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The Legal Observer.


- Quod magis ad nos
Pertinet, et nescire malum est, agitamus."


PARLIAMENTARY DEBATES RE. i expense of all this. Attorneys and counsel LATING TO THE LAW.

must be employed. The attorney must rigidly | inquire ; that enquiry will be opposed ; and I

have consulted a respectable solicitor on the IMPRISONMENT FOR DEBT BILL.

subject, and he informs me, that before these Mr. Richards said :-A wrong impression proceedings could be terminated, the whole has gone before the public with respect to expenses on both sides might be calculated at what passed on a foriner evening, on the 2001. or 3001., or in some cases as much as occasion of the second reading of this bill. 4001., for the chance of recovering a debt of The Attorney General, in bringing forward 501. The creditor, after having had held out this measure, is not only bound to shew that to him at this time the vain and delusive hope imprisonment for debt" is an evil, per se, but of recovering his debt, and having been dehe is also bound to shew that his measure will feated by his debtor, having nothing left to pay remedy that evil. Has he done this? I con. | with, would be left without any sort of redress, tend that he has not. He has not even thought and would not only lose his original debt of it necessary to explain these enactments. 501., but would be out of pocket from 1001. to

It is well known that the creditor has, by 2001. in expenses. But the Attorney General the law as it stands at present, the power of says, the judgment creditor has still the power, arrest; and it is generally admitted, that if the debtor happen to have any, of coming if the debtor be not insolvent, in ninety-nine upon his estate. This is very true ;-but he cases out of a hundred, he pays the money would first have to search out whether any rather than go to prison. The learned judgment was already on that estate. This gentleman takes away the power of arrest, would be another expense, and probably, with and proposes as an equivalent, that, in the same result. But the learned gentleman debts under 1001., the creditor shall bring provides that the judgment creditor may take his action, and if he gets judgment, he is the book debts of the debtor ; and if these then to be in the situation of a judgment book-debtors refuse to pay, (which they procreditor. But it must be remembered, that bably would) he has the power to proceed from four to twelve months, according as against them in the same way, and with every the action is defended, will elapse before probability (as any assistance in the way of he gets judgment; during which the debtor intormation from the debtor would be out of may, if he is so minded, dispose of all the question) of finding in each instance a his effects. Under this bill, then, the judg- verdict given against him, and thus would he ment creditor will, after obtaining judgment, be saddler, not only with the enormous costs have to apply for the debtor to give in a sche- I have already mentioned, but with the whole dule of his effects. Now, as the law stands, costs of these proceedings in addition. And execution can issue immediately after judg- this is the sort of boon which the Attorney ment, either against the body or goods; but General bestows on the commercial world. the learned gentleman takes away the right of But this is not all. If the clause of which execution against the body, and gives as an the Attorney General has given notice to folequivalent this schedule. If the judgment low the 17th should pass into a law, another creditor supposes the schedule is incorrect, he gross injustice would be done to the 501, crehas the power of applying to a commissioner ditor. In that clause, the Attorney General to examine the debtor upon oath. If that ex- proposes, that where a man is a creditor for amination is not considered satisfactory, the 1001., he shall have the power, unless his debt commissioner has then the power of commit- be paid within twenty-one days, or the debtor ting the debtor to prison. But, look at the can give approved security (for which he will

VOL. XIV.-No. 411.


Parliamentary Debates relating to the Law.

have to ofier two sureties) of making the debt-now merely say, that to this 12th clause, I or a bankrupt on the 22d day. Now, it is give a decided negative, and I move that it be evident, that in all cases where the 1001. crestruck out of the bill. ditor possesses this power, he will exercise it, Sir F. Pollock.-I am anxious to call the atif he thinks that he cannot get his money as tention of the compittee to the bearing of soon as he wants without it. But what would this clause. For my own part, I am not an be the result of clothing the creditor with this advocate for anything like an arrest for debt extraordinary power? It would lead infallibly except in extreine cases; and I am therefore to that abuse which the bankrupt laws are most decidedly in favour of abolishing imprisonment particular in guarding against-namely, the for debt, so far as is practicable. I must, giving of an undue preference to a particular however, admit that my learned friend oppocreditor. But the Attorney General from his site, has not carried out the recommendations desire to conciliate some great men in the city, of the Common Law Commissioners in this gives the 100%. creditor this monstrous power particular, and I really cannot go along with of making his deblor bankrupt, if his own in-him in agreeing with the policy of this clause. dividual debt be not paid within three weeks. According to the report of the commission of “ Well, but,” the Attorney General may say, which I had the honour to be one, it was re“ supposing the debtor to be made a bankrupt commended that every facility should be given by the 1001. (reditor, the 501. creditor will to make the property of the debtor available come in for his share of the estate, as well as to his creditors. I must also say that the de. the inan who makes the bankrupt.” This will tails of some of the clauses of this bill, do not be very true, if matters come to bankruptcy; contain sufficient machinery to carry this obbut of course this will be the very thing which ject into effect. Any man not arrested for the debtor would wish to avoid, and in 99 debt, and against whom a judgment has been cases out of 100, where there are any effects, the obtained, fiuding himself without the means of debtor will, at any loss, pay the 10011. creditor paying his creditor in full, may, as the law his debt in order to avoid the Gazette, while the now stands, go to prison and petition the In501. creditor, at the end of two or three years solvent Debtors' Court. It is in his power, of litigation, will be left without recovering a when pressed by an arrest, or by a demand for farthing of the money owing to bim, and greatly the payment of a judgment debt, to make a out of pocket by the expenses of prosecuting cessio bonorum for the benefit of his creditors. his claim. Why should more indulgence be it is iny opinion that the debtor, without going given to the great than to the small creditor? to prison, ought to have the opportunity of

Again, it is provided, that if a man wakes affi- dividing his property amongst his creditors davit that such and such a person, being a tra- fairly, but that ought to be followed by a der, is indebted to him in the sum of 1001., then clear and undoubted discharge from his liaunless the money be paid within twenty-one bilities, so that he may not be harassed again. days, or the trader find two sufficient sureties Now, this clause makes the same provision for the payment of the debt and costs, he is to for one single judgment creditor, which the be declared a bankrupt. I believe it was So- law has never created before, except for the lomon who said, “ Be surety for no man.” | purpose of dividing the debtor's property Suppose any man—and I think few men will among all his creditors, and giving the debtor be found willing to become surety-(not for himself a release from the engagements which the surrender of the debtor, as it is at present, he has contracted. If a person of large probut for the payment of the whole debt and perty should be sued for a judgment debt, anil costs) were to make an affidavit, that an hono- the debt be not instantly paid, by this clause, rable member of this house owed him 10,0007, not all his creditors, but one individual creand that honorable member were a trader; he ditor, may call upon him for a schedule of promight be worth 30,0001., and yet be unable to perty sufficient to satisfy that particular judgpay 10,0001. within twenty-one days, or sind inent, but he can call upon him to disclose all sureties for so large an ainount,-he would his concerns; and if the debtor, on his examinthen be made a baukrupt on an affidavit. This ation, do not fully satisfy the commissioner, he is what must be the inevitable result of the 18th can be brought before a Judge, and sent to clause, if it become law. With regard to the prison till he satisfy the Judge. Now, I do clause at present before the cominittee, I feel not see the great allvantage of this course; sure that the 501. creditor would rather waive but I see a very great disadvantage in inaking his debt than attempt to recover it by proceed. every creditor of the party, the investigator ings so expensive and tedious as those which of the debtor's concerns, toties quoties. Every the clause prescribes, Yet this is the measure timne a judgment debt is obtained, while the on which the Attorney General so much debtor, except in the case of that particular plumes himself, and for which he expects to creditor obtaining any discharge from his liaget the thanks of the mercantile community. bilities, has to make out a new schedule ; for I should also further observe that this 12th the one will not do for two creditors every clause, excepi so far as the 18th clause restores tinie. Constant complaints are at present tlern, repeals the whole of the bankrupt laws; made; thus the proceedings under a commiswhile the fraudulent debtor, by the aid of the sion of bankruptcy are unnecessarily severe and 6th, 71, and 8th sections, will be able to con- iuquisitorial; and in the Insolvent Debtors' cert measures by which he will give an unfair Court the case is the same, and there the preference to one creditor over others. I shall | debtor is liable to be remanded time after

Purliamentary Debates relating to the Law.


time, if the schedule is not satisfactory to the sions of bankruptcy; and sometimes they even commissioners : but he has still this advantage, realize a surplus. By this clause it is prowhich this proposed measure takes away :- posed to give the power of enforcing a disclonamely, that if he is called upon to give an sure of all a debtor's property ; by some anteaccount of his effects, he is also to give an aç cedent clauses the sheriff is empowered to seize count of his creditors, and from whom, under and assign all the property to a debtor. Supcertain restrictions, he is discharged. The pose, then, a man to have a debtor for 5001.. system of forcing a debtor to make a complete and that debtor to be found insolvent; thé discovery of his property by sending him to creditor will get his judgment,-he will get prison if he give dissatifaction, and keeping his assignment-he will try to pay hinsell--hin there until the Judge is satisfied, ought at he will turn every thing he can into moneyleast to be followed by some corresponding ad- he will sell reversions, remainders, and intervantage to him ; but he will not, as the clause esis of all kinds, regardless of the imprudence now stands, be in as good a position as either of selling them at unfavourable periods ; carethe insolvent debtor or a bankrupt under the less whether one farthing will remain for other present law'; and after successive examinations creditors, or for the debtor himself, and intent by separate judgment creditors-after he has solely on making up his 5001., and the costs been stripped of every farthing, he will be in- of recovering it. This is not the case now, capable of obtaining fresh credit, if an act of or, if it were, it would be hove the Attorney parliament do not give him relief from his lia-General to meet it-it is the duty of the House bilities.

of Lords to look into it, and if such an error The Attorney General may perhaps object do now exist, to cure, not to copy it. Insol10 a cessio bonorum, and has consequently vent cases I know, are rarely worth pursuing. adopted this plan instead of it; but I must ob- | The insolvent commissioners on their circuits ject to it as being extremely harsh and se- only empty the gaols without benefit to the vere, and contrary to the principles of the creditors; but that is not the case in banklaw of England; and I really am astonished ruptcies, when once it is thought worth while that my learned friend should think of giving to issue a fiat. That system may not be perto a single judgment creditor the whole power fect, but it is much better than one wbich will of bankruptcy and insolvency to enable him to admit the creditors to come in separately. get his debt paid, and yet afford to the debtor Now, the proceeding itself under the cause. no relief. My learned friend said he wished when called for, will be nugatory. I cannot to abolish imprisonment for debt; but under see what difference there is between the war. this clause, where is the difference between rant of a commissioner, and the writ of a shethe present and the proposed law? Where riff, by which the former can compel a debtor. is the difference to the debtor whether he goes unwilling to disclose, to make a disclosure to gaol on a commissioner's warrant, or a she- under the threat of doing no more than the rid's writ? Is there any magic in the former latter, namely, sending him to prison. If the which will infuse a greater share of candour object be to give power to the commissioner. into the breast of a debtor? If a debtor wishes you should give him the power of protecting to defer paying his debts, what will be do? the debtor,-you should do so by enabling He will say, “You ask me for a schedule.-I him to make the debtor do justice to all Can shall not give it you.” He will then be taken it be expected that the debtor will obey the b.•fere the commissioner, who will ask him, command to disclose for the benefit of one “Will you make a disclosure of your pro- creditor only? No, he will rather declare his perty ?“No.” “And why not?” “Be- intention to go to gaol- he will refuse to be cause it would ruin me. If I go to prison for a party to the fraudulent preference against three or four months, I shall be able to pay all the other creditors proposed to him. my creditors, and have enough for myself ; ! I have had the honor of being a member of but if I make a disclosure of my concerns now, the Common Law Commission; I joined in you will seize all iny effects, and sell them in the recommendations of that commission: I such a manner as will be my ruin." Now, now see no reason to deviate from those rcthen, are you prepared to give the judgment commendations ; but those recommendations creditor this power, and yet not extend the have since been accompanied by no practical slightest relief to the debtor, as something details. I want to see the machinery by which thrown into the other scale? A man who those recommendations are to be carried into avails himself of the bankrupt and insolvent practice. I agree with my honourable friend acts, knows that he delivers up his assets to the Attorney General, that it is expedient to all his creditors; he knows, therefore, in the limit imprisonnent for debt. I am aware that first place, that all his creditors have a com- in so doing, a saving would be made to the mon interest,-generally so at least (cases of community in the expenses of abortive suits. fraudulent preference certainly occur some useless and harassing proceedings, annountino times); and then he knows, in the second to between 250,0001. and 300,0001. I am de place, that the assignees can have no interest sirous of seeing the principle carried out; but. to squander and throw away his property, but because I believe that it will confer no more that they will make the most of it, and try to benefit to the debtor than he possesses now, get twenty shillings in the pound for all. They because I think it will not operate with greater may not succeed in doing so in cases of insol. terror on the debtor than the provisions of the vency, but they often do in working commis- present law,-because I think it will give an 236

Parliamentary Debates relating to the Law.

an undue preference to one creditor over an- of cessio bonorum is not more extensively inother, I shall decidedly, as far as I am con- Iroduced in the scheine and application of this cerned, negative the proposition that this bill. In the former bill it was so—with reclause stand part of the bill. I never will sup. spect to all persons whether in trade or not. port a measure for calling in all the property I am still far fron saying, that such an exten. of a debtor, at whatever risk, for the benefit of sion of that system may not prove ultimately any other than the whole of his creditors. beneficial. But it is, at the same time, a very

The Allorney General.-I greatly rejoice to large remedy. Too much, perhaps, was atlearn that my honourable and learned friend's tempted to be effected under the former bill. opinion as to the expediency of introducing I found that it attempted inore than I could this bill, remains unchanged. We have now induce others to concur in. I have found it the authority, the high authority, of Sir Fred- | better to proceed by degrees, and more cauerick Pollock, that it is expedient to do away | tiously. The person of the debtor is prowith arrest on mesne process. My learned tected, I repeat, unless where fraud has been friend agrees that the creditor should be in attempted, or is strongly surmised. But my vested with a more direct remedy against the honourable and learned friends say, “Is it not property of the debtor ; and not disapproving very cruel, that under this bill the debtor is of the previous clauses that put within the not discharged?” Let me, however, remind reach of judgments, property and interests them that in every case a man may be arrested, that were formerly beyond thein, he objects to a fiat be sued out, his property be equally disthe 12th clause. But it must be obvious that tributed among all his creditors, and he begins the new remedies would be, in practice, use the world de novo, under the present law. I less, but for the powers under the 12th clause. contend that, under the old law, there is no To give this remedy, however, against the substitute for this efficient power over the property, would come to nothing, unless you creditor. In the former bill, the substitute for could compel the debtor to declare what his the compulsion upon him to undergo impri. property was. It would be in vain to say that sonment was not well detailed. The clause vou might go upon his property that is in set- to which the member for Knaresborough has tlements, or the funds, or other property of referred, I introduced, at the suggestion of that description, unless you can compel the a most respectable deputation, which did me debtor to disclose what that property is. It is the honour to wait upon me on the subject of merely to enable the creditor to compel this this bill, consisting of several directors of the disclosure, that this 12th clause is drawn. It Bank of England, with the governor at their is auxillary to the other clauses. A power head. An act of bankruptcy, according to is given to call within three weeks, on the that clause, may be compromised by a man debtor, to declare what is the nature and who is really insolvent. By that clause, the amount of such property, so that it may be advantages of such an act will be secured to transferred for the benefit of the creditor. any party, being a trader, who, having had It must, in all cases, be a debt expressed be final judgment signed against him, “shall tween the time his judgment was obtained, not, within twenty-one days after demand in and the delivery of the schedule. Under the writing, personally served upon bim, pay, sepresent law, the moment you can snap up a cure, or compound for such judgment debt to judgment, you may sue out a writ against the the satisfaction of such judgment creditor." debtor, of capins ad satisfaciendum, and incar- | The honourable member for Knaresborough cerate him. Yet iny learned friend says that, says, that it might be the case of only a temnow, because the debtor is not clapped up in a porary embarrassment; as if a man owed 1001. gaol, and this process is substituted for the upon a bond which he had given, and that this present bill, they think it a hardship to require would not amount to an act of bankrnptcy. that the debtor shall give up a statement of his Now, if the honourable gentleman had con. property, and then be discharged! How this sulted my honourable and learned friend (Sir can be said, gravely, to be a hardship on the F. Pollock), he would have found that under debtor, is, what I own, I cannot understand. the present law, members of parliament are Now, here is a power of great importance. privileged from arrest; but, at present, they But, how very rarely under this bill, will it be may be compelled to commit an act of bankput in force! Only where the creditor has ruptcy, if, on demand, they do not satisfy a reason to suppose that the debtor has property, debt due from them within a certain lapse of which he conceals, will it be resorted to. But, time. The great end of a bankruptcy law then, it is said, that under this bill no protec-should be, to compel an equal distribution of tion is provided for the person of the debtor. I property among the creditors. The great I say there is just the same protection for the difficulty of our bankruptcy law is, to provide debtor, as there is at present, when the debtor a test to prove that a man is bankrupt. But is discharged under the “ Insolvent Debtors this is a test ; namely, that if, after three weeks Act.” His person is protected, but his pro- have elapsed from the period of its being deperty remains liable. So, under this bill,-his manded, a man can neither pay a debt, nor person is protected, but it is only after giving give satisfaction for it, nor compromise with up any property that may be rendered available his creditor, there is reason to believe that he to the creditor, that that protection is ensured cannot meet his engagement, that he is not to him.

competent to manage his own affairs, and that My learned friend complains that the system his property should be put into the hands of

Parliamentary Debates relating to the Law.


trustees. I believe that this argument satisfied that fell from him. We are willing to make the deputation to which the honourable mem- this proposition to my learned friend, that ber for Knaresborough has alluded, and they there should be a clause or proviso introduced were satisfied that this clause will not prejudice into the bill, giving a party against whom the them. On the contrary, it will give them a proceeding by judgment has issued, and upon new remedy. It will give to creditors, gene. whom the notice under the 12th section has rally, a distinct remedy against debtors. It been served, the power of appealing to the will protect the persons of debtors, unless Insolvent Debtors' Court. If he will agree to those debtors be fraudulent debtors. I see no this, I have no objection to the clause. This hardship in calling on the debtor who cannot ! is a matter of immense importance, and all pay a just debt within one month, in requiring | legislation upon it should be governed by a him to give up his goods ; neither can I see constant reference to the state of the existing that this liability, in extent, exceeds the hard-law. Under this bill there will be three courts ship which he suffers under the existing law. established, and in operation against the un

Mr. Richards.-In reference to what the fortunate debtor. For, as the clause stands, Attorney General has been speaking of, the there will be first, the Insolvent Debtors' Court; clause allowing creditors whose debts amount because this court will not be abolished, but will to or are more than 1001., on their affidavit exist for the purposes of a class of creditors in that twenty one days have elapsed since their all cases of personal wrong, &c. The Bankrupt demand of such debts without the same having Code, applying to all persons engaged in trade; been satisfied, to make such debtor a bank and this special code, neither applying in one rupt; I beg to assure him, that I am perfectly way nor in the other, but endeavouring to get aware, that under the present bankruptcy law at a sort of tertium quid. The Attorney Genea man must have 1001. of debts against him in ral says that his bill leaves the debtor free from order to bring him within the operation of that the penalty of personal arrest: no doubt it law. But what I complain of is, that the left does ;-but he says also, that it leaves the handed justice of the Attorney General pro-debtor only where the existing Insolvent Act poses to give to the great monied leviathans would leave him. Under one of these sections, of the City a summary remedy, if the debts if one judgment creditor have sued, and then due to them (from any single creditor) amount a second, and then a third, another may come to more than 1001., as they generally do. If I and sweep away every thing, if he be in a cerwere speaking for my own especial interests tain position which the learned Attorney Geneand concernment, as the debts due to me are ral has thought proper to favor. Under the seldom less, this clause would answer very well. operation of the Insolvent Debtors' Act, if a But see how the clause operates with those person being a debtor, have been swept out of wbose debts are of a less amount. They have prison by an Insolvent Debtors' Act commis. been I must say, most unfaily dealt with. sion, the people of this country may, if they The creditor, whose debt happens to be under think fit, and deem bin worthy of that confi1001., must be driven to the tedious, the dence, give him credit. But why will they do troublesome, the desultory mode of proceeding so? Because there is a clause in the Insolvent provided by this bill. And what is the equal Debtors' Act which prevents your coming in benefit which the learned Attorney General upon him, except it be upon such a state of talks of, as compared with the remedy provided facts as that which is supposed by the clause under the existing law? At present, where I speak of. The new creditors say, “there is the creditor's debt is 1001., the mere threat not more in this estate than will pay us, and of an affidavit, will in most cases produce its we shall not touch him.” Well, Sir, and the immediate payment. But this clause, Sir, will Insolvent Debtors' Court will protect him. not effect any thing like equal distribution of But under this new code there is no such pro-' the debtor's property among the creditors. Itection. It may be too late to throw out this I do not wonder at that deputation from the suggestion, but, in my opinion, it would be Bank having waited upon the Attorney Gene-much better if the Attorney General would ral, if they thought it likely that he would be consolidate all his code of debtors' law induced to sanction such a clause. The clause together, and assimilate it to the new law of is not a remedial clause quodd the small debtor, bankruptcy. The Attorney General says, that but only quoàd the debtor above 1001. I do a man could be made a bankrupt under the net pretend to dispute the law of the Attorney | 12th section of this bill. Why, Sir, by making General, but I have consulted a gentleman a declaration of insolveney under the existing who is well skilled in Scotch Law, and he says, law, a man may protect himself and his goods; that arrest for debt still continues in Scotland and in this way a trader, if he consider it defor all debts above 81. 2s. My informant tells / sirable to do so, may either make himself a me, that the Scotch imprison for bills of ex. bankrupt or may procure others to make him change unpaid, and yet the Attorney General | so. But suppose he is not a trader, what actually boasts, that he has really assimilated becomes of the Attorney General's anxiety to the law of the two countries. Why, Sir, he improve the existing law of imprisonment for leaves the small debtor totally unprotected, debt. If you are sincere in your desire to and the great men or great capitalists, provided ameliorate it, let all the creditors of a debtor with an additional remedy.

have the benefit of this act. Let all the creditors Sir F. Pollock, -I am anxious to correct the in common-yes, and also the unfortunate Attorney General in one or two observations bankrupt or debtor himself,-derive some

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