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Justice Lush also said that McDougal knew Thornton to be a person of no resources at all. There seems, therefore, to have been some little disagreement as to the effect of the evidence. But all the judges were anxious not to impute to the defendant moral fraud, or an inten. tion to deceive. Possibly when the Lords Justices come to revise their judgments for the authorized reports the little differences will be smoothed away. If McDougal really did know that Thornton had no means, it becomes more difficult to draw the line between legal and moral fraud than if the view of the Master of the Rolls was the correct one. But the drawing of this line belongs more to casuistry than to law, and it is to be regretted that the court could not lay down in clear terms the principle upon which their judgment went, without bringing in the very inconvenient and quite unnecessary bugbear-legal fraud.

DISCLAIMER OF LEASES UNDER THE BANKRUPTCY BILL.

II.

WE stated last week the result, so far as we can estimate it, of the provisions of the new Bankruptcy Bill as to disclaimer of leases. If we are right in our view, it - cannot be said that the framers of the Bill have met all the difficulties of the subject. They have left open a loop-hole by means of which the landlord may be saddled with disadvantageous sub-tenancies, without, so far as we can see, any possibility of obtaining relief from them. Now, the objects to be aimed at in any properly drawn disclaimer clause could not be better stated than they were by our correspondent a fortnight ago:-" To destroy sub-interests by the act of the representative of the person creating them must be wrong, whilst to return the property to the landlord burdened with charges and sub-tenancies, and stripped of its valuable incidents, must be equally so. The objects of any legislation should be to free the trustee and the bankrupt's estate from liability to the obligations of the lease (subject to rights of proof by persons injured), and to interfere as little as possible with all other rights." The new Bill, as we saw last week, fails to carry out these principles, because it provides that the estate and interest of the bankrupt shall pass to the person entitled thereto on the determination of the estate or interest of the bankrupt, and the result of this is (or seems to be) to render the position of a sub-lessee impregnable.

The remedy suggested by our correspondent is very simple. He would enable the trustee, by leave of the court, to sign some instrument, or give some notice to all parties interested, the effect of which would be to inform them that he will not adopt the lease, and thereupon, the liability of the trustee, and (subject to rights of proof) the liability of the bankrupt's estate, should cease. The term will be left subsisting in the trustee, but without any liability on his part to perform the provisions of the lease. Then the court will be at liberty, at any time afterwards, upon hearing all parties, to make an order vesting the term in any person entitled to it. He proposes to give effect to his suggestion by the following clause :

"The trustee may, with the sanction of the court, by writing under his hand, hereinafter called a disclaimer, disclaim any property of the bankrupt acquired by the trustee under this Act, notwithstanding that he may have endeavoured to sell, or have taken possession of, such property, or exercised any act of ownership in relation thereto. Upon the application by the trustee for leave to disclaim any such property, he shall furnish the court with such information as to the nature and value of the property, and as to the person or persons interested therein, as may be prescribed, or as the court may direct.

"Notice of the execution of any disclaimer by the trustee

shall be given to such person or persons (if any), or published in such way (if any), as may be prescribed, or as the court shall direct.

"Such disclaimer shall operate as a release to the trustee, and, subject to the right of proof given by this Act, also to the bankrupt's estate, from all obligations affecting the property disclaimed, or the bankrupt, or his estate, in respect thereof, but shall not release or affect the obligations, or the rights or remedies, of any other person or persons, nor divest the property disclaimed from the trustee."

Then follow provisions enabling any person interested to apply to the court, and enabling the court, after notice, to make an order vesting the property in such person as the court may think fit, subject to provisions→(1) that the court shall vest the property in the person claiming an interest in it under the bankrupt, who desires such vesting order in his favour, and the vesting order shall vest the property in such person subject to the duties and obligations affecting it. If more than one person, claiming under the bankrupt, desires a vesting order, the court shall have power to modify its order as it thinks expedient. And upon any vesting order being made, the rights, estates, and interests in the disclaimed property of all persons claiming under the bankrupt, other than the person or persons in whose favour such order is made, shall cease and determine. (2) If no person claiming under the bankrupt desires to have a vesting order in his favour, then the court shall make a vesting order in favour of any person or persons who may be liable to perform the duties or obligations affecting the disclaimed property who shall desire such order in his or their favour, subject to such duties and obligations [similar supplementary provisions being made]; and (3) if no person desires a vesting order under rules 1 and 2, the court may make such order in favour of any person entitled to the disclaimed property upon the determination of the bankrupt's estate or interest therein, if such person shall desire such vesting order in his favour. And after such last-mentioned vesting order, the rights, estates, and interests in the disclaimed property of all persons who might, under rules 1 and 2, have been entitled to a vesting order shall cease and determine.

The effect of these provisions would be that if any person claiming under the bankrupt-such as a mortgagee or sub-lessee-was content to take the bankrupt's interest, subject to the rents and covenants affecting it, he would be entitled to have it vested in him. If no person claiming under the bankrupt was willing to take the estate, then any person liable (for instance, a previous lessee) to the obligations affecting the property would be entitled to a vesting order. And if no person either claiming under, or liable with, the bankrupt wished to take the property, then the person entitled, subject to the bankrupt's estate, would be at liberty, if he thought fit, to have the property vested in him, and thereupon all prior interests would cease.

We state these proposed provisions as matter for discussion. They are an ingenious mode of dealing with the difficulty, but we are inclined to think with our correspondent that it would be better to leave the court to deal with the facts of each case unfettered by rules. As regards the proposed clause quoted above, however, we are inclined to think that it affords the only mode of satisfactorily dealing with the difficulty preliminary to the application to the court, for a vesting order.

REVIEWS.

LIBEL AND SLANDER.

A DIGEST OF THE LAW OF LIBEL AND SLANDER. By W. BLAKE ODGERS, Barrister-at-Law. Stevens & Sons. This appears to be a useful and carefully written treatise, though we are not prepared to say that the author has entirely overcome the difficulties incident to the form which he has adopted for his work. His object, as

announced in his preface, is to state the law on each point in the form of an abstract proposition, citing the decided cases in smaller type merely as illustrations of the abstract proposition. The difficulty in practice that arises is that, in treating the subject systematically after this fashion, a number of fundamental propositions must be enunciated which are rather assumed than expressed by the decisions. The author is driven to the enunciation of these on his own authority, and no cases are forthcoming by way of illustrations in the smaller type, but only hypothetical illustrations by the author. This, even when it occurs in the case of digests by authors of higher authority than, with all respect to the author of the work under discussion, he can be said to be, always seems to us slightly anomalous. We regard a digest, perhaps wrongly, as a work stating propositions for which there is authority. The author in the present case is obliged sometimes to give propositions for which he can adduce no authority. One of the first which he gives might by some be considered doubtful as a matter of theory viz., that to say A. is a rascal is not defamatory unless it can be proved that some one seriously believed or acted on the assertion to the prejudice of A. These observations are, however, perhaps hypercritical, as the real usefulness of a book does not much depend on such introductory propositions.

The author has not, like some writers of books of reference, heaped together inconsistent decisions without any regard to their inconsistency, and without any attempt to deduce from them any net result. The form of his book, as already stated, precludes such a perfunctory mode of treating the subject. The prevailing fault of writers of law books is perhaps too great timidity; a man shrinks from expressing too distinctly in print an opinion on a doubtful point which a decision may soon show to be erroneous. We think it perhaps would be well if authors were somewhat bolder. It may be sometimes more useful to the reader to discuss a point and express an opinion, even though it may turn out to be erroneous, than to pass over a point in silence. As an instance of Mr. Odgers' mode of dealing with points of this sort we may instance the discussion on p. 146, in which he joins issue with a statement in Addison on Torts. We cannot profess to have considered all the propositions which our author enunciates as the results of conflicting or dubious authorities, but, so far as we can judge, his statements of the law are careful and well considered. Some parts of his book are amusing as well as useful-e.g., the list of expressions which have been held to be defamatory at p. 22. There is one point on which sympathize with the feeling expressed by the author. He says that in his book he has restored the word "malice" to its simple and ordinary meaning, and has

we

abandoned the technical and fictitious use of the term as meaning "malice in law." We think it very unfortunate that words should come in legal diction to have artificial and non-natural meanings, but it is not always easy, having regard to the historical growth of the law, to ignore entirely the artificial use of words in such meanings.

CORRESPONDENCE.

QUERIES.

22 & 23 VICT. c. 35, s. 21.-A testator by will, after leaving a few pecuniary legacies, directed his trustees, at their discretion, to convert into money all the rest and residue of his real and personal estate, or such part as should not consist of money (with power to continue any investments existing at his decease). And, after directing payment of his funeral and testamentary expenses and debts, and making trusts for investment, the testator directed the trustees to stand possessed of the said trust estate, and the investments representing the same, in

trust to pay the income to his wife for life, and after her decease, in trust for his son, T. G. (one of the trustees), his heirs, executors, administrators, and assigns, accord-ing to the respective nature and tenure thereof. The testator appointed his trustees executors of his will, and his wife died in his lifetime. The testator has since died, and both his executors proved the will. Part of testator's property consists of leaseholds for lives, and a policy of assurance on such lives. There is sufficient to pay all the legacies and debts in full, without selling the leaseholds or policy, both of which the son wishes to retain as his own property. And the executors wish to assign these absolutely to the son, who is one of the executors and trustees. I shall be glad if some of your correspondents will inform me how this is to be done, as the 22 & 23Vict. c. 35, s. 21, only provides for the assignment from one person to himself and another, and not for the assignment from two persons to one of them. Will two deeds be necessary as formerly, cne to assign from the executors to a trustee, and another to assign from such trustee to the son, or can the property be absolutely vested in the son by a release from his co-executor ?* Cases or references will greatly oblige. G. H. M.

CASES OF THE WEEK.

PATENT INFRINGEMENT-TRANSHIPMENT IN ENGLAND OF ARTICLE MANUFACTURED ABROAD-CUSTOM HOUSE AGENT. -In a case of Nobel's Explosives Company v. Jones, before the Court of Appeal on the 29th ult., a somewhat novel question arose with regard to the infringement of a patent. The plaintiffs' patent was for a method of making safe and prac-ticable the transport of nitro-glycerine, a substance which is liable to explode at the slightest shock. The invention, the subject of the plaintiffs' patent, consisted in causing the nitro-glycerine to be absorbed in porous inexplosive substances, such as charcoal, the result being a pasty substance, called dynamite, which is insensible to shocks, and can betransported with safety, but which at the same time is equally valuable as an explosive when ignited in the proper way. A firm of Krebs & Co. manufactured abroad a substance which they called litho-fracteur, and at one time sold it in England. In an action brought against them by the plaintiffs it was decided by the House of Lords that the article manufactured by them was an infringement of the plaintiffs' patent. After this, Krebs & Co., though no longer selling their article in England, shipped it to England, consigned to an agent of theirs in England, for the purpose of reshipment for exportation and sale in Australia. The present action was brought against some persons who had acted for the agent of Krebs & Co., in England, simply as Custom House agents in procuring the necessary documents at the English Custom House authorizing the transhipment to be made in the port of London. It was alleged that by thus acting the defendants had infringed the patent, and so it was held by Bacon, V.C., but his decision was reversed by the Court of Appeal (JAMES, BAGGALLAY, and LUSH, L.JJ.). The plaintiffs' case was put in this way. It was said that, the peculiar nature of the invention being the making nitro-glycerine transportable with safety, anyone who moved the article with safety was in fact using the invention, and anyone who had the control of the article manufactured by Krebs & Co., though merely for the purpose of transhipment in England and exportation therefrom, was in fact using the invention in England. Krebs & Co., therefore, through their agent in England to whom their goods were consigned, were infringing the plaintiffs' patent, and the defendants, by obtaining the necessary documents from the Custom House, were enabling Krebs & Co. to commit the infringement, and were therefore liable as infringers. JAMES, L.J., said that the defendants had no control over the article; the safety or danger of the transportation was quite immaterial to them. They could not be said to be liable for the infringement of a patent, but they must be using the invention. The court had always held agents actual agents directly employed in the transmission in question. The doctrine could not be extended beyond the case of direct agency.-SOLICITORS, Woodbridge & Sons; J. § P Gole.

NEWSPAPER - COPYRIGHT IN ARTICLES- REGISTRATION-COPYRIGHT ACT, 1842, ss. 18, 19, 24.-In a case of Walter v. Howe, before the Master of the Rolls on the 29th ult., a motion was made by the proprietors of a daily newspaper, not registered under the Act, to restrain a reprint in a cheap form, and without the consent of the proprietors, of a biographical memoir published in the newspaper. The author of the memoir was not made a party to the action, but it was stated in an affidavit filed by the plaintiffs that the author had been paid for his literary services by the plaintiffs. The plaintiffs relied upon a decision of Malins, V.C., of Cox v. Land and Water Journal Company (L. R. 9 Eq. 324), where it was held that a newspaper was not within the Copyright Act, 1842, and required no registration under the Act, and that the proprietor had aliunde, and without registration, such a property in the contents of a newspaper as would entitle him to sue in respect of a piracy. JESSEL, M.R., said he did not agree with the decision of Vice-Chancellor Malins, and refused to fellow it. He was of opinion that a newspaper was a "periodical work" within the meaning of section 18 of the Copyright Act, 1842, and, therefore, that it required to be registered under the 19th section to entitle the proprietors to sue in respect of any piracy of the articles produced in the newspaper. If there was any other copyright in the memoir, that would be in the author of the article, and as the plaintiffs, in his opinion, aid not sufficiently show they had purchased the whole copyright, and as the author was not a party to the action, no injunction could be granted on that ground. The motion must, therefore, be refused, with costs.-SOLICITORS, Soames; G. L. Claxton.

PRACTICE-INFANT DEFENDANT-JUDGMENT BY CONSENT -EVIDENCE-TRIAL OF ACTION-ORD. 19, R. 17-ORD. 40, R. 11.-In an action of Ellis v. Robbins, before Hall, V.C., on the 28th ult., a new point of practice was raised as to the form in which judgment should be taken by consent in an action so as to bind an infant defendant. The action was for the rectification of a marriage settlement, and the wife and an infant child of the marriage were made defendants. It was agreed to take a judgment upon the admissions of the facts stated in the statement of claim, no defence being put in, but, as by ord. 19, r. 17, the allegations of fact in a pleading cannot, although not denied, be taken to be admitted as against an infant, the statement of claim had been verified by affidavit. Formal consents had been given to the evidence in the action being taken by affidavit, as required by ord. 37, r. 1, but a difficulty now arose from the fact that the action had not been set down for trial, but merely on motion for judgment, on admissions in the pleadings, under ord. 40, r. 11. There is no provision in the Rules of Court as to evidenoe being received upon motion for judgment, and, upon the point being now brought to the notice of the court, HALL, V.C., directed that, in order te put the matter in proper form, the action should be set down for trial, notice of trial being given to the wife and infant. The action would then be again placed in the paper, and upon being called on pro forma, their consents would be given by counsel.-SOLICITORS, Roopers & Co.

COMPANY IN LIQUIDATION-PROOF FOR DAMAGES BY CONTRIBUTORY-CONTRACT TO GIVE PAID-UP SHARESCOMPANIES ACT, 1867, s. 25.-Oa the 2nd inst. ViceChancellor Hall delivered a written judgment in Re The Great Australian Mining Company, upon an important question bearing upon the 25th section of the Companies Act, 1867, which provides that, in the absence of a registerel -contract to the contrary effect, every share in a company shall be deemed to be issued and held subject to the payment of the whole amount thereof in cash. Mr. Appleyard had under that section been placed upon the list of contributories in the winding up of the company for the amount of £1,000, and the application on which judgment was now given was to be allowed to claim in the liquidation for damages to the same amount. Briefly stated, the facts were that the original promoter of the company gave Appleyard, partly in payment for legal services in starting the undertaking, and partly for money lent, certain debentures of the company which had been issued to himself. By an arrangement with the directors, of whom Appleyard was himself one, fully paid shares were agreed to be issued to Appleyard in exchange for the debentures, which were delivered up to be cancelled. He was

credited with the shares in the books of the company, but no contract in writing was registered, and when the company afterwards was in liquidation Appleyard was placed upon the list of contributories. His claim was for damages for breach of contract in not completing the arrangement. Appleyard had been the solicitor of the company, but no fraud whatever was suggested. HALL, V.C., held that the contract was proved by the minutes and documents of the company, the consideration was valid, and the arrangement made was not ultrà vires. He considered the case governed by Mudford's Claim, Re Government Security, &c., Company (28 W. R. 670), where the judgment had been founded upon the remarks of the Court of Appeal in White's case (27 W. R. 895.) The judgment of the House of Lords in City of Glasgow Bank v. Houldsworth (28 W. R. 667) was not repugnant to such a decision, and the claim for damages must be allowed with costs.-SOLICITORS, Appleyard; West, King, Adams, & Co.

EXECUTOR-POWER TO PLEDGE TESTATOR'S ASSETSLEASEHOLD PROPERTY-PURCHASER FOR VALUE WITHOUT NOTICE TITLE DEEDS.-In a case of Pillgrem v. Pillgrem, before Fry, J., on the 2nd inst., a question arose as to the power of an executor to pledge his testator's assets, and the right of the executor's own private creditor to be paid out of assets of the testator, when he has dealt with the executor in the belief that the assets were his own property. A testator, who was a trader, devised and bequeathed all his property, real and personal, to his executor, upon trust to sell his business and stock in-trade, and some leasehold houses in which the business was carried on, and, after payment of his debts and funeral and testamentary expenses, to retain out of the proceeds of sale a legacy of £200 to himself, and to invest the residue and hold the investments upon certain trusts; and, until a sale could be effected at a fair price of the business and leasehold houses, the testator desired the executor to continue the business, and to hold the profits, after maintaining himself and his family, upon trusts corresponding to those of the income of the invested proceeds of sale. After the death of the testator, the executor took possession of his property, and carried on the business for some years at the same place in his own name. He borrowed various sums of money from a person who knew nothing of the executorship, but believed that the business belonged to the executor himself. Six years after the testator's death, the executor surrendered the lease of the houses, and obtained from the lessor a renewed lease in his own name. He deposited the renewed lease with the same creditor as security for an advance made to him for his own purposes, the creditor believing the lease to be the executor's own property. A part of the unsecured advance was employed for the purposes of the business; the remainder was employed by the executor for his own private purposes. Nine years after the death of the testator, the creditor recovered judgment against the executor for the amount of the unsecured advances, and issued execution, under which the sheriff seized chattels and stock-in-trade belonging to the testator's estate. An action having been brought for the administration of the testator's estate, the creditor claimed in the action to be entitled to the benefit of his execution. Reliance was placed on the case of Ray v. Ray (G. Cooper, 264). In that case a testator died in 1809, and his executors took possession of his personal estate, and paid his debts and legacies, with the exception of a promissory note for £1,000 due to the plaintiff, payment of which was not demanded. They also took possession of a leasehold farm which the testator had occupied, and procured a renewal of the lease to be granted to them in their own names. One of the executors having died, in 1815 a bond creditor of the surviving executor (not a creditor of the testator) seized the leasehold premises in execution for his debt. The plaintiff had not demanded payment of his promissory note until about the time when the seizure was made. The plaintiff obtained an ex parte injunction to restrain the sale of the leasehold property under the execution, and this injunction was afterwards dissolved by Sir Thomas Plumer, on the ground of the lapse of time and the laches of the plaintiff. "If," his Honour said, "the plaintiff had any right to consider the renewed lease as made for the benefit of the testator's estate, is it not fair to say that he had waived that right at this distance of time? The defendant has

the law on his side, and, at least, an equal equity with the plaintiff, arising from the credit which he has been induced by the plaintiff to give, from being led by the plaintiff to consider the lease to be the executor's own property. I say he has, at least, an equal equity, and I ask if he has not even a superior equity? I cannot, therefore, see any ground for this court interfering with those rights of the defendant after a lapse of six or seven years. It would be injurious to credit to do so, especially in the case of trades." FRY, J., said that the law on the point was clear. When an executor carried on the business of his testator under the directions of his will, and in that character contracted a debt, an action for the debt must be brought against the executor personally, and the judgment would be de bonis propriis of the executor. No action could be brought against the estate of the testator, and there could be no judgment de bonis testatoris, because the debt was not the testator's debt. The creditor might have a right to be subrogated to any claim which the executor had against the estate. It could make no difference that the chattels seized by the sheriff were ostensibly those of the executor. In some cases, no doubt, if there had been a great lapse of time, and the possession of the executor was not in accordance with the trusts of the will, there might be an inference that there had been an absolute gift by the beneficiaries to the executor. But, when the possession of the executor was in accordance with the trusts of the will, and the time which bad elapsed was also, so to say, in accordance with the trusts, there could be no such inference. In the present case, the mere ostensible possession of the executor and the lapse of time could make no difference; but, the moment it was found that the property was trust property, no judgment could go against it for the executor's own debt. In Ray v. Ray the point was not finally decided; but the court thought the circumstances were such as to raise an inference of gift to the executor. With regard to the deposit of the renewed lease, the case stood in this way. The execution creditor claimed an equity by virtue of the deposit; the testator's estate claimed an equity by virtue of the renewal. But the equity of the estate attached as soon as the renewed lease was granted; the equity of the creditor did not attach until the deposit was made. There was no superiority in the one equity over the other, and, therefore, as between the two equities, the ordinary rule must apply, qui prior est in tempore potior in jure. It was argued on behalf of the creditor that at any rate the actual lease itself could not be taken away from him, he being a purchaser for value without notice, reliance being placed for this purpose on Heath v. Crealock (23 W. R. 95, L. R. 10 Ch. 22). FRY, J., said that, in order to avail himself of the defence that he was a purchaser for value without notice, the depositee must show that he had made every reasonable inquiry as to the title to the lease. He had not shown that he had made any inquiry at all, and there was nothing to show that if he had inquired he would not have been furnished with an honest abstract of title, disclosing the surrender. A person who thus wilfully shut his eyes could not say that he was a purchaser without notice. The order would, however, be made without prejudice to the right (if any) of the creditor to stand in the place of the executor in any claim he might have have against the testator's estate in respect of the legacy of £200 or otherwise.—SOLICITORS, J. P. Murrough; Allen & Edwards.

PRACTICE-DEFENDANT OF UNSOUND MIND-APPOINTMENT OF GUARDIAN-ORD. 13, R. 1.—In a case of Taylor v. Pede, on the 2nd inst., FRY, J., held, under the provision of rule 1 of order 13, that when no appearance has been entered to a writ for a defendant who is a person of unsound mind, not so found by inquisition, the plaintiff may apply to the court for the appointment of a guardian by whom the defendant may appear and defend the action, it is not obligatory on the plaintiff in every such case to apply for the appointment of a guardian; but that the provision only applies when the plaintiff for his own purposes desires that the defendant should appear and defend. It is not necessary to make the application when no relief is asked against the defendant.-SOLICITORS, W. & J. Flower & Nussey.

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DIVORCE-ADULTERY CRUELTY CONDONATION-REVIVAL MISCONDUCT FALLING SHORT OF ADULTERY.-In the Probate, Divorce, and Admiralty Division, on Saturday, April 30, the suit of Ridgway v. Ridgway was tried before the President of the division without a jury. The petition was by a wife for a dissolution of marriage on the ground of her husband's adultery and cruelty. The petitioner admitted that she had condoned her husband's misconduct, but there was evidence that, after the condonation, the respondent had attempted to take liberties with a maid-servant living in the house, and this was relied upon as showing that the acts which had been condoned had been revived. HANNEN, P., observed that the question whether condoned adultery or cruelty could be revived by misconduct falling short of actual adultery had never been expressly decided. Condonation was only conditional forgiveness, and the respondent's be haviour must be taken to be a breach of the condition upon which his wife's forgiveness had been accorded to him. He therefore held that the adultery and cruelty had been revived by the subsequent misconduct, and that the petitioner was entitled to a decree nisi.-SOLICITOR, Greenfield.

CASES BEFORE THE BANKRUPTCY
REGISTRARS.

(Before Mr. Registrar MURRAY acting as Chief Judge). April 4.-Re Bear & Bear.

The court refused to grant an injunction restraining the wife of a bankrupt from dealing with goods alleged to have been purchased with trust moneys belonging to her.

This was an application by the trustee under the bankruptcy of Messrs. G. & J. Bear, cigar manufacturers, for an injunction to restrain Mrs. Emily Bear from dealing with a quantity of tobacco, alleged to form part of the property of the bankrupts.

The facts are stated in the judgment of the registrar.

E. C. Willis, in support of the application.-The tobacco spondent is that it was purchased with trust moneysin question belongs to the bankrupts. The case of the rebelonging to her, but these moneys have been so mixed up with others as to have lost their identity. The tobacco was also in the reputed ownership of the bankrupts. He cited Clayton's case (1 Mer. 572).

Colt, for the respondent.-Before any act of bankruptcy was committed, the respondent was in possession of thetobacco as the absolute legal owner, and no question of re puted ownership can arise. All that it is necessary to show, in order to substantiate the claim of the respondent, is that tobacco to the extent of £2,50C has been bought with trust money. The evidence shows that in 1871 £2,000, drawn out of the bank upon the security of the respondent's deeds, was applied in payment of tobacco purchased from Messrs. Bremner, and the rights of the respondent extend to the tobacco so purchased. What afterwards took place between George Bear and his bankers is immaterial, as the tobacco was impressed with a trust in favour of the respondent: Re Halletts' Estate (28 W. R. 732, L. R. 13 Ch. D. 696).

Mr. REGISTRAR MURRAY said the hearing had occupied a considerable time, but when the case was divested of a certain amount of fringe, he did not think that it presented any serious difficulty. The facts lay within a narrow compass. The application was by the trustee for an injunction restraining Mrs. Emily Bear from dealing with certaln tobacco, with respect to which she had a legal and beneficial interest. The circumstances under which the delivery order was given to her a few days before the bankruptcy, ferred to her, were no doubt open to the greatest suspicion, and the circumstances under which the property was transand fully entitled the trustee to avail himself of his right to have a private examination of the parties under section 96. But it so happened that before a private sitting was held the trustee took upon himself to launch the present motion for an injunction, and the circumstances being so suspicions he (the registrar) felt that he could not withhold an injunction until after the investigation at the private sitting had taken place. The facts as elicited from the examination of the parties, appeared to be these: Mr. Benson, by his will, had left the residue of his property to George Bear and Emily Bear (under her name of Emily Benson) as executor and executrix. The trusts of the residuary estate were declared by the testator, and Mrs. Bear was to have the income of the property during her life, with a power of appointment) as to

was

He did not

the residue. At any moment Mrs. Bear, by a stroke of the
pen and by exercising her power of appointment, might have
made herself the absolute legal and beneficial owner of the
property. The trust estate was realized by George Bear and
Mrs. Bear did not interfere. George Bear acted in the ad-
ministration of the estate, and it appeared that he realized
it to the extent of £5,000 or £6,000, and invested it in the
purchase of houses. He had sworn that the bulk, if not the
whole, of the moneys paid into his banking account were
trust moneys forming part of the residuary estate. Although
some question had been raised about it, he thought it
was sufficiently established that the trust money
invested in the purchase of houses.
lose sight of the fact that the houses were
purchased by George Bear in his own name; but there
might be no particular harm in that, although it would
have been better if the purchase had been made in the
There was
joint names of himself and Mrs. Emily Bear.
no doubt that, in dealing with this trust property, he had
acted throughout as if it were his own-a course that
could not but be deprecated-and the best explanation that
could be given was that he probably thought he was
doing the best both for Mrs. Bear and himself, having
regard to their relationship of husband and wife. They
appeared to have trusted each other, but from beginning

to end it must be admitted that there was a breach of
trust on the part of George Bear. That being the state
of things, and hearing of some tobacco that was for sale,
George Bear was willing to become a purchaser, but not
having sufficient money of his own, he applied to his
bankers for an advance. He required £2,500, but the
bankers would only make the advance upon the deposit
of security, and he bethought himself of depositing the
deeds of the houses which had been bought with trust
money and were trust property. Thereupon the £2,500
was advanced solely upon the security of the deposit of
the title deeds. This was questioned, but at least one
thing was certain, that the £2,500 would not have been
advanced but for the deposit of the deeds. George Bear
stated that, in the first instance, he drew a cheque for
£2,000 upon the bank on February 28, 1871, which was
paid in two notes of £1,000 each. Those notes were handed
by him on the same day to Messrs. Bremner on account
of moneys due to them for tobacco which had been
It was,
purchased by him to the extent of £3,600.
therefore, clear that these two bank notes were earmarked
as having gone to Messrs. Bremner in payment of a portion
of that tobacco. Assuming that Mrs. Bear had then
appeared upon the scene and stated to George Bear,
"I understand you have been purchasing tobacco with
money belonging to the trust estate, or that you have
been depositing title deeds as security for an advance
which you have invested in tobacco," could it have been
denied that she would have been entitled to be recouped
out of the tobacco purchased partly with trust moneys and
partly out of the moneys of George Bear? The tobacco
was undoubtedly impressed with a trust to the extent of
the trust moneys that were used in its purchase. This
view was supported by the decision of the Court of Appeal
in Hallett's case, the Master of the Rolls remarking that
the doctrines of equity were progressive, and had been
enlarged in modern times. Upon the evidence it must be
taken that the £2,000 had been sufficiently traced as
having been paid out of the trust funds, and that a charge
upon the tobacco was created in favour of Mrs. Bear.
The
with
tobacco being impressed
a trust,
was unnecessary to take into consideration the subsequent
It did not
dealings between George Bear and the bankers.
make any difference whether the original advance of £2,500
had been paid off or not, if the title deeds were not redeemed
and handed over to Mrs. Bear. The trust estate not having
been recouped, the charge upon the tobacco remained in
force. It was true that some of the tobacco had been dissi-
pated, but the charge was created the moment the £2,000
was paid to Messrs. Bremner, in February, 1871. Mrs.
Emily Bear had a charge upon the whole of it, and if some
of the bales had been taken by George Bear out of the bulk,
that would not prevent the charge continuing as to the
residue. Mrs. Bear was the absolute owner at the present time
of the tobacco, and it would not therefore be right to pre-
vent her from dealing with it because some difficulty existed
in earmarking a cheque for £509, as well as for the £2,000.
Allegations of fraud were made, but his Honour did not con-

it

sider that they had been proved. It appeared that George Bear was very much pressed for money, and his wife noticed that he was worried. When he informed his solicitor, Mr. Turner, that he proposed handing over the tobacco to Messrs. Bremner, Mr. Turner said, "You must not do it, because it is Mrs. Bear's property." That was proper advice under the circumstances, and a delivery order being given to Mrs. Bear, she became absolutely entitled to the tobacco. His Honour then held that, except as to three bales which had not been purchased out of the trust money, the title of Mrs. Bear prevailed, and the motion for an injunction must be refused, with costs. Solicitor for the trustee, Marsh.

Solicitor for the respondent, Turner.

April 13.-Ex parte Cape, Re Bridge.

Order confirming scheme of settlement of the bankrupt's affairs set aside upon proof that property of considerable value has been concealed from the creditors.

A creditor holding a charge upon such concealed property has no locus standi upon the trustee's application to set aside the scheme, and the court will not make any order by which his rights are protected.

This was an application by the trustee for an order to rescind an order made in April, 1877, confirming a scheme of arrangement of the bankrupt's affairs.

The bankrupt, William Bridge, an accountant, was adjudicated in March, 1875, and John Slater was appointed trustee of his property, and so continued until August, 1880, when he was removed from his office, and G. A. Cape was appointed trustee in his place. The bankrupt's debts amounted to about £1,200.

On the 20th of January, 1877, a meeting of creditors was held, at which resolutions were passed to the following effect:

:

(1) To accept a composition of four shillings in the pound upon the debts proved and admitted in the bankruptcy, payable within fourteen days from the confirmation of the scheme by the court.

(2) That the composition be paid free from all costs, charges, and expenses.

(3) That the proper costs, charges, and expenses be paid by or on behalf of the bankrupt.

(4) That on payment of the composition of four shillings in the pound to the trustee, and upon the order of the court confirming the resolutions being made, the bankrupt or the trustee be authorized to make an application to annul the adjudication.

On the 14th of April, 1877, an application was made to the court to approve and confirm the resolutions, and such order was then granted upon affidavits of the bankrupt and Mr. Slater, in which no mention was made of any property recently acquired by the bankrupt under the will of S. A. Turner; and upon the report of the official assignee based thereon. The bankruptcy had never been anulled.

The trustee had since ascertained from the bankrupt, and it appeared from his deposition, that at the time of the confirmation of the resolution, the bankrupt and his then trustee were fully aware that the former had become en. titled under the said will to property of considerable value, and that he was well able to pay more than 4s. in the pound. The acting trustee believed that the report of the official assignee was obtained by a concealment of the property belonging to the bankrupt, and that the consent of creditors was obtained in consequence of undue payments to the members of the committee of inspection and others, and by withholding the true value of the property, and by the total concealment of the bankrupt's interests under the wills of J. S. Bridge and J. H. Gibson. The aggregate value of the property not disclosed in the accounts was about £2,000.

S. Woolf, in support of the application, asked for an order similar to that granted in Ex parte Jarvis, Re Spanton (L. R. 10 Ch. D. 179). In that case the power of the court to make the order was assumed, and the only question which arose was as to the position of the creditors-whether or not they were remitted to their original rights.

Eady, for Mr. Tatham, a creditor who had advanced a sum of money upon a charge on the concealed property on the faith of the confirmation of resolutions by the court, asked that, if the court made any order, it should be with'out prejudice to his rights.

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