Court may think sufficient to justify such | year. It is quite clear, therefore, that he a measure over and above the grounds must have contracted this amount of debt mentioned in the catalogue of offences. without any reasonable expectation of being Beyond that, we propose that the after- able to pay. That sounds very plausible acquired property of the bankrupt should at the outset. But the moment you come be subject to the payment of his debts in to details you find that you are obliged this way. If it should appear at a subse- when charging a man with misdemeanour, quent period that the bankrupt has ac- to put your finger upon some particular quired property, after deducting what may debt and say, "that debt was contracted be proper for the maintenance of himself without any reasonable expectation of being and his family, and providing for debts able to pay it ;" and experience shows that subsequently contracted for, of course, it is utterly impossible to convict any perthey must be provided for any surplus son, singling out any one debt in that way, remaining may be made liable by an order and the affirmative being on the person of the Court for the payment of former objecting. Now, in order to meet that creditors. Now that the proposition is to case we propose, under the sixth head of abolish imprisonment for debt, there is no offences, that the Court may suspend the longer any reason why a bankrupt should order of discharge from taking effect for do what, unfortunately, too many of them any time not exceeding three years from have done that is to say, acquire large the date of the order, if it appears to the property afterwards and leave the whole satisfaction of the Court of his debts under the previous bankruptcy unpaid. With regard to this after-acquired property, I should add that power is given in this Bill to a specified majority of the creditors, should they think fit, to release the debtor from his liability in this respect, and he may by their consent acquire an absolute legal discharge as to all after-acquired property.

I now desire, my Lords, to say a few words with regard to the offences for which punishment may be inflicted upon the bankrupt, either by suspension of the certificate of discharge, or by proceedings in the nature of proceedings for a misdemeanour. If your Lordships will look at the list of offences which are specified at page 35 of this Bankruptcy Bill, you will readily follow the observations which I desire to make upon it. The whole description of these offences has given me great anxiety, and the specification of them has been drawn up in a somewhat novel form. With regard to the punishment of the bankrupt we get rid of a part of the existing law which has been found in practice to give some trouble-the general introduction to the catalogue of offences declaring the intent with which a thing may be done. I will give one instance, which will illustrate what I desire to say on this point. At present the law is that a bankrupt may be punished if he has contracted his debts without a reasonable expectation of being able to pay them. In practice the way that has worked is this: -Creditors come to the Court and say"Here is a man who owes £20,000. He never in any year made above £1,000 a

"That any Debt or Liability of the Bankrupt subsisting at the Time of Adjudication was not contracted or incurred by him with a reasonable Expectation (Proof whereof shall lie on him) of his being able to pay or discharge it."

That is to say, we put the onus upon the bankrupt to show that when his debts. were contracted he had a reasonable expectation of being able to pay them. That is a mode of legislation entirely in accordance with the course taken in many cases in our criminal law, and it commends itself to our common understanding. If you find a man in a position in which a presumption arises that he has contracted debts without any reasonable expectation of paying them, and if the means of proof are in his hands to show the contrary, I submit that it is not unfair to throw the burden of that proof upon him. We take the same course with regard to offences which shall be taken to be misdemeanours; and although this inversion of the burden of proof in this way may appear a small matter in itself, I venture to think it will lead to one of the most important changes in the administration of the Bankruptcy Law of this country. Beyond this, we provide that, whereas hitherto these offences have been only triable before a Judge at assizes, there shall be a power to try these misdemeanours at Quarter Sessions and by the Recorders-Courts in which they may be easily disposed of.

Without delaying your Lordships by any complete specification of the enactments of the Bill, I may say we have

endeavoured in another respect to make are made--and they are loud and strongan alteration in the Law of Bankruptcy as to these deeds, which have thus grown which will be advantageous. At present and multiplied. In the first place, it is a various questions may arise under bank strong measure at the least to say that ruptcy which cannot be decided by the the minority of creditors shall be bound Bankruptcy Court itself. Thus the va- by the resolution of the majority to accept lidity of an adjudication being in dispute a sum for their debt far less than the sum may fall to be decided by higher Courts really due to them. But that is not the than the Court of Bankruptcy; and ques- only difficulty. By the present arrangetions may arise which are now determined ment, what are called the secured creditors by the Courts of Common Law. I think it would be desirable to make the Bank ruptcy Court on this head-to use an expression from Scotland-"self containing;" to give it the power of deciding once for all whether an adjudication is valid or invalid; and powers of that kind are in cluded in this Bill.

may term a chapter of misdemeanours, | Treasury taking the income from the fees applicable to deeds just in the same way which are at present applied to the paythat similar offences are dealt with in ment of the Bankruptcy Courts expenses. bankruptcy. The result will be that, whereas at present the debtor thinks that by resorting to a deed containing a majority of his creditors he can escape the law for any offence of which he may have been guilty with regard to his estate, he will now find that, notwithstanding that deed, he will be liable to be punished for any of these offences, just in the same way as if he became a bankrupt. A false claim for a debt under a deed is also made punishable as a false proof under bankruptcy.

It only remains that I should state our proposals with regard to Courts of Bankruptcy. We propose no new Courts, no additions to our present Courts and Judges. On the contrary, we propose that the district Courts of Bankruptcy shall be gradu. ally absorbed, as each Commissioner dies or retires, and that the district Courts shall be closed. There is at present concurrent jurisdiction in the County Courts, and they will become the Courts of bankruptcy for the country districts. We shall use the district Courts while they remain; in the meantime the County Courts will be gradually familiarizing themselves with the administration of bankruptcy, the whole of which they will ultimately dispose of.

These are the leading features of the measures to the first of which I ask your Lordships to give a second reading; and, if they receive your approbation, I think they will effect a very important reform in the Bankruptcy Law. No point has been urged by the mercantile community which has not been attended to, and, I think, effectually met by the provisions of these Bills. I have sometimes heard it said that great desire has been manifested for a thoroughly satisfactory measure of bankruptcy reform; but I do not believe that there ever can be a thoroughly satisfactory measure, because bankruptcy itself is not a satisfactory thing. It is not satisfactory to the debtor, and it certainly is not satisfactory to the creditor, in whose mind it is generally associated with loss and disappointment, and often with fraud and imposition. Under these circumstances, it is not surprising that there always is, as there always will be, a disposition to throw upon the law something of that blame and of that discontent which arises not so much out of the law as out of the subject-matter with which the law has to deal. However, I believe that these measures will really do the best that can

There are large powers of trans-be fer from one Court to another, or from a County Court to London, if it should be deemed desirable by the creditors. The metropolitan district will be twenty miles round the Post Office, and there will be three London Commissioners, who will be primary Judges along with the Judges of the County Courts in the districts. The three London Judges will also compose an appellate tribunal from the County Courts; and any two of the Judges may hear appeals. If an appeal relates to an estate in respect of which the debts are under £300, the judgment of the London Court will be final; but in other cases there will be an appeal to the Court of Chancery. The provision for appeals will be ample, for the appellate business in the Court of Chancery has been for some years easily disposed of in one day a week.

done at present with the law upon the subject. I regret that, owing to circumstances beyond my control, the print of these Bills has not been longer in your Lordships' hands. I have been very anxious to ask you to hear the statement I had to make, because I think that statement will enable your Lordships to find your way, so to speak, through the great mass of paper which the Bills occupy. As to the further progress of these measures, I am desirous to consult your Lordships' convenience; but I am anxious that the measures should as soon as possible receive your Lordships' approval, and go down to the other House of Parliament. At the same time, if it be your Lordships' opinion that these Bills should pass through a Select Committee of this House, I know so well your Lordships' energy and assiduity, that I shall not be disposed to offer any opposition to Certain financial causes of the Bill are that proposal. The only drawback will not supposed to be visible to your Lord- be that the judicial business of the House, ships until they come back again from the which is considerably in arrear, may be other House; but we hope that arrange-interfered with for a few days. However, ments will be made by which establishment I am in your Lordships' hands, and I now expenses of the Bankruptcy Courts will be ask you to give the first of these Bills a charged upon the Consolidated Fund, the second reading.

Moved, "That the Bankruptcy Acts Re- | mode of administration which had been peal Bill be now read 2."(The Lord received with considerable favour. The Chancellor.)

of those who resorted to it? His noble and | ditor in a manner correspondent with its learned Friend on the Woolsack proposed importance and its value to the country at to leave the chief tribunal precisely in the large. If they did so, they might effect condition in which he found it. There real improvement; if they did not, they were three Commissioners, two of whom would always have, if he might so speak, were very aged men, and had, he believed, the dregs and fœces only of insolvency held office above thirty years, and therefore flowing into court, and all the rest seeking they could hardly be supposed to be much other channels and other modes of aralive to the necessity of adopting an en- rangement. What they had to look to tirely new system. He wished, of course, first of all was not so much any defect in to speak of them with all the respect due the principle of the law as in the system to persons who had been long employed as of administering it with reference to the servants of the community; but, at the collection and distribution of the banksame time, he must be permitted to say rupt's property. On examination of a that they were by no means fitting repre- great number of cases he found that in sentatives of this important branch of the many of them the expenses of administralaw. They acted wholly independently of tion were frightful. He had received one another, and were not governed by any many letters from the creditors of bankone mode of procedure. Sometimes they rupts informing him of the amount of differed among themselves, and there was their claims and the extent of the bankno presiding or controlling power. Above rupts' estates, and telling him that the all, the besetting vice in the present con- dividend they obtained was only a few stitution of the Court was that adminis- pence, the great bulk of the estate going trative and judicial duties were mixed to the benefit of the attorneys, the acup and blended together. At one time countants, the messengers, the auctioneers, a Commissioner would sit as a tribunal and other persons. He would give one to determine questions which might be case as an illustration, the correctness of brought before him. At another time he which he had ascertained. The gross prowould proceed to hold a noisy and multi- ceeds of the estate were £777 198. 6d. tudinous meeting, and would bring into The solicitor's bill amounted to £366, or his Court a rabble, who acted without any nearly one-half of the whole estate, the considerations of decorum or decency. In- accountant's charges to £60 148. 9d., the deed, in the evidence taken before the official assignee's to £33, the manager's to Committee of the House of Commons in £37 118. Altogether £523 went to the 1864, the existing tribunal was spoken of various officials, and only £254 was left in the most disparaging terms. It was to be divided among the creditors. All not fair that this important branch of the that waste of the estate took place secunlaw should be administered in a hole-and- dum legem in the process of administration, corner court in Basinghall Street, in a the creditors receiving only about onebuilding thronged by persons who flocked third of that to which they were entitled. together for the purpose of being present In another case the gross proceeds of the at meetings which had no connection with estate were £250. The solicitor's bill the judicial business of the Court. In his amounted to £143, the manager's bill to opinion the law of debtor and creditor £45 198. 10d., the official assignee's to should be represented by a Judge, sitting £12 178., and after various minor other side by side with the other Judges of charges, the balance divisible among the the superior Courts, and whose attention creditors was only £34. Before such a should be confined entirely to judicial state of things could be effectually corbusiness. There would then necessarily rected they must establish some office by be a proper distinction drawn between ad- which all bankrupt estates could be colministrative and judicial duties, and at lected and distributed at a total expense the same time uniformity in the adminis- not exceeding 10 per cent of the gross tration of the law would be secured. He value. Taking a number of bankrupt earnestly protested, therefore, against con- estates which had been administered of late tinuing the present mode of administering years with, perhaps, exceptional economy, the Law of Bankruptcy. Although he was he found that the expenses amounted to only repeating an old story, he must urge 33 per cent of the gross value. on their Lordships the necessity and pro- remedy for such evils was to be sought by priety of providing for the administration creating a species of tribunal charged with of that part of the law of debtor and cre- the duty of collecting bankrupt estates, or

The