The Attorney-General (Sir Charles Russell, Q.C.) and Mr. Muir Mackenzie, who appeared for the Official Receiver in support of the appeal, admitted that previous to the Act of 1875, the course of legislation had been in favour of the preference, but it was contended that under that Act such preference no longer existed. Mr. Herbert Reed, Q.C., and Mr. Mellor, appeared for the friendly society. The Master of the Rolls said that a treasurer of a friendly society had been made a bankrupt and he had at the time of the bankruptcy some money. He had some book debts owing to him, and he had certain other property which, when realised in the bankruptcy, would produce money. The trustees of the friendly society said that they were entitled to so much of the money in the hands of the trustee in bankruptcy coming to him as the money of the bankrupt, to the extent of £100 68. 7d., to be paid to them in preference. Whether they were so or not depended on the true construction of section 15, sub-section (7) of the Friendly Societies Act, 1875. It was contended against the claim of the society that it had no preference, because it could not say that the bankrupt had in his possession the money they claimed at the time of the bankruptcy. It was said that it was not in his possession according to the true construction of section 15, sub-section (7). If that contention prevailed, it was admitted that the whole course of legislation with regard to friendly societies was altered in 1875. The privilege in favour of the societies had existed from 1793. The question, therefore, was, did section 15, sub-section (7), of the Act of 1875, oblige the court to say that there had been that startling alteration in the views of the legislature? If it was not obliged to say so the proper conclusion of the court would be to construe the section so as not to alter the long course of legislation. Certainly when the matter under discussion was considered nobody could wish to alter it. Friendly societies were societies in which moneys were paid by poor people as a means of saving. If money so paid was to be treated as money in the hands of the officers in such a way as to give them credit on it, poor people who had no control over the officers would stand a good chance of being ruined. At a time when societies of this kind were crashing up, in many cases through the misconduct of their officers, the court would be very disinclined to take away the long course of favourable legislation unless it was absolutely obliged to do so. But even if sub-section (7) stood quite alone the court was of opinion that it did not take away the protection. The court was of opinion that it rather gave the protection. Upon the section itself it showed that the money which the trustee in bankruptcy was to pay by way of preference was treated, not as the actual money as pieces of gold, or silver, or copper, but as money in the ordinary sense. Therefore, if the bankrupt had money it did not say that it was to be the very same money which he received. Further than this, on looking at a previous part of the section, it said that friendly societies were to be entitled to a privilege. If the trustee had to hand over the specific money there would be no privilege. The money could not be touched by the creditors by the ordinary laws of trust. Beyond all this the larger meaning was given to the section in 1882 by the Chief Judge in bankruptcy, and since that decision the section must have been acted on in very many cases. That decision has never been challenged, and if, therefore, the section was reasonably capable of the construction put on it, it ought not to be reversed unless it was clearly wrong. Since that decision two statutes had been passed-the Bankruptcy Act, 1883, and the Preferential Payments Act, 1888-in neither of which had anything been done with regard to reversing that decision. The court was of opinion that the decision was right, and, consequently, that the decision of the Divisional Court in the present case was right, and the appeal must be dismissed. Lords Justices Lindley and A. L. Smith concurred. N.B.-See Friendly Societies Act, 1896, 59 & 60 Vic. cap. 25, sec. 35. PLYMOUTH COUNTY COURT. 1893. Dec. 1. CASE 53. RE H. C. WELCH, A BANKRUPT. Friendly Society-Defaulting Treasurer-Preferential claim by Society admitted. In the bankruptcy of Henry Cummings Welch (the absconding Penryn alderman), the Star of the West Lodge of Oddfellows (of which the bankrupt was secretary) moved to get their claim of £723, the amount of his defalcations, treated as a preferential one. His Honour (Judge Granger) has forwarded to the Registrar of Truro (Mr. J. G. Chilcott) his written judgment. His Honour orders that "the proof of the trustees of the Star of the West Lodge for £723 6s. 2d. (or for such sum as may be ascertained, if necessary) be admitted as a claim in preference to any other debts or claims," and that the costs of both parties be paid out of the estate. N.B.-See Friendly Societies Act, 1896, 59 & 60 Vic. cap. 25, sec. 35. NORWICH COUNTY COURT. 1877. Jan. 18. Before MR. REGISTRAR TRUSTEES CASE 54. OF THE LOYAL AGINCOURT LODGE, M.U.I.O.O.F., v. J. M. WOODS, A BANKRUPT. Friendly Societies Act, 1875 (38 & 39 Vic., cap. 60), sec. 15, sub-sec. 7.-Treasurer Bankrupt-Claim by Society for Payment of Moneys belonging to them in the hands of Debtor at the time petition filed in preference to any other debt.-Allowed. A motion was made by Mr. Simms Reeve, barrister-at-law, instructed by Mr. S. Linay (Sadd and Linay, solicitors, Norwich), on behalf of the Trustees of the Loyal Agincourt Lodge, No. 314, of the Manchester Unity Independent Order of Oddfellows, to order the trustee under the liquidation proceedings, instituted by one James Matthias Woods, of Wymondham, in the county of Norfolk, the treasurer of the lodge, to pay, in preference to any other debts or claims against the estate of the said J. M. Woods, the sum of £90 15s. 6d., being moneys belonging to the lodge, and in the possession of the debtor at the time of his filing his petition. Mr. W. S. Rackham (Coaks and Rackham, solicitors) appeared for the trustees of the debtor's estate.-Mr. Reeve called attention to the section 72 of the Bankruptcy Act, 1869, and section 15 sub-section 7 of the Friendly Societies Act, 1875, 38 & 39 Vic., c. 60, and contended that the order should be made, as also that the debtor's estate should pay the costs of and incidental to this application. After hearing Mr. Rackham on behalf of the trustee of the debtor's estate, the order was made that the £90 15s. 6d. and costs should be paid out of the first assets that came into the possession of the debtor's trustee under his liquidation. —A similar application was made by Mr. S. Reeve, again instructed by Mr. S. Linay (Sadd and Linay, Norwich), on behalf of the trustees of Loyal Wyndham Lodge, No. 2,904, of the Ancient Order of Foresters, the debtor having held the office of treasurer to that lodge, and received £130 7s. 4d. on account of the lodge, which sum was in his hands when he filed his petition for liquidation.- Order made as in the preceding case. N.B.-See Friendly Societies Act, 1896, 59 & 60 Vic., cap. 25, sec. 35. CASE 55, TRUSTEES OF THE SHAKESPERE LODGE, M.U.I.O.O.F. v. MANCHESTER COUNTY COURT. 1877. April 8. GRAHAM. Friendly Societies Act, 1875 (38 & 39 Vic., cap. 60), sec. 15, sub-section 7-Priority of claim on Death, Bankruptcy, or Insolvency of Officer-Treasurer Bankrupt-Sureties— Claim allowed. An action affecting the priority of claim, on death, bankruptcy, or insolvency of an officer of a friendly society having in his possession, by virtue of his office, any money or property belonging to a society (Friendly Societies Act, 1875 (38 & 39 Vic., c. 60), s. 15, sub-s. 7), was tried before the judge of the Manchester County Court on the 8th of April. The plaintiffs were the trustees of the Shakespere Lodge, Independent Order of Oddfellows Manchester Unity Friendly Society, and the defendant was Mr. Graham, the trustee of the estate of William Herd, the treasurer of the lodge. The sum in the hands of William Herd, at the time of filing his petition, amounted to £48 15s. 6d. At the first meeting of the creditors a demand was made, in accordance with the Act of Parliament, for the payment in full of the sum in the hands of the treasurer. At this meeting Mr. Graham was appointed trustee, and on application being made to him he refused to pay the claim, contending that the treasurer had not at the time of filing his petition such sum of money as that demanded in his possession. It was also contended that the bankrupt's sureties should be called upon to pay the demand in the first instance. The facts of the case were stated to the judge by Mr. Cobbett (Messrs. Cobbett, Wheeler, and Cobbett), and the clause of the Friendly Societies Act having been read, which stipulates that a friendly society has preference to any other debts or claims against the estate of a bankrupt, &c., the judge said he entirely agreed with Mr. Cobbett's version of the Act, and without calling upon any case to prove his argument, ordered that the claim be paid over to the trustees of the lodge. The judge said that the trustees of the lodge were quite right in making the application, and that the sureties would have had cause of complaint upon the trustees if they had not taken this action to get the money from the estate of the liquidating bankrupt. N.B.-See Friendly Societies Act, 1896, 59 & 60 Vic., cap. 25, sec. 35. WESTMINSTER, CASE 56. EX PARTE JAMES RAY AND OTHERS. Friendly Society-Treasurer-Bankrupt―Preference -10 Geo. IV., cap. 56; 4 & 5 Wm. IV., cap. 40, sec. 12. On the appointment of the bankrupt as treasurer of a friendly society, it was agreed that of the funds then in hand she was to pay interest for £120. Held that this was not to be considered as a loan to her; but that it was in her hands and possession by virtue of her office of treasurer, within the meaning of the 4 & 5 Wm. IV., c. 40, s. 12, and that the assignees were bound to pay over the amount to the society. This was the petition of the members and stewards for the time being of a friendly benefit society, called "The Liberal Society," established at Pontypool, in Monmouthshire; and it prayed an order on the assignees to pay over to the petitioners the sum of £153 4s. 10d., under the circumstances stated in the petition, which were as follows: : The society was established in the year 1792, and the rules of the society were afterwards duly enrolled, pursuant to the provisions of the 33 Geo. III., c. 54. On the 3rd September, 1829, the bankrupt was appointed treasurer of the society, and had then in hand the sum of £149 8s. 9d., and out at interest the sum of £50. At the time of her appointment the following resolution was entered into by the society: "That she, the said Mary Woodliffe, is to have the sum of £149 8s. 9d., of which she is to pay interest for £120." On the 7th September, 1829, the bankrupt, pursuant to the requisitions of 10 Geo. IV., c. 56, entered into a bond, with two sureties, to the clerk of the peace, in the sum of £300 for the just and faithful execution of the office of treasurer. The bankrupt continued to fill that office until her bankruptcy, which took place in November, 1837, at which time she was in possession of £153 4s. 10d. belonging to the society, including the £50 out at interest when she became treasurer. Mr. Swanson appeared in support of the petition. Mr. J. Russell and Mr. Wm. Rose contra. Sir John Cross: This seems to me a very clear case, and I think that the commissioners have done wrong in rejecting the claim of the petitioners. It is admitted that the bankrupt held the office of treasurer of this society, but it is contended that she did not hold the £120 as treasurer. It becomes material, therefore, to see the terms on which this money was intrusted to her custody. It appears that on the appointment of the bankrupt to the office of treasurer, the funds of the society amounted to £149 8s. 9d., of which sum it was agreed that she was to "pay interest for £120." Now, her appointment as treasurer, and her agreement to allow interest for this sum, were contemporaneous acts, and it cannot be said that the £120 did not come to her hands by virtue of her office or employment as treasurer. But then it is contended that the agreement to pay interest makes a difference in the case, and shows that this portion of the money intrusted to her was to be considered as a loan. It appears to me, however, that the legislature did not contemplate that the money in the hands of the treasurer was to be locked up in a chest, but that it should be deposited with the treasurer in the same manner as with a banker. And I see nothing in the case which rebuts the presumption that the whole of the money was in her hands and possession by virtue of her office of treasurer. Sir George Rose concurred. Ordered as prayed, but without costs. N.B.-See Friendly Societies Act, 1896, 59 & 60 Vic., cap. 25, sec. 35. LONDON BANKRUPTCY COURT. 1882. Mar. 6. CASE 57. EX PARTE EDMONDS RE ATKINS. Friendly Societies Act, 1875 (38 & 39 Vic., cap. 60, sec. 15)-Preferential claim-Bankruptcy of Treasurer— BACON, V.C. Claim allowed. This was an appeal from the decision of the judge of the Salisbury County Court, and involved an important point as to whether the officers of a friendly society were entitled to be paid their claim, in preference to the claim of the other creditors, in a failure where the bankrupt was the treasurer of the society. Mr. Lang appeared for the trustees; Mr. Finlay Knight for the respondent. The facts were shortly as follows: The debtor, who was a wine and spirit merchant, of Salisbury, and was also the treasurer of No. 3,587 Lodge of the Manchester Unity of the Independent Order of Oddfellows Friendly Society, failed in September last with debts, secured and unsecured, of £1,800, and assets £493. At the first meeting resolutions were passed for the liquidation of the estate by arrangement, with Mr. Edmonds, accountant, Cheapside, as trustee, and a committee of inspection. At the time of the failure, the debtor was in the possession of the friendly society's funds to the extent of £43 odd, as treasurer of the society, which the officers of the society claimed to be paid in preference to the other creditors; and upon the case coming on in the court below, the judge |