Page images

his warrant to the Clerk of the Crown to make out a new writ for prima facie is that he does, and it may be that it is very difficult electing a member in the room of any member of the House who in most cases to prove the contrary; but this is not the same shall happen to die during the recess, “ as soon as he shall receive thing as deciding as matter of law that where the landlord lives in notice, by a certificate under the hands of two members of the the house the sub-tenant must necessarily be a lodger and can House of Commons, of the death of such member.” “ The certifi- never be a householder. It does seem to us to involve a certain cate,” it is added, “ may be in the form or to the effect comprised absurdity to say that, if a person rents rooms in a house of which in the schedule” annexed to the Act. This certificate purports to his occupation is precisely the same in either case, his qualificacertify that the deceased member died on the day of - tion depends on the mere question whether the rest of the house It seems, upon the construction of this Act, that although the form is retained by the landlord, or let off to another person. Assume need not be strictly adhered to, and the exact day of death need that in the one case the landlord never in any way does anything not be certified, yet something approaching to a legal certainty of of any sort other than the co-tenant of the other part of the the fact of death before the date of the certificate would have to house does in the other case, why should the occupation be that be arrived at, and that the Speaker has no discretion to go behind of a mere ledger in the one case and of a householder in the the certificate. The writ, therefore, can hardly be expected to other? We shall look with interest for the appearance of the issue until Parliament is in session, when, not the evidence required legal reports of these cases to see how far a solution of this by the Act, but reasonable certainty, would be sufficient.

question is given.

THE COURT OF APPEAL has reversed the decision of DENMAN IT WILL BE SEEN from a case of Copp v. Lynch and the Law Life and BOWEN, JJ., in two of the recently decided cases with regard Assurance Company, which is reported in another column, that the to the much-vexed question when the occupier of a room in a question whether, where the relationship of solicitor and client dwelling-house can, for the purposes of the parliamentary exists, the solicitor can legally take a commission from an insufranchise, be considered to be the occupier of a dwelling-house. rance office on a policy effected in the course of the business in It is extremely difficult to say what the effect of the decision of the which he is employed, is likely shortly to come before the High Court of Appeal is until it is exactly reported in the regular law Court. reports. We observe that very off-hand opinions are expressed in the reports and articles in the daily papers as to the effect of the judgment, some of which opinions seem to us of doubtful

THE ARBITRARY DISCRETION OF THE accuracy. It does not appear to us, so far as we can judge, that the court above differed from the court below so much on any

COURT UNDER THE CONVEYANCING distinct question of law, or on the construction of the statutes, as ACT. on the inference of mixed law and fact to be drawn from certain statements in the two cases the judgment in which was reversed,

At the present day two causes are at work to obliterate the as to the character of the occupation. We understand that, in

distinction, which was formerly so strongly marked, between both these cases, there were statements from which the Court of

English judges and virtuous Turkish cadis. One of them is the Appeal gathered that the landlord of the house not only retained

increasing crop of statutes and the carelessness (often condemned part of the house in his occupation, but retained or exercised

by the judges themselves) with which they are too often drafted.

The other cause is the high and unsullied character of our some general control over the house as a whole. The court below appear to have thought, if we are not mistaken, that this general

judges, which has so effectually earned for them a deserved veneracontrol practically amounted to nothing. We have always contended

tion, that Parliament is more ready to thrust the responsibility of a that the Act of 1878 by no means amounted to an abolition of the

discretion upon them than they themselves are to assume it. The lodger franchise-a construction which appears to have been rashly

poor quality of the parliamentary grist makes it often necessary, contended for by some—and that it was a very nice question of

if any product of common-sense is to be evolved out of the halfmixed law and fact, depending on the circumstances of the particu

chaotic mass, that the judges of to-day shall permit themselves lar case, whether a man was a lodger or an inhabitant householder.

much greater liberty in dealing with the letter of the law than Both the court below and the Court of Appeal hold that a part of

would have commended itself to the judges almost of yesterday, a house not structurally severed may now be occupied as a house

Our purpose to-day is not to debate whether such changes are or as lodgings, and that it is a difficult question, depending on the

for good or for evil, but to point out that, partly through particular facts in each case, whether the character of the occupa

negligence and partly by design, they are taking place; and tion is such as to make the tenant a mere lodger or an independent

in particular, that a huge stride in this direction has been householder. It is obvious to anyone reading the report of the

taken by the Conveyancing Act. The public seems at present to judgment that the result of the decision of the Court of Appeal is

have a very imperfect apprehension of the vast increase in the not to be summarized in the reckless, rough and ready manner to

mere arbitrary discretion of the courts which that Act has effected. which have alluded. It is easy, of course, to suggest cases well

| The earliest example in the Act of this extension of arbitrary on each side of the line. It is now clear that if the landlord does

discretion is contained in section 5. not reside in the house or keep any servant in it to exercise con- «5.-(1.) Where land subject to any incumbrance, whether immediately trol, but lets off the whole house to different persons who exercise payable or not, is sold by the court, or out of court, the court may, if it the exclusive control over their respective rooms, except so far as

thinks fit, on the application of any party to the sale, director allow

payment into court, in case of an annual sum charged on the land, or of a the landlord may retain control for the purposes of repairs, the

capital sum charged on a determinable interest in the land, of such amount as, occupiers of the different rooms will be householders. It is also when invested in Government securities, the court considers will be sufficient, clear that if the landlord retains part of the house which he by means of the dividends thereof, to keep down or otherwise provide for that occupies by himself and his servant, and retains the general con

charge, and in any other case of capital money charged on the land, of trol over the house as a whole, the sub-tenants are merely

the amount sufficient to meet the incumbrance and any interest due thereon ;

but in either case there shall also be paid into court such additional amount as lodgers. The question which the decision does not seem distinctly

the court considers will be sufficient to meet the contingency of furi her costs, to decide, so far as we can judge from the newspaper reports, expenses, and interest, and any other contingency, except depreciation of is whether or no the fact of the landlord's retaining part of the investments, not exceeding one-tenth part of the original amount to be paid in, house necessarily involves that the sub-tenant is a lodger—whether

unless the court for special reason think fit to require a larger additional

amount. there cannot be an occupation of part of a house by some other

“(2.) Thereupon the court may, if it thinks fit, and either after or without person than the landlord as a householder, if the landlord lives any notice to the incumbrancer, as the court thinks fit, deolare the land to be in the house. Some of the comments on the recent decisions freed from the incumbrance, and make any order for conveyance, or vesting very dogmatically assert that they decide this point. We feel

order, proper for giving effect to the tale, and give directions for the retention doubtful whether they do altogether decide it. Practically

and the investment of the money in court.” speaking, it may, as a matter of fact, be almost universally the The gravity of this enactment hardly admits of exaggeration. case that when the landlord lives in the house he does exercise By section 2, sub-section (vii.), “ incumbrance includes a mortgeneral control over it as a whole; it may be that the inference gage in fee, or for a less estate." Section 69, sub-section (iü.),

enacts that “every application to the court shall, except where it at the beginning of the sub-section is singularly abrupt, being is otherwise expressed, be by summons at chambers." The section heralded only by a provision that no notice needs to be given. applies to ordinary sales as well as to sales by the court. We may The section applies (sub-section 4) to “ sales not completed at hope that general regulations will be made to put some restraint the commencement of this Act, and to sales thereafter made." upon powers so evidently liable to abuse. But as the matter now By this charming euphemism the inclusion within the Act of stands we see nothing to prevent any mortgagee of land from mortgages made before its commencement, in case of a subsequent being redeemed behind his back, by an order made by a chief sale of the mortgaged lands, is effectually secured. clerk at chambers, upon an ex parte application, at which no one. But the most astounding consequence of the section is one is obliged to be present except persons whose interests are adverse which was evidently neither desired nor foreseen by its authors. to that of the mortgagee, and whose interest it is to keep him in If it shall ever become the common practice to permit mortgagees the dark.

to be redeemed behind their backs, there will exist a means to The objectionable character of the section is enhanced by the prevent the consolidation of mortgages far more potent than the obscurity of those parts which, more than any others, needed to be tame proposals of section 17. Mortgagees will in vain seek to made clear. There is no obscurity about those parts which give | protect themselves by expressing “a contrary intention" in their the court power to permit a mortgagee to be redeemed behind his mortgage deeds: they will be liable to find that their mortgages back; but much obscurity hangs about the provisions which seem have been secretly redeemed in detail, without an opportunity of to have been designed to give him some protection under those even claiming to consolidate. This is “abolishing consolidation" circumstances. We find three phrases used to describe the with a vengeance ! incumbrances which the section contemplates; (i.), “ an annual The foregoing, if it is not the most sweeping example to be found sum charged on the land; (ii.), “a capital sum charged on a in the Act of the extension of the court's arbitrary discretion, determinable interest in the land"; and (ii.), “any other case of seems to offer the most dangerous prospect of abuse. It is also percapital money charged on the land." It is difficult to give any haps the most conspicuous example of the Act's interference with meaning to this distinction between “the land” and “ determin- rights of property which have hitherto been treated more respectable interest in the land," unless the former means an interest in fully by Parliament. Section 25, sub-section (2), is similar in the land which is not determinable ; that is, an estate in fee simple. character, but of much less significant scope. It extends the existThe first two kinds of incumbrance seem, upon this hypothesis, to ing practice under section 48 of the Chancery Procedure Act (15 & be respectively (i.), a rent charge (whether terminable or not) | 16 Vict. c. 86), whereby the court is enabled in foreclosure suits to issuing out of land held in fee simple subject thereto; and (ii.) make an order for the sale of the mortgaged property against the any principal sum charged by way of mortgage upon a less estate wish of the mortgagee. Under the present practice this cannot be than a fee simple, In both these cases the sum to be paid into done without the deposit in court of a reasonable sum for the court must be, in the opinion of the court, “ sufficient, by means of purpose of securing performance of the terms subject to which the the dividends thereof, to keep down or otherwise provide for " the sale is ordered to be made. Under the coming practice, such incumbrance. In the third case, which seems to include the case deposit is not obligatory, but lies wholly in the discretion of of a mortgage in fee simple, the protection given by the section is the court. One circumstance makes us view this provision much less adequate. Nothing is here said about the sufficiency of more favourably than those contained in section 5: there is the dividends : the Act speaks only of “the amount sufficient to nothing to show that, under section 25, the mortgagee can be meet the incumbrance and any interest due thereon"; together deprived of his rights in his absence ; for which section 5 makes with a further margin, which is not generally to exceed ten per express provision. This distinction is of great importance. cent. These expressions, “the amount” and “any interest due Section 25 in much of its language follows section 48 of the prethereon," seem most naturally to mean the bare amount of the vious Act; and we regret that the language (which admits easily principai, together with any interest which may be actually due of being improved) has in its new version become less clear than at the time when the order discharging the incumbrance is made ; | it was before. upon which latter point the court, in the absence of the creditor, The importance of the foregoing matters is certainly not will, it would seem, be forced to rely upon the evidence of the diminished by section 70. debtor. There seems at present to be no reason why, after the | “70.-(1.) An order of the court under any statutory or other jurisdiction commencement of the Act, any mortgagee in fee should not be shall not, as against a purchaser, be invalidated on the ground of want of jurisliable to the sudden discovery that his mortgage has been com- | diction, or of want of any concurrence, consent, notice, or service, whether the

purchaser has notice of any such want or not. muted behind his back for a sum of consols bearing interest at

“(2.) This section shall have effect with respect to any lease, sale, or other three per cent. In this respect mortgagees of leaseholds seem to

act under the authority of the court, and purporting to be in pursuance of the be placed in a safer position by the Act than mortgagees in fee | Settled Estates Act, 1877, notwithstanding the exception in section forty of simple.

that Act, or to be in pursuance of any former Act repealed by that Act, We find nothing in the section to indicate that the court has

notwithstanding any exception in such former Act.

“ (3.) This section applies to all orders made before or after the commencepower, out of the margin of (not exceeding) ten per cent., to

ment of this Act, except any order which bas before the commencement of this indemnify the unfortunate mortgagee for the sudden fall of his Act been set aside or determined to be invalid on any ground, and except any income to three per cent. upon his capital ; unless this was in- order as regards which an action or proceeding is at the commencement of this tended to be effected by the words, “such additional amount as Act pending for baving it set aside or determined to be invalid." the court considers will be sufficient to meet the contingency of We might inquire how an order “under any statutory or other further costs, expenses, and interest, and any other contingency.jurisdiction" can possibly be invalidated “ for want of jurisdicBut such a diminution of income would very improperly be styled | tion.” We do not profess to know. But there remain enough a “contingency"; and even granting that the last cited words can of other “wants” to give the section plenty of meaning. It by possibility bear this meaning, we think that such a point as this does not contain any saying in case the order shall have ought not to have been dealt with in so perfunctory a fashion. been obtained by fraud or collusion; for which section 5, in the

The last-mentioned point does not seem to be dealt with in the absence of stringent regulations not yet made, seems to offer next following sub-section.

tempting facilities. Indeed, it is no difficult thing for an unscru** (3.) After notice served on the persons interested in or entitled to the pulous and daring person to obtain an order by deceit; and the money or fund in court, the court may direct payment or transfer thereof to principal check upon the practice has hitherto been the fact that the persons entitled to receive or give a discharge for the same, and generally such orders do not at present bind absent parties, whose absence may give directions respecting the application or distribution of the capital or

is at the same time necessary to the success of the fraud. This iacome thereof."

obstacle seems now to be in great part removed, and the result There seems to be nothing here to give to any person a larger or remains to be seen. For though it may be hoped that, if an better title than he has without it; nor anything to enlarge the order should be obtained by fraud with the collusion of the purpower of the court to deal with the fund, unless such a meaning chaser, or even with his knowledge after the event, the court lurks in the words, “and generally may give directions," &c. (relying more upon its high moral tone than upon the letter of the But those vague words seem to be very inadequate to such a statute) would treat it as void, we feel no sufficient assurance purpose. We may also observe that the reference to “notice" that, if the purchaser had no notice of the fraud, the order would

be held to be void as against him. A striking career seems here to open itself to certain classes of our population.

THE TRUE GROUND OF PRESCRIPTION. We have already more than once expressed the opinion that the absolute discretion to relieve against the forfeiture of a lease for

The case of Angus v. Dalton (L. R. 6 App. 740) has found breach of covenant, given to the court by section 14, will turn its way into the legal reports, and we now, therefore, have an out to be much less to the public benefit than such a discretion

opportunity of perusing the very elaborate opinions of a great would have been if limited by moderate and clearly-defined rules. many judges and of the law lords themselves. A truly enormous If general conclusions may ever be safely drawn from the general

amount of learning has been lavished upon this case in all its facts of human nature, we may safely conclude (1) that in future stages. The case was one of great importance, no doubt, but some few tenants, who are not willing to surrender their holdings, will slight regret must, we think, be present to many that it should give up possession after incurring a forfeiture, without first be impossible to arrive at a conclusion on the matter by a sometrying their luck” in the court ; (2) that the frequent exercise

| what shorter route. It is obvious to anyone who regards many of of a very difficult discretionary power, unguided by any hint of a the great decisions of our ultimate tribunal from an external or rule in the Act, will lead to much conflict of opinion among the philosophical, rather than an internal and professional, point of courts of first instance as to what under different circumstances view, that, professing as they do all the while to be founded on constitutes a proper case for relief. These consequences will both the strictest adherence to precedent, the reason and expediency of tend to cause litigation which might, with great advantage to the

the thing have really been the governing considerations. The public, have been prevented.

effect of previous decisions and dicta depends entirely, or, at least, A similar objection lies against section 39, of which the inten. to a very great extent, on the point of view from which they are tion seems to us to be much more praiseworthy than the execu

approached. One finds constantly in judgments the most elabortion.

ate reviews of all the previous decisions when, all the while, one

cannot help suspecting that the legal authority who undergoes “39.-(1.) Notwithstanding that a married woman is restrained from anticipation, the court may, if it thinks fit, where it appears to the court to

this colossal labour has really previously made up his mind on the be for her benefit, by judgment or order, with her consent, bind her interest

| broad principle, of reason and expediency, and that had those in any property.

broad principles led his mind to the contrary conclusion, he would “(2.) This section applies only to judgments or orders made after the somehow have found the long chain of authorities susceptible of a commencement of this Act.”

very different construction. It is, to our mind, great matter for Here we are unfortunately in doubt as to the meaning which thankfulness that broad principles do govern. On the other hand, will ultimately be affixed to the vague word “bind." In our no doubt, the principle of adherence to authority is very importopinion it is properly adapted to indicate only the creation of a ant. One cannot, however, help being sometimes conscious of a valid charge. The learned authors of a highly-commendable slight regret that the loyalty and ostensible deference which are, text-book upon the Act seem to think that it is equally well (or no doubt, due by an English judge to the sanctity of precedent better) adapted to permit the complete alienation of the property. should sometimes entail such enormous labour both to judges and

Sub-section (2) exhibits a singular scrupulosity of precaution; / students of the law. which might perhaps with greater profit have spent itself in find We observed at the time when Angus v. Dalton was passing ing a clearer word than “bind” to express the meaning of through the courts below, that to whatever length the arguthe previous sub-section.

ments might be spun out, the real question was but a short Section 41 is another well-meant provision of the Act which one, and that it was which of two divergent principles prescripseems likely to prove a doubtful blessing.

tion really rests upon. These principles are not always clearly “41. - Where a person in his own right seised of or entitled to land for an formulated by the authorities, and the cases all along have, thereestate in fee simple, or for any leasehold interest at a rent, is an infant, the fore, presented somewhat conflicting views of the subject. One land shall be deemed to be a settled estate within the Settled Estates Act,

ground upon which prescription has been rested is long enjoyment 1877.

simpliciter. The other is long hostile enjoyment. The differences Anyone who is familiar with the Settled Estates Act will be between the two are considerable. There is a formal and a subaware that it is so thoroughly permeated (as would be expected stantial difference. The difference in form is this : in former times from its title and subject-matter) with constant references to the there has always been a disposition to rest principles on the legal machinery of a settlement, that this mere bald and unqualified fiction of a supposed grant, express or implied. The reason is intrusion into it of unsettled estates cannot fail to give rise to obvious : judge-made law naturally seeks the aid of such fictions many questions and much consequent litigation. The disabilities to mask its really arbitrary nature. For a judge, of himself, to which arise from ownership of a limited interest are by no means say, that after such a period of enjoyment there shall be a right, is identical with the disability of an absolute owner arising from or seems, a greater stretch than for him to say, such a period of infancy. Common sense suggests that a scheme devised to meet enjoyment leads me to think that there must have been a grant of the former case can hardly be well adapted to meet the latter. We this right. When the period of prescription went back a very have no space for a detailed exposition of the numerous hitches long way, it really was not so very violent à presumption that there which may be expected to occur. But some doubt may be felt originally had been a grant. It is not until the period of prescripwhether section 41 will have any operation, unless the court is tion comes to be shortened to twenty years, which, by various willing by virtue of it to assume a plenary authority to act on the devices, such as the doctrine of lost grant, it subsequently was, infant's behalf, unfettered by any conditions whatever, in such that it gradually becomes obvious that the presumption of a grant way as it judges to be most for the infant's advantage.

is very violent and artificial. It is obvious that the preSuch are the principal extensions, so far as the Act's designed sumption of a grant much more easily arises from hostile enjoyoperation is concerned, of the arbitrary discretion of the court. ment-i.e., from enjoyment which, in the absence of a grant, Some of them appear to us to be such as ought not to have been would have been an actionable wrong—than from enjoyment which committed to any assembly or body of persons whatever; and our was no wrong. best hope in regard to these is, that the superior wisdom of the

The substantial distinction between the two grounds of precourt will forbid them ever to be practically exercised. In

scription is not a slight one. When a person who might have regard to some others we think that the shape in which they have

| asserted his rights by legal proceedings, has slept upon them for found expression is so unfortunately designed, that they are likely

years and acquiesced in his neighbour's encroachments, his laches on the whole to do more harm than good.

may not unnaturally be held to give his neighbour a title against him. It is obvious that it would be unjust to allow him suddenly, after a great interval, to turn round and assert his dormant right.

On the other hand, there is some hardship in establishing a preWe have received several excellent diaries from Messrg. Partridge & Cooper-convenient, well arranged, and printed on good paper.

scriptive title against a person simply because he has not inter

The Diary and Call Book for 1882 is a very cheap and useful work. Messrs.

rupted his neighbour's lawful enjoyment of his own. These two Lette, Son, & Co. also send some specimens of diaries, of wbich the Rough somewhat different grounds of prescription seem to have coDiary or Scribbling Journal is a very good specimen of a quarto diary. existed to a great extent in the history of the decisions on the subject, and the issue between them never seems to have been the narrower view of the ground of prescription as being fairly joined until this recent case of Angus v. Dalton. The acquiescence or consent, and therefore to think that prescription prescriptive right to light, no doubt, was a strong point in favour could not arise where the owner of the servient tenement could of the broader view of the true ground of prescription, but the not practically have interrupted the enjoyment. In the face of principle on which this right must rest never seems to have been these differences, it may possibly be open to some slight question laid down in general terms.

whether the broader view of the ground of prescription is It seems to us that the general effect of Angus v. Dalton is entirely established, but, having regard to the expressions of the nearly, if not quite, to establish that the true ground upon which | Lord Chancellor and Lord Blackburn, it would seem to be very prescription rests is that of enjoyment, without reference to the nearly clear that it is so. question whether that enjoyment is hostile in the sense of being The judgments in the House of Lords, though they treat fully actionable. In the case of affirmative easements, of course the of the question as to the character of the enjoyment from which a enjoyment must be hostile if not by agreement or license, and prescriptive right arises, do not deal very fully with the principle these of course will be à fortiori cases, but, on the principle of upon which, apart from the Prescription Act, enjoyment for a omne majus continet in se minus, it cannot be said that prescrip- period short of immemorial enjoyment gives a prescriptive right. tion depends on the hostile character of the enjoyment if the The Lord Chancellor, indeed, expresses an opinion that the easebroader principle be correct. The Lord Chancellor, in giving ment of support is within the Prescription Act, but apparently he judgment, says, “ The policy and purpose of the law upon which does not base his judgment on that opinion, saying that even if it both prescription and the presumptions that have supplied its place, were otherwise his decision would be the same. He states, howwhen length of possession has been less than immemorial, rest, ever, that he agrees with the views of Lush, J., in the Queen's would be defeated, or rendered very insecure, if exceptions to it Bench Division, and of the majority of the judges in the Court were admitted on such grounds as that a particular servitude capable of Appeal, and of the judges who attended in the House of Lords. of a legal origin is negative rather than positive, or that the The view of the majority in the Court of Appeal on this point inchoate enjoyment of it, before it has matured into a right, is would seem to be that it has become established by authority as not an actionable wrong; or that resistance to, or interruption of positive law that a lost grant must be presumed from twenty it may not be conveniently practicable, . . . it would not be years' user of the requisite character. The grant is, in one sense, reasonably consistent with the policy of the law in favour of a fiction, but it is not a fiction in the sense that any falsity is possessory titles that they should depend in each particular case now involved. It is only now another way of saying that the law upon the greater or less facility or difficulty, convenience or establishes the prescription after twenty years' enjoyment. inconvenience, of practically interrupting them. They can always be interrupted, and that without difficulty or inconvenience, when a man wishes, and finds it for his interest, to make such a use of his land as will have that effect. So long as it does not suit his purpose or his interest to do this, the law which allows a

BANKRUPTCY LAW REFORM. servitude to be established or enlarged by long and open

[COMMUNICATED.] enjoyment against one whose preponderating interest it has

IV. been to be passive during the whole time necessary for its acquisition, seems more reasonable and more consistent Clause 16 of the Government Bankruptcy Bill relates to proofs of debt, with public convenience and natural equity than one which and proposes to make several alterations in the existing practice. would enable him, at any distance of time (whenever his

any distance of time (whenever his Sub-clauses 1 and 2 are as follows :views of his own interest may have undergone a change), to

“ (1.) Every creditor shall send or deliver bis proof of debt as soon as may destroy the fruits of his neighbour's diligence, industry, and

be after the adjudication.

“(2.) The proof shall be sent or delivered to the official receiver or, if a expenditure. The law of ancient lights, as it stood before the

trustee has been appointed, to the trustee. Prescription Act, was a stronger example of the application of

The words “ as soon as may be after the adjudication" in sub-clause these principles, the easement in that case being more purely 1 a

ase being more, purely 1 appear unsatistactorily vague, and taken in conjunction with sub-clause negative.Lord Blackburn said, “I cannot agree that the only 7, which provides a limit of three months from the date of adjudication principle on which enjoyment could give the owner of property a for the admission of any proof, except under special circumstances, would prescriptive right over a neighbour's land exceeding what would make a very undesirable alteration in the present practice. Why should of common right, belong to the owner of that property, was

a creditor be compelled to put in his proof until a dividend is about to acquiescence on the part of the neighbour. Nor even that it is be declared ? No one is prejudiced by his not doing so, and there may the chief principle. In general, such enlarged rights are of such a

be many reasons why he may not be able to prove earlier, particularly if

| he be partly secured. This appears to be another change for change's nature that those over whose property they are enjoyed could, in

sake, and we feel sure that if enacted it will soon be found quite unwork. the beginning, have stopped them; and a failure to stop them is able, and its alteration back again to the present law would be asked for. evidence of acquiescence, and may afford a ground for finding that | Then, again, reference is made in the marginal note of the Bill to rules there was an actual assent, but that is in many, if not in all, cases 6777. Is it intended that those rules shall be entirely done away with ? a fiction, there is seldom a real assent. But no doubt a failure to If so, then there will be no provision as to clerks, &c., proving debts owing interrupt where there is power to do so may well be called laches, to their employers, or agents of corporate bodies, which will soon bring and it seems far less hard to say that for the public good, and for

down the complaints of commercial men. If, on the other hand, fresh the quieting of titles, enjoyment for a prescribed time shall bar

rules are to be prescribed on these points it might be so stated. The

introduction of the words “in manner prescribed " would probably be the true owner when the true owner has been guilty of laches,

sufficient for that purpose. than to say that for the public good the true owner shall lose his Sub-clause 2 is practically the same as the present law, “official rights if he has not exercised them during the prescribed period, receiver" being substituted for “registrar.” whether there be laches or not; but there is not much hardship. Pre-! « Sub-clause (3). The official receiver and trustee shall respectively have sumably such rights, if not exercised, are not of much value, and power to accept or reject proofs subject to appeal to the court.” though sometimes they are, ad ea que frequentius accidunt jura This is practically an amalgamation of section 25, sub-section 1, of the adaptantur. This ground of acquiescence or laches is often spoken Act of 1869, and rule 70,“ official receiver" being again substituted for of as if it was the only ground on which prescription was or could "registrar.” We think it highly objectionable for an official receiver to be founded. But I think the weight of authority, both in this have the power to accept or reject proofs prior to the appointment of a country and in other systems of jurisprudence, shows that the trustee, so as to prejudice the investigation which a trustee will afterprinciple on which prescription is founded is more extensive." | wards, when appointed, have to make into each claim. Power might,

however, very properly be given to the official receiver to advise the first These passages from the judgments of the Lord Chancellor and Lord

meeting as to proofs presented prior thereto, or at the meeting, or to Blackburn seem to establish the broader ground as the true ground of

object to them (or allow any creditor to do so), for the purpose of prescription. Lord Watson's judgment is short, and is based chiefly | voting. on the authorities. Lord Penzance also appears to have thought

"Sub-clause (4). A creditor may, with the leave of the official receiver or the matter concluded by authority, though inclined, if the matter trustee amend the proof, and thereupon shall be entitled to be paid out of any had been res integra, and to be determined on principle, to take monry for the time being available for dividend any dividend or share of dividend he may have failed to receive by reason of the inaccuracy of bis L " Clause 17.--A creditor shall not vote in respeot of any debt on, or original proof, before that money is made applicable to the payment of any secured by, a current bill of exchange or promissory note held by him, unless future dividend, but he shall not be entitled to disturb the distribution of any he is willing to treat the liability to him thereon of every person other than dividend declared before the date of the amendment."

the debtor as a security in his hands, and to estimate the value thereof, and

deduct it from his proof, in which cage he shall, on application within the It seems only reasonable that a creditor should have liberty to amend

prescribed time by any person interested, give up the security for the benefit his proof if unintentionally any inaccuracy should have crept into the

of the bankrupt's creditors on payment of the value 80 estimated. Provided proof as originally drawi), so that no one is to be prejudiced thereby.

that this estimate shall not, except as far as the creditor receives any such But this sub-clause proposes to give the power to allow or refuse such payment as aforesaid in respect thereof, prejudice the right of the creditor to an amendment absolutely into the hands of the official receiver or trustee receive from the bankrupt's estate & dividend on the whole amount of the (subject to the limit proposed by sub-clause 7). We think, in case of debt." their refusing to allow such an amendment, an appeal to the court should

No distinction is made by this clause between the case of an indorsee be allowed. Trustees appointed by creditors may be apt to abuse this

of a bill of exchange, upon which the debtor upon whose estate the power, and it appears very desirable that creditors should not be placed

proof is to be made is primarily liable as acceptor, there being tho absolutely at their mercy on a point of this kind. Further, is it intended that the official receiver shall have this power collaterally with a trustee,

drawer and perhaps one or two indorsers of the bill also liable to the

holder, and an indorsee of a current bill of exchange seeking to prove or only when a trustee has not been appointed, or has ceased to act ? |

upon the estate of the indorser thereof to him, there being, perhaps, a We presume the latter, but a literal construction of the words would give

solvent acceptor and drawer also liable upon the bill of exchange. We him the power in the former case also, which would be highly objection

should presume that the clause was meant to apply only to the latter able.

case, but, as drawn, it would undoubtedly also embrace the former, which "Sub-clause (5). A secured creditor shall state in his proof the particulars

would be very objectionable, though the other might be advisable. Our of bis security, and the value at which he estimates it, and shall be deemed to be

remarks upon the words “any person interested ” in sub-clause 6 of a creditor only in respect of the balance due to him after deducting the value

clause 16 will also apply to the same words in this clause. The proviso 80 estimated.”

at the end of the clause, we think, would be greatly improved by the The words “unless he shall have previously realized his security" | omission of the words, “ except as far as the creditor receives any such ought, we think, to be inserted between the words “ creditor" and payment as aforesaid in respect thereof," ard the substitution of the “shall,” in the first line of this sub-clause, as they appear in rule 99 of following words at the conclusion :-"But so that he shall not receive the Bankruptcy Rules, 1870. The chamber of commerce of a provincial from all sources more than the full amount of his debt.” The effect of city recommended thut this sub-clause should not apply to collateral the proviso, as drawn, is anything but clear to our mind, and may not be securities. The members of that body may set their minds at rest upon intended to mean more than the amendment we have suggested. If it this point, as, by section 16, sub-section 5, of the Act of 1869, a “ secured is intended to go further than our suggestion obviously would, then we creditor" is defined to mean " any creditor holding any mortgage, charge, think it objectionable, but if not, then there is all the greater reason why or lien on the bankrupt's estate or any part thereof as security for a debt it should be made clear. due to him.” So that a creditor holding only collateral securities is not Clause 18 relates to the much-vexed question of proxies. Thie quesa secured creditor within the meaning of that Act, or of this Bill, which tion and the limitation of the power of the appointees to vote has given was to be incorporated therewith,

rise to very considerable discussion. Our experience leads us to say, "Sub-clause (6). A secured creditor sball, on application made by any

without hesitation, that the abolition of proxies altogether (which some person interested within a prescribed time after the date of adjudication, and have advocated) is utterly impracticable, but that a considerable limitaon payment of the value of bis security as estimated in his original or amended tion in the use of them upon the present system is very desirable. This proof, give up his security to be dealt with as part of the property of the clause proposes to so limit them, and we will consider each proposal bankrupt for the benefit of the creditors."

separately under the head of each sub.clause. This and the last preceding sub-clause must be carefully com

“Sub-clause (1). Every proxy for the purpose of proceedings under a bank. pared with rules 99-101 of 1870. On the whole, we think the ruptcy petition shall be in a form issued by the official receiver, or, after the latter preferable, especially rule 101, which inflicts a penalty upon a | appointment of a trustee, by the trustee and stamped as such.' creditor who, in his proof, over-estimates the value of his security-viz., that he cannot afterwards increase his proof-which is not contained in

We cannot see what protection this will be, but, on the contrary, it the sub-clauses under discussion, leaving the trustee in bis absolute dis

will only give unnecessary trouble to creditors, unless it be also provided cretion (sub-clause 4) to allow or refuse to allow a creditor to amend

that the official receiver or trustee shall send a form of proxy to each his proof in such a case ; subject, however, to the restriction as to time

creditor along with the notice convenivg the meeting. Then what is the contained in the next sub-clause. Then, again, it is proposed to give

meaning of the expression “stamped as such"? Does it mean that an “any person interested” a right to take up the security at its assessed

Inland Revenue or Bankruptcy stamp of a certain prescribed value shall value for the benefit of the estate instead of the trustee only, as by rule 100.

be affixed by the official receiver or trustee ? If so, who is to bear the We presume it is intended that in the event of a person other than the

cost? Or should the word "stamped” read “sealed”? And if so, with trustee taking up such a security, the risk of such security turning out to

| what is it to be sealed-with the seal of the court or with some seal to be of less value, and the loss that would thereby arise, would have to be

be provided by the official receiver or trustee ? borne by such person. And, on the other hand, we presume it is intended "Sub-clause (2). A proxy shall not be available except for the pur. that such person should be entitled to be recouped out of the proceeds of pose of voting at a specified meeting, or at any adjournment thereof." the security the moneys he would have to advance in order to take it up.

This limitation is very desirable, but at the same time it will not preBut the sub-clause leaves this to be inferred only, which is very objec

vent a cr editor from appointing by power of attorney any person to do tionable, and we think the position of such a person ought to be more

all acts in the bankruptcy in the same way as the creditor himself could clearly defined.

do. This is a power given by the common law outside of any Bankruptcy "Sub-clanse (7). No proof sball be admitted or amended after the ex. Act, and we do not think it can advisedly be done away with. It piration of three months from the date of the adjudication, except under frequently happens that gentlemen in business go abroad (perhaps on special circumstances approved by the court as sufficient to justify the business or for the benefit of their health, or merely for pleasure delay."

seeking) for many months together, leaving general powers of attorney We have referred to this sub-clause in our comments upon sub-clause in the hands of their managers, and it would not be advisable to curtail 1. The proposition is a complete innovation in the law and practice of this power. But it leaves open a way by which, at the cost of ten shillings bankruptcy, and, in our opinion, a very mistaken one. Then, again, the (being the stamp required on a power of attorney), the provision in this intention of the latter portion of the sub-clause is not very clear so far sub-clause may be entirely evaded. Probably a provision that no person as it affects the allowance of an amendment. If a creditor is only to be shall be allowed to vote as the attorney for a creditor under any general allowed to amend his proof with the leave of the official receiver or power of attorney unless the attorney be a person in the usual and trustee (sub-clause 4), and they decline to give such permission, we pre- | bona fide employment of the creditor would meet this difficulty. sume that the creditor could not apply to the court under this sub-clause. “Sub-clause (3). No more than one form of proxy shall be issued to the It would seem, therefore, only to apply to cases where the official same oreditor for the same meeting." receiver or trustee is willing to allow the amendment, but is debarred on account of the lapse of time. We think this altogether an unnecessary

What is the object of this? Does it mean that if a creditor should hampering of a trustee's discretion.

inadvertently lose or destroy his form of proxy that he should not be

If the trustee is willing to allow the amendment, it is not likely that any court will refuse its sanction,

entitled to another? If so, it is decidedly too arbitrary, and provision

should be made for such a case. and the necessity of such application will only be to cause useless expense. It ought to be the aim of the bankruptcy laws to afford

“Sab-clause (4). A person shall not be appointed as proxy for a creditor creditors facilities to prove their debts and not to throw obstacles in their

if he is solicitor for the bapkrnpt, or a partner with, or a person in the em. way.

ployment of, the bankrupt's solicitor." Clause 17 proposes to place certain restrictions on the rights of voting The proposal contained in this sub-clause has been hailed in some by holders of bills of exchange and promissory notes. It is as very short-sighted quarters as the grand panacea which is at once to set follows:

right the whole machinery of the bankruptcy laws. To us it appears to

« PreviousContinue »