bankrupts who escape imprisonment by the aid of the bankruptcy laws. If he has been guilty of no fraud and offers to give up all that he has, together with a reasonable proportion of his future earnings, what more should be required of him?

One great defect of the statute, however, has since been accentuated by the growth of a class of creditors at whose instance the greater part of the present imprisonments for debt are made those who give credit on exorbitant terms, relying simply on recovering the debt by the threat of imprisonment, when if the debtor has not the money he may have some friend or relative willing to pay the ransom. On the hearing of a judgment summons, the County Court judge is not only debarred from looking into the circumstances under which the judgment was obtained, but he is compelled to enforce payment of the entire amount, whether in one sum or by instalments, when the requisite proofs are given. I do not suggest that the question of the validity of the judgment should (save in a few instances) be reopened on the application for a committal order, but I think the judge should be authorised to consider whether it was reasonable or just that the creditor should exact the entire debt, with imprisonment as the only alternative, or whether it would be more fair and reasonable to limit the instalment orders and committal orders to a portion of the debt only, leaving the creditor to his other remedies as regards the residue. For example, to take a case which has sometimes occurred: the debtor effects a private composition of, say, five shillings in the pound with his other creditors, but one who has obtained an instalment order insists on payment in full, or imprisonment if not paid. In such a case the judge should have power to say that in his opinion the creditor should have fallen in with the other creditors, and that the instalment order should cease to be operative as soon as five shillings in the pound had been paid.

In dealing with imprisonments under the Act, it should be borne in mind that the majority of the debtors do not know the law, and that they cannot afford to pay for legal assistance. (If they procured such assistance it would be regarded as proof of means to pay.) On the other hand, the plaintiffs (I regard the debt-collectors as the real plaintiffs in the cases which they conduct) have often made a study, not merely of the law, but of the idiosyncracies of the particular judges with whom they have to deal, and understand the exact amount of suppressio veri and suggestio falsi which can be introduced into an affidavit without rendering the deponent liable to a prosecution for perjury. It has been said that the judge at an English criminal trial acts as counsel for the prisoner when he is undefended, and though this is not universally true, the judge's questions often bring out the prisoner's defence. It ought to be the same on a trial for non-payment of a debt which the debtor had the means of paying-which many advocates of the present system describe as a trial for dishonesty. The judge should endeavour to elicit the relevant facts, bearing in mind that the plaintiff knows what to keep back, while the defendant may not know what to bring out. Some further protection is clearly needed against this class of plaintiffs. The credit which they give is an undesirable credit, and it is in the public interest to discourage it rather than to encourage it. The credit which is given solely in reliance on the imprisoning clauses of the Debtors Act, is always an unhealthy credit. The real object of the statute, I believe, was to enable creditors, who had given credit on ordinary terms to ordinary customers, to enforce their debts by imprisonment when the debtors, though able to pay, unexpectedly refused to do so. It was not intended to create a new class of debts in which the creditors from the outset relied on imprisonment to collect them, and made a consequent study of all the arts and tricks by which such imprisonment might be brought about.

4

Had there been many creditors of this class in the year 1869, I can hardly doubt that the statute would have required the creditor to pay for the maintenance of the debtor while imprisoned at his suit, adding the sum thus paid to the amount necessary to procure a release. This would place executions against a man's body in the same position as executions against his goods, viz., the loss to fall on the creditor when the proceedings prove abortive. It can hardly be contended that imprisonment at the suit of money-lenders, credit-drapers, speculative purchasers of bad debts, etc., is beneficial to the public. Why, then, should the public pay for it? The creditor can, under the present system, release the debtor at any moment by a stroke of his pen. Statistics seem to show that almost all debtors who do not pay within the first two or three days serve out their sentences. It seems clear that in many of these cases the creditor knows that he will not recover the debt long before the sentence expires, but he will not sign the order for liberation because further detention costs him nothing. The public ought to be empowered either to turn the debtor out or to make the creditor maintain him.

APPELLANT.

III. THE ASSESSMENT OF PUBLIC BODIES
FOR INCOME TAX.

IT

T used to be the custom for public bodies to make their returns of interest under Schedule D of the Income Tax in some detail. Each loan was treated separately, and deductions were made for Schedule A when required. There was much to be said against this crude plan, and it appears to have been considered necessary to make a change and to put the assessment of interest paid by public bodies upon some intelligible and indeed scientific basis. There was a school who thought to achieve this object by assessing

the interest absolutely in full, relying principally, though not entirely, upon words introduced into the Statute 16 & 17 Vict., c. 34, by which all interest of money was liable to assessment. This consummation, however, could only be achieved by degrees.

The principle appears to have been first applied in the Aberdeen case.1 This case was heard in June, 1890. The circumstances were briefly these: Aberdeen required a new town hall. The Commissioners of Supply built the town. hall, borrowed the money on the security of the rates and paid the interest. They were assessed firstly under Schedule A on £145 for the annual value of the town hall, and, secondly, under Schedule D on £92: 10s. in respect of the interest of the money borrowed to build it.

Now it is perfectly evident that if a private individual had built a house in similar circumstances, that is to say, having no money of his own, the house being of the same value, and the money borrowed in such a way as to bring about a deduction of Income Tax, no such assessment would ever have been made. There would have been an assessment under Schedule A, of course, but that would have been all. It would have been recognised that, although the private individual referred to was the titular owner, the real and effective ownership was in the party who advanced the money. But in this case it was said that the interest was secured on the rates, and that there were two totally different persons interested in the charges, first the Commissioners of Supply, who paid the income tax on the town hall, and secondly the creditors on the rates who received the interest. Consequently there was no double assessment at all. In view of the subsequent development of this subject it may here be noted that a substantial amount (£40) was received by the Corporation for actual rent of part of the premises, which under any circumstances at the 1 Aberdeen Commissioners of Supply v. Russell, 27 S. L. R. 759.

present day would be considered a fair ground for a set-off. But apart from this it requires considerable ingenuity to see any difference in principle between the case of the Aberdeen ratepayers and that of the private individual before referred to.

It may be asked, and with some show of reason, why the Commissioners of Supply did not at once enter an appeal. The reason is that there is no Court of Appeal in Scotland, and they must have risked an appeal to the House of Lords. But the tax was too insignificant to render such a step necessary or desirable, and the sequel will show that they were well advised.

Almost immediately upon the Aberdeen case follows that of Portobello. Here the town clerk made the mistake of appealing against the wrong assessment. This assessment being upon the actual profits of the Portobello Cemetery, could not properly be impeached. There was, however, another assessment which might probably have been attacked. The existence of this other assessment is only alluded to in the surveyor's contention, the amount not being named. After stating the assessment on the profits, the surveyor goes on to say that this is "in addition to the assessment separately made upon the interest paid out of the rate. . Here the profit was applied to the relief of the actual cemetery rate, which must be levied at a considerably higher rate were it not for the profit earned in the working of the cemetery." The town clerk seems to have thought that until the capital sum was paid back the ratepayers made no assessable profit. It appears that in 1890 the debt to the Standard Office stood at £2,768. The amount of profit actually assessed would more than cover the interest, even assuming that the interest on £337: 10s. (one year's repayment) had to be added to that on the £2,768 already referred to as being due to the 1 Portobello Town Council v. Sulley (1890) 27 S. L. R. 863.