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By the act of last session, the system of official assignees was extended to the country. But suppose the property to be realized lay 50 or 100 miles away from the official assignee, great expense must in that case be incurred, and the estate would derive little benefit from it, the creditors losing the security which it was intended they should derive from the active interference of a well-informed person. So much of the report of 1481 as was adopted, produced the act of last session. By an order in council the London district was greatly extended ; in one direction 122 miles, so as to include Yarmouth. He would now state some of the towns that had been deprived of their own courts, and been obliged to go to a considerable distance for all bankruptcy proceedings. Nottingham, with 80,000 inhabitants, had to go 50 miles ; Boston, with 14,000 inhabitants, had to go 100 miles ; Louth, with 60,000 inhabitants, 90 miles;
Yarmouth, with 25,000 inhabitants, 122 miles ; and Norwich, with a population of 72,000, 122 miles. From the return of 1841 it appeared that of the fiats sued out, 1,714 were executed in places not now enjoying the benefit of a local court. In 866 of those fiats, the distance the parties would have to go was 40 miles, and in 176 it was as much as 80 miles. The majority of the debts in those fiats was under £10. A petition from Leicester stated the details of five fiats, in which of 213 debts, 117 were under £5, and 75 under £10, and no less than 178 creditors proved in person. In many of those cases the dividend would not pay the expenses of the creditor's journey, and the natural consequence would be, that the system would act as a great discouragement to the creditor troubling himself at all in the matter. Not only had the creditor to make a long journey, and to be at great expense of money, time, and trouble on his own account, but he would often be put to additional expense in taking his witnesses with him, and thus the mere show of opposition might be sufficient to induce an honest creditor to abandon his claim altogether.
The official assignee never went at all. What chance was there, under such circumstances, that the estate would ever be properly realized ? The books had of course been carried away, and put into the hands of the official assignee. The parties were probably at Yarmouth, the books in London. The messenger was not to go down again without a special order. The agent was probably a common person with little or no information. What, under such circumstances, was to become of the interests of the creditors? The next step was the choice of the assignees. He had already stated, that a large proportion of the creditors had not a sufficient interest to induce then to undertake the trouble and expense. If they resided in the same town in which the court was placed, and if they exercised the right of electing the assignees, no doubt they would look after their own interests, even when the amount was inconsiderable, because they might do so without any material sacrifice of time and trouble. Another point to which it was necessary he should refer was this : It was very desirable that throughout the proceedings the bankrupt should himself be present to explain every point that might appear to be obscure. The official assignee had the books, it was true, but in many cases the
books proved nothing. A question might arise whether a debt that appeared on the books should be sued for or not. Without some explanation from the bankrupt, it might often be impossible to know whether it would be expedient to incur the expense of doing so.
After stating the opinion of Mr. Commissioner Holroyd to the same effect, the observations proceed :
After this, it cannot be necessary to dwell on the hardship and inconvenience of bringing bankrupts, and creditors, and witnesses up from Norwich, Yarmouth, Northampton, Salisbury, Southampton, &c. to London ; or of these and such places as Leicester, Coventry, Derby, York, Worcester, Chester, Ipswich, Carlisle, Oxford, Cambridge, Shrewsbury, Gloucester, Durham, Lancaster, Stafford, Preston, Huddersfield, Bradford, Wakefield, Lincoln, &c., all of them with judges and court houses of their own, and yet not being able to have their own bankruptcies worked at their own doors. It is true, that since the time of Lord Cottenham's motion the grievance has to some extent been remedied—the Commissioners of the Birmingham Court now hold sittings at Nottingham ; those of the Leeds Court at Hull and Sheffield ; and the Commissioner of the Exeter Court holds sittings at Plymouth—but there can be no good reason why this should not be carried further. Certain it is, that if in 1842 the County Courts had been in existence we should never have heard of these District Courts of Bankruptcy. Most certainly not. Jurisdiction in Bankruptcy would have been given as is proposed by this bill; and now that we have these courts— have the means, through them, of “ administering the law in the immediate neighbourhood of the scene of the bankruptcy" —it is not easy to comprehend why the two establishments should be kept up; why these District Courts, with their Commissioners, Registrars, and staff (working, by the way, not quite three days in the week), should be continued at a cost to the suitors in bankruptcy of upwards of £37,000 per annum, more particularly as precisely what is now proposed to be done in regard to matters of arrangement and of bankruptcy has already been done as to matters of insolvency by the tenth and eleventh Victoria, chapter one hundred and two. Indeed that act went further than the present bill, inasmuch as it restricted the jurisdiction of the Court for the Relief of Insolvent Debtors within a narrower limit than it is now proposed to restrict the jurisdiction of the Court of Bankruptcy. It transferred the jurisdiction of the Commissioners of the Court of Bankruptcy in matters of insolvency to the Court for the relief of Insolvent Debtors, and to the judges of the County Courts, restricting the jurisdiction of the Court for the relief of Insolvent Debtors to cases in which the insolvent shall have resided for six calendar months next immediately preceding the time of filing his petition within any parish, the distance whereof, as measured by the nearest highway from the General Post-Office in London to the Parish Church of such parish, shall not exceed the distance of twenty miles, and giving jurisdiction to the County Courts in all cases wherein the insolvent shall have resided elsewhere, and shall have resided for
six calendar months next immediately preceding the time of filing his petition within the district of such County Court to which he shall prefer his petition. The jurisdiction of the Commissioners of the Court of Bankruptcy in matters of insolvency was taken away, and jurisdiction was given in all matters of insolvency to the judges of the County Courts. (See 10 & 11 Vict., c. 102, ss. 4 and 6.)
These observations are equally pertinent now as when they were published, and are entitled to great weight and consideration; and it is also important to bear in mind that, assuming the distinctions between insolvency and bankruptcy are to be abolisbed, concurrent jurisdiction should either be given to the county courts in all cases, or provision should be made for the county courts to retain jurisdiction to the extent to which they now possess it under the Protection Acts.
In considering what the proposed court should be, Mr. Bond has some sensible remarks in pp. 9 and 10 of his publication :
It must be local, and it should be stationary. The county courts are already overworked ; they sit at different places; there is no appeal from the exercise of their jurisdiction in insolvency; and their machinery is not adapted to administrative purposes. That of the courts of bankruptcy, with some alterations, may be well fitted for the objects in view. Those courts have at present scarcely anything to do. With the present staff, one Commissioner might sit every day at the same place, so as to be at all times accessible (which, however, is unfortunately far from being the case at present); and this is of the utmost importance in very many cases where prompt action is required. With such amendments as may be found requisite, they are, therefore, the most fitting tribunals to undertake that which, according to the plan which has been faintly shadowed out, would become the sole primary jurisdiction in all matters of insolvency, and by giving it to them no expense would be incurred either in new appointments or retiring pensions. It is not necessary to weary you with suggestions as to the amendment of process. Suffice it to say, that it should be as simple as is consistent with perspicuity and the preservation of a proper record of the proceedings of the court, and that it is, for obvious reasons, desirable to secure as much of uniformity as possible.
II. Then as to control, which is the second point to which it has been proposed to direct your attention. When the property of an insolvent debtor has been taken from him by operation of law, to be distributed, as far as it will go, among his creditors, it becomes theirs; and they, by themselves, or by means of trustees or assignees chosen by themselves, ought to have the control of it, instead of, as now, being thought officious and sometimes snubbed, if they presume to make an inquiry about it. Experience has long taught me that the whole official assignee system is an expensive mistake, and the sooner
it is put an end to the better. There can be no doubt that under the old system some wrong was done. But it suited the purpose of the hour to magnify the amount of it; and even then it was insufficient to justify the violent transition which took place from one extreme to the other, under the superintendence of a judge, appointed by the crown, and sitting daily in open court; and not of commissioners, nominated by the parties themselves, and meeting only when convened by them, in a room at an inn, its repetition, if not impossible, would at least be as unfrequent as are the losses by the misconduct of official assignees, or of trustees under assignments, and the total extent of mischief probably less.
The writer here approves of localisation, but is satisfied with the existing courts, which, nevertheless, in our judgment are insufficient; for there are but seven bankruptcy districts throughout England. One great objection to the county courts is, doubtless, their not being stationary, and this is a strong reason for not giving them the exclusive jurisdiction ; but we do not see that it is conclusive against their possessing concurrent jurisdiction, which would be a great convenience in the populous manufacturing districts, where the county court circuits are not large, and the judges are sitting almost daily at one of several places within a radius of eight or ten miles. With reference to the machinery or staff of the county courts, we think there would be no great difficulty in adapting it to bankruptcy matters, if the proposed alterations, by which the administrative portion of the business will be intrusted to the creditors, or their assignees, be carried out.
Mr. Rayner thus states the various propositions which have been made with reference to this subject :
1. That the existing district courts should be continued as at present, debtors owing less than £300 being permitted, or rather required, to file their own petitions for adjudication in the county courts where they reside.
2. That the district court should be retained, the commissioners going circuit to all towns having 20,000 inhabitants.
3. That the district courts should be continued, the county courts having concurrent jurisdiction in cases where the debts do not exceed £1000.
4. That the district courts should continue to have exclusive jurisdiction to adjudicate, a majority in value of the creditors being empowered, at their first meeting, to remove the proceedings into the most convenient county court, provision being also made for debtors to
petition either the bunkruptcy or county court for an arrangement under judicial superintendence.
3. That the district courts should be entirely abolished, and the jurisdiction transferred to the county courts sitting in such places, within their circuits, as may be fixed by order in council ; the twelve country bankruptcy commissioners, and their registrars, being appointed judges and registrars of county courts, at their present salaries, and attached to the twelve county courts having the largest number of plaints.
The first proposition is contained in the government bill, and the fourth is the plan provided by Lord John Russell's bill. Mr. Rayner then continues :
After considering these various propositions, we think the best arrangement as to the jurisdiction would be, to restrict the exclusive jurisdiction of the present district courts to the county court circuits in which they are situate, and to give concurrent jurisdiction in all other cases to the county courts in other circuits within such districts. This plan would possess the same advantage which distinguishes Lord John Russell's bill, and would set itself right if the county courts were found inefficient; and it would not increase the business of the county courts in the twelve large towns in which the district courts are held. Its adoption would, in many cases, save the expense of travelling a considerable distance to attend adjudication and first meeting, and, practically, the effect would be, that petitions for adjudication would be presented to the county courts in all cases where, under Lord John Russell's Bill, the proceedings would be removed at the first meeting of creditors; and we do not think that the county court judges are less qualified to adjudicate than to determine questions arising subsequent to adjudication.
The effect of this would be to give the creditor or debtor filing the petition the option of goiøg to the district bankruptcy court or county court in every case, except where the debtor resides or carries on business within those county court circuits in which the district courts are situate; and in the latter case the bankruptcy courts would retain exclusive jurisdiction. We see no objection to this, and we think in many cases considerable expense in obtaining adjudication might be saved by it; but if it be adopted, full power should be given to the district courts to remove the proceedings from the county court to the district court, or vice versá, or from one county court to another when it becomes necessary to do so, in order to secure a full investigation, or for the convenience of a considerable majority of creditors. VOL. VII. NO. XIIT.