power to execute disentailing assurances under the Fines and Recoveries Act, 1833. Moreover, rrith the sanction of the committee of inspection, the trustee may carry on the business of the bankrupt, so far as may be necessary for the beneficial winding up of the same ; may bring, institute, or defend any action or other legal proceeding relating to the property of the bankrupt; may employ a solicitor or other agent to take any proceedings or to do any business which may be sanctioned by the committee of inspection ; may accept as the consideration for the sale of any property of the bankrupt a sum of money payable at a future time, subject to such stipulations as to security and otherwise as the committee think fit ; may mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts ; may refer any dispute to arbitration ; may compromise all debts, claims, and liabilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist, between the bankrupt and any person who may have incurred any liability to the bankrupt, on the receipt of such sums, payable at such times, and generally on such terms, as may be agreed on ; may make such compromise or other arrangement as may be thought expedient with creditors, or persons claiming to be creditors, in respect of any debts proveable under the bankruptcy ; may make such compromise or other arrangement as may be thought expedient with respect to any claim arising out of or incidental to the property of the bankrupt, made or capable of being made on the trustee by any person, or by the trustee on any person ; and may divide in its existing form among the creditors, according to its estimated value, any property which, from its peculiar nature or other special circumstances, cannot be readily or advantangeously sold (s. 57). The trustee may also (with the sanction of the committee) employ the bankrupt himself to superintend the management of his property ; and may make an allowance to him for his support, or in consideration of his services (sect. 64).

As soon as conveniently may be after the expiration of the time for the submission of the debtor's statement of affairs, the court holds a public sitting for the examination of the debtor (called his public examination); and of the date of such public sitting the official receiver gives notice by advertisement in the London Gazette and in a local paper. This public examination of the debtor proceeds upon the statement of his affairs; and the official receiver, the trustee, and the court, may put questions to the debtor, as likewise may any creditor who has tendered a proof of his debt ; and it is the duty of the debtor to

« EelmineJätka »