BOOK VI. THE JURISDICTION AND PRACTICE IN BANKRUPTCY. When and on what conditions order of discharge can be obtained. The Bankruptcy Act, 1869, s. 48. CHAPTER XVI. THE DISCHARGE OF THE BANKRUPT. THE bankrupt may at the close of or during the bankruptcy, and after the last meeting of creditors, obtain an order of discharge. The regulations as to the order of discharge are contained in the following section of "The Bankruptcy Act, 1869" : 66 66 66 "When a bankruptcy is closed, or at any time during its continuance, with the assent of the creditors, testified by a special resolution, the bankrupt may apply to the Court for an order of discharge; but such discharge shall not be granted unless it is proved to the Court that one of the following conditions has been fulfilled, that is to say, either that "a dividend of not less than ten shillings in the pound has "been paid out of his property, or might have been paid except through the negligence or fraud of the trustee, or that a special resolution of his creditors has been passed to the "effect that his bankruptcy or the failure to pay ten shillings "in the pound has, in their opinion, arisen from circumstances "for which the bankrupt cannot be justly held responsible, "and that they desire that an order of discharge should be "granted to him; and the Court may suspend for such time "as it deems to be just, or withhold altogether, the order of discharge in the circumstances following; namely, if it appears to the Court on the representation of the creditors "made by special resolution, of the truth of which representa"tion the Court is satisfied, or by other sufficient evidence, "that the bankrupt has made default in giving up to his "creditors the property which he is required by this Act to "give up; or that a prosecution has been commenced against "him in pursuance of the provisions relating to the punishment "of fraudulent debtors, contained in The Debtors Act, 1869,' "in respect of any offence alleged to have been committed by "him against the said Act."-32 & 33 Vict. c. 71, s. 48. 66 66 Though, as provided by this section, the application for a Order of disdischarge may be made at the close of the bankruptcy or during charge will not its continuance, yet, the order of discharge will not be made be granted till until after the public examination of the bankrupt. This is provided by the following rule of "The Bankruptcy Rules, 1870" "An order of discharge shall not be granted until after the "public examination of the bankrupt under section 19 of the "Act."" The Bankruptcy Rules, 1870," r. 140. Where the discharge is sought to be obtained during the continuance of the bankruptcy, the bankrupt must apply to the trustee to summon a meeting of creditors. On this subject, "The Bankruptcy Rules, 1870," provide as follows:"A bankrupt desirous of obtaining the assent of his creditors "to his applying to the Court for an order of discharge during "the continuance of his bankruptcy, shall request the trustee "to summon a meeting of his creditors, and thereupon the 66 trustee, upon the deposit of a sufficient sum for costs, shall summon such meeting; where at the meeting the creditors "do not so assent no other meeting shall be called for the same 66 purpose until after the lapse of three calendar months.""The Bankruptcy Rules, 1870," r. 142. 66 after public of the bank examination rupt. The Bankruptcy Rules, 1870, r. 140. Mode of obtaining discharge during continuance ruptcy. Practice on A bankrupt wishing to obtain his discharge must, first, file an application with the registrar in accordance with the follow- application ing rule of "The Bankruptcy Rules, 1870": 66 for order of discharge. Formal application to "A bankrupt intending to apply for an order of discharge, "shall file an application with the registrar, who shall thereupon fix the time and place at which the application will be be filed. "heard. Notice of the time and place fixed for the hearing of The Bank"the application of the order of discharge shall be gazetted, ruptcy Rules, "and also given to the trustee by the bankrupt, twenty-one 1870, r. 138. "days before such day."-" The Bankruptcy Rules, 1870," r. 138. Forms of application under this rule are provided (a). And -Form of also a form of memorandum of application (b), and a form of application. notice of application for the Gazette (c). On the day appointed for the hearing of the application the -Hearing of bankrupt must be prepared to prove that one of the following application. conditions has been fulfilled, namely, "either that a dividend of not less than ten shillings in the pound has been paid out of his property, or might have been paid except through the negligence or fraud of the trustee, or that a special resolution of his creditors has been passed to the effect that his bankruptcy or the failure to pay ten shillings in the pound has, in their opinion, arisen from circumstances for which the bankrupt cannot justly be held Appendix V. Forms 62, 63, 64, and 65. Appendix V. Form 61. Date of order of discharge. When order of discharge to be dated. The Bankruptcy Rules, 1870, r. 139. Form of order of discharge. Order of discharge not delivered out till time for an appeal expired. The Bankruptcy Rules, 1870, r. 141. Effect of order of discharge. The Bank ruptcy Act, 1869, s. 49. responsible, and that they desire that an order of discharge should be granted to him" (d). If the bankrupt applying for his discharge fail to prove the fulfilment of one of these conditions, no order of discharge will be made (e). But even if he give the required proof the Court is not bound to grant a discharge. For it is expressly provided that the Court may withhold altogether the order of discharge, or suspend it for such time as it deems to be just in the circumstance following: “namely, if it appears to the Court, on the representation of the creditors made by special resolution, of the truth of which representation the Court is satisfied, or by other sufficient evidence, that the bankrupt has made default in giving up to his creditors the property which he is required by this Act to give up; or that a prosecution has been commenced against him in pursuance of the provisions relating to the punishment of fraudulent debtors, contained in The Debtors Act, 1869,' in respect of any offence alleged to have been committed by him against the said Act" (f). An order of discharge is dated on the day on which it is made, and takes effect on and after the day of its date. On this subject, "The Bankruptcy Rules, 1870," provide as follows: "An order of discharge shall be dated of the day on which "it is made, and shall take effect on and from the day of "its date, and shall be gazetted."-" The Bankruptcy Rules, 1870," r. 139. Forms of orders of discharge (g) are provided, and also of notice in Gazette of order of discharge (h). The following rule of "The Bankruptcy Rules, 1870," regulates the time for delivering out the order of discharge : "An order of discharge shall not be delivered out until after "the expiration of the time allowed for appeal, or if an appeal "be entered, until after the decision of the Court of Appeal "thereon.""The Bankruptcy Rules, 1870," r. 141. As regards the effect of an order of discharge, "The Bankruptcy Act, 1869," provides as follows: 66 "An order of discharge shall not release the bankrupt from any debt or liability incurred by means of any fraud or "breach of trust nor from any debt or liability whereof he has "obtained forbearance by any fraud, but it shall release the bankrupt from all other debts provable under the bankruptcy, "with the exception of― 66 "(1.) Debts due to the Crown: "(2.) Debts with which the bankrupt stands charged at (d) 32 & 33 Vict. c. 71, s. 48, ante, p. 1404. (e) Ib. (†) Ib. (g) Appendix V. Forms No. 67 ("Bankruptcy Rules, 1870"), and No. 2 (Schedule to "Bankruptcy Rules, 1871 "). (h) Appendix V. Form 69. "the suit of the Crown or of any person for any "And he shall not be discharged from such excepted debts "unless the Commissioners of the Treasury certify in writing "their consent to his being discharged therefrom. 66 "An order of discharge shall be sufficient evidence of the "bankruptcy, and of the validity of the proceedings thereon, "and in any proceedings that may be instituted against a bankrupt who has obtained an order of discharge in respect "of any debt from which he is released by such order, the bankrupt may plead that the cause of action occurred before "his discharge, and may give this Act and the special matter "in evidence."-32 & 33 Vict. c. 71, s. 49. 66 "The order of discharge shall not release any person who, "at the date of the order of adjudication, was a partner with "the bankrupt, or was jointly bound or had made any joint "contract with him."-32 & 33 Vict. c. 71, s. 50. Where a person has failed to obtain his discharge, certain consequences ensue which are indicated by the following section of "The Bankruptcy Act, 1869" : "Where a person who has been made bankrupt has not "obtained his discharge, then, from and after the close of his "bankruptcy, the following consequences shall ensue : "(1.) No portion of a debt provable under the bankruptcy "shall be enforced against the property of the person so made bankrupt until the expiration "of three years from the close of the bankruptcy (1); and during that time, if he pay "to his creditors such additional sum as will, "with the dividend paid out of his property 66 66 during the bankruptcy, make up ten shillings (2.) At the expiration of a period of three years from the 66 bankrupt has not obtained an order of discharge, "any balance remaining unpaid in respect of "any debt proved in such bankruptcy (but "without interest in the meantime) shall be "deemed to be a subsisting debt in the nature "of a judgment debt, and, subject to the rights (1) As to close of the bankruptcy, see post, cap. xviii. pp. 1412 et seq. Who are not released by order of discharge. The Bank ruptcy Act, 1869, s. 50. Consequences of failure to obtain discharge. The Bankruptcy Act, 1869, s. 54. Enforcement of a debt against an undischarged bankrupt. Application by creditor to enforce payment against undischarged bankrupt of balance of debt due to him. The Bank ruptcy Rules, 1870, r. 183. Proof must be given at hearing of service of notice on the Court may Practice at ad- "of any persons who have become creditors of "the debtor since the close of his bankruptcy, 66 may be enforced against any property of the "debtor, with the sanction of the Court which "adjudicated such debtor a bankrupt, or of the "Court having jurisdiction in bankruptcy in the "place where the property is situated, but to "the extent only, and at the time and in manner "directed by such Court, and after giving such "notice and doing such acts as may be pre"scribed in that behalf."-32 & 33 Vict. c. 71, 8. 54. The following rules of "The Bankruptcy Rules, 1870," relate to the enforcement of a debt against an undischarged bankrupt : 66 "Where after the expiration of a period of three years from "the close of a bankruptcy, in which the bankrupt has not "obtained an order of discharge, an application is made to the "Court for its sanction to the enforcement by a creditor of "the payment of the balance remaining unpaid of a debt proved under the bankruptcy, the creditor shall file a statement, verified by affidavit, showing the dividend paid under "the bankruptcy, the balance remaining unpaid, and the property against which he seeks to enforce payment, and that "such property is the property of the bankrupt, and the regis"trar shall thereupon appoint a time and place for the hearing "of the application and direct notice of the time and place appointed for the hearing, according to the form in the schedule, to be served by an officer or a bailiff of the Court, personally on the bankrupt, or at his usual or last known place of residence or business."-" The Bankruptcy Rules, 1870," r. 183. 66 66 66 "At the hearing of the application service of the notice on "the bankrupt shall be proved, unless he appears, and the "Court if it think fit may refuse the application, or adjourn "the hearing to some other day, and in such latter case shall "direct the creditor to cause a notice to be gazetted and "inserted in one local paper, seven days before the day to "which the hearing is adjourned, according to the form in the "schedule."-" The Bankruptcy Rules, 1870," r. 184. "At the adjourned hearing the creditor shall produce a copy "of the Gazette and of the paper in which the notice was "published, and the Court may then hear all persons claiming "to be creditors of the debtor before or since the close of the bankruptcy, and make such order in the matter as it thinks "fit, or adjourn the hearing for further evidence."-" The Bankruptcy Rules, 1870," r. 185. 66 A form of notice in Gazette that a creditor seeks to enforce |