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Lcsw 
 
 THE 
 
 INSOLVENT ACT OF 1875. 
 
 AND 
 
 AMEJMDlIiJG ACTS. 
 
 ANNOTATEIJ BY 
 
 SAMUEL KOBINSON CLARKE, ESQ., 
 or osaooDE hall, paruisier at- law. 
 
 Maximum interpretatwim juridic<:t mysteriiim. 
 
 R. (^ARSWELL, LAW PUBLISHiiR, 
 
 20 & 28 ADELAIDE STREET EAST 
 
 1877. 
 
_^fVJ 
 
 
 } r 
 
 EiitL-ivil accurdiiiLT to the Act nf the Piirliamcnt of Ciinadii, in the year of .mr Lord one thoiisiiiiil 
 I'iylit hundred and seveidy-seven, liy Koiikiit Caiiswkll, in the otfii'i/ ..f llic Minister of 
 Auri'-ultni-e. 
 
 / 
 
 w^i 
 
 o^i 
 
 (■ 
 
 ■:^ 
 
 -i: 
 
 '•: \ 
 
 Printkd iiy 
 
 HUSTBK, ROSK & Co., 
 TOKONTO. 
 
Sf 
 
 PEEFACE. 
 
 tliousatiil 
 iiiistcr of 
 
 Two sessions of the Piivliaiaont of Canada liavc intcrvoned since 
 the enactment of " The Insolvent Act of 1875." The amending 
 Acts of these sessions and the decisions of the (Courts have so 
 altered, added to, and exjylained the Act of 1875, tliat no apology- 
 is necessary for the ai)pearance of this work. It w^as undertaken 
 prior to the passing of the Act of 1875, and the subject of 
 insolvency lias received the special attention of the author since 
 that time. 
 
 The amending Acts of 1870 and of 1877 will lie found incor- 
 pcji'ated with the Act of 1875, the sections of the latter Act, in 
 every case, are given to rea<l as- amended. It was deemed advis- 
 ;\Me to cite such of the American cases as are applicable to our 
 Act; these have, accordingly, been brought down to the 1st of 
 January, 1877. All the late I-Cnglish ca.ses, down to and incln.sive 
 of April, 1877, have been given. In regard to the Canadian cases, 
 tlie researches of the author have not extended further back than 
 the 1st of Januaiy, 18G4, but he believes that all cases on the 
 subject of insolvency reported in Canada, from that date to the 1st 
 of May instant, will lie found in theii- proper places in the work. 
 
 Through the kindness of N. H. Meagher, Es(i., of Halifax, and 
 others, lie has also lieen aljle to give several unreported cases of 
 considerable importance. 
 
 The author regrets that no Rides of Practice have yet been 
 framed in any of the Provinces except Quebec, and the I'ules of 
 this Province were framed on the Act of I8()4i. 
 
 The Tariffs of Fees for the Pi'ovinces of Ontario, Quebec, Nova 
 Scotia, New Brunswick and Prince Edward Island will be found 
 in the Appendix. In Manitoba, a tariff has not yet been framed ; 
 and at the time of going to press, the author had not heard from 
 his correspondent in British Columbia. 
 
.-^ 
 
 ^0 
 
 % \ 
 
 IV 
 
 PREFACE. 
 
 The list of OHicial Assignees contains all appointments up to 
 the 25th of April, 1877. 
 
 Yielding to the desire which seems to prevail in the profession 
 for a full expression of opinion on the part of an author, I have 
 in this work, in many instances, pronounced an opinion of my 
 own, and have ventured, in some in.staiices, to dissent from the 
 conclusions of learneil judges. I have endeavoured also to point 
 out the cases which have been overruleil, or are not now a])pliea- 
 ble. Jn those bold undertakings, I can scarcely oxpect that 1 have 
 not made .some mistakes, but I trust that the conclusions I have 
 arrived at are, in the majoi'ity of cases, correct. 
 
 Tho.se who have been of the opinion that the case of Davkhov 
 v. Ross (24 Grant, 22) has abolished the doctrine of " pressure," 
 will, no doubt, attentively peni.se the notes to the ISSrd section 
 of the Act. In fact, the doctrine of pressure is practically un- 
 touched by the decision referred to,ext'eptas to the 18.'h'd section of 
 the Act. The decision was, in brief, that " unjust preference " 
 used in this section is not a synonym for " fraudulent prefeience." 
 The doctrine of pressure still applies in all cases of fraudulent pre- 
 ference, and under the -oOth .section of the Act, fraud or fraudulent 
 preference is a ground for withholding a discharge. 1 nave, 
 therefore, under the 138rd section of the Act, given all the cases 
 in which the (|uestion of pressure arose, foi they ai'e ex]>lanator3' 
 of the doctrine of fraudulent prefei'encc. Where ]iressure es- 
 tablishes that the ti-ansaction is not voluntary, there cannot be a 
 presumption of an intent to prefer, which is an ingredient in case 
 of fraudulent preference. 
 
 Toronto, 12th May, 1877. 
 
ii]-) to 
 
 '*J 
 
 ression 
 
 have 
 
 of my 
 
 )iii the 
 
 point 
 
 )|»lic'a- 
 
 I havu 
 
 liavu 
 
 TABLE OF ABBREVIATIONS. 
 
 A. Ii. J Albany Law Journal. 
 
 A, Ti. Rt'x American Law Register. 
 
 A. L. Rev " " r.eview. 
 
 A. L. T " *' Times. 
 
 Ben Benedict's) Reports. 
 
 Biss BisRell'H Reports. 
 
 R. R Bankrupt Register, U. S. 
 
 Ch. Cham Chancery Chamtiers Report.'^, Ontario, 
 
 C. L. J. N. S Canada Law Journal, New Series. 
 
 C. L, N '. Chicago TiOgal News. 
 
 trrant Grant's Chancery Reports, ( )ntario. 
 
 Ilannay Hannay's lieports, New Hrunswick. 
 
 Lans Lansing, N. Y. 
 
 L. C. Gazette Local Courts Gazette, Ontario. 
 
 L. C. .T. liower Canada Jurist, 
 
 L. C. L. J " " Law Journal. 
 
 L. 0. R " " Reports. 
 
 L. T. B Law Times Bankrupt Rejiorts. 
 
 Pitts. L. J Pittsburgh I'^egal Journal. 
 
 P. R, U. C Uj)i)er (^"auada Practice Re|)orts. 
 
 Pugsley Pugsley's Rei)oi'ts, New Brunswick. 
 
 (J. B. U. C Queen's Bench Reports, Ontario, 
 
 Rurtsull (It Chesley Russell & Chesley's Reports, Nova Scotia. 
 
 Kcvue Ci-itique La Revue Criti(|ue, Montre.al. 
 
 Hf \ uf liCgale " liegale, Sorel. 
 
 Stephen's Digest Stephen's Digest, New Brunswick. Reports. 
 
 S. C Same ( !ase. 
 
 Taylor Taylor's lleports, ( )ntario. 
 
 U. ( '. ('. P Upper Can.ada Common Pleas Reports. 
 
 U.C. L.J " " Law Journal. 
 
 U C'. P. R " " Practice Reports, 
 
 U. C. (}. B " " (^tfen's Bench Reports. 
 
M 
 
TABLE OF COKl^ENTS. 
 
 TaI;I.K ok AltHRKVlATION'S V 
 
 Tai;lkofContknts vii 
 
 List op Cases '^vi' 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 DIVISION I. 
 
 Afi'LU'ATIon ok Act. 
 
 Whci are Traders under this Act, 1. 
 
 Proviso, l-'J, 
 
 As to jiersons having been Traders, 2. 
 
 Interjiretation ; County, District, 22. 
 
 OHicial Assignee, 22. 
 
 Assignee, 22. 
 
 Otticial Gazette, 22. 
 
 Court, 22-3. 
 
 Judge, 2;}. 
 
 Debtor, 24. 
 
 Insolvent, 24. 
 
 Notary, 24. 
 
 Creditor, 24-5. 
 
 Collocated, 2(1. 
 
 Partnerships and companies, 2(). 
 When a Deistor dkemed 1n'solve>jt. 
 
 Acts of Insolvency, acknowledging insolvency, 20. 
 
 Absconding, 30. 
 
 Secreting ett'ccts, 31^ 
 
 Fraudulently a.ssigning, 31, 
 
 Conniving seizure, 33. 
 
 Being imprisoned, 3C. 
 
 Making default to appear, 30. 
 
 Disobeying rule, 36. 
 
 Or decree, 3(5. 
 
VIU 
 
 TABLE OF CONTENTS. 
 
 Makhij? aBsij,Tiiiiont, ntherwise than under this Act, ttc. , V'\. 
 AllmvinfJ! oxocntion to bo unsatiaticd, 4(). 
 ProviHo as to cuatH, 4i\. 
 Dkmani) ok Assionmrm. 
 
 When croditoFB may demand an asHigninunt, 47. 
 
 Form, 47. 
 
 Affidavit recinired, 47. 
 
 Croditnrs demanding assignment, must elect a domicile. 47. 
 
 Judge may annul demand, if claims do not amount to ijtTifK), Ac, .')(!. 
 
 Or if 8t(jppago 1)0 only temporary, 5H. 
 
 Proviso as to co.sts, o*). 
 
 Judge may cidiirgo time for contestation or iwsignment, ."<".). 
 
 Proviso, oO. 
 
 When debtor's estate to become subject to li(iuidation, (JO. 
 
 Time for commencing proceedings limited, (iO. 
 
 DIVISION II. 
 
 Writs of Atta(;hmrjjt. 
 
 Affidavits by parties demanding, <)2. 
 
 Writs of attachment, t>2. 
 
 Form, (>2. 
 
 Concurrent writs, 02. 
 
 Forms of proceeding, 62. 
 
 Service of writ, how made, 71. 
 
 And of concurrent writs, 71. 
 
 Time for return of writ, notice of issue, 72. 
 
 Duty of Assignee executing writ, 74. 
 
 Assignee may break open house, &o,, 75. 
 
 DIVISION III. 
 
 Ak.sionments and Proceedino.s thereon. 
 
 Assignment, when and to whom it may be made, 75. 
 
 Form of assignment, 85. 
 
 Property and powers of insolvent vested in Othcial Assignee, to whom 
 
 assignment is made and first writ issued, 85. 
 Conservatory proceedings, 85. 
 Certain property excepted from seizure, 85. 
 Insolvent to furnish statement of his liabilities, assets, Ac, 110. 
 
TABLE OF CONTENTS. 
 
 IX 
 
 What it must show, 110. 
 
 Petition by iiiHolvont to set acido attachmont, 114. 
 
 Hearing in snch case, 114. 
 
 HoKi^tration nf aH«i|,'ninont and transfer, 117. 
 
 First nioiitinj^ of creditors, Imw called, ll'.*. 
 
 Form, 1H». 
 
 Notice to each creditor by mail, llil-122. 
 
 Proviso, ll'J-120. 
 
 '4 
 
 M 
 
 DIVISION IV. 
 
 KXA.MI.NATIOH OF I\S(ii.\ KNTS. 
 
 Who sl "11 pro.side at meetings, 12'2. 
 
 Insolvent to attend and be examined as to cause of failure especially. 123. 
 
 Attestation, Sec, nf oxamination, 12.'5. 
 
 Insolvent subject to further examination, 124. 
 
 Refusal to answer, A'C, to be ccmtenipt of (!ourt, 128. 
 
 Examination of wife or husband of insolvent, 128. 
 
 DIVISION V, 
 
 Ah8K(NEEH and I^fHPEt'TOR.S. 
 
 Api)ointment of Official Assignee, 132. 
 Ontario, 132. 
 Quebec, 132. 
 District, what to be, 132. 
 Security given by ( )tticial Assignee, 132-3. 
 Additional security, 133. 
 Responsibility, ifec, of OtHcial Assignee, 133. 
 Appointment of, and security given by Assignee, not Official, 135. 
 What creditors only shall vote at meetings, 130. 
 Claims not to be divided for voting, 130. 
 Transfer of estate by Official Assignee, 143. 
 Notice of appointment, 144. 
 Assignee not to act as agent of a creditor, 144- 
 Exception, 144. 
 Place for meetings, 144. 
 
 Inspectors, their appointment, &c., by creditors, 146. 
 Renuineration of Inspectors ; they and Assignee not to purchase insol- 
 vent's property, 14o. 
 
TAJiLK OF CONTENTS. 
 
 Disposal of estato of insolvent, 140. 
 
 Objuftion to proposed niodo of disposal of ostato, 14(). 
 
 Hearing by Court or Jndge, 14(). 
 
 Powers of insolvent vested in Assignee, 147. 
 
 Proviso : as to sale of entire estate, 147. 
 
 Assignee to sue for debts due insolveiit, &c., 148. 
 
 If insolvent sues for the same after assigmnent or attacluuent, 148. 
 
 Partnership dissolved by insolvency of a partner, 154. 
 
 Register to be kept by OlHcial Assignee, 154. 
 
 Assignee to oi)en separate account with each estate, 154. 
 
 Deposit of register by non-otticial Assignee, 154-5. 
 
 Assignees under this or any former Act, must obtain dischar,;", aiid jiay 
 
 over balance to Heceivor-Cieneral, with sworn account, l.")4"5. 
 .Assignee to be paid only by conindssion on amount realized, 15ii. 
 .\nd .actual necessary disbursements, 15(i. 
 As to employing counsel, itc. , 15(>. 
 Remuneration of superseded Assignee, lo(>. 
 Assignee to call meetings on recjuisition, 157. 
 Deposit and withdrawal of moneys of estate in l)ank, 157. 
 Interest on deposits, 158. 
 
 Penalty for nou-distribntion of such interest, 158. 
 Assignee to produce bank books at meetings, &c., 158 
 Punishment for false entry in such pass book, 158. 
 Estate, in whom vested on death of Assignee, 158. 
 Final accmuit and discharge of .Assignee, 158-!). 
 Obligation of Assignee, itc. , 15!». 
 Power of Judge, 150. 
 
 Penalty in case of neglect to present such petition, 15!). 
 Provisions of section 47, to apply to .Assignees (uider former Acts, 159. 
 
 Divisi '>< vr. 
 
 Co.Ml'O.SITION .Wn Dl.S(H,\KGF,. 
 
 Meeting to consider composition and discharge, how and when called, 15!). 
 
 Notice of I'.ieeting, 174. 
 
 Dischargo may bo approved or not, 174. 
 
 Proceedings when consent is obtained, 174-5. 
 
 Certiticate and what it shall contain, 17 
 
 (i). 
 
 Probable ratio of dividend to be stated, 175. 
 Application for contirmation of discliarge, 178. 
 Notice, 178. 
 
TABLE OF (CONTENTS. 
 
 XI 
 
 IK, 
 
 iiiMl [liiy 
 
 ts, 159. 
 
 Notice, how given, 17«. 
 Opposition allowed, i'lS. 
 Continuation of dischargo, 180-1. 
 Affidavit by insolvent to be produced, 182. 
 
 WTien insolvent shall not be entitled to contirniation of discharge, 182. 
 Proper books must have l>een kept, 182. 
 I'rovisD, as to certain provinces, 181). 
 Provisi>, as to fraud and frfiudulent preferences, 183. 
 Powers of Court or Judge, 188-U. 
 
 Ill certain cases character of discharge may be nioditicd, bSl). 
 ]\Iay >ie suspended or made second class, 18'.(. 
 Deed of composition may be conditional, 190. 
 If condition be not fulfilled, UK). 
 Rank ni creditors thereafter, 190. 
 Deed of reconveyance by Assignee to uisolvent, 191. 
 Itsett'ect, 191. 
 
 If deed of composition be contested, 191. 
 Form of deed, 191. 
 
 Effect of contirniation of discharge— what claims afi'ected, 193. 
 Holders of negotiable paper unknown to insolvent, 193. 
 Discharge not to affect secondary liabilities, 199. 
 
 Disciiarge under this Act not to apply to certain debts or liabilities, 201. 
 But creditors may accept a dividend, 201. 
 
 Application to Cimrt or Judge for discharge if not (jbtained from cre- 
 ditors, 204. 
 Proceedings on such application and powers of the Court or Judge, 2(t5. 
 Suspension or classification of second class, 205-<). 
 Must pay fifty cents on the dollar, 20ti. 
 Discharge, itc, obtained by fraud, to be void, 208. 
 
 DIVISION VII. 
 
 lied, 169. 
 
 Saia', of Debts. 
 
 Sale of debts the collection of which would be too onerous, 212. 
 
 Proviso. 212. 
 
 Creditor may bo authorized to take any special proceeding at his own 
 
 risk, 213. 
 Proviso, 213. 
 
 Rights of purchasers of debts due Insolvent, 213-14. 
 No warrnnty, 214. 
 
n 
 
 xii TABLE OF CONTENTS. 
 
 DIVISION VIII. 
 
 Leases. 
 
 Lease of property more valuable than rent to bo sold ; on what condi- 
 
 tions, 214. 
 Other cases of lease, how dealt with, 210. 
 Lessor claiming damages for termination of the lease, 210. 
 How damages to bo estimated, 210-7. 
 Preferential claim of landlord limited in the several Provinces. 217. 
 
 '<4 
 
 DIVISION IX. 
 Sale of Real Estate. 
 
 Sale of real estate of insolvent, 220. 
 In Quebec, 220. 
 
 Proviso, postponement of sale by consent of creditors, iVc, 220. 
 Effects of sales of real estate, 222. 
 Form of d jed and terms, 222. 
 
 Sales in Quebec may be subject to certain charges, 222-\i. 
 Folle enchere, 223. 
 Certificate of Registrar, 223. 
 Code of Civil Procedure to apply, 223. 
 Order of distribution, 223. 
 Assignee's commission, 223. 
 Balance, 223. 
 
 In Quebec privileged creditors may requii'o sale of proi^rty sutijeot to 
 their privileged claims, 225. 
 
 DIVISION X. 
 
 Dividends. 
 
 .\ccount8, st.atements and dividends, by Assignee, 22o. 
 What claims shall rank on the estate, 220. 
 Case of contingent claims provided for, 240. 
 Arbitration, if award be rejected, 241. 
 Rank and privilege of creditors, 245. 
 Proviso as to creditors holding security, 245. 
 
 Seizure in execution after appointment of Assignee, its ett'i'ct, 240. 
 Proviso as to costs, 240. 
 
 As to creditors i;olding security for their claims, 251. 
 Security not matuied and insolvent only secondarily liable. 251. 
 If the security is on real estate or shipping, 258. 
 " Proceedings on filing of a secured claim, 25'.>. 
 
TABLE OF CONTENTS. 
 
 Xlll 
 
 imli- 
 
 211 
 
 Rank of several items of a creditor's claim, 250, 
 
 Oath of a creditor as to non-payment of his claim, 259-»10. 
 
 Insolvent owing debts as a partner, 2(50. 
 
 Allowance to insolvent, how made, 207. 
 
 As to costs in suits against insolvent after notice under this Act, 2(58. 
 
 Privilecte of clerks, &c. , for wages, 208. 
 
 They may be employed, 208. 
 
 Notice of dividend sheet and payment, 270. 
 
 Contestation of claims by Assignee under Inspector's instnictions, 271-2. 
 
 Claiujs not filed, how dealt with, 272. 
 
 Claims on dividends objected to, how determined, 273. 
 
 Hearing and decision thereon, 273. 
 
 Judgment executory, 273. 
 
 Creditors or Inspectors may order contestation of claims, &c., 274. 
 
 If there he any property of insolvent under seizure at time of assignment 
 
 or attachment, proceedings, 274. 
 l"nclaimud dividends, how dealt with, 275. 
 Balance of estate (if any) to be paid over to insolvent, 275. 
 
 DIVISION XI. 
 
 subject to 
 
 Prooedure Genkrallv. 
 
 Notice pending delay, 275. 
 
 Notices (if meetings, Ac, how given, 275. 
 
 Cases unprovided for, 275. 
 
 How (]ue.stion.s shall be decided at meeting, 270. 
 
 What matters may be voted upon at first meeting of creditors, 277. 
 
 Form and proof of claims, 278. 
 
 Affidavits, before whom sworn, 280. 
 
 Surrender of security by creditor and effect thereof, 280-1. 
 
 Sot-off, how allowed, 281. 
 
 Service of papers under this Act, 284. 
 
 Commissifin for examination of witnesses, 285. 
 
 SubpcL'uas to witnessea, 285. 
 
 Service of process, A-c. . 285. 
 
 Disobedience of writs and process, how punishable, 285-0. 
 
 Proof of default, 38(>. 
 
 Expenses must be tendered to person summoned as witness, A'c, 280. 
 
 Forms under this Act, 28(3. 
 
 Foreign discharges not to bar debts contracted in Canada, 287. 
 
 As to amendments in proceedings under this Act, 288. 
 
 Provision in case of death of insolvent, 289. 
 
XIV 
 
 TAP.LE OF CONTENTS. 
 
 
 Represontiitives how fai' liable, 280. 
 
 Costs, on what property ami in what order char<feable, 28i>-!Mi, 
 
 As to assets chargeable with mortgages, itc., 2!)(). 
 
 Provisions as to letters addressed to insolvent by i)ost, 2!ll. 
 
 Dis(inalification of Judge, 2!U. 
 
 What Judge to act in such case, 291. 
 
 Prothonotary to preside (in Quebec) in absence of .Tndge, 292. 
 
 Rules of practice and tarilF of fees in I^rovince of Q\iebec, how to be 
 
 made, 292. 
 And in other Provinces, 292-H. 
 Present rules to remain until altered, 29;3. 
 Assignee to be subject to summary jurisdiction of Court, 293 
 Obedience, how enforced, 29.'1. 
 Registration of marriage contracts of traders, in Quebec, 300. 
 
 DIVISION XII. 
 
 lMi'lUSoX:',fF,XT FOR DeBT. • 
 
 Insolvent in jail or on the limits, may apply to Judge fordiscjifiiue. I'.OO. 
 
 Proceedings there<in, IlOl. 
 
 Examinations of insolvent and witnesses, 3()I. 
 
 .hidge may discharge him if the examination be satisfact<iry. .301-2. 
 
 Provisf., :{01 . 
 
 Jlinutes of e.Kamination t{j be kept, 301-2. 
 
 Postponement in certain cases, 301-2. 
 
 As to any sidise((U('nt jiroceedings, .")01-2. 
 
 Proviso, 302. 
 
 DIVISION XIII. 
 
 AlTKAL. 
 
 Appeal from any order of the Judge in Province of Quebec, 304. 
 
 In other Provinces, 304. 
 
 Appeal to be prosecuted within eight days, .304. 
 
 If appellant does not proceed, 304-f"i. 
 
 .Judgment of court final, 305. 
 
 Reservation of amount of dividend contested, 310. 
 
TAllLE OF CONTENTS. 
 
 XV 
 
 DIVISION XIV. 
 
 Ml 
 
 Fhauds and Fraudulent Pkefekknces. 
 
 Oratuituousj contracts within thi'ec months of insolvency presumed 
 
 friunlulent, 310. 
 Certain other contracts voidable, 314. 
 
 Contracts made witli intent to defraud creditors to bo void, 316. 
 Contracts giving an unjust preference, 317. 
 Presumption of fraud, 317. 
 Certain payments by debtor void, 345. 
 Proviso, 345. 
 
 Transfer of curtain debts l)y insolvent, void, 350. 
 Purchasing goods on credit by persons l^nowing themselves unable to 
 
 pay, to 1)0 fraud, and how punishable, 352. 
 Proviso, 352. 
 
 Fraud must be proved, 358. 
 Award of imprisonment, 358. 
 Assignees to be deemed agents for certain purposes, ' 32-33 Vict. iha]). 
 
 21, 35! ». 
 Punishment of assignee mailing wilful misstatement, 3()ff. 
 Certain Acts by insolvent to be misdemeanors, 3<iC-7. 
 Not fully discovering or not delivering property, books, jjapers, tV^c, o(»7. 
 Removing ]>roperty, 3()7. 
 Not ilenounciiig false claims, 307. 
 False schedule, 3(i7. 
 Withholding books, &c., 307. 
 Falsifying books, 3()7. 
 Stating hctitious losses, 3()7. 
 Disjjosiug of goods not j)aid for, 307-8. 
 ( »lFences against this Act how tried, 369. 
 
 Creditors taking consideration for granting discharge, 30D-37O. 
 Penalty, 370. 
 Punishment of insolvent receiving money, &c., and not handiiii the 
 
 same to assignee, 370. 
 Im])ris(mnient for disobeying order, 370. 
 Certain documents to be evidence, 371- 
 
 DIVISION XV, 
 
 BuiLDlNCi AND JURY FUTND. 
 
 Contribution to Building and Jury Fund in Quebec, 371. 
 Governor in Council has certain powers, 371. 
 
XIV 
 
 TABLE OF CONTKNTS. 
 DIVISION XVI. 
 
 Procediuie in Case of Incorporated Companies. 
 Provisions for Incorporated Companies, 371. 
 Preliminary notice, 371. 
 Inquiry by assignee, 371-2. 
 Company to exhibit books, &c. , 372. 
 Refusal to be contempt of Court, 372. 
 
 After service of order, company to hold property in trust, 372. 
 Meeting of creditors may be called, 372. 
 Resolutions thereat, 372. 
 To be submitted to Judge, 372. 
 Powers of Judge in relation thereto, 372-3. 
 Order may be made by Judge, 372-3. 
 Receiver may be appointed, 373. 
 To render account, 3^3. 
 Further meeting within six months, 373. 
 Further delay may be granted, 373. 
 
 If demands are unsatisfied, estate of c(jnip;iny may be wound up, 373. 
 Judge may uKidify order, 373. 
 Otlicers of company may be examined, 373. 
 Remuneration of assignee and receiver, 373. 
 Company may make assignment pending delay, 373-4. 
 
 DIVISION XVII. 
 
 General Provisions. 
 
 Commencement of foregoing provisions, 374. 
 
 Insolvent Act of 1804 and 1869 and Acts amending them. Acts of B. C. 
 
 and P. E. I. continued to Ist Sept. and then repealed, saving certain 
 
 proceedings and matters, 374. 
 Proviso, 374-5. 
 Procedure under this Act to apply and supersede that under said ActK<. 
 
 374-5. 
 Securities to remain valid, 375. 
 Inconsistent Acts repealed, 375. 
 Act to apply to all the Provinces of Canada, 370. 
 Short title, 376. 
 
 The amending Act of 1876, 376. 
 The amending Act of 1877, 380. 
 
LIST OF CASES. 
 
 up, 373. 
 
 cts of B. C. 
 ving certair. 
 
 r said Act^j,. 
 
 
 L 
 
 A. 
 
 I'VfJE 
 
 Abbey v. Dale 202 
 
 Abbott V. Hicks 283 
 
 Adams, Re 130 
 
 Adams V. McCall 322, 323 
 
 Adkins v. Farringdon 244 
 
 Ahlv. Thorner 337 
 
 Ala & Chat, R. R. Co., Re 55 
 
 Alcott, Exp 239 
 
 Aldridge v. Ireland 30 
 
 Alexander, Re ^ 44, 253 
 
 " V. Vaiighan 24 
 
 Allan, V. Clarkson 333 
 
 " V. Garratt.l38,161,lG5,lG7,l<)<.) 
 
 Allen, Exp 229 
 
 " V. Bonnett 41, 01 
 
 ' ' V. Cannon 24 
 
 " V.Montgomery 152 
 
 Alsager, v. Currie 238 
 
 Am. Glass Ins. Co. , Re 242 
 
 Amoskeag M. Co. v. Barnes. . . . 204 
 
 Amot V. Holden 244 
 
 Anderson. Ex. p 153 
 
 " V. Miller 222 
 
 V. Wurtelo 219 
 
 Angerstein, Ex. p 90, 109, 134 
 
 Anon 14, 45 
 
 Appold, Re 219 
 
 Archibald, Re 21 
 
 " V. Haldan..295, 321, 328 
 
 Arm.strong v. Armstrong 282 
 
 Arnold v. Leonard 221 
 
 Arsenault, Re - . 179 
 
 Ashley V. Robinson 113 
 
 Ashton V. Blackshaw H() 
 
 Ashworth, Ex. p 59, 252 
 
 Assignees v. Ubsdell, Ex. p 132 
 
 Atkins, Ro 121 
 
 Atkinson, Ex. p 17 
 
 Austin, Ex. p 131 
 
 " V. Gordon 199 
 
 V. Markham 210 
 
 2 
 
 B. 
 
 PAOF, 
 
 B. &. S. Gas Co., Re 219 
 
 Babcock, Re 252 
 
 Bachelder, Re 339 
 
 Bacon v. Douglas 101, 24(> 
 
 Bagwell V. Hamilton 15, 21 
 
 Bailey, Ex. p 22, 330 
 
 " V. Finch 283 
 
 Bailie v. Grant 21 
 
 Bailey v. Johnson 283 
 
 •' V. Loeb 2K) 
 
 Baker, Re 8, 35, 255, 201, .354 
 
 " V. Dawbarn 261 
 
 Baker's Trusts, Re 40 
 
 Baldwin v. Peterman 150 
 
 " V. Rosscau 32 
 
 Bamford, Ex. p 21, 30 
 
 Bank of Australasia v. Flower . . 254 
 *• B. N. A. and Strong . . 58 
 
 " Hindustan, Re 65 
 
 " Montreal v. McWhirter. 315 
 
 Banks, Re 185 
 
 Banner, Ex. p 263 
 
 Barclay v. Sutton 80, 206 
 
 Barling v. Bishopp 40 
 
 Barnard v. Ford 33 
 
 Barnett, Ex. p 282 
 
 Barrett, Ex. p 229 
 
 " Re 141, 279 
 
 Barstow v. Adams 8, 152 
 
 Bartholow v. Bean 337 
 
 Bartholemew v. Sherwood 19 
 
 Batchelder, Re 180 
 
 Bateman v. Gosling 200 
 
 Baun, Re 130 
 
 Baxter v. Pritchard .38, 43 
 
 Beal, Re 113, 114, 184 
 
 Beales, Re 234 
 
 Bean v. Laflin 337 
 
 Beard, Re 70 
 
 Beardsley, Re 114 
 
 Beare, Re 187 
 
 
XVUl 
 
 LIST OF CASES. 
 
 PAGE 
 
 Beaudin v. Roy 150 
 
 Bechor v. Blackburn 80 
 
 Bejeau, Ex. p 7, 302 
 
 Belcher v. Prittie 327 
 
 Bdis, Re 186 
 
 Belisle v. Union St. Jacques 3 
 
 Bell, Re 330 
 
 " V. Simpson 41 
 
 " V. Young 10 
 
 Benham v. Broadhurst H>3 
 
 Bennett, Re 113 
 
 " V. Gamgee 149 
 
 Bennett's Trust 107 
 
 Berthelot, Re 24 
 
 Bessette, Re 239 
 
 Bcstwick, Re 254 
 
 Bettley v. Stainsby 245 
 
 Bigelow, Re 233 
 
 Bills V. Smith 324, 326 
 
 Bingham v. Mulholland 94 
 
 Bird, Ex. p 92 
 
 Birmingham & S. G. Co. , Ex. p. 154 
 
 Bittel, Re 279 
 
 Bittleston v. Cooke 39, 40 
 
 Black, Re 35, 33P 
 
 " V.Fountain 315 
 
 " V. McClelland 236 
 
 Blackburn, Ex. p 348 
 
 Blakeley v. Hall 132, 248 
 
 Bleeker v. Wisebum 57 
 
 Blencowe, Ex. p 47 
 
 Bolland, Ex. p 317 
 
 Bolton V. Lancashire & G. R. VV. 
 
 Co 245 
 
 Boomer, Ex. p 101 
 
 Booth V. Hutchinson 282 
 
 " V. Taylor 355 
 
 Both»m V. Armstrong 319, 338 
 
 Botsford, Re 21, 135 
 
 Bowers. Ex. p 16, 19 
 
 Bowie, Re 126 
 
 Boyd V Robins 244, 245 
 
 Brady v. Otis 118 
 
 Bradshaw, Ex. p 263 
 
 " V.Klein 152 
 
 Brand v. Bickle 246 
 
 Brandt, Re 130 
 
 Brett, Re 81, 82 
 
 " Exp 252, 369 
 
 " V. Levett 65 
 
 Brewer v. Sparrow 153 
 
 Briggs V. Sowry 218 
 
 Brigham v. Smith 281 
 
 PAOE 
 
 Brigstock, Ex p .52 
 
 Brimley, Re 128 
 
 Britton v. Payen Hi 
 
 Bromley, Re 125, 127 
 
 Brook. Ex p 230 
 
 Brooks V. Tayh)r 44, 1312 
 
 Brown, Re 270 
 
 " V. Douglas 78 
 
 '♦ V. Farmers' Bank 284 
 
 " V. Hudson 287 
 
 " V. Kempton 32(1 
 
 " V. Smith 1.53 
 
 " V. Wright 80, 8) 
 
 " V. Carr. . 200 
 
 Brum, Ro 114 
 
 Brunquest, Re 253 
 
 Bryan, Re loO 
 
 Buchanan and McCormick ....21, 48 
 
 " V. Smith 190, 314 
 
 Bugbee, Re 232, 2:i4 
 
 Bullon V. Harding 250 
 
 Bulmer v. Hunter . 33 
 
 Bunney, E x. p (>0 
 
 Burke v. McWhirter 296 
 
 liurland v . Larocque 1 48 
 
 Burns v. Steele 75 
 
 Burrell, Exp 170, 192, 21 1 
 
 Burrows v. De Blaquiere, 197,235, 241 
 
 Burt Re 45 
 
 Burwell v. Tullis 9 
 
 Butcher, Ex p 348 
 
 Butler V. Hobson 138 
 
 0. 
 
 California P. R. R. Co., Re 02 
 
 Calthrop, Re 49 
 
 I Calvin v. Tranchemontagne . . 37, 287 
 
 Cama, Ex p 238, 264 
 
 Camack v. Bisquay 222 
 
 Cameron v. Cameron 70 
 
 " V. Holland 10, 195 
 
 " v. Kerr 298 
 
 Campbell, Ex p 130 
 
 " Re 139 
 
 v. Barrie313,318,321, 
 
 322, 327, 344 
 
 " v. Im. Thurn 170 
 
 Can. Bank Com. v. Davidson.. 91 
 Canada L. C, Co. v. McAllister. . 250 
 
 Caudy, Exp 20 
 
 Cannon v. Denew 1!) 
 
 Carlin v. Carlin 204 
 
LIST OF CASES. 
 
 XIX 
 
 I'AGE 
 
 . 52 
 
 . 128 
 
 . -M 
 
 , 127 
 
 . 230 
 
 , :iV2 
 
 . 270 
 
 . 78 
 
 . 284 
 
 . 287 
 
 . ;J2«) 
 
 . 153 
 
 JO, 81 
 
 . 200 
 
 . 114 
 
 . 253 
 
 100 
 
 }1, 48 
 
 ), 314 
 
 }, 234 
 
 . 250 
 
 . 33 
 
 . . 00 
 
 . 290 
 
 . 148 
 
 . 75 
 
 2, 211 
 
 $5, 241 
 
 . . 45 
 
 .. 9 
 
 . 348 
 
 . . 138 
 
 . . 02 
 
 . . 49 
 
 J7, 287 
 
 J8, 204 
 
 .. 222 
 
 .. 70 
 
 10, 195 
 
 .. 298 
 
 ., 130 
 
 .. 139 
 
 ih 
 
 7, 344 
 
 . . 170 
 
 .. 91 
 
 . . 250 
 
 .. 20 
 
 . . 19 
 
 . . 204 
 
 PAGE 
 
 Carnegie v. Tuer 375 
 
 Caton and Cole, Re 313 
 
 Chaffey, Re 254, 255, 261 
 
 Chalmers, Ex p 93-4 
 
 Champion v. Cotton 33 
 
 Chandler, Ex p 263 
 
 « Re U 
 
 Chapman, Re 153 
 
 Chatteris, Ex p 272 
 
 Chesterfield Col. Co. v. Hawkins 163 
 
 Chippendale v. Tomlinson 98 
 
 Churcher v. Cousins .. 136, 319, 
 
 342, 344, 345, 349 
 
 " V.Johnston 346,349 
 
 " V. Stanley 319 
 
 City Bank, Re 283 
 
 " V. Smith 333, 345 
 
 ' ' of Glasgow Bank v. Arbuckle 
 
 65, 110 
 
 Citizens' Bank v. Ober 221 
 
 Clark, Re 314 
 
 " V. Binninger 23 
 
 " T. Clark 96, 222 
 
 " V. Iselin 340 
 
 Cnarke v. Porter 243 
 
 Cleghorn, Re . . . .188, 270, 273, 299 
 
 Cleland, Re 15, 16, 17, 18, 19 
 
 Clementson v. Hammond .... 59, 295 
 
 Clemmow v. Converse 324 
 
 Clifton V. Foster 253 
 
 Coates, Ex p 40 
 
 " V. Joslin 43, 312 
 
 Cobb, Exp 210, 211 
 
 ' ' V. Symons 14 
 
 Cochrane, Ex p 109 
 
 < "ockburn, Ex p 163 
 
 Cogswell, Re 142 
 
 Cohen, Ex p 331, 332 
 
 Coker, Ex p 154 
 
 Coleman, Re 87 
 
 Colemere, Re 40 
 
 Collie, Re 253 
 
 Collins, Re 12 
 
 CoUver v. Shaw 101 
 
 Comm V. Erisman 203 
 
 Commonwealth v. Conyngham . . 8 
 
 Connell, Re 114 
 
 Connelly v. Bremner 70 
 
 (.'onverse v. Michie 247, 248 
 
 Cook v. TuUis 340 
 
 Cooper, Ex p 51, 278 
 
 Copland v. Stephens 215 
 
 Cork, Re 253 
 
 PAGE 
 
 Cork v. Tullis 96 
 
 Cornwall, Re 32, 279 
 
 Cotter V. Mason 88 
 
 Cotton V. Daintry 18 
 
 Coulthurst V. Smith 297 
 
 Cowles, Re 14,32 
 
 Cragoe v. Jones 200 
 
 Cram, Re 141, 252 
 
 ! Crawford, Re 232 
 
 Crisp V. Perritt 14 
 
 1 Crispin, Ex p 11,12,30 
 
 " Re 24 
 
 Crockett v. Jewett 99, 114 
 
 Crombie v. Jackson 3, 11, 294 
 
 Crosby v. Crouch 325 
 
 Crossley, Ex p. . . , 132 
 
 Crowther, Ex p 141 
 
 Crump, Ex p 124, 126 
 
 Cumberland, Re 240 
 
 Curran v. Munger 45, 338, 341 
 
 Curtis V. Dale 341 
 
 Cutter V. Folsom 11 
 
 Cuxton V. Chadley 282 
 
 Cyrus. Ex p 64 
 
 D. 
 
 Dale, Re 127 
 
 Dangerfield, Re 233 
 
 Darling v. Wilson 248 
 
 Davidson, Re 285 
 
 " V. Mclnnes. .313, 324, 328 
 
 " V. Perry 167 
 
 " V. Ross..iO, 187,305, 
 311,313,317,318,319, 
 
 321, 322, 324, 325, 343 
 
 Davis, Re 59, 141, 274, 316 
 
 " V. Anderson 119 
 
 Day, Ex p 12U 
 
 Dean, Re 32 
 
 " V . Speakman 243 
 
 Dear, Ex p 265 
 
 Derby, Re 13 
 
 Descharmes, Ex p 218 
 
 Deseve, Ex p 180 
 
 De Tastet v. Carroll 327 
 
 Deveber v . Austin 102 
 
 Dever v. Morris 51, 52, 60, ()3.67 
 
 Dewhirst, Ex p 262, 346 
 
 Diblee, Re 27, 325, 338, 339 
 
 Dickinson v. Bunnell 168 
 
 Dillard V. Collins 99 
 
 ! Ditton, Ex p 153 
 
XX 
 
 LIST OF CASES. 
 
 
 PAGE 
 
 Doan V. Compton 339 
 
 Dudge, Re 255, 2GI 
 
 Dodsworth v. Anderson 24 
 
 Doe d. Palmer v. Andrews 215 
 
 Douglas, Re 237 
 
 '' V. Wright 77 
 
 Dow, Re 284 
 
 Dowling, Re %, 340 
 
 Downing v. Traders' Bank 22!) 
 
 Drake v. Rollo 2tS 
 
 Dredge v. Watson . . . . 1G4, 1G8, 177 
 
 Driggs V. Moore 27 
 
 Druiumond, Re 31, 338 
 
 Duffield Re 237 
 
 Dumblo V. White 295 
 
 Dummelow, Re 237 
 
 Duncan v. Smart 15 
 
 Dunn V. Dunn 248 
 
 " V. Irwin 99, 149 
 
 Dyke, Re 219 
 
 E. 
 
 East India Cotton Agency, Re . . 240 
 
 Eaton V. Shannon 71 
 
 Ebb., V. Boulnois 107 
 
 Eccels, Re 14 
 
 Ecfort V. Greely 32 
 
 Edwards v. Coonibe 109 
 
 " V. Gibbs 184 
 
 " V. Glyn 320 
 
 " V. Grace 19 
 
 " V. Hancher 169 
 
 Elam V. Rawson i) 
 
 ElUs, Exp 43, 171 
 
 " Re 10 
 
 " V. MoHenry 288 
 
 " V. Wilmot 198, 200 
 
 Elsworth V. Cole 7 
 
 Elworthy, Ex p 211 
 
 Elton, Ex p 204 
 
 Emmanuel v. Bridger 258 
 
 Engleback v. Nixon 92 
 
 English, Exp 252 
 
 " J. S. Bank, Exp 59 
 
 Entwistle, Re 90 
 
 Erben.Re 113 
 
 Esinhart, Re 205 
 
 Eslick,Re HO 
 
 F. 
 
 Fair, Re 250 
 
 1'A<1E 
 
 Fairwoathcr v. Nevors 145 
 
 Farnsworth, Re 284 
 
 Farrell v. O'Ncil 194, 195 
 
 Farrin v. Cniwfcjrd 33, 338 
 
 Fax(jn V. Folvoy 88 
 
 Foron, Re 129 
 
 Fisher, Exp 40, 41 
 
 Ro Ash 
 
 .28, 
 
 39 
 
 314 
 
 59 
 
 95 
 
 287 
 
 Ex p. 
 
 Forsyth, Re 
 
 Foster, Ex !> 
 
 " V. Hockley 
 
 " V.Taylor.. 
 
 Fowler V. Perrin 199 
 
 Fox V. Eckstein 253 
 
 Fi.xloy, Exj) 40 
 
 Frank, lie 142, 143 
 
 Franks, Ex p 13 
 
 Eraser, Re 127 
 
 " V. Patterson 
 
 15 
 
 Freedley, Re 03 
 
 Freeman v. Lcmias 282 
 
 French v. Morse 243 
 
 Frisbie, Re 130 
 
 Fuller, Re 90 
 
 Fulton V. Lefebvre 117 
 
 G. 
 
 Gallimore, Ex p 18 
 
 Gallinger, Ro 35 
 
 (iardner. Ex !> 17 
 
 Garland, Ex i> 13 
 
 Garratt, Re 107, 355 
 
 Garrett, Re 203 
 
 (iarrison v. Markley 129 
 
 Gates V. Another 151 
 
 Gault V. Lagarde 150, 354 
 
 Gay, Re 180 
 
 Gem, PJx p 15 
 
 George, Re 180 
 
 " V. Clagett 282 
 
 ' ' V. Somers 202 
 
 Gibbs, Ex p 18 
 
 Gibson v. Jenny 9 
 
 Gilbert, Ro 130 
 
 " V. Mclean 288 
 
 Gillebrand, Ex p 310 
 
 Gillingham v. Laing 18 
 
 I Girard v. Hall 208 
 
 (jladwell V. Turner 231 
 
 Glaister v. Hewer 04 
 
 Glegg V. Gilbey 200 
 
 Glover, Re 191 
 
LIST OF CASES. 
 
 xxi 
 
 I'AOE 
 
 
 145 
 
 
 284 
 
 4, 
 
 195 
 
 .^i, 
 
 3138 
 
 
 88 
 
 
 129 
 
 40 
 
 , 41 
 
 
 39 
 
 28, 
 
 314 
 
 
 59 
 
 
 95 
 
 
 287 
 
 
 199 
 
 
 253 
 
 
 40 
 
 12, 
 
 143 
 
 
 13 
 
 
 127 
 
 
 155 
 
 
 r.3 
 
 
 282 
 
 
 243 
 
 , . 
 
 130 
 
 
 9(5 
 
 
 117 
 
 
 18 
 
 
 35 
 
 , 
 
 17 
 
 ^ 
 
 13 
 
 07 
 
 355 
 
 , 
 
 203 
 
 . 
 
 129 
 
 . 
 
 . 151 
 
 50 
 
 , 354 
 
 
 186 
 
 
 15 
 
 
 180 
 
 
 282 
 
 
 ■ 202 
 
 
 . 18 
 
 
 . 9 
 
 
 130 
 
 
 . 288 
 
 , , 
 
 . 310 
 
 
 . 18 
 
 
 . 208 
 
 
 . 231 
 
 
 . 64 
 
 
 . 200 
 
 , . 
 
 . 191 
 
 PAGE 
 
 Goatur, Exp 30 
 
 (ioddard v. Weaver 108 
 
 Godkin V. Beech 209 
 
 Goldnoy v. Lording 109 
 
 Goldschmidt, He 31, 45 
 
 Golloyhy v. Graham 209 
 
 Gomez, Ex p 90, 262 
 
 Goudfollow, Re 11, 184 
 
 Gordon, Exp 143, 265 
 
 Gordon v. Young 318 
 
 Gordon V. Rosa 297 
 
 (Jore IJank v. Eaton 72 
 
 Graham, Re 103 
 
 " V. Chapman 39 
 
 " V. Furber 44 
 
 Granger, Re ^JyO 
 
 Gravel v. Stewart 78, 79 
 
 Graves, Re 143 
 
 Gray v. Hatch 101 
 
 " v. R(dk) 283 
 
 Green, Ex p 237 
 
 " V. Swa.i 7, 162, 163, 354 
 
 Greener, Ex p 2(>2 
 
 Greenway, Ex p 258 
 
 (Jrellier, Ex p 269 
 
 Griften, Re 129 
 
 Griffith V. Brown 21S 
 
 Grone v. Lobeau 135 
 
 Groocock v. Cooper 130 
 
 Groom v. Watts 326 
 
 Grove, Ex p 219 
 
 Groves v. McArdle 138, 139 
 
 " v. Winter 13 
 
 H. 
 
 Halbrook v. Coney 97 
 
 Haldeman v. Michael 35 
 
 Hall, Re 78 
 
 " v. Cooley 14 
 
 " V. Descher 8 
 
 " V. Scodel 100 
 
 " V. Scovil 222 
 
 Halliburton v. Carter 204 
 
 Hambright, Re 102 
 
 Hamilton, Re 129 
 
 " V. Burgeois 306 
 
 Hammond, Ex p 266 
 
 Re 186 
 
 " V. Coolidge 184 
 
 Hankey v. Jones 16, 18 
 
 Hansen, Ex p 230 
 
 Hapgood, Re 89 
 
 PAGE 
 
 Harding, Ex p 236 
 
 Hardy v. Binninger 27, 36, 339 
 
 '« V. Carter 187, 228 
 
 " V. Clark 27 
 
 Harman v. Clarki im 16 
 
 Harrington v. Witt-r 352, 353 
 
 Harris, Ex p 40,260,263 
 
 " Re 123,137,138 
 
 " V. McLaren 28 
 
 Harrison, Re 3, 105 
 
 Harteau v. Boyer 259 
 
 Harvey v. Wilde :519 
 
 Hastie's Case 245 
 
 Hatton, Re 170- 
 
 Hawker, Ex p 10, 17, 39 
 
 Hawksworth v. Elliot 246 
 
 Haynes, Re 142 
 
 Hayward, Ex p ()'' 
 
 Heanny v. Birch 19 
 
 Heath, Exp 125 
 
 Heather v. Webb 199 
 
 Hegan v. Jones 150, 302 
 
 Heilbutv. NeviU 1S2 
 
 Heller, Re 113 
 
 Henderson v. Biso ... 7 
 
 " v. Kerr 297 
 
 Hennocksburgh, Re 236 
 
 Henry v. Douglas 249 
 
 Hensted, Re 127 
 
 Hercules Insurance Co. , Re . . . . 49 
 
 Hersee v. White 322, 334 
 
 Hervey v. Devereux 203 
 
 " V. Rimmer 85 
 
 Hester,Re 103 
 
 Heyden, Re 250 
 
 Hicks, Ex p 310 
 
 " Re 371 
 
 Higgs, Re 232 
 
 Hill, Exp 236 
 
 " Re 141 
 
 " V. Moore 302 
 
 Hillborn v. Mills 66, 116, 285 
 
 Hingston v. Campbell 77, 86 
 
 Hinton v. Acraman 241 
 
 Hoare, Ex p 170 
 
 " Re 26, 140, 256, 278 
 
 " V. White 230, 245 
 
 Hobson V. Bass 231 
 
 Hodgson V. Sidney 99 
 
 Hogan, Re 271 
 
 Holbrook v. Coney 119 
 
 Holland, Ex p J2 
 
 Holmes, Re 173. 
 
; 
 
 xxu 
 
 LIST OF CASKS. 
 
 PAiiK 
 
 Holroyd v Gwynne 18, li> 
 
 Holt, Re M57 
 
 Holthttuson, Ex p 107 
 
 Honian, Ex p HO 
 
 Homo Ins. Co. v. HoUis 14!> 
 
 Hood V. DocWb. .67, 70, 112, 113, 
 
 303, 305, 307, 308, 300 
 
 Hooper, Ex p. (")!> 
 
 V. Marshall 200 
 
 Hope, Ex p 231 
 
 " V. Frank 180 
 
 Hopkins v. Thomas 200 
 
 Houghton, Ex p 2ir> 
 
 Houston, Ex p 230 
 
 Hoyt, Ro 14, 271 
 
 Hubbard, Re 280 
 
 Hubbell, Ro 226 
 
 Huffman, Re 22, 180 
 
 Hufnagel, Re 157 
 
 Hughes, Ex p 154 
 
 Hughes V. Griffith, 70 
 
 Hummitsh Re 114 
 
 Hunt V. Pooke 3(5 
 
 Hunter v. Potts 97 
 
 Hurst, Re.. 25, 43, 257, 324, 325, 327 
 
 Hur8man,Re 113, 184 
 
 Hutchins, Re IGC 
 
 " V. Cohen ..61,65, 71, 106 
 
 Hutto, Re 100, 102 
 
 Hutton V. Crutwell 39 
 
 Hylliard, Ex p 47 
 
 I. 
 
 Inglis, Re 291 
 
 Isaac, Ex p 153, 310 
 
 Izard, Ex p 40 
 
 J. 
 
 Jackson, Re 332 
 
 " V. Bowman 317 
 
 Jacobs, Ex p 200, 278 
 
 James, Ex p 84, 134 
 
 Jamieson v. Kerr 296 
 
 Janeway, Re 89 
 
 Jaycox, Re 234, 251, 278 
 
 Jenkins v. Armour 284 
 
 " V. Fereday 203 
 
 Jenkyn v. Vaughan 46 
 
 Johnson, Ex p 230 
 
 " V. Emerson 58 
 
 " V. Fesemeyer 330 
 
 r.vtiE 
 
 JoluiHoii V. KoIIy 306 
 
 " V. Montreal I. I{y. r>>. 149 
 
 " V. Skaftu 236 
 
 Jones, Ro ....34, 101, 141, 183, 
 
 233, 306, 367 
 
 V. liejoau 356 
 
 V. PfH Mrisay 102 
 
 V. Hanfunl 360 
 
 V. Harbor 40 
 
 V. Harper 61 
 
 V. Phelps 199 
 
 V. RnssoU 201, 204 
 
 V. Sleeper 29, 35 
 
 Joseph V. Lemioux 240 
 
 Julia Lyons, Re 12 
 
 K. 
 
 (I 
 11 
 
 II 
 
 Kalus V. Horgert 43, 
 
 Koays v. Brown 321, 322, 
 
 Koniptner, Ro 
 
 Kennedy, Re 
 
 Kent V. Thomas 
 
 Kunyonand Fenton, Tie 
 
 Korr V. Hastings 
 
 Kettle V. Hammond 
 
 Kevan v. Mawson 
 
 Kibble, Ex p 
 
 Kimball, Re 
 
 King, Exp 41,42, 76, 
 
 " Ro 14 
 
 " V.Smith 85,111,194 
 
 Kingston, Ex p 
 
 Kinkoade, Re 
 
 Kinsman, Re 
 
 Kintzing, Re 
 
 Kirby, Ex p 
 
 Kitson V. Hardwick 
 
 Knight V. Burgess 
 
 Knolpfel, Re 
 
 Kuper V. Stewart 
 
 31() 
 
 328 
 
 265 
 
 218 
 
 244 
 
 339 
 
 215 
 
 38 
 
 39 
 
 272 
 
 203 
 
 254 
 
 , 35 
 
 195 
 
 92 
 
 12 
 
 54 
 
 46 
 
 125 
 
 214 
 
 94 
 
 141 
 
 106 
 
 Lacey, Re 63 
 
 " V. Hill 260, 263 
 
 Lacombe v. Lanctot ... 58 
 
 Lafoie v. Hudon 1 48 
 
 Lafond v. Rankin 213 
 
 Lake, Re 13 
 
 " Superior, C.R.&L Co., Re 
 
 140, 142 
 Lamb, Re. .185,189.276,277,305, 310 
 
LIST OF CASKS. 
 
 .Will 
 
 .'{57 
 356 
 102 
 :150 
 40 
 01 
 H)l> 
 , '204 
 >, 155 
 240 
 12 
 
 :5, 31(} 
 2, :V28 
 , 205 
 . 218 
 . 244 
 . . 339 
 . . 215 
 . . 38 
 . . 39 
 . . 272 
 .. 203 
 rC, 254 
 14,35 
 D4, 195 
 92 
 12 
 54 
 46 
 . 125 
 . 214 
 . 94 
 . 141 
 . 100 
 
 58 
 148 
 213 
 
 13 
 
 I'AdB I 
 
 Liiinb V. HiitlKU'land 91 ; 
 
 Liiinl)o, Ko 157 I 
 
 Liimhurt, Ho 102 
 
 Liiiiibton, Ex p 90 
 
 Liiiuontiij^no, Ro 124, 173 
 
 LiingH, Ro 170, 188 
 
 LangHtaff, Ro 233 j 
 
 Langstalfo, Re 271 
 
 Lariviere and Sauvagean 350 
 
 " V. Whyto 225, 271 
 
 Latham v. Chartered Hank of ' 
 
 India 232 ; 
 
 Lathrop v. Drake 151 
 
 Lawlor v. Walker 88 i 
 
 Lawrence, Re 124 
 
 Lawrio v. MacMahon. . . . 13,289, 310 
 Lawsun, Re..lG4,105, 108, 170,177,181 
 
 Leavenworth, Ro 03 
 
 Leduc V. Tourigny 64 
 
 Leo, Ex p 143 
 
 " V. Motfatt 153 
 
 Luors, Ex p 239 
 
 Luggatt, Re 83 
 
 Leman, Ex p 109 
 
 Levy, Re 201 
 
 Lewis V. Mason 245 
 
 Leys V. McPhorson 31(5 
 
 Lindon v. Mason 330 
 
 " V.Sharp 38 
 
 Lindsay, Ex p 59 
 
 Linn v. Smith 04 
 
 Linsley, Ex p 172,211 
 
 Liquidators, R. I. Co., Ex p. . . . 191 
 R. L Co. ; Re,Glover 
 
 Ex p 191 
 
 Littlotield, Re 144 
 
 Littler,Re 254 
 
 Lloyd v. Ranks 98 
 
 Locke, Re 10 
 
 Loder, Re 228 
 
 Lomax v. IJnxton 38, 39, 40 
 
 London B and M. 13. v. Narraway 282 
 
 " andC. Bank, Ex p.... 348 
 
 " " P. T. Co., Ro 98 
 
 Longsteth v. Pennock 219 
 
 Lord v. Colvin 50 
 
 Loud v. Pierce 184 
 
 Love V. Love 14 
 
 Lowe v. Blakemore 258 
 
 Lowenthail, Ex p 231 
 
 Luckes, Ex p 332 
 
 Ex p., Ro Wood 38 
 
 Lusk, Re 130 
 
 TAtiK 
 
 Luxton V. Hamilton 139 
 
 Lyons, Julia, Re 12 
 
 M. 
 
 Macfarlane, Re 82, 121 , 1 10 
 
 Macintosh v. Davis 70 
 
 Mackay, Re 186 
 
 " v. Goodson 202 
 
 Mackenzie, Ex p 124 
 
 Mackley v. Pattenden . . 21 ."> 
 
 Macredie, Ex p 264 
 
 Mageo V. Rankin 215 
 
 Magennis, Ex p 19 
 
 Malletto V. White 73 
 
 Manning v. Keyes 204 
 
 Mansell v. Regina 10 
 
 Hansen v. Gordon 264 
 
 Mapleback, Re 108 
 
 Marks v. Feldman 299, 342, 343 
 
 Marsh V. Sweeney.. 138, 327, 343, 344 
 
 Marshall, Ex p 46, 241 
 
 " Re 183 
 
 " V. King lOft 
 
 Marstiss, Ro 137 
 
 Marten v. Brumell 199 
 
 Marvin, Ro 13 
 
 Mason V. Hamilton 218 
 
 Masson v. McGowan 315 
 
 Mason v. Redpath 27, 108 
 
 Mathers v. Lynch 316, 335 
 
 Mattheson v. Kellogg 203 
 
 Mathews, Ex p 198, 349 
 
 Mattos V. Saunders 283 
 
 Maule, Ex p 18 
 
 May, Re 235 
 
 May V. Larue 117 
 
 Mayer v. Harding 70 
 
 Maghan, Re 218 
 
 Mayo V. Archer 10 
 
 Mayou, Ex p v>(;5 
 
 McAlpine v. Yo\ing •221 
 
 McAulay v. Allen y28 
 
 McConnell, Re 270 
 
 McCord v. Harper 310 
 
 McCrao, Re 212 
 
 McCready and Loamy 58 
 
 McDonald, Re 201 
 
 " v. Cameron 221 
 
 " v. Cleland.. 62,68,69, 
 
 72,75,76,115 
 " V. Georgian Bay Co. 
 
 97, 288 
 
XXIV 
 
 LIST OF CASES. 
 
 PACK 
 
 McDonald v. Gordon 221 
 
 " V. McCalhim 207 
 
 McDonnell, Ru 24 
 
 McFarlane v. McDonald. . . .321, 327 
 
 ^lcGrego^ v. Hume 334 
 
 Mclnnes v. Brooks 60, 0!) 
 
 " V. Davidson 208 
 
 Mclntyre v. Ingraham _S 
 
 Mclver, Re 151 
 
 McKay, Re 345 
 
 McKenzie, Re 82, 200 
 
 " V, Davidson 152 
 
 McKewan v. Sanderson 211 
 
 McKinsey v. Harding 256 
 
 McLaren and Chalmers, Re . . 83, 
 
 147, 160, 191 
 
 McLean v. Brown 49 
 
 V.Klein 219 
 
 V. McLellan 208,209 
 
 McLeod V. Domville 351 
 
 V. McGuirk 219 
 
 McMillan, Re 190 
 
 McNair, Re 128, 129 
 
 McCiuirk v. McLeod 296 
 
 McRae, Re 238 
 
 McWhirter v. Learmonth 78 
 
 " V. Royal Can. Bank 
 
 324, 330 
 
 " V.Thome 345, 349 
 
 Mechanics' Bank v. Brown .... 292 
 
 Megrath v. Gray 199, 200, 214 
 
 Melbouni, Ex p 140, 234 
 
 Mollon V. Nichols 11 
 
 Mendelsohn, Re 331 
 
 Mendeiihall, Re 03, 127 
 
 Mercer v. Peterson 39, 40 
 
 Messenger, Re 1 57 
 
 Meyers, Re 152 
 
 Meymot, Ex p 14 
 
 Middleton, v. Pollock 282 
 
 Midland B. Co. v. Chambers 231 
 
 Miller, Re 271 
 
 Miller v. Hewitt 233 
 
 Millikin v. Brandon 18 
 
 Mills, Ex p 153 
 
 Mills, Re 275 
 
 Milne, Exp 124 
 
 Mitchell, Ex p 20 
 
 " V. Foster 122 
 
 " V. Mitchell 171 
 
 Molfatt, Re 275 
 
 Mogg V. Baker 320 
 
 Molson Bank and Buchanan .... 171 
 
 j\I()ore, Re 83 
 
 " V. Grand Trunk R. W. Co. 70 
 
 " V. Luce 04, 05 
 
 " V. Rosenberger 113 
 
 Morcll V. Wilmott 122 
 
 Morgan v. Mastick :3!>1' 
 
 Morgan v. ISteble 99 
 
 " V. Whyie 290 
 
 Morse, Ro 140 
 
 Morison, Re 244 
 
 Morris, Re 23 
 
 Morrison v. Thomas 234 
 
 Morriss, Ex p 250 
 
 Mortin v. Martin 245 
 
 Motion, Re 214 
 
 " Moojcn 149 
 
 Mudge v. Rowan 245 
 
 Mul]-.>r, Re 10 
 
 Muniford, Ex p 23(5 
 
 •' v. Hitchcock 70 
 
 Munn, Re 32, 49 
 
 Munro v. Com. Bldg. and S. So- 
 ciety 218 
 
 Murd(jck v. Walsh 100 
 
 Murray V. De Roctenh.am. . . . 190, 203 
 
 Mutrie, Exp 30 
 
 Myers v. Hutchinson 300 
 
 Myrick, Re 114 
 
 N. 
 
 N.anson, Ex p 2'jo 
 
 Naoroji v. Bank of India 283 
 
 Napier, Ex p 209 
 
 Narraway v. Beattio 204 
 
 National Bank, Albany v. Moore 174 
 
 Neal V. Smith 248 
 
 " Re ] 19 
 
 New, Exp 200 
 
 Newall, Ex p 10 
 
 Newell V. Van Pragh 109 
 
 Newman, Re 237 
 
 Newton v. Newton 17 
 
 " V. Ontario Banr..l32,139, 
 
 311,318,325,344 
 
 Nichols V. Eaton 00 
 
 Nicholson v. Gnnn 73,101,212 
 
 Nickodemus, Re 2L8 
 
 Noble, Re 18« 
 
 " v. Scofield 210 
 
 Noonan v. Orton 99, 152 
 
 Norris, Re 23 
 
 North v. House 314 
 
LIST OF CASES. 
 
 XXV 
 
 I'.VliE 
 
 S:3 
 70 
 ;4, tio 
 11 ;{ 
 
 12-2 
 
 :5:'.!t 
 
 •HI 
 200 
 UO 
 244 
 23 
 234 
 25(5 
 245 
 214 
 14!) 
 .. 245 
 .. 10 
 .. 230 
 .. 70 
 .32,49 
 S.)- 
 
 218 
 10(i 
 1<J0, 203 
 30 
 306 
 114 
 
 . . . . 2'j5 
 . . . . 283 
 
 200 
 
 . . . . 204 
 ooru 174 
 . . . . 248 
 .... 110 
 
 200 
 
 .... 10 
 .... 100 
 .... 237 
 .... 17 
 !,13!>, 
 8,325,344 
 .... iH) 
 3,101,212 
 
 2L8 
 
 188 
 
 210 
 
 ..09, 152 
 
 23 
 
 314 
 
 PAOE 
 
 Northern Iron CoTn'mny,Re. . 142,278 
 Norton v. De la v illebeuve .... 151 
 Nunes v. Carter 325,349 
 
 0. 
 
 ( »akey v. Bennett 97 
 
 O'Bannon, Re 113 
 
 O'Farrall, Re 182 
 
 <^gle,Exp 134 
 
 (.»'Kell, Re 128 
 
 Oregon B. and P Co., Re 63 
 
 " Printing Company, Re. . 
 
 28, 330, 350 
 
 (J'Rielly v. Rose 221,299 
 
 Orue, Ke 113, 232 
 
 Oriental Com. Bank, Re 237 
 
 F.C. V. Ov*:rend 232 
 
 • Jstraiider, Ex p 57 
 
 Oswald V. Thompson 40 
 
 Oulton, Re 231 
 
 Owens, Re. . . .72, 187, 285, 300, 
 
 307, 308, 358 
 
 Page, Exp 47, 172, 211 
 
 Palmer, Re 142 
 
 " V. Andrews, Doe d 215 
 
 V.Baker. 7, 194, 195 
 
 Panton v. Labertouch^ 306 
 
 Parisien and Stewart 221 
 
 Parke v. Day 81, 168 
 
 Parker v. Ince 244 
 
 Parkes, Re 141, 280 
 
 Parlue v. Agricultural Ins. Co. 79, 118 
 
 Parr, Re 185, 307, 309 
 
 Pascal, Ex p 12, 50 
 
 Patman v. Vaughan 19 
 
 Patterson, Ex. jp 19 
 
 " V. McCarthy 248, 250 
 
 Paul V. Dowling 20 
 
 Payne v. Able 201 
 
 " V. Dicker 149 
 
 " V. Hendry 311, 322 
 
 " V. Solomon 331 
 
 Peacock, Exp . . 170 
 
 Pearse v. Morrioe . . 316 
 
 Pearson, Ex p 44, 326, 331 
 
 Pen)iell v. Reynolds 39 
 
 Perdue, Re 100, 102 
 
 Perks, Re ... . . 04 
 
 Perry, Re 162, 185 
 
 Perry v. Langley 33, 45 
 
 Pesoa V. Passmore 181 
 
 Peterson v. Spier 184 
 
 3 
 
 PAGE 
 
 Petrie, Re 284 
 
 Pettit's Trusts, Re 107 
 
 Petty V. Walker 184 
 
 Phoenix, B. S. Co., Re 93 
 
 Phelps, Re 141 
 
 " V. Clasen 64 
 
 Philpott, Ex p 46 
 
 Philps, Exp 83 
 
 " V. Hornstedt 41 
 
 Phipps, Exp 15 
 
 Pidgeon v. Martin 165 
 
 Pierce and Holbrooke, Be 45 
 
 Pierson, Re 185, 186 
 
 Pike V. Dickinson 171 
 
 Pinkerton q. t. v. Ross ....... 15 
 
 Phnnmer, Ex p 218 
 
 Pomeroy, Re 114 
 
 Port V. Turton 17 
 
 Port Huron D. D. Co., Re. .232, 278 
 
 Pott V. Turner 15 
 
 Potts V. Garwood 33 
 
 Poulin, Ex p 206, 276 
 
 Powis, Ex p 270 
 
 Pratt, Re 14, 49 
 
 Prevost V. Drolet . . .8, 148, 162, 354 
 
 " V. Pickle 210 
 
 Prescott, Re 227 
 
 Preston v. Hunton ..HI .112,164, 
 
 166, 196 
 
 Priddy, Ex p 14 
 
 Purvis, Re 141 
 
 Putman, Ex p 349 
 
 ^■•ke, Re 300 
 
 Q. 
 
 Quantock v. England ... 20 
 
 Qiiesnol, Re 176, 181 
 
 Quiuike, Re 182 
 
 j R. 
 
 Ramsden v. Brearly 13 
 
 Ramsey v. Foy 9 
 
 Randall, Re 33 
 
 " V. Bowman 248 
 
 ' ' and Sutherland Re 45 
 
 Randolph, Re 227 
 
 Ratlibone, Re . 184 
 
 Rawlings, Re 163 
 
 Rawlinson v. Pearson 15, 20 
 
 Ray, Re 130 
 
 Raynor, Re 61 
 
 .* 
 
XXVI 
 
 LIST OF CASES. 
 
 
 (I 
 
 Rux 
 
 l-ACE 
 
 Reave v. Waterliouse 149 
 
 Reed, Exp 41, 332 
 
 " Re 18(5 
 
 Reg V. Rrfxly 347 
 
 " V. Chandler 3 
 
 r. Ohristijm 301 
 
 V. CoDper 30 1 
 
 V. ( 'reese 3(J!* 
 
 V. Kerr. ... 370 
 
 V. Udlierts 107 
 
 V. linbiiison 131 
 
 V. Sciitt 131 
 
 V. Tiitlock . ..... 3<)2 
 
 V. Tlidiiias 3(i!> 
 
 V. Wiildop 131 
 
 V. Jii.'^tiec'i, i\:c 122 
 
 " V Widdup 120 
 
 Revell V. B!id<e 51) 
 
 liliixidy V. lUackJ.stDU (MJ 
 
 Ricli V. Keyser 9 
 
 Riehards.jie J 25 
 
 Ricliardsiiii v. Ihad.shaw 10 
 
 Piddell V. Reay 352 
 
 Ridge, Ex p . . .' 17 
 
 Riggin V ' 
 
 Rimini v. V:.n i'ra.i'h 1!)!) 
 
 Risk V. Sleeman. IMl 
 
 Robertson v. Hale .......... 150 
 
 " V. Overii.g 31 
 
 Rollins V. Omnibus H. R 8 
 
 Robinson v. INIcKeand. ...... 287 
 
 " V. Pesant . 24i 
 
 " V. Yale= 23(i 
 
 Robson V. Wairen. I'.t.'i 
 
 Rocke, Ex p 153 
 
 Roe V. Rank of British North 
 
 .America 340 
 
 " V. Royal Canadian Hank ■■• ■ 340 
 
 " V. Smith. . . 25, 97, 319, ;.33. 34r, 
 
 Rogers, Ex p 1 43 
 
 Russell, Ex p 
 
 '• Re 
 
 " V.Owen 
 
 linssell's Trust, Re 
 
 Rutherford v. Eakins 355, 358 
 
 Hyan, Re 32, 59 
 
 I'.ACE 
 
 . 172 
 172 
 
 . 284 
 98 
 
 ,s. 
 
 Safl'erv, 
 .Salkcid. 
 
 324 
 
 17 
 
 I 
 
 Ex p 
 
 Ex p 
 
 " V. John.ston 
 
 8alkey,Re 127 
 
 Salvas V. Levreau 35(( 
 
 Sandf-.rd, He 32 
 
 Saunders v. Stull 342 
 
 Sauiiderson. Re 172 
 
 Sauvagtau v. Lariviere .">24 
 
 Savin. He 232 
 
 Sawyer, Re 173 
 
 " V. Hon'j; 284 
 
 V. Tnrpin 28 
 
 Scammon v. Cole 314 
 
 V. Kindiall .... 283 
 
 Magwire 243 Scarth, Ex p 272 
 
 " " ■ " Re 235 
 
 Schick, Re 32 
 
 Scliietier, Re 142 
 
 Schomberg, Ex p . 17 
 
 Schnuipert, Re 90. 185 
 
 Scott, V. Slate 8 
 
 Scu(laiuoie, Ex p 327 
 
 Scidl, \le 35 
 
 20 
 358 
 2H(I 
 
 37 
 
 Second N 
 
 Stdley. Be 
 
 Selkrigi.' v. Uavi.s . 
 S( rgeant, l-'x p. . . . 
 
 Soyniouv, Re 
 
 Shackeiton, Be . . . 
 
 Sharp, F,x p 
 
 '• V. Matth'!W8 
 
 B. V. State N. B. 
 
 ..97. 
 .22i», 
 
 253 
 172 
 237 
 230 
 2(J3 
 92 
 (13 
 
 Sliarpi', 
 Shaw V. 
 
 R.i . . . . 
 iMassie 
 
 Re 
 
 " V. Saucer. . . . .... 
 
 Roiiney v. Lyon.. 141, 104, 177 
 
 Rose V. lU'owii 
 
 " V. Hayc<)ck 38 Shawhan v. W'herritt 
 
 Rose, Re 250 Slu'.han, Be 
 
 Rowan V. Harrison 242. 24;> 
 
 Royal C. Bank v. Mathes(m...31 , 07 
 
 V. Kerr 3:J0 
 
 Rue V. Alter 9 
 
 Rugely V. Robinson 184 
 
 V)iuson 95 
 
 31, 52, 07, 
 
 08, 2,S7 
 
 . . . 13, 289, 309 
 
 1()2, 103, 198, 211 
 
 ... . 28 
 
 03, 230 
 
 Slicrll, Ex ]) 41 
 
 Miepjiard, Re Ill 
 
 Sibin, Re 25;{ 
 
 Siebert v. Spooner 118 
 
 Silverman. Re Il», :'38 
 
 -^y 
 
 RushforHi. Ex p 231 Simp.son, Be 205 
 
If- 
 
 LIST OF CASKS 
 
 XXVll 
 
 172 
 
 284 
 <.>8 
 
 
 324 
 
 
 17 
 
 
 
 
 127 
 
 
 ;55() 
 
 
 32 
 
 
 342 
 
 
 172 
 
 
 3.24 
 
 
 232 
 
 
 173 
 
 
 284 
 
 
 28 
 
 
 314 
 
 
 283 
 
 
 272 
 
 
 235 
 
 
 32 
 
 
 142 
 
 
 17 
 
 »('). 
 
 185 
 
 
 8 
 
 
 327 
 
 
 35 
 
 
 253 
 
 
 172 
 
 'I , 
 
 2:'.(t 
 
 
 2U3 
 
 
 92 
 
 
 03 
 
 )7, 
 
 
 l;«, 
 
 2H7 
 
 RO 
 
 30! » 
 
 '(8 
 
 211 
 
 
 28 
 
 (5:5 
 
 23(i 
 
 
 41 
 
 
 111 
 
 
 253 
 
 
 . 38 
 
 10 
 
 , :'38 
 
 
 207 
 
 VM.li 
 
 Simpson v. HLiiniiig 254 
 
 " V. Xewtoii 271 
 
 Sinclair a-. Ferguson 04 
 
 " V. Henderson 211 
 
 V. McDongiill 240 
 
 Skinner V. McLe(,d. .2!>!>,30('>.311, 310 
 
 Sillier V. .Jonus J\'.), 170 
 
 •' V. I'inder 258 
 
 Smiles V. iJelf-rd 288 
 
 Smith. Ex 1) 78 
 
 " lie 120, 142, 357 
 
 S. T.. He 45 
 
 '' V. liaker 47, 153 
 
 V. Cannrin ;'32 
 
 V. Conniiercial Union Ins. 
 
 ( ■(. '.»!» 
 
 V. Gordon '■)'> 
 
 V. Hnrst 33 
 
 V. McLeim 28 
 
 V. Scott 10 
 
 ■' V. Teiitonialns. Go 45 
 
 Sneezum, He 02 
 
 Snowball, Ex p 8() 
 
 Solis, Re IL'7 
 
 Solomon, Re 185, 180 
 
 Sparrow v. Garruthers 13 
 
 Spicer v . ^^'ard 45 
 
 Spooner v. Jones 81 
 
 Squire v. Watt 8, 102, 354 
 
 Stair. Ex p 5!l, 172 
 
 Stammers v. Elliott 282 
 
 St:anpM, Ex p 14 ■ 
 
 Stansell, Re 2.50 
 
 StansHeld v. Cnbitt 80 ; 
 
 Sturey v. IJurnes 238 | 
 
 Stark, Re 205 j 
 
 Starling, Re 205 
 
 Slate V. Judge 8 
 
 " V. Weigel 8 
 
 Steele v. Stuart 00 
 
 Steen v. .Vjdesworth 183 
 
 Steevens v. Earles . 00 i 
 
 Stern, Re 200 ' 
 
 Stevens. E.x p 15, 40, 332 
 
 lie 201 
 
 Steven.son, Re.... 170, 181, 188. 278 
 
 " V. Brown 84 
 
 V. .MoOwan . . . .150, 302 ' 
 
 Stewart, Ex p \(\ 
 
 Re 200 
 
 ■' V. Lednux 107 
 
 V . Moody 38 
 
 St. Lo.^ky x.'Greeii 10 
 
 Sti me V. Thomas 208 
 
 Straehan v. Barton ... 3:50 
 
 Stranger v. Wilkins 3:50 
 
 Stray, Ex p 40 
 
 Streeter v. Snmmr 0.'. 
 
 Stuart V. Cookerell 08 
 
 " V. Sloper .... .... 10 
 
 Sturt, Ex p 05 
 
 Sullivan, Re 70 
 
 " V. Bridge 152 
 
 Sunnners v. City Bank . . ... 50 
 
 Summcrsett v. Jarvi« 18 
 
 Suter V. Merchants' Bank . 330, 
 
 337. :344 
 
 Sutherland, Re 182, 23(5, 3:58 
 
 Swain v. Barlier 228 
 
 Swepson v. liouse .... .... 88 
 
 Swift, Ex p 1' 2 
 
 Swilchenbart, Ex p. . . . . . 332 
 
 Sykes, Re 4!> 
 
 Sym, Re 05 
 
 T. 
 
 Tait, Exp 153 
 
 Taitt, Ex p 204 
 
 Tarquand v. Vanderplank 340 
 
 Tate V. Charleljois 100 
 
 Tiiylor, Re 131, 100 
 
 Tenipe,st, Ex p 187, 350. 370 
 
 Teneyck, Re , . 215 
 
 Terrell, Re 172 
 
 Thoday.Exp 59 
 
 Thomas, Ex p 24. 50, :505 
 
 Re., 112, 188, 207, 307, 308 
 " V. Hall. .15, 81, 82. 150. .100 
 
 '♦ V. Martin 77 
 
 " V. ^^'iIIiam8 2(50 
 
 " l^e 48. 81, 82, 00 
 
 Thompson v. Cohen. ... . .... 108 
 
 Thomas and Martin 57 
 
 Tliompson V. Rutherfor'l .... 2oO, 210 
 
 Thorne, Ex p lo 
 
 " V. Torrance 37 
 
 Thornhill v. Link 44 
 
 Timber, Kx p .' 350 
 
 l^e , 187 
 
 Ihurniond v. Andrews 152 
 
 Tiffany V. Boatman. '<av. Inst.. ;5K) 
 
 'I'ill, Ex p 121. 124 
 
 Tinker, Ex p 214 
 
 Todd, Ex p 2:50, 252 
 
 Tomlin v. Button ' KJO 
 
XXVlll 
 
 LIST OV CASES. 
 
 !. 
 
 ' 
 
 PAGK 
 
 Tomlinson, Ex p 157 
 
 Touf V. Martin 314, 325 
 
 Topham, Exp 348 
 
 Toussaint, Re 176 
 
 Traders' N. B. v. Campbell .... 35 
 
 Tread well v. Holloway 203 
 
 Trevor, Exp 43 
 
 Trickett, Ex p 325 
 
 Tucker, Re 178, 226 
 
 T. Oxley 283 
 
 Tuesley v. Robinson 103 
 
 Turgeon v. Taillon 53 
 
 Turqiiand, Ex p 239 
 
 Turner v. Hardcastle 17 
 
 " V. Thoniaa 283 
 
 Tuttle V, Truax 314 
 
 Twynne's case 33 
 
 Tyler, Re 20 
 
 U. 
 
 U. S. V. Bayer 369 
 
 " V. Penn 369 
 
 " V. Smith 369 
 
 " V. Throckmorton 244 
 
 Unity Bank, Ex p 234 
 
 V. 
 
 Valentine, Ro 279 
 
 " V. Holdman 114 
 
 V. Vaughan 18 
 
 Van Casteel v. Booker 326 
 
 Vaughan v. Halliday 262 
 
 VanTuyl, Re 129 
 
 Van \\'agner v. Findlay 100 
 
 Vila, Re 221 
 
 Voigt V. Lewis 89 
 
 Wiiddoll, Re 205, 307 
 
 V/adling v. Oliphant 99, 100 
 
 Wagor V. Hall 314, 340 
 
 Waite, Re 30, 32, 339 
 
 Wakeman v. Hoyt 14, 325 
 
 Walker, Ex p 264 
 
 V. Neville 166 
 
 Wallis, Re 189, 350 
 
 Walton, Ex p 59 
 
 " Re 279 
 
 Warburg v. Tucker 244 
 
 Ware v. Gardner 46 
 
 Waring, Ex p 90, 261, 262 
 
 Warmington, Re 183, 370 i 
 
 Warner v. Russ 358 
 
 i I'AUE 
 
 ' Warren, Ex p 1 53 
 
 ' Washburn, Re 215 
 
 Waterer, Ex p 170 
 
 Waters, Ex p 94 
 
 ' " Re 202 
 
 j Watson V. City of Glasgow Bank. 116 
 
 ! Watson V. Henderson 74. 106 
 
 Watt, Ex p 187 
 
 Watts, Re 113 
 
 Weeks, Re 126. 238 
 
 Weitzel, Re 14 
 
 Wells, et al 45 
 
 " Re 28, 338 
 
 " V. (Jirling 20 
 
 " V. Hews 298 
 
 " V. Parker 17 
 
 " V. Porter 7 
 
 West, Re 13 
 
 " V. Reid . . 97 
 
 Westcott, Ex ]) 2')0 
 
 " Ro 48,49 
 
 V. Hodges 230 
 
 White, lie 18t>, 237 
 
 " V. Bisson 107 
 
 " V. Corbett 244 
 
 " V. Cuthbertson 77 
 
 " V. Elliott 98 
 
 " V. Simmons 257, 298 
 
 Whitmore v. Claridge 332 
 
 Whitney and Shaw 258 
 
 Whitwell v. Thompson 38 
 
 Whitworth, Re 245 
 
 Wliyte v. Cohen 38 
 
 " v. Tread well 77, 247 
 
 Wiener, Ro 280 
 
 Wilduian,Exp 239 
 
 Wilkinson's Appeal 35 
 
 Wilkinson, Re 181, 183 
 
 Williams, Exp 265 
 
 Re 27, 236 
 
 " V. Burgess Ill 
 
 " V. Chambers 98 
 
 " Munu .50 
 
 Wilmot, Ex p 235 
 
 Wilson, Ex p 15, 44, 229, 256 
 
 Re 184 
 
 V. Cramp ....29,34,37, 134 
 
 V. Lloyd 200 
 
 " V. Stephenson 83 
 
 " V. Voigt 84 
 
 Wiltshire Iron Co., Re 310 
 
 Winder, Ex p 41 
 
 Wiseman, Ex p 245 
 
 I 
 
LIST OF CASES. 
 
 XXIX 
 
 PAGE 
 
 Wdlcot V. Hodge 204 
 
 Wood V. J^rouke 89 
 
 " V. DodgSDii 230 
 
 Woodard v. Horbort 243 
 
 \V()odft)rd, Re 03 
 
 Woodhoiisev. Murray 42 
 
 Woods, Mo .' 15, 30 
 
 Worslcy v. UoMatt<js 38 
 
 Worthingtou and Ball 292 
 
 " V. Hainiltou 34 
 
 V. Taylor. 52, 03, 128,] 29 
 
 Wright, lie 215 
 
 " V. Filley 35 
 
 V. Maute 130 
 
 Wyatt, Re 184 
 
 Y. 
 
 HAGK 
 
 Yalden,Ex p 157 
 
 Yale V. ToUerton 341 
 
 Yarrington v. Lyou 80 
 
 Yeaton, Re 215 
 
 Yglesias, Re !>0, 202 
 
 Young, Ex p 230 
 
 " V. Higgou 09, 111 
 
 " V. Ridenbaugh L82 
 
 Yuile V. Muiiroe 193 
 
 Z. 
 
 Zouch V. Enipsoy 122 
 
 Zantzinger v. Ril)l)k' 151 
 
i i; 
 
 ¥ 
 
 ;i 
 
 1 1 
 
 ■I ' 
 
THE 
 
 INSOLVENT ACT OF 1875, 
 
 AND AMENDING ACTS. 
 
 38 VICT. CHAP. 16, 1875. 
 
 39 " " 30, 1876. 
 
 40 " " 1877. 
 
 HER MAJESTY, by and with the advice and consent of the Senate and 
 House of Commons of Canada, enacts as follows : — 
 
 1 . This Act shall apply to traders and to trading co-partnerahips and to 
 trading companies whether incorporated or not, except Incorporated Banks, 
 Insurance, Railway, and Telegraph Companies. 
 
 The following persons and partnerships or companies, exercising like trades 
 callings or employments, shall be held to be traders within the meaning of 
 this Act : — 
 
 Apothecaries, auctioneers, bankers, brokers, brickmakers, builders, carpen- 
 ters, carriers, cattle or sheep salesmen, coach proprietors, dyers, fullers 
 keepers of inns, taverns, hotels, saloons or coffee-houses, lime burners, lively 
 stable keepers, market gardeners, millers, miners, packers, printers, quarry- 
 men, sharebrokers, shipowners, shipwrights, stockbrokers, stock-jobbers, 
 victuallers, warehousemen, wharfingers, persons insuring ships or their 
 freights or other matters against perils of the sea, persons using the trade of 
 merchandise by way of bargaining, exchange, bartering, commission, consign- 
 ment, or otherwise, in gross or by retail, and persons v. ho, either for them- 
 selves or as agents or factors for others, seek their living by buying and 
 selling or buying and letting for hire goods or commodities, or by the work- 
 manship or the conversion of goods or commodities, or trees ; but a farmer 
 grazier, common labourer, or workman for hire shall not, nor shall a member 
 of any partnership, association or company which cannot be adjudged insol- 
 
2 
 
 THE INSOLVENT ACT. 
 
 vent under this Act, be deemed as such, a trader for the purposes of this 
 Act. All such persons, co-partnerships, or companies liaving been traders as 
 aforesaid, and having incurred debts as such which have not been barred by 
 the Statutes of Limitations or prescribed, shall be Iield to be traders within 
 the meaning of this Act ; but no proceedings in liipiidation shall be taken 
 against such trader based upon any debt or debts contracted after he has 
 so ceased to trade. 
 
 ; 
 
 In reference to the time when an Act of Parliament takes effect, 
 "The Interpretation Act " (31 Vict. chap. 1. ,s. 4) provides that 
 the Clerk of the Senate shall indorse on eveiy Act of the Parlia- 
 ment of Canada, immediately after the title of such Act, the day, 
 month, and year, when the same was by the Governor-General 
 assented to in Her Majesty's name. >Such indorsement is to be 
 taken as a part of the Act ; and the date of such assent shall be 
 the date of the commencement of the Act, if no later date be 
 therein provided. The 148th section of the Act of 1875, however, 
 fixed the first day of September, 1875, as the date for the com- 
 mencement of the Act, except as to the appointment of official 
 assignees, and the making and framing of rules, orders, and forms, 
 to be followed and observed in proceedings under the Act, with 
 respect to which the Act was declared to be in force from the 
 time of its passing. The Act was assented to on the eighth day of 
 April, 1875 ; therefore it has been in force since that date as to the 
 appointment of assignees and the making of rules ; but in other 
 respects only from the first day of September, 1875. 
 
 The preamble of the Act indicates the authority by virtue of 
 which it was passed (31 Vict. chap. 1, s. 1), and, in reference to 
 bankruptcy and insolvency, the Parliament of Canada has, under 
 the British North America Act, 18(57, section 91, exclusive legisla- 
 tive power. There is nothing in the Act to show that the word 
 " insolvency " is used in any other than the ordinary sense, viz. — 
 general inability to pay all just debts. It was, therefore, held, in 
 New Brunswick, that an Act which provided for the examination 
 of a debtor before a judge, as to his ability to pay his debts and 
 for his discharge from gaol or the limits, as to the suit for which 
 he was confined, where his inability to pay was shown, and where 
 he had made no fraudulent transfer or undue preference, was an 
 
APPLICATION OF THE ACT. 
 
 3 
 
 Insolvent Act which the Legislature of New Brunswick had no 
 power to pass since the British North America Act, 1867, came 
 in force ; and that the assent of the Governor-General would not 
 make it valid (Rey. v. Chandler, 1 Hannay, 548). 
 
 The Local Legislatures of the several Provinces have no juris- 
 diction in matters of insolvency, and if such a Legislature passes 
 a law authorizing the compounding of a debt, such a law will be 
 ultra vires and unconstitutional (Bel isle v. Union St Jacques, 
 15 L. C. J. 212 ; 1 Revue Critique, 118 ; see also Cromhie v. Jack- 
 son, o4 Q. B. U. C. 575 ; re Harrison, 2 Pugsley, 11). 
 
 The Insolvent Act of 1804 only applied in the present Provinces 
 of Ontario and Quebec. In the former, it applied to all persons, 
 whether traders or not ; but in the latter, to traders only. The 
 Insolvent Act of 1869 applied to traders only, and it extended to 
 the Provinces of Ontario, Quebec, New Brunswick, and Nova 
 Scotia. The present Act applies to each and every Province in 
 the Dominion of Canada. The former Acts contained no definition 
 of the term trader, and the definitions in this Act are borrowed 
 almost verbatim from the English Act of 1869. 
 
 The Insolvent Law is now made applicable to the estates of in- 
 corporated companies. Trading companies, whether incorporated 
 or not, are subject to the provisions of the Act. Companies not 
 incorporated for the purposes of trade, are apparently subject to 
 its provisions. Under the 147th section of the Act all incorpor- 
 ated companies, not specinlly excepted in the first section of the 
 Act, are liable to be placed in insolvency. The 147th section, being 
 subsequent to the first, would control it (see Potter's Dwarris on 
 Statutes, 118-158) ; and in express language it extends to all in- 
 corporated companies not excepted. The only excepted companies 
 are Incorporated Banks, Insurance, Railway, and Telegraph Com- 
 panies. Therefore, according to the strict wording of the Statute, 
 all incorporated companies, except the foregoing, come within its 
 provisions. It would seem, however, that it was not intended to 
 have this extended signification ; that it does not apply to religious, 
 charitable, or municipal corporations, but only to trading corpor- 
 ations. 
 
 The persons designated traders by the Act are traders within 
 
i 
 
 ■ II 
 : t 
 '■'h 
 
 4 THE INSOLVENT ACT, 
 
 the Act, whether they are private individual.s, partnerships or 
 companies, A miner, for instance, as a private individual, is 
 witliin the Act ; an incorporated mining company, or partnership 
 formed for mining purposes, is also within the Act. The proce- 
 dure, however, in the case of the incorporated company is dif- 
 ferent from the case of a private individual or partnershij) ; so a 
 private banker would come within the ordinary provisions of the 
 Act. An insolvent incorporated bank is, however, subject to 
 special provision under the Act 39 Vict. chap. 31, This statute 
 provides as follows : — 
 
 1. Notwithstanding anything contained in " The Insolvent Act 
 of 1875," the provisions of the said Act shall apply to incorporated 
 banks, subject to the modiiications contained in the one hundred 
 and forty-seventh section of the said Act, and to the following ad- 
 ditional modifications which apply to the case of incorporated 
 banks only. 
 
 2. No application for a writ of attachment against, and no 
 assignment of the estate shall be made until after the bank has, 
 whether before or since the passing of this Act, become insolvent 
 by suspension of payment for ninety days, under the provisions 
 of the fifty-seventh section of " An Act relating to Banks and 
 Banking," passed in the thirty -fourth year of Her Majesty's Reign, 
 chaptered five. 
 
 3. The judge may adjourn proceedings upon any application for 
 a writ of attachment, for a time not exceeding six months from 
 the time at which the bank suspended payment. 
 
 4. The judge may order that the preliminary inquiry authorized 
 by the first sub-section of the said one hundred and forty -seventh 
 section shall be made by a person or persons other than an official 
 assignee, to be by him named on the application of the parties, and 
 the person or persons so named shall have all the rights and dis- 
 charge all the duties appertaining to the official assignee in con- 
 nexion with such inquiry ; and the judge may extend the time for 
 report on such inquiiy to a period not exceeding thirty days from 
 the date of the order for inquiry. 
 
 5. Nothing herein, or in the said Insolvent Act, contained shall 
 
 ■I . 
 
STATUTE AS TO HANKS. 
 
 and 
 
 ho held to authorize the carrying on or continuing the business 
 after the bank has become insolvent as aforesaid. 
 
 6. An incorporated bank may be appointed a receiver or credi- 
 tors' assignee, and in case a bank is so appointed it may act through 
 one or more of its principal officers to be approved by the judge. 
 
 7. The Receiver shall, in addition to the powers vested in him 
 under the said hundred and forty-seventh section, have the powers 
 vested by the fifty-seventh, fifty-eighth and fifty-ninth sections of 
 the said Act respecting banks and banking in the " Assignee, or 
 Assignees, or other legal authorities," in the said fifty -seventh sec- 
 tion named. 
 
 8. After the issue of the writ of attachment the Assignee shall, 
 in addition to the powers vested him under the Insolvent Act, have 
 like powers to those given to the Receiver under the next preced- 
 ing section of this Act. 
 
 9. Publication in the Canada Gazette, and in one newspaper 
 issued at or nearest the place where the head office is situate, of 
 notice of any proceeding of which, under the Insolvent Act, credi- 
 tors should be notified, shall be deemed sufficient notice to holders 
 of notes of the bank intended for circulation. 
 
 10. It shall be the duty of the Assignee to ascertain as nearly as 
 may be the amount of notes of the bank intended for circulation 
 and actually outstanding, and to reserve until the expiration of at 
 least two years after the bank has become insolvent, or until the last 
 dividend, in case that is not made till after the expiration of the 
 said time, dividends on such part of the said amount in respect of 
 which claims may not be filed ; and if claims have not been filed 
 and dividends applied for in respect of any part of the said amount 
 before the period herein limited the dividends so reserved shall 
 form the last or part of the last dividend. 
 
 The Act of 1869 did not, as we have already seen, extend be- 
 yond traders ; but, under this term, trading co-partnerships were 
 included. By trading co-partnerships are meant mercantile or 
 trading firms ; for instance, partnerships composed of professional 
 men, as barristers or physicians, are not trading co-partnerships, 
 but a firm composed of several persons associated in partnership 
 for the purpose of trade is a trading co-partnership. The dis- 
 
THE INSOLVENT ACT. 
 
 
 tinction between trading co-partnersliipH and unincorporati-d 
 trading companies, to which tlie Act applies, is, that a pai'tner- 
 ship consists of a few individuals known to each otlier, Itound to- 
 gether by ties of friendship and mutual cimtidence, and who, 
 therefore, are not at liberty, witlioutthe consent of all, to retire 
 from the firm and substitute other persons in their places ; M'hilst 
 a company consists of a lar^'er munber of individuals, not neces- 
 sarily ac(]uainted with each other at all, so that it is a matter of 
 comparative inditt'erence whether changes amongst tliem are 
 effected or not (Lindley, on Partnership, Srd Kd., 4, ')). 
 Unincoi'porateu trading companies are, generally, formed by agree- 
 ment ; and they differ from coi'porations in this : That the riglits 
 and obligations of the individuals composing the latter are not 
 tlie rights and obligations of tlie fictitious ptM'scm composed of 
 those individuals; noi' are the rights and obligations of the body 
 corporate exercisable by, or enforceable against, the individual 
 members thereof, either jointly or separately, but only collectively 
 as one fictitious whole (ib. 4). 
 
 This first section of the Insolvent Act is couched in affirmative 
 terms. A Statute made in the affii'mative, without any ni'gative 
 expressed or implied, does not take away the common law. Jiut 
 if an affirmative Statute, which is introthictive of a new law, direct 
 a thing to be done in a cei'tain manner, that thing sliall not, even 
 altliougli there are no negative; words, be done in any other man- 
 ner (Potter's Dwarris on Statutes, (58-72). 
 
 The Insolvent Act, tlierefoie, does not inteifei'e with tlie com- 
 mon aw, which may exist in any of the Pi-ovinces, as to the dis- 
 charge of debtors, nor would it repeal, by implication, any Statute 
 heretofore in force in any of the Provinces, for an affirmative 
 Statute does not repeal an affirmative Statute, and if the substance 
 be that both may stand together, they shall have concurrent effi- 
 cacy (ib. 05)). 
 
 A number of Statutes named in the 149th and ir)lst sections 
 of the Act are, however, expiessly rejiealed. This express repeal 
 abrogates the Statutes named ; but the Act does not prevent a 
 debtor from ettecting a composition independently of its provis- 
 ions by deed, at common law. In such case, however, the deed 
 
 "^&i 
 
RULES OF CONHTUUCTION. 
 
 ^ 
 
 will not havf. tlic statiitory ('H'cct of a <1(M!<1 exocutod under tlic 
 Act. The majority in nuinlK-i' and tlirce-fourth.s in value, caiuiot 
 V)ind tlm non-assontint,' crcMlitors {(xrcen v. Siiuin, 22 C. P. U. C. 
 307). Ah tlu' Act cro'ites a new method for the adminiHtration of 
 the estates of insolvent debtors, and for their relief fnmi lial>ility, 
 the provisions of the Act mu.st be complied with, in order that th e 
 delitor may be entitled to their benefit. A debtor, wlio assigns and 
 comes within the Act, must look to the Act alone for his dis- 
 cliarge, and he has no claim to exemption except in .so far as the 
 Act expressly declares he shall be di.schar«,'ed (see Palmer v. 
 Baker, i2 C. P. U. C. CS ; ex parte Jiejeau, 2 Pugsley, 200). 
 
 Thou<.,di this section u.ses no negative language, yet, for the 
 reasons already nained, j)ersons not de.signated as traders cannot 
 be brought within the Statute, for it is introductive of anew 
 law, and it civates rights and remedies ordy in favour of the indi- 
 viduals to whom it applies. 
 
 It is a general and very sound rule, applicable to the construc- 
 tion of ever}' Statute, that it is to be taken in reference to its 
 subject matter. In this way often, the operation of general 
 words m<iy ]»e limited. Thus the Stock-jobbing Acts in England 
 are general, and their terms would apply to transactions in foreign 
 stocks; a construction, however, which the C'ourts have rejected, 
 in obe lience to the obvious intention of the Legislature that the 
 provisions of thesis enactments are to apply only to British 
 stocks {Sii/h'ld v. John»fov, 1 Hare, 190 ; IJenderson v. Bisc, 3 
 Stai-kie, 15« ; Wclh v. Porter, 2 Bing. N. C. 722 ; Elsivorth v. 
 Coh', 2 M. \: W. 31). 
 
 h\)v these reasons the writer is of opinion that the penal clauses 
 <jf the StaKite cannot be invoked against non -traders, to whom 
 the Act does not apply, and, as we shall see hereafter, some of 
 the clau.ses do not apply unless against a trader whose estate is 
 being adnuni.stered under the Act. Parties may, if they choo.se, 
 wind up the estate of an in.solvent debtor without having re- 
 course to the macliinery provided by the Insolvent Act ; and, if 
 this is done, the provisions of tl j Insolvent Act will not apply to 
 the case, for the Act only applies where an assignment is made, 
 or writ of attachment issued, and proceedings taken thereunder. 
 
8 
 
 THE INSOLVENT ACT. 
 
 II 
 
 If an assignment is made without reference to the Statute, none 
 of its clauses as to fraudulent preferences can be invoked to 
 make the assignment invalid (Squire v. Watt, 29 Q. B. U. C. 
 328 ; see also re Baker, 8 Ch. Cham. 499 ; see also, on the general 
 question, Prevost v. Drolet, 18 L. C. J. 300.) 
 
 If two Acts are in pari materia, the second one being in effect 
 amendatory of the first, a word in the second will not be presumed 
 to be used in a different sense from that in which it ie used in 
 the first (Rohbina v. Omnibus R. li. Z2 Cal. 472). Ambiguous 
 words are to be interpreted by comparmg therewith the context, 
 of the whole Statute, and by considering its reason, spirit and 
 cause (State v. Judge, 12 La. Ann. 777) ; and the law is to be 
 construed as a whole (State v. Weigel, 48 Mo. 29). It is not so 
 much the abstract meaning of words which is to be regarded, but 
 the sense in which they are used in the particular Statute, and 
 this is to be ascertained from the context (Mclntyre v. Iwjra- 
 ham, 35 Miss. 25). The whole Statute is to be so construed that 
 all its provisions may be harmonized if possible (Scott v. State 
 22 Ark. 369) ; and incongruities are to be so construed as to har- 
 monize with the general intent of the whole (Commonwealth v. 
 Conymjham, 60 Penn. St. 99). 
 
 Ex anteced^ntibiLS et conseqiientihibs fit optima interpretatio is 
 one of the most important canons of construction. Every part of 
 a Statute should be brought into action, in order to collect from 
 the whole on^. uniform and consistent sense, if that may be done ; 
 or, in other words, t^^^ construction must be made upon the entire 
 Statute and not meiciy upon disjointed parts of it (Hall v. Desh- 
 ler, 71 Penn. 299). 
 
 In the construction of the law the princii)Ie of uniformity must 
 not be out of sight, for such construction ought to be put on a 
 Statute as may best answer the intention the makers had in view 
 (Barstow v. Adams, 2 Day, 70). 
 
 For the purjiose of arriving at the legislative intent, all Acts on 
 the same subject matter are to be taken together and examined 
 in order t-^ arrive at the true result, (Sedgwick on Statutes, 2nd 
 Ed. 209) ; and this rule applies though some of the Statutes liave 
 been repealed (ib. 212). But whore a Statute differs in its language 
 
RULES OF CONSTRUCTION. 
 
 9 
 
 from a prior Statute on the same subject, it is an intimation that 
 a different construction is intended(ii?'c/i v./re?/8er,54Penn.St.86); 
 but, not where the change is one of phraseology merely (Biirwell 
 V. Tullia, 12 Minn. 572). A declaratory Act or an Act declaring the 
 true intent of a previous Act does not control the judiciary in de- 
 ciding on the true construction of the first Act, except in cases aris- 
 ing subsequent to the declaratoiy Act, or except in cases where 
 a retrospective Act can properly be passed (Sedgwick on Statutes, 
 2nd Ed. 214). Under 40 Vict., s. 37, no amendment thereby made 
 shall be held to be a declaration of the construction of any jjrovi- 
 sion of the Insolvent Act of 1875, as applicable to any proceedings 
 theretofore had under the Act (see also 39 Vict. chap. 30, s. 22). 
 
 Construction should lean towards personal liberty, and Statutes 
 authorizing arrest are to be strictly construed (Elam v. Rawson, 
 21 Goo. 139 ; Rammj v. Foy, 10 Ind. 493). 
 
 Statutes in derogation of the common law are to be construed 
 strictly, and it has been said that Statutes exempting portions of 
 a debtor's property from liability for his debts are in derogation 
 of the common law, and not to be extended by an equitable con- 
 struction ; and it has been held that, where a Statute declared a 
 team should be exempt from execution, this did not exempt the 
 necessary food for them, although a previous Act of Exemption 
 did exempt a cow and two swine and the necessary food {Rue v. 
 Alter, 5 Denio, 119). But this doctrine has been relaxed in modern 
 times, and these Statutes are now to be construed sensibly and with 
 a view to the object aimed at by the Legislature, and accoixlingly it 
 was held that a Statute exempting one cow from execution applied 
 to the animal whether alive ordead {Gihfionw. Jenny, 15 Mass. 205). 
 Under "The Inter})retation Act " (31 Vict. chap. 1, sec. 7, thirty- 
 ninthly), " The prcandile of every Act of Parliament shall be 
 deemed a pait thereof, intended to assist in explaining the pur- 
 port and object of the Act, and every Act and every provision or 
 enactment thereof shall be deemed remedial, whether its imme- 
 diate purport be to direct the doing of anything which Parlia- 
 ment deems to be foi- the public goo<l, or to prevent or punish the 
 doing of anything which it deems contrary to the public good, 
 and shall accordingly receive such fair, large, and liberal con- 
 
 M 
 
I 'i 1 
 i 1 I 
 
 \\ 
 
 10 
 
 THE INSOLVENT ACT. 
 
 struction and interpretation as will best ensure the attainment of 
 the object of the Act, and of such provision or enactment accord- 
 ing to their true intent, meaning, and spirit. Fortiethly, nothing 
 in this section shall exclude the application to any Act of any 
 rule of construction applicable thereto, and not inconsistent with 
 this section." (The application of the foregoing provisions to the 
 Insolvent Act was recogni.«ed in Cameron v. Holland, 29 Q. B. 
 U. C. 506 ; where a decision in accordance with these principles 
 was rendered.) 
 
 And it would seem that the Insolvent Act is remedial, 
 and should be liberally cimstrued. It is not to be construed 
 strictly as if it were an obscure or special penal enactment. 
 The Act establishes a system, and regulates, in all their details, 
 th<i relative rights and duties of debtor and creditor. It does not 
 attempt to punish the insolvent, Itut to distribute his property 
 fairly and impaitially between his creditors, to whom in justice it 
 belongs. It is reiiiedial, and seeks to protect the honest civditor 
 from being overreached and defrauded by the imscrupulous. It 
 is intended to relieve the honest but unfortunate debtor from 
 the burden of liabilities which he cannot discliarge, and allow 
 him to conunence the business of life anew. 8uch an Act must 
 be construed according to the fairimjiort of its terms with a view 
 to effect its object, and to promote justice (re Lorke, 2 B. R. 
 882; re i]faller, :i B. R. 32!) ; re Silverman, 4 B. 11.52:3; re 
 Ellis, 5 Law Rep. 273.) 
 
 When an Act of Parliament has received a constniction, cither 
 from kmg practice or from judicial int<r])i(tation,and is afterwards 
 re-enacted in the same terms, the Ijcgislature is deemed to have 
 had that construction in view in the re-enactment (ManscU v. 
 lien'nia, 8 K. .^ B. 54; Si. Loxhj v. Grmi, IJ. B. N. S. 370; 
 ex parte Campbell, h. R. 5 Ch. 703 ; Da-'uho)! v. Boss, 24 (Jrant, 
 79 per Pattei'son, J.). This rule would ajtply (o tlie sections of the 
 Act which have been re-enacted in all cases wheiv these sectiims 
 have received the same ccmstructioii in all tlie Provinces; but if 
 the consti'uction has diffei'ed in tlie different Provinces, the jKirti- 
 cular consti'uction, which the Legislature had in view, could not 
 be deteiniined, and in such ca.se the rule would not a])iily {Ihn'ld- 
 
 ^i 
 
ALIENS AND DENIZENS. 
 
 11 
 
 ve 
 
 son V. Ross, supra, per Patterson, J.). Acts of Parliament are 
 always presumed to be passed with a knowledge by the legisla- 
 ture of the then existing law, and of the decisions of the courts 
 upon the matter which is the subject of legislation (Crombie v. 
 Jackson, 34 Q. B, U. C. 580, per Wilson, J.). 
 
 There is nothing in the Act to show that the persons named in 
 this section must be subjects of Her Majesty, and it is apprehend- 
 ed that the law applies to aliens and denizens resident in Canada 
 in the same manner as in the case of subjects. The point has not 
 been decided in Canada, though raised in the case of Mellon v. 
 Nichols, 27 Q. B. U. C. 1G7. 
 
 In the United States, the Bankrupt Act s})eaks of persons 
 " residing within the jurisdiction of the United States," and 
 it is there held that resident aliens may take the benefit of the 
 Act (re Goodfellovj, 3 B. R., 452 ; s. c. Lowell, 510 ; Cutter v, 
 Folsom, 17 N. H. 139). 
 
 The writer is of (jpinion that a trader not domiciled in Canada, 
 who is nevertheless doing business, and has a place of business 
 here, may obtain a discliarge from his liabilities under the Act. 
 In ex parte Crispin, L. R. 8 Ch. 374: 28 L. T. N. S. 483, the 
 Court declared that it was the act of bankniptcy, being connuit- 
 ted within the jurisdiction of the Court, that gave the jurisdic- 
 tion, and tliey expressed the opinion that, if a foreign trader 
 trades in England, and commits an act of bankruptcy there, he is 
 subject to the bankrupt laws, and that it makes no difference 
 that he is not a resident trader in England, or that his principal 
 place of business is elsewhere. It would, therefore, seem that all 
 persons, who carry on trade in Canada, are liable to be placed in 
 insolvency, if they commit any of the acts which, under the third 
 section, are declared to make a debtor insolvent, and that this 
 liability attaches independently of the domicile or nationality of 
 the trader (see also annotations to section 2 E). 
 
 Where a person neither de facto nor in contemplation of law, re- 
 sides in England, it would seem that if he contracts debts during 
 a temporary stay in England he may conunit an act of bankiuptey 
 in England, and thus give juristliction to the English Court of 
 Bankruptcy, although, if he leave England without havino- com- 
 
12 
 
 THE INSOLVENT AC;T. 
 
 1 i| 
 
 initted an act of bankruptcy, the mere fact of indebtedness in 
 England will not give the court jurisdiction (re Crispin, L. R. 8 
 Oh. 874). It makes no difference that the debt is contracted 
 abroad; thus if a foreigner domiciled abroad contracts a debt 
 aliroad to another foreigner also domiciled abroad, such debt will 
 support an adjudication against the debtor if he comes to England, 
 and there commits an act of bankruptcy (ex parte Pascal, L. R. 1 
 Ch. D. 509 ; 24 W. R. 263). 
 
 The Statute of the Province of Ontario (35 Vict. chap. IG, 
 section 8) (macts that a husband shall not, by reason of any mar- 
 riage which shall take place after the Act has come into operation, 
 be liable for the debts of his wife contracted before marriage, but 
 the Avife shall be liable to be sued therefor, and any property be- 
 longing to her for her separate use shall be liable to satisfy such 
 debts as if she had continued unmarried. Under this section, a 
 married woman who has no property belonging to her for her 
 separate use is not liable to become insolvent (ex parte Holland, 
 30 I T. N. S. 10(3 ; L. R. 9 Ch. App. 307). 
 
 1 1, may be observed, that there is in the Act a recognition of 
 the liability of a married woman to become bankrupt. Section 26 
 .speaks of the examination of the " husband " of the insolvent, and 
 this indicates that the insolvent may be a married woman. 
 
 In the United States, a married woman who is a sole trader, 
 may apply for the benefit of the l)ankrupt law (re GollinH 3 Biss. 
 415) ; and where a niaiTied woman is living apart from her hus- 
 band, and by the statute law of the State or Province, in such 
 case, .she is liable to be sued in all actions as if sole and unmarried, 
 she may be proceeded against under the bankrupt law (re Jtdla 
 Lyom, 10 C. L. J. N. S. 179 ; 2 Saw. 524 ; re Kinkeack, 7 B. R. 
 439). 
 
 In the latter case it Avas declared that a Court of Bankruptcy is 
 clothed with all the powers of a Court of Equity, and if a feme 
 covert, with the consent of the husband, can enter into co-partner- 
 ship with him or any other person, then she may be declared a 
 bankrupt on the petition of creditors, or at least the firm as a 
 business entity may be so adjudged for the purpose of distributing 
 assets among the creditors. 
 
 ■''SI' 
 
PERSONS WITHIN THE ACT. 
 
 13 
 
 If the husband is civiliter mortuus or has abjured the reahn or 
 is in exile or under sentence of transportation, the wife becomes 
 liable to be sued at law as a feme sole, and as such liable to bank- 
 ruptcy (ex parte Franks, 7 Bing. 764 ; Sparro'w v. Carruthers, 
 2 W. Bl. 1197). The same results follow if the wife is living 
 apart from her husband, under a decree for judicial separation or 
 order of protection (see Eamsden v. Brearly, L. R. 10 Q. E. 147). 
 
 It would seem doubtful whether an infant under any circum- 
 stances can be made a bankrupt (re West, 22 L. J. Bank., 71 ; 
 re Lake L. R. 8 Ch. 51) ; at all events it can only be in respect of 
 judgment debts, or debts incurred for necessaries. It has been 
 held in the United States that infants are not, as to their general 
 contracts, within the provisions of the bankrupt law (re Derby, 
 8 B. R. 106). 
 
 The Insolvent Law does not in general embrace trustees, such as 
 executors, administrators, and guardians and others acting strictly 
 in a fiduciary capacity (Groves v. Winter, 9 B. R. 357). 
 
 But an executor who carries on his testator's trade to a greater 
 extent than is required to wind up his business is liable to be ad- 
 judged insolvent as a trader (ex parte Garland, 10 Ves. 110), and 
 the 117th section of the Act expressly extends the provisions of 
 the Act to the heirs, administrators, or other legal representatives 
 of any deceased person who if living would be subject to it.j pro- 
 visions. But under this section a writ of attachment cannot issue 
 against an executor or administrator as such. But if the insolvent 
 dies after the assignment or the issue of a writ of attachment 
 against him, the proceedings may be carried on by or against his 
 executors or administrators (re Sharpe, 20 C. P. U. C. 82). 
 
 But it would seem before this can be done, the representative 
 of the deceased insolvent must be clothed with proper authority 
 by a grant of letters of administration or probate of the will 
 {Lawrie v. McMahon, R R. U. C. 9 ; 8 C. L. N. S. 171). A per- 
 son who is so unsound in mind as to be wholly incapable of man- 
 aging his own affairs, cannot in that condition, commit an act for 
 which he can be forced into bankruptcy by his creditors, against 
 the objection of his guardian (re Marvin, 1 Dillon, 178). 
 
 A party who is under guardianship as a lunatic may be pro- 
 
'% 
 
 14 
 
 THE INSOLVENT ACT. 
 
 I; '! 
 
 ceeded against in involuntary bankruptcy, in opposition to the 
 wish of his guardian (re Weitzel, 14 B. R. 400). 
 
 It seems a hinatic may be adjudged a bankrupt upon a debt 
 contracted and an act of bankruptcy committed by him whilst 
 sane, or during a lucid interval {A7wn. 13 Ves. 500 ; ex parte 
 8ta'mp,I>e Gex 345). 
 
 But a lunatic cannot conmiit an act of bankruptcy, involving 
 an intent, unless di'rirfr ? lucid interval (Crisp v. Perritt, Wils. 
 473 ; ex parte Pvt hh] - -e, 48 ; ex parte titamp, l)e Gex, 45). 
 In the United States 'ir. been held that if a person while 
 sane has committed an act ot bankruptcy, he may be made bank- 
 rupt after he has bee luo limaf.',. The rights of the bankrupt 
 will be fully protected by hio guamian 're Pratt, 6 B. R. 270). 
 A clergyman may be made bankrupt ; and, if he carry on a 
 trade, may, it would seem, commit those acts of bankruptcy which 
 are peculiar to traders (ex parte Meijmot, 1 Atk. 198-201 ; Cobb v. 
 Symons, 5 B. & A. 510), 
 
 The commercial definition of a trader is one who makes it his 
 business to buy and sell merchandise or other things ordinarily 
 the subject of traffic and commerce ; (re Coti'les, 1 B, R. 280 ; 
 Love V. Love, 21 Pitts. L. J. 101 ). 
 
 In order to be a ti'ader the person must buy as weli as sell 
 (Hall V. Cooley, 3 N. Y. Leg. Obs. 282 ; re Chandler, 4 B. R. 
 213). If he merely makes up the product of his own land he 
 is not a trader, (ib. ; re Kiny, 1 N. Y. Leg. Obs. 270). 
 
 A sale of surplus commodities not purchased with a view to 
 sale, is not such a dealing as will render the party a trader (Hall 
 T. Cooley, 3 N. Y. Leg. Obs. 282). 
 
 A person who carries on the business of a distiller, and also 
 buys cattle which he fattens and sells is a trader (re Eccles, 1 N. 
 Y. Leg. Obs. 84 ; 5 Law Kep. 273). 
 
 If a person is engaged in a business requiring the purchase of 
 articles to be sold again, either in the same or in an improved 
 state, he must be regarded as " using the trade of merchandise " 
 (re Hoyt, 1 N. Y. Leg. Obs. 132 ; Wakertian v. Hoyt, 5 Law Rep. 
 309). But a person who sells the mere produce of his own labour 
 is only a seller, and not a trader (ib). A person who owns and 
 
TRADERS. 
 
 15 
 
 also 
 IN. 
 
 lise 
 Rep. 
 bour 
 and 
 
 leases oil land, and receives a part of the products as rent, is not 
 a trader as respects his dealings in the products of his land in a 
 crude state. The word " trader " is to be interpreted according to 
 its meaning in the English Bankrupt Law. The intervention of 
 a factor and the commercial disposal of the products by him and the 
 accommodation which he may have extended as a banker, will not 
 in such case make the principal a trader (re Woods, 7 B. R. 126). 
 
 The word "traders," as used in the Statute, must be understood 
 and interpreted by its meaning at the present day, as the limits 
 of trade have been so much extended beyond what they were 
 in former times. Printing and publishing a newspaper is a trad- 
 ing (Finkerton q. t. v. Ross, 33 Q. B. U. C. 508). So a banker 
 and exchange and money broker, and a dealer in foreign and 
 uncurrent money, and buying and selling stocks is a trader {Dun- 
 can v. Smart, 35 Q. B. U. C. 532; see also Bagivell v. Hamilton, 
 10 U. C L. J. 305) ; and a person may be adjudge<' a bankrupt as 
 a banker, if he acts as one, although he does not keep an open shop, 
 or books as bankers usually do. (ex parte Wilson, 1 Atk. 217). 
 
 A barber is not a trader, and the sale of perfumery being merely 
 incidental to his business, and a purchase of tobacco nine months 
 before his assignment, which he sold again immediately, being an 
 isolated transaction, were held upon the evidence insufficient to 
 bring him within the Act {Thomas v. Hall, P. R. U. C. 276). 
 
 The term " brokers" has been held to include not merely brokers 
 employed in the purchase and sale of merchandise, but also pawn- 
 brokers {Rawlinson v. Pearson, 5 B. & Aid. 124, bill-brokers; ex 
 parte Fhipps, 2 Dea. 487, assurance brokers ; ex parte Stevens, 4 
 Mad. 25G, stock-brokers ; Cullen 12, note 2 ; and ship-brokers, 
 Fott V. Tunier, 6 Bing. 702). 
 
 A person, who merely discounts bills for the accommodation of 
 his friends, is not a bill broker (ex parte Fhipps, 2 Dea. 487). Nei- 
 ther will a person who occasionally sells shares for his friends be 
 a share broker (re Cleland, L. R. 2 Ch. App. 466). But a solicitor, 
 who was in the habit of laying out the money of his clients by way 
 of investment, was adjudged bankrupt as a money broker (ex 
 parte Gem, 2 M. D. & D. 9U). 
 
 A builder is a person who builds for hire or by contract for 
 
 
■'*1^ 
 
 I \ 
 
 10 
 
 THK INSOLVENT ACT. 
 
 
 others, or who, as part of liis business, buys or takes a luase of lauil 
 for the purpose of building' thereon, with a view to profit by sel- 
 ling vr letting the houses ; one or two isohited transactions will 
 not make a man a builder, if there is no intention to carry on the 
 Itusiness as a means of livelihood (Stuart v. Slo'per, 3 Exch. 700 ; 
 ex i)arte Stewart, 3 D. & S. 577). 
 
 Under the description of cattle and sheep salesmen is included 
 a farmer who habitually deals in cattle or sheep to an extent not 
 re(juired for the purposes of his farm in the ordinary course of 
 husbandry, for he is in fact a cattle jobber as well as a farmer 
 (ex parte Neimll, 3 Dea. 333). 
 
 So keepers of inns include lodging-housekeepers, or boarding- 
 housekeepers, who supply provisions to their lodgers at a profit 
 and as a means of getting a livelihood (ex parte Boivers, 2 Dea. 
 90 ; Smith v. Scott, 9 Bing. 99) ; and this whether the lodgers take 
 their meals with the proprietor or separately. 
 
 Under the Act of 18G9, which did not in any way define the 
 meaning of the word " trader," it was held that an innkeepm- 
 was not a trader {Harman v. Clarkson, 22 C. P. U. C. 291). 
 
 A professional nurse, who keeps a lodging-house for invalids 
 and supplies them with board at a profit, as well as lodging and 
 nursing, is a keeper of an " hotel," and therefore a trader within 
 the Act (ex parte Thorrw., L. R. 3 Ch. D. 457). 
 
 Persons using the trade of merchandise by way of bargaining, 
 exchange, bartering, commission, or otherwise, in gross or by 
 retail. 
 
 Under this description seem to be embraced the regular 
 merchants and traders of the country. It applies to persons who 
 practise merchandise as a trade, by which they seek to get a 
 living {Hankey v. Jones, Cowp. 745 ; Richardson v. Bradehaw, 
 1 Atk. 128). It will not include a person who raises money on 
 bills for his private use, and not with a view to gain a profit on 
 the exchange (ib.) ; but it will include a commission agent for 
 the sale and purchase of merchandise (ex parte Hawker, 26 
 L. T. N. S. 54.) 
 
 Persons who, either for themselves, or as agents or factors for 
 others, seek their living by buying and selling, or buying and 
 
 m 
 
TRADERS. 
 
 17 
 
 get a 
 
 letting for hire, goods or commodities, or by the workmansliip 
 or conversion of goods or connnodities or trees. 
 
 It lias always been held that trading by buying and selling 
 goods and connnodities has reference only to dealings in such 
 goods, wares, or chattels, as are the ordinary sid)ject of merchan- 
 dise (ex parte Hmvker, 20 L. T. N. S. 54). Thus it was held not 
 to a|)i)ly to the buying and selling of shares (re Gleland, L. R. 
 2 Ch. Ajtp. 40G). So, also, it does not extend to land or any inte- 
 i-est in land, or to articles manufactured from the soil, or ])]'oduce 
 of land, by the owner or occupier, although othei- ingredients or 
 materials are purchased by him and used for the purpose of ame- 
 liorating the ])r()duce of the land, and rendering it a more mar- 
 ketable commodity {Port v. Tiirton, 2 Wils. 169). Thus it has 
 been held not to ajiply to a person who sold alum, made from 
 alum rocks in his ])ossession, as owner or lessee (Netvton v. New- 
 ton Crookes' B. 8th Ed., 71) ; or to a burner of lime (ex parte 
 Rid ye, 1 liose, .310) ; or the owner of a slate ([uarry (re Gleland, 
 L. R. 2 Ch. App. 400); or a manufacturer of bricks (Wells v. 
 Pdrker, 1 T. R. '^4) ; or the manufacture of salt from salt springs 
 (ex parte Atkinxon, 1 M. D. & D. 300), where the material used 
 was the produce of land in the jxissession of the person carrying- 
 on the business either as owner or lessee. The same principle 
 has been applied to the owner oi- lessee of a coal mine, or stone 
 (piarry (ex parte Gardner, 1 Rose, 377) ; or phosphate mine (ex 
 parte Schomberff, L. R. 10 Ch. A])p. 172) ; and to a farmer who 
 sells cheeses or cider, respectively made from milk and apples 
 produced on his farm (Neiuton v. Neivton, uhi supra), and to other 
 cases of a like nature. If, however, a man bought the whole or 
 a very large })ortion of the materials necessary to make the 
 manufactured article in which he dealt, as if for makinsr bricks 
 he bought the clay as well as the other subsidiary ingredients, 
 he was held to be a trader (ex parte SulJadd, 3 M. D. & D. 
 125). So where a smelter of iron mixed sixty -five per cent, of 
 iron ore purchased by him with that produced from his own 
 land, he was held to be a trader {Turner v. Hardcastle, 11 
 C. B. N. S. 689). So, also, a man who buys timber whether 
 
 standing or not, for the i)urpo3e of selling again, is a trader 
 B 
 
'} \ 
 
 I 
 
 n 
 
 ; s 
 
 !( 
 ji 
 it 
 
 \i 
 
 n 
 
 18 
 
 TlIK INSOLVKNT ACT. 
 
 {Hoh'oyd v. Ounjnne, 2 Taunt. 17<S). But the Ifsscc of a (|uaiTy 
 who (lui-- rocks and worked up the materials into sUites was held 
 not to he a trader in respeet thereof, hecause he sold tools and 
 gun])owder to liis workmen, or allowed a huilder to have some 
 iron and timher for the erectitm of a forj^^e and huildinns for the 
 purposes of the ((uarry, and for which the huilder was charned 
 in his accounts (re Clcland, L. R., 2 ('h. Ap)). 4(iG). The doc- 
 trine under consideration is no longer ai)i)lica1ile to hrick- 
 niakers, limehurners, miners, or (j uarry men, as they an- ex])ressly 
 made suhject to the provisions of the Act. 
 
 In order to con.stitute a trading hy l)uyin<f an<l selling, or hy 
 buying and letting for hire, or the workmanship of goods, or coni- 
 nu)t.lities, these occupations must he followed as a means of gain- 
 ing a livi'lihood ; one or two isolated transactions will not do. 
 But if the intention of getting a living is pi'oved, either hy the 
 party's own admissi(jn or otherwise, the extent oi- duration of the 
 trailing is innnaterial {MUl'ik'iv v. Braudov, 1 C. t.^ P. 380 ; Hankeij 
 V. Joncff, Cowj)er, 74-') ; ex parte iMaiilr, 1 4 Ves. (iO.Sj. 
 
 A person em])loyed to buy an<l sell foi' anothei' at a salaiy and 
 without deriving any profit ther(,'from, is merely a servant, and 
 not an agent who gets his living liy buying and selling foi' others. 
 But a servant, who buys goods of his master, as, for itistaiice, copies 
 of a news])aper to sell again, he bearing the loss, if any, is a trader 
 {GlUuKjIiani \. Lain<j,{} Taunt. o82). Again, the doing one only 
 of tlie acts specified will not be sufficient to make a trading ; thus 
 a buying without selling or letting for hire, at least without 
 an intention to sell, or to let for hire, or vice. 'I'erxa, will not 
 constitute a trading (ex parte G'lhbx, 2 Rose, 3>S). So also the 
 buying and selling nnist be in tlie general way of business, and 
 not in a (lualilied manner, or oidy for a special purpose (ex parte 
 Gollhitnrc, 2 Rose, 428) ; as where a trader having ceased to trade, 
 sells off his sur])lus stock {CofUni \. Dauifm, 1 Vent. 2!») ; or a 
 man having purchased more goods than he wants for his piivate 
 use, sells off the .sui'])lus (Sn nimcrxcll v. J(irri.<<, 3 B. tS: B. 2); or 
 where a schoolmaster supplieshis pupils with books and provisions, 
 {Valciitina V. VaiKjhan, 1 Peake, 7(5) ; or an executor oidy dis- 
 poses of his testator's stock in trade, for the pui'pose of winding 
 
 
TRADERS. 
 
 19 
 
 n\) liis estate, or merely continues the buHiness to the extent that 
 is necessary to complete contracts enteied into l»y the testator 
 (Edvnrdu v. Gr((c(', 2 M. \5 W. 190). In like manner, and upon 
 similar piinciples, it has been held, that, if a lodoing-liouse keeper 
 buys furniture to let with his lodgings, this is not a buying and 
 letting for hire within the Act ; the buying and letting the furni- 
 ture bt'ing merely ancillary oi- incidental to the principal object, 
 that of letting lodgings, (ex parte j'^oiW/'-s, 3 M. & A. 33). 
 
 The words " or by the ■v\M)i'kmanship or the conversion of goods 
 or commodities," would st'em to comprise not merely persons who 
 buy the raw material and work it up into some article of manu- 
 facture for the purpose of sale, but also persons who manufacture 
 articles from materials of their own production. The words, how- 
 ever, do not apply to the workmanshij) or conversion of the pro- 
 duce of land by the owner or lessee (re Clcbiitd, L. R. 2 Ch. App. 
 400). 
 
 The exemption of a farmei', grazier, common labourer or work- 
 man for hire merely extends to the occupations specifically men- 
 tioned, and will not protect a person from insolvency as a trader 
 who follows some other business within the statutory definition 
 of tradint;-. Thus a farmer who deals in cattle or other animals 
 to a greater extent than can be fairly considered incidental to his 
 farming will be deemed a trader (Bell v. Yoamj, 15 C. B. 524). So 
 if he l)uys and sells farming produce not grown on his farm, with 
 a view to profit, he will lie a trader within the Act {Mayo v. 
 Archer, 1 Str. 514). If in fact he buys and sells animals and com- 
 modities not merely as ancillary to his farming bu.siness but as 
 the means of making a living thereby independently of his farm, 
 he will be a trader. An occasional dealing with })articular friends 
 will not be sulHcient {Bartkoloniciv v. Sherwood, I T. R. 573) ; but 
 where the trading is a man's connnon or (ordinary mode of dealing, 
 whatever be the (juantum, that is sufhcient (i''rtf7JMni v. Vaiujhaii, 
 1 T. R. 572 ; Cannon v. Denew, 10 Ring. 292; ex parte Magennu 
 1 Rose !S4) ; and ont^ act of trading with an intent to continue, will 
 be sufficient {Holroi/d v. Gwynnc, 2 Taunt. 178; Hennny v. 
 Birch, 3 Camp. 233). A person who retires from trade is not 
 liable in respect to debts subsec^uently contracted (ex j)arte Pat- 
 
20 
 
 TIIK INSOFAKNT ACT. 
 
 I 
 
 4' i 
 
 I': • 
 
 I : 
 
 ■' t 
 
 
 ter»on,\ Rohc 402 ; ox \m-ti' Mildcf/,! Df (it-x, 257; ex paito 
 C(iii(l;i, 2 llnsi- '\'>7) ; I'tit if lit! ('(nitiiuu's to sell utf liis <j;ni< \s hu 
 remains a trader (Riiivli nsmi v. Fcai'i^oii,, ') B. ^ A. 124; Pmd 
 V. Doivliwf, Moo. & M. 2(;.S). 
 
 The distinction taken in liliii^land wlietlier every ont^ vvlio l»uys 
 and sells ^^oods is t/iioad lux' a tradi-snian may ailnut of (jues- 
 tibn ; and yet it is very difHcidt to draw any lint^ founded solely 
 on the sniallness of the transactions. It would seem that any 
 ono who hi ys on cre<lit with intent to sell ajjfain at a profit, and 
 who has no other regular business, is fairly within the nuschief 
 of the Act. Though where the Iniying and selling arc a mere 
 incident, as if a farmer shoidd Imy stock or grain, in addition to 
 what he had raised, perhaps such a person could not bo described 
 as a trader (le Tijlcr, 4 B. R. 104). A [jcrson who liought 
 goods whicli he could use and did use, and which he sold when 
 pressed for money, cannot be deemed a trailer. Isolated and 
 separate acts having no connection with each otlier, and showing 
 no intention to set up any trade, do not make a person a trader. 
 The deliberate purpose of buying goods to sell them again might 
 be within the letter of the Act; so might an amount of trading, 
 however small, connected with an intent to deal generally (re 
 Rogers, 3 B. R. 504). 
 
 Debts barred by the Statutes of Limitations do not, by the ex- 
 press terms of this section, attbrd ground for placing the estate of 
 the debtor in liquidation. Such is also the law in England 
 (Quantock v. Enyland, 2 Bl. 703), where it is also held that a 
 debt founded on an illegal consideration is insufficient ( IVelln 
 v. Girlmy, 1 B. & B. 447). 
 
 Where the intention of the Legislature is to make a law retro- 
 spective, there is no doubt that they have tlie power to do so. 
 This intention is a ([uestion of construction, to be gathered clearly 
 and unmistakably from the purview and scope of the Act. It 
 would seem that this clause is retrospective, and it extends 
 the provisions of the Act to those who -"t sonie time prior to its 
 passing were traders, and had incurreil debts as .such, but who 
 were not in business as traders at the time the Act was passed 
 
 III; 
 
THK ACT IIKTUOSI'KCTIVE. 
 
 21 
 
 '^iv Ai'ch'ihdld, Siipremi' Coiu't, Nova Scotia, 1S71, ivported 7 
 C. I, J. N. S. 300). 
 
 Ke- Arclnlmhl was ilccidtMl on tlic .'M- Vict. olmp. 25, soc. 1 ; liut 
 tlierc is no niatciial (litU-rcncc lu'tvvecn this Statute and tlio present 
 Act. Tin- .'i4 Vict. chap. 2'), s. 1, was hold to apply to a case where 
 proceedings, conniience<l under the In.solvent Act of IHOO, were 
 still pending' at the time the 84 Vict. chap. 25 was pa.ssed. There- 
 it ne whei'o insolvents who had ceased to he tratlers het'ore tlie 
 first day of Srptend)er, 1>S(!!», a])))lie(l for and ohtained an order of 
 discharife under sec. lOG of the Act of that year, the discharge 
 was contirnicd on appeal to the Supreme Court; the operation of 
 the ori_i,dnal Statute having in tlie meantime heen ho extended by 
 the aiiiendin>4 enactments as to bring the case within its scope 
 (re Archlhuhh supra) ; and in the Province of Quebec, on the 34 
 Vict. chap. 25, a similar decision lias been rendered. It was there 
 held thitt, although there was no ])ro<)f of a party having traded 
 foi' over thiee years, yet such ]iarty will be still consiilered a trader 
 if his debts are unpaid, and will be liable to the provisions of the 
 Insolvent Act {Buchanan and McCorviicJc, 19 L. C. J. 29). If 
 the debts arc not l)arred l)y the Statute of Limitations, or pre- 
 scribed (see re Avcliiltahl, supra), they need not be incurred since 
 the passing of the Act. 
 
 Statutes relating to the conduct of Assignees and the jurisdic- 
 tion of the Court over them would apply to A.ssignees appointed 
 before tlie Act were passed, at all events as to matters occui'ring 
 aft'M- li.e statute (/v Botsford, 22 C. P. IT. C. Go.) 
 
 The Act of 1(S04 has been held not to be TGtroH])QctiyQ, (Bagivell 
 V. Hiimilfon, 10 U. C. L. J. 305). 
 
 In England, prior to the Bankruptcy Act of 1869, it was held 
 that a man might l»e made a bankrupt as a trader, after he had 
 ceased to trade in respect of a debt contracted or subsisting during 
 the tiading {Bailie v. Grant, 9 Bing. 121); and the act of bank- 
 ruptcy might be committed after tlic trading had ceased (ex 
 parte Bamford, 15 Ves. 453). But it'r.as been held there that the 
 Act of 1809 has not a retrospective effect and that a man cannot 
 be made a bankrupt as a trader, unless he was a trader at the 
 
22 
 
 THE INSOLVENT ACT. 
 
 N 
 
 I ! 
 
 i!' 
 
 ! I 
 
 comiiienceiuent of the Act or became one subsequently (ex parte 
 Bailey, L. R. 13 Eq. 814; 2r, L. T. N. S. 918). 
 
 2. Tlie word " CDunty" sliall meiin a county or union of counties, and the 
 word " district " shall mean a district, as defined for judicial purposes by the 
 Legislature of the Province wherein the same is situate. 
 
 The word " county " in the said Act includes any judicial district in the 
 province of Ontario not organized into a county (30 Vict. chap. 80, s, '21). 
 
 For all the purposes of The Insolvent Act of 1875, the temporary Judicial 
 District of Nipissing in the Province of Ontario shall he taken and con- 
 sidered as part of the County of Renfrew, and so much of the terri- 
 tory comprising the Territorial District of Parry Sound and the Terri- 
 torial District of Muskoka, as is not already included in the Judicial C(>\iuty 
 of Simcoe shall be taken and considered as part of the said Judicial County 
 of Simcoe ; and all persons and courts having auth<:rity or jurisdiction in 
 the said Counties of Renfrew and Simcoe respectively under the said Act shall 
 have like authority a nd jiu-isdiction in the said District of Nipissing and 
 the said Districts of Pai-ry Sound and Muskoka respectively (40 Vict. s. 24.) 
 
 Under "The Interpretation Act" (81 Vict.cliap. 1, s. 7,)"Nint].iy: 
 The word 'county' inchides two or more C(MUitieH united for 
 purposes to which the Act relates." 
 
 a. " Official Assignee " shall mean the person or persons appointed by the 
 Governor in Council as hereinafter provided, t(j act as Assignee or .loint 
 Assignee under this Act in any County or District. — " Assignee" shall mean 
 either the Official Assignee or the Assignci appointed by the Creditors, as the 
 context may retjuire. 
 
 b. ' ' Official (iazette " shall mean the Gazette published under the authority 
 of the Government of the Province where the proceedings in Bankruptcy or 
 Insolvency are carried on, or used as the official means of communication be- 
 tween the Lieutenant-Governor and the people, and if no such Gazette is 
 published, or if such G.azette is not, in the opinion of the Court or Judge 
 published with sufficient frequency to enable tlio reiiuired notice to be con- 
 veniently published therein, then it shall mean any newspaper published in 
 the Countjs District or Province, which shall be designated by the Court or 
 Judge for publishing the notices re([uired by this Act \'i'.^ Vict. chap. 150. s. 1 ). 
 
 See as to OlHcial Gazette, re Huffman, 5 U. C. L. J. N. S. 71. 
 
 c. The word " Court " shall mean the Superior Court in the Province of 
 Quebec, the Court of Queen's IJench in the Province of Manitoba, and the 
 County Coiirts in the Provinces of Ontario, New Hrunswick, British ( 'olumbia, 
 
Tllh. INSOLVENT COURTS. 
 
 2:3 
 
 and Prince Ethv.ard Isliunl, and also in N(jva Scotia whenever County Courts 
 shall have heen established in tliat Province, and until such County Courts are 
 established it shall mean the Court of Probate of that Province. 
 
 And undta- the " Intorpretcation Act " (81 Viet. cha]). 1, s. 7), 
 " Eio'htocntlily : Tho words " Superior Courts " in the Province of 
 Quebec, denotes the Court of Queen's Bench and the Superior 
 Court in and for the said Province." 
 
 Courts of Bankruptcy as tliey exist in England are separate 
 distinct organizations with powers and jvirisdiction separate and 
 distinct froui all other ccmrts. In this country, however, instead 
 of creating' new organizations, some of those alreaily existing were 
 taken up and made use of in lieu of new organizations. Thus, in 
 the Pi'ovince of Quebec, the Superior Court is the Court having 
 jurisdiction in insolvency, the Queen's Bench in the Province of 
 Manitoba, and the County Courts in the other Provinces. But 
 although the insolvency jurisdiction is thus as it were added to 
 these Courts, yet while acting in insolvency matters, they are none 
 the less separate and distinct courts exercising powers and juris- 
 diction as sejtarate and distinct from their other powers and juris- 
 dictions than if they were separate and distinct organizations (re 
 JVori'in, 4 B. Pi.. 85). But these Courts as (.'oiu'ts having jurisdic- 
 tion in insolvency are the ci'eatuies of the statute and liave no 
 powers except those conferred upon them either expressly or by 
 necessary implication hn- the just and full execution of the law 
 (re il/o/'/'i.s', Crabbe, 70 ; Clad- v. Binni.n<jer, 3 B. R. olS). 
 
 d. The word '"Judge" shall ni(}an a juilge of the said courts respectively, 
 having jurisdiction in the county or district wliere proceedings shall be had 
 under this Act, and shall also inchide a junior and deputy judge when such 
 are appointed. 
 
 Under the Act of LSOl), in the Province of Quebec, the judge 
 having jurisdictitm in insolvency, was tlie judge of thedouucile 
 of the insolvent, and a judge in the Province of Quel)ec had no 
 right to interfere with insolvency matters originated in Ontario, 
 wheie the insolvent had his domicile, even though tlie assiunee 
 resided in tlie Province of Quebec, and the affairs (^f the estate 
 
24 
 
 THE INSOLVENT ACT. 
 
 . 1i: 
 
 h\ t 
 
 were being carried on there (re McDunnell, 15 L. C. J. 145 ; see 
 re Bnihelof, 3 Revue Legale, 122). 
 
 TTnder this clause, however, it is conceived "judge " will mean 
 a judge having jurisdiction where the proceedings are being carried 
 on, as well in the Province of Quebec as in the other Provinces 
 (see ex parte Thomas, 2 Hannay, 1(53). 
 
 t. The w(jrd " (lel)t()r'' shall mean any per.son or persons, co-partnershij), 
 company, or corporation, having lial)ilitios, and being subject to the pro- 
 visions of this Act. 
 
 The English Act uses the words "any debtor," and it is there 
 held that the word "debtor" must be construed to mean "a debtor 
 properly suljject to the laws of England ;" and this, it seems, 
 should be taken to include not only English subjects and denizens, 
 but also foreigners domiciled in Enfdand, and foreigners tradii.g 
 in England, and this whether or not they have committed an act 
 of bankruptcy while personally lesident in England; and lastly 
 foreigners, who l)eing neither domiciled nor trading in England 
 have contracted del)ts and connnitted an act of bankruptcy during 
 their personal residence there. But it does not include foreigners 
 not domiciled nor cariying on trade in England, who (juit Eng- 
 land without having connnitted an act of bankruptcy (re Crispin, 
 L. R. 8 Ch. 374 ; 28 L. T. N. S. 483; see also Alexander v. Vaaghav, 
 Cowp. 398 ; DoiJstvorth v. Anderson, Raym. 375; Alien v. Cannon, 
 4 B. & A. 418). 
 
 i 
 .* 
 
 f. The word " insolvent" shall moan a debtor subject to the provisions of 
 this Act unable to meet his engagements, or who shall have made an assign- 
 ment of his estate for the benefit of his creditors. 
 
 g. The words " before notaries" or " before a notary," shall mean executed 
 in notarial form, according to the laws of the Province of Quebec. 
 
 h. The word " creditor" shall mean every person, co-partnership or com- 
 pany to whom the insolvent is liable, whether primarily or secondarily, and 
 whether as principal or surety ;— but, in referenc^o to proceedings at meetings 
 in insolvency, to the right of voting, to the execution of a deed of composi- 
 tion and discharge, the consent to a discharge of an insolvent, or any other 
 consent or action with regard to the management and disposal of the estate 
 of an insolvent, the word "creditor" shall mean a person, co-partnership or 
 company whose unsecured claims, to an amount of one hundred dollars or 
 
 !.:( 
 
^ip 
 
 CREDITOR. 
 
 25 
 
 see 
 
 I'.pwiiids, have heun proved in tlie niiinner |ir(.vided by this Act, and the 
 prupnition (jf elaim.s in vahie recjnired to give viilidity to any such proceeding 
 or action shall be formed of all claims so proved, whether above oi .mder 
 one hundred dollars, and of no others ; and with regard to any deed of com- 
 position and discharge, or the consent to a discharge of the Insolvent, no 
 creditor whose claim is not affected by such discharge shall be reckoned as 
 one of the required number of creditors, nor shall his claim be reckoned as 
 forming part of the proportion of claims recjuired to give efiect to such com- 
 position and discharge. For all the purposes of this Act the required amount 
 of the creditor's claim shall be over and above any set-off or counter-claim 
 of the debtor against such creditor ; and every affidavit of indebtedness made 
 by any creditor shall be construed as nifide in this sense. 
 
 When the Act speaks of the word " creditor" meaning every 
 person to whom the insolvent is liable, whether primarily or 
 secondarily, and whether as principal or surety, the primary and 
 secondary liability referred to is that of the insolvent and not 
 of the creditor {Roe v Smith, lo Grant, 340). Thus th<i holder of 
 a note on which the insolvent is endorser, would be a ci'editor 
 within this clause in the same manner as if the insolvent were 
 maker. 
 
 A secured creditor is one who holds security from the insolvent 
 or from his estate. Such a creditor is not bound to come in and 
 rank with the general creditors. If his security is sufficient, he 
 may lot)k to that alone ; but if he elects t(j come in he mu.st put a 
 value on his security ami comj)ly with the provisions of the 84th 
 section of the Act (see re Huyst, 31 Q. B. U. C. 110). In such 
 case he may rank on the estate for the balance, and a secured 
 creditor would probably be considered a creditor for the differ- 
 ence between the value of his secu)'ity and the total amount of 
 the insolvent's indebtedness to him. 
 
 This clause requires the creditor to prove his claim, in order to 
 give validity to any consent or action on his part (see also section 
 143 of the Act of 1809). 
 
 This clause provides, in reference to deeds of composition and 
 discharge, &c., that a creditor whose claim is not attected by the 
 discharge, shall not be reckoned as one of tlie required number of 
 creditors to give such deed validity, nor shall his claim be 
 reckoned as forming part of the projjoi-tion of claims required to 
 
I ; 
 
 I [ 
 
 ( fi ■ 
 
 20 
 
 THE INSOLVENT ACT. 
 
 give effect to siicli deed of composition and discliarge. The claims 
 not affected by the disdiai'ge, ai'e enumeiuted in tlie sixtv-tliiid 
 section of the Act. To these may he aihU'd privileged debts, and 
 secured chiims wlien the secured creditor elects to retain his 
 security, and not to rank on the estate (sei' section H'2). 
 
 A creditor cannot vote at any meeting unless his claim amounts 
 to one hundred dollais, and unless, also, that claim is proved ; 
 and a secured creditor would seem entitled to vote only where he 
 had vahied his security, and proved ngainst the estate for the 
 deliciency, and that deficiency exceeded (me hundred dollars. 
 
 In England, a secured creditor is for the purpose of voting, 
 deemed to be a creditor (mly in respect of the Italanee duf to him 
 after deducting the value of his security. If he votes in ivspect 
 of the whole debt without deducting the value of his secnritv, he 
 lo.ses the benefit of his security by so doing ; but his vote is not 
 invalidated thereby (re Hodve, L. R. liS Eq. 705). 
 
 There seems no objection to admitting a secured creditor to the 
 rights and privileges of unsecured creditors, in respect of the bal- 
 ance of his claim after deduction of the value of his security; 
 although this clause, and also section ihnr of the Act, speaks of 
 " unsecured claims," yet it would seem this must be taken to mean 
 unsecured, in respect of the amount for Avhich the cre<litor claims 
 to rank on the estate (see section KX] of this Act; see also notes 
 to sections 4 and !)). 
 
 /. Tlie word " collocated ' shall mean ranked or placed in the dividend 
 sheet for some dividend or sum of money. 
 
 j. In the case of any partnership or any company, incorporate or not, the 
 word " he," " him," or " his " used in relation to any insolvent or oi'editor, 
 iihall mean "the partnership " or " the company" or of " the partnership '' 
 or "of the company,'' (as the case may be) unless the context re(pures an- 
 other interpretation to give such effect as the purposes of this Act re(pure, to 
 the provision in which the word occurs. 
 
 3. A debtor shall be deemed insolvent — 
 
 a. If he has called a meeting of his creditors for the purpose of compound- 
 ing with them, or if he has exhibited a statement shewing his inability to 
 meet his liabilities or if he has otherwise acknowledged his insolvency. 
 
 Insolvency means an inability to pay debts as they inatuie and 
 
 
INSOLVENCY. 
 
 27 
 
 become due, and payal»le in the oi'dinary course of business as per- 
 sons carrying on trade usually do, in tliat which is made by the 
 laws of the country lawful money, and a legal tender to be used in 
 the payment of debts, witliout reference to the amount of the 
 del (tor's property, and without reference to the possibility, or pro- 
 bability, or even certaii'ty that, at a future time, in the settlement 
 and winding up of all his aft'aii's, his debts will be paid in full out 
 of his property. Nothing else is a legal tender in [layment of debts, 
 but that which is declared by the law of the country a lawful 
 money and a legal tender. Pro})erty is not a lawful tender in 
 payment of debts, and a debtor has no right to pay a debt with 
 property of a'^y kind ; therefore, tlie amount of the trader's pro- 
 perty is of no conse([uence if .such ina)>ility to pay matured debts 
 in such lawful money exists (Hard >/ \\ Clark, fi B.K.'-iH't ; re 
 Williams, :i B. R. 2N(i). But insolvency is not to be inferred in 
 every instance of tt'mporary want of funds to pay notes coming to 
 maturity. This woidd be tantamoimt to holding that, whenever 
 a trader sutieis a note to go to protest for want of funds in hand 
 wherewith to jiay, he can thereupon be adjudged insolvent 
 (Hardy v. JUnninfjei; 4 B. R. 26-). 
 
 In Mason v. Red/xifk, tV.) Q. B. U. C. 1()9, the Court expressed 
 an opinion that allowing commercial ])aper to go to protest was 
 not an net of bankruptcy under this section. 
 
 There is no doubt that merely allowing a note to go to protest 
 will not render a debtor liable to be placed in insolvenc}'. But 
 paper might V)e protested so fre([uently as to attbrd evidence that 
 the debtor had ceased to meet his liabilities genei-ally as they be- 
 came due, in which case he would be subject to a demand under 
 the fourth section. 
 
 But inability to pay one debt in the ordinary course of busi- 
 ness is suthcient to constitute insolvency (re Dlblee, 2 B. R. ()17 ; 
 Dr'ajija v. Moore, 3 B. R. (502). A solvent nian is one who is able 
 to pay all his debts in full at once, or as they become due. Insol- 
 vency is merely the opposite of solvency. A man who is unable 
 to pay his debts out of his own means, or whose debts cannot he 
 collected out of such means by legal process is in.solvent, and this, 
 although it may be morally certain that with indulgence from his 
 
28 
 
 THE INSOLVENT ACT. 
 
 It 
 
 creditors, in point of time, he may be ultimately able to satisfv 
 his engajrements in full. The term insolvency imports a present 
 naliility to pay. The probable or im])rol)ablo future condition 
 of the party in this respect does not atfect the (juestion. If a 
 man's debts cannot be made in full out of his property l)y levy 
 and sale in execution, he is insolvent within the primary and 
 ordinary meaning of the word and particularly in the sense in 
 which the word is nsed in the Bankrni)t Act (re Wells, 3 B. R. 
 371 ; re Oregon PrhitliKj Company, 13 B. R. 503). 
 
 A debtor is legally insolvent wdien he has not snflicient pro- 
 peity subject to execution to pay all his debts if sold under legal 
 process, and commercially insolvent when lie has not the means 
 to pay off and discharge his connnercial obligations as they be- 
 come due in the ordinary course of business (Harris v. McLaren, 
 10 B. R. 244 ; Smith v. McLcm, 10 B. R. 200). The connnission 
 of an act of bankruptcy is considered as a test of insolvency, 
 showing conclusively the inability of the debtor to pay his debts 
 or carry on his trade (Shawhan v. Wherritt, 7 How. 027). 
 
 Ii\solvency as used in the Bankrupt Act, in force in the 
 United States, does not mean an absolute inability to pay one's 
 debts at a future time upon a settlement and winding up of all 
 the traders concerns, but a trader may l)e said to be in insolvent 
 circumstances when he is not in a condition to pay his debts in 
 the ordinary course of business as persons carrying on trade 
 usually do {Sawijer v. Tarpin, 5 B. R. 33!> ; s. c, 13 B. R. 271 : 
 re Forsyth, 7 B. R. 174). 
 
 The Act is not intended to cover all cases of insolvency to the 
 exclusion of other judicial proceedings. It is very liberal in the 
 class of insolvents which it does include, and needs no extension 
 in this direction by implication. But it still leaves, in a great 
 majority of cases, parties who are really in.solvent, to the chances 
 that'their energy, care, and prudence in Inisiness may enable them 
 finally to recover without disastrous failure or positive bank- 
 ruptcy — all experience shows both the wisdom and justice of this 
 policy. Many find themselves with ample means, good credit, 
 and large business, totally insolvent; that is, unable to meet their 
 current obligations as fast as they mature. But by forbearance 
 
INSOLVENCY, 
 
 20 
 
 to satisfv 
 a prest'iit 
 condition 
 
 on. If a 
 
 y ^».V It!vy 
 iniary and 
 i sonse in 
 's, 3 B. R, 
 
 iciont pi'o- 
 inder legal 
 ilie means 
 they be- 
 McLdven, 
 onnnission 
 isolvency, 
 ■ his debts 
 
 7). _ 
 
 CO in the 
 
 pay one'.s 
 up of all 
 insolvent 
 debts in 
 on trade 
 
 |3. R. 271 ; 
 
 cy to the 
 al in the 
 extension 
 \ a great 
 li chances 
 ible them 
 va l)ank- 
 ce oi this 
 )d credit, 
 eet their 
 bearance 
 
 of creditors, by meeting only such debts as are pressed, and even 
 l)y the submission of some of their property to be seized on exe- 
 cution, they are finally able to pay all and save their commercial 
 character, and much of their property. If the ci'editors are not 
 satisfied with this, and the parties have conunitted an act of 
 l)ankruptcy, any creditor can institute ju-oceedings. But until 
 this is (hme, their honest struggle to meet their debts, and to 
 avoid the breaking up of all their business, is not of itself to be 
 construed into an act of bankruptcy or a fraud on the Act ( Wil- 
 son V. ClUj Bank, 5 B. R. 270 ; 1 Dillon, 476). 
 
 It would seem that a debtor cannot be placed in insolvency 
 unless some one of the circumstances arises which the Act declares 
 shall render him so liable. Some circumstance nuist arise which 
 the Act declares shall subject the debtor's estate to liqui- 
 dation. The act must be committed in Canada, and within the 
 jurisdiction of some Insolvent Court. The act, when once com- 
 mitted, cannot be purged except by lapse of time. The debt 
 of the insolvent must not be contracted after he has ceased to 
 trade. Proceedings must be taken, under the Act, within three 
 months next after the act or omission, relied upon as subject- 
 ing the estate thereto (see sections 1 and 8 ; also Robson, 3rd 
 Ed. 10!)). 
 
 That part of the Statute which enumerates the acts of ])ank- 
 ruptcy, is in the nature of a penal Statute, and to be construed 
 strictly. It cannot be enlarged by construction to include acts 
 that are within the reason of the law, or the mischiefs intended 
 t»j V)e provided against, but which are not within the words of the 
 Statute, acconling to their reasonable construction (Jones v. 
 Sleeper, 2 N. Y. Leg. Obs. 131). 
 
 Under the English Act, the acknowledgment of insolvency by 
 the debtor must be in the form of a declaration, filed in the Court 
 for the district in which the debtor resides, and witnessed by an 
 attorney or solicitor entitled to practise in the Court. The de- 
 claration must admit, under the signature of the debtor, his in- 
 ability to pay his debts. It is apprehended that, under our 
 Statute, a formal acknowledgment of this character would not be 
 re<iuired. A letter by the debtor, admitting insolvency, or making 
 
Jil 
 
 i 'i 
 
 II 
 
 ! }: 
 
 30 
 
 THE INSOLVENT ACT. 
 
 an oftbr of coinproiiiise, or even a vei'bal admission of inability to 
 pay in full, would, it is api)i'eliendt^d, bo sufficient undci- this 
 clause. The wi'iter has ol)tained a writ of attachment, under sec- 
 tion nine of the Act from tlie Insolvent (Jourt, where the oidy 
 evidence of insolvency was the def)tor's letter, offering a comj»ro- 
 niise and statin<f his inability to pay in full. This letter was 
 attached to the affichivit made by the creditor uiuhir that section, 
 and this admission of insolvency was made the ground of the 
 proceeding-. 
 
 A debtor admitting insolvency by his acts is conclusively pie- 
 suined to contemplate insolvency (re Witite, 1 B. 11. 373). 
 
 /'. If Ke .abscoiuls or is iiii mediately iibont t(i Jibscoiul from any Province in 
 Canada with intent to defrand any creditor, or to defeat or delay the remedy 
 of any creditor, or to avoid being arrested or served with legal process ; or if, 
 being ont of any snch Province in Canada, he so remains with a like intent ; 
 or if he conceals himself within the limits of Canada with a like intent. 
 
 Under this clause the intent is a material ingredient, and must 
 be shown either by necessary inference or from the circumstances 
 (cx-'phvic Baniford, 15 Ves. 441); Aldi'id(je v. Ireland, 1 Taunt. 
 273). 
 
 Every man must be field to intend the necessary consecjuencos 
 of his own acts, and where a d(n)toi- knows that the necessary 
 consetjuence of his going abroad will be to defeat or delay certain 
 creditors, he will ])e held to have gone abroa<l witf\ intent to de- 
 feat ())• delay his creditors, and will be adjudicated an insolvent 
 accordingly (ex parte Goatcr, 30 L. T. N. S. 620). 
 
 This case was decided on the English Statute, wdiich makes it 
 an act of l)ankru])tcy for a debtor to depart out of England with 
 intent to defeat or delay his cieditors. But the same rule would 
 not apply to a foreigner domicded abroad, unless he knew that a 
 writ was issued against him and he went abroad to avoid service, 
 (ex parte Crispin, L. R. 8 Ch. App. 372). 
 
 If the debtor goes abroad for a proper purpose and his creditors 
 are not thereljy delaye<l it will not be an act of bankruptcy (ex 
 parte Mufric, 5 Ves. 570). 
 
 The mere intention on the part of a debtor to sell and dispose 
 
 m 
 
 
■^, 
 
 ACTS OF BANKHUPTCV. 
 
 31 
 
 aliility to 
 ndt'V this 
 in<ler soc- 
 thf only 
 C()in]»vo- 
 jtter was 
 b section, 
 [ul of the 
 
 ively pio- 
 
 Province in 
 tho roiuody 
 icess ; or if, 
 [ike intent ; 
 iteut. 
 
 and must 
 unistancos 
 J, 1 Tannt. 
 
 iso( minces 
 
 necossary 
 
 ay certain 
 
 ent to <le- 
 
 insolvent 
 
 I makes it 
 
 land with 
 
 rule would 
 
 cw that a 
 
 jid service, 
 
 is creditors 
 ruptcy (l'X 
 
 nd dispose 
 
 of all his property, and the apprehension of his sole creditor that 
 he will not then, th()U<,di perfectly ahle and owin^r no one else, pay 
 the creditor his debt, does not briny the debtor within the opera- 
 tion of this clause if there is no actual intent to defraud shown 
 (Sh<n-i> V. Mdfthcu's, .-) U. C. P. R. 10). 
 
 c. ( »r if ho secretes or is iniuiediately about to secrete any part of his estate 
 and elfects with intent to defraud his creditors, or to defeat or dehiy their 
 demands or any of them. 
 
 Till' sale of moveables by an insolvent debtor to a person for 
 value received does not amount to a secretion of his estate 
 {Rohrrlson V. Owvinrj, 20 L. C. J. 2!)!»). 
 
 (/. Or if he assigns, removes or disposes of, or is about or attempts to as- 
 sign, remove or dispose of any of his property with intent to defraud, defeat 
 or delay his creditors or any of them. 
 
 Where a debtor lias ample means to satisfy all claims against 
 him, a sale of }»art of his p)'0j)erty for a full consideration to 
 a ImiKi jiilc purchaser cannot render lii.s estate liable to coni])ul- 
 sorv liquidation imder this clause, merely because he declines to 
 pay the proceeds to one of his creditors, though coupled with 
 subse(|uent circumstances, tending to raise a suspicion of the good 
 faith of the party in the disposal of the money (Roi/al C. Bank 
 V. Mnfhcmv, G U. C. L. J., N. S. <).) 
 
 In this case the as.sets amounted to $3,818, and the liabilities 
 to i?2,831. A house of the alleged insolvent was sohl for $1,8.30, 
 and the suspicious circumstance was that SI, 000 was paid to the 
 wife to induce her to bar dower, on the jiretence that she 
 positively refused to do .so without this sum paid out of the pur- 
 chase money. 
 
 The intent means an actual design in the mind, and must be 
 proved as a (piestion of fact (re Dmmmond, 1 B. R. 231 ; re Gold- 
 .srlnnidt, 3 B. R. 10.")). 
 
 The intent need only exist on the part of the person makino- 
 the transfer. If that exist, the debtor clearly commits an act of 
 bankruptcy, however innocent the intent of the preferred credi- 
 tor, or the person to whom the transfer is made (re Drmnmond, 
 
■■> 
 
 S2 
 
 THE INSOLVKNT ACT. 
 
 I ; 
 
 I t M 
 
 1 B. R. 231). Tho (|uusti(m of intent to defraud, defeat, or delay 
 creditors must be solved l»v lookiiii,^ at wliat tlte deKtor says and 
 does, ami tlu' etll'ct thereof (Ec/ort v. (n-eclij, B. II. 438 ; I'e U/jav. 
 
 2 Saw. HI). 
 
 A iiiort<fa<fi' jfiven for a present consideration which is used to 
 reliove the niortya^'or's stock from an attacliment, and to pay the 
 only ovenhie paper of the debtor known to the mortnaooi', is not 
 a transfer with intent to delay creditors (re Sdnd/onl, 7 H. R. 
 3.')1). A debtor has tlie riyht to mort<;;ine his property oi' a i)or- 
 tion of it, for the purpose of raisini>' money to pay his debts ; l»ut 
 a niort»,'a.go given for the purpose, and with the manifest desiun 
 of so encumbering liis availal)le means tliat creditors will lie hin- 
 dered and delayed in the collection of tlieir demands, is fraudu- 
 lent (re Govjles, 1 B. R. 2.S() ; Iiahhi'!n v. Rom'au, 1 N. Y. Leg. 
 Obs. 301). A sale of all the delator's property for a small portion 
 in cash, and tlie balance in long notes does to tliat extent delay 
 creditors (re Dean, 2 B. R. 89). The insertion of a power in the 
 mortgage to enter aiid sell whenever tho mortgagee may deem 
 hiniself unsafe, is a suspicious circumstance (re li(j<m, 2 Saw. 
 411). 
 
 A conveyance by a person whose propei'ty exceeds in value all 
 that he owes, in consideration of an agreement, that the grantee 
 shall pay all the grantor's debts, and support him during the re- 
 sidue of his days, is not jk'/j' se fraudulent and void, as against 
 creditors (re Cornvxdl 0, B. R. 30.")). 
 
 If an insolvent firm is dissolved.and tho assets transferred to one 
 of tho partners, who immediately e.vecutes a mortgage to secure a 
 separate debt, tho mortgage niay be charged as a conveyance to 
 hinder and delay creditors (re Wdlte, Lowell, 407). A transfer of 
 the firm property by one partner to his cf)-partnor, is not a con- 
 veyance to hinder or delay the firm's creditors (re Mann, 7 B. R. 
 408). Allowing property to be taken on a false and fictitious 
 judgment, is a transfer with intent to defraud, defeat, and delay 
 creditors (re Schick, 1 B. R. 177). 
 
 To make a general assignment for the benefit of creditors an 
 act of bankruptcy within the meaning of this clause, it must bo 
 made with intent to defraud, defeat, or delay creditors within the 
 
> 
 
 ACTS OF BANKRU1»TCY. 
 
 33 
 
 1 
 
 meaning of th I.' Statute 13tli Klizabeth, asexcni])litie(l in Tivynne's 
 case, and otlier subseciuent decisions following it. It becomes a 
 (question of fact. Tlie innocence or guilt of the act depends on 
 the mind of him who did it, and it is not a fraud within the mean- 
 ing of the Bankrupt Act, unless it was meant to he .so {Perry v. 
 Luvjlt-i), 1 B. H. .j:)9 ; Farr'in v. Crawford, 2 B. R. 002 ; Potts v. 
 Garwood, Crahhe, 40!)). An assignment by a .solvent person, for 
 the benefit of creditors, with or without preferences, is void under 
 the Statute of Frauds, because the natiu'al consequence of it is to 
 delay and defraud creditors, by preventing them from subjecting 
 the debtor's pro[)erty by the ordinary legal proceedings and pro- 
 cess to the .satisfaction of their claims. An assignment which 
 authorizes the assignee to sell on credit, or in any manner to pro- 
 long his possession of the property beyond the time reasonably 
 necessary to convert it into cash, and distribute it among the 
 ci'editors, is fraudulent (re Randall, 3 B. R. 18). 
 
 It would seem that all deeds which are fraudulent and void 
 under the Statute 13 Eliz. chap. 5, as having been made with intent 
 to delay, hinder or defraud creditors, come within this clause. To 
 bring a deed within this Statute, the fraudulent intent need not 
 be actually proved or exist ; it is sufficient if the circumstance.s 
 are such as to warrant the inference of fraud. If it is shown that 
 a deed was fraudulently executed for the express purpose of de- 
 feating creditors, it will be void {Svi'ith v. Hurst, 10 Hare, 30), 
 even though supported by some valuable consideration, as mar- 
 riage (Baimer v. Hunter, L. R, 8 Eq. 46 ; Barnard v. Ford, L. R, 
 4 Ch. App. 247), at least so far as respects the creditors sought to 
 be defeated, but without prejudice to the parties from whom the 
 valuable consideration proceeds, if not participators in the fraud- 
 ulent design (Champion v. Cotton, 17 Ves. 203). 
 
 e. Or if with such intent he has procured his money, goods, chattels, lands 
 or property to be seized, levied on or taken under or by any process or exe- 
 cution, having operation where the debtor resides or has property, founded 
 upon a demand in its nature provable under this Act, and for a sum exceed- 
 ing two hundred dollars, and if such process is in force and not discharged by 
 payment or in any manner provided for by law. 
 
 C 
 
I;; 1 
 
 ! i I 
 
 u 
 
 TIIK INSOLVENT ACT. 
 
 ■I 
 I 
 
 i ; 
 
 ! I 
 
 TIr' int'ic fact :>F a jtcisuii in in.solvent circuiiistanccs not di-- 
 fi'iidinj^ one action, and dcfundin;^' ami (lt'layin<,f anotlicr, is not 
 illfiral 1)V till' conniion law, Imt nndcr tli is clause of tlio Insolvent 
 Act it is a fraud foi' an insolvent to cause hi', j^'oods to he taken 
 in execiition to tlie prejudici' of his ^fiieral ci'e<litors, even thougli 
 the prt'ferred claim he a just one, and if this is done l»y the judn'- 
 nient creditor with intent to defraud, the judnmuiit \V(»idd cer- 
 tainly he void (re Joncn 4 TI. C. P. R. .SlTj. 
 
 Hut tliis clause i'e(juires some active {)artici))ation on the part 
 of the dehtor, and merely refraininjj; from entering' an appearance 
 wherehy a creditor on a specially endorsed writ entei-s jud{,nnent 
 hy default, and thei'ehy ohtains a [)reference or priority over other 
 creditors, is not in itst'lf a pi'ocurin<'' of tlu; dehtor's <roods, \:c., to 
 he seized, levied on, or taken in execution within the meaning; of 
 the Act. But if a dehtor asks liis creditor to sue liim and under- 
 takes not to defend the action, l»iit to <lefend other actions, so 
 that he may ohtain the first jud«,nnent, or if witliout tlie know- 
 leil,i,'e of the creditor, tindinjjf himself pressed hy others, the dehtoi' 
 induces his own attorney to sue for the deht due to this paiticidar 
 creditor, and enters no ap])earanci', though lie appears and defends 
 other acti(ins hrought against him ; in these and similar cases 
 there could be no douht hut that the del)tor procures liis goods to 
 taken in execution {Woi'thhvjton v. Ilam'dtun, 10 U. C. L. J. JiO^, 
 Logic Co. J). 
 
 Sinular princi})les ohtain in the United States. There it is 
 held that merely allowing a creditor to obtain a jud^n;ent hy de- 
 fault in an action for a debt, to which there is no defence, does 
 not, as a conclusion of law, raise an implication of a motive or 
 inti^nt to ])Ycfer {Wilson \. City Bank, 'J B. R. 97; Brifton v. 
 Payen, i) B. R. 445). Something more than the passive non-re- 
 sistance of an insolvent dehtor to regular judicial ])roceedings, in 
 which a judgment, and levy on liis property are ol)tained, when 
 the deht is due and he is without just defence to the action, is 
 necessary to show a preference of a creditor or a purpose to de- 
 feat or delay the operation of the insolvent law (M'^ilson v. City 
 i^(/»^, supra). But very slight evidence of an affirniative char- 
 acter of the existence of a desire to prefer one creditor, or of acts 
 
 ■i 
 
>. 
 
 ACTS OF BANKRUPTCY. 
 
 35 
 
 s not (Ic- 
 31', is not 
 Insolvent 
 bt' taken 
 ■n tliongli 
 
 tlx'jlldu- 
 
 (»ul(l eer- 
 
 tlie part 
 npcavancc 
 jndn-nicnt 
 )vor otlior 
 Is, \:c., to 
 janintf of 
 1(1 undel- 
 etions, so 
 ;lie knoAv- 
 lie debtor 
 paiticnlar 
 d defends 
 ilav eases 
 =1 goods to 
 , L. J. 804, 
 
 here it is 
 ant by de- 
 'ence, does 
 motive or 
 Brition v. 
 VG non-re- 
 uedings, in 
 ned, when 
 action, is 
 pose to de- 
 on V. City 
 itive char- 
 ', or of acts 
 
 done with a view to secure such preference, may be Hufficient to 
 invaliflate the whole transaction (re Bitker, 14 R. R. 433). The 
 slightest solicitation on the part of the creditor will protect the 
 judgment. Unhtss it clearly appeals tliat the act originated with 
 the debtor, and that he took the first step to have the judgment 
 rendered, it is valid (Haldeman v. Michael, G W. & S. 128 ; Wil- 
 kith'^ioiK Api)C(il, 4 Penn. 284.) 
 
 Tliei'e i.s a ch^arly recognised distinction between procuring 
 and suffering. Suffer implies a ])assive condition, so to .speak, as 
 to allow, to permit ; not a demonsti-ative act like the word pro- 
 cure {Traders' N. B. v. GampbeU, 3 B. il. 498 ; a. c. G B. R. 353 ; 
 re Bh(ek, 1 B. R. 353 ; re Gailiwjrr, 4 B. R. 72!)). 
 
 Mere honest inaction when a creditoi- seeks to make a just debt 
 by law is not in itself an act of bankruptcy (Wriffht v. Filley, 4 
 B. R. Gil). It is not enough that the debtor is pas.sive, and 
 docs nu'.liing to prevent a creditor from taking hi.s goods in exe- 
 cution. The words of the Act can be .satisfied with nothing .short 
 of a positive agency and active co-operation. To be pa.s.sive 
 merely, and to do nothing, is not to procure an act to be done. It 
 is not to aid, co-operate, or advise (Jones v. Sleejmr, 2 N. Y. Leg. 
 01)8. 131). An agreement by the debtoi- that a default may be 
 taken against him, at the time when it could have been entered ac- 
 cording to the usual course of the Court without that agreement, 
 is not a procurement of the taking of hi.s })roperty on legal pro- 
 cess (ib.). 
 
 T< i" not an act of bankruptcy for a debtor to suffer his property 
 to be taken on legal process with intent to give a preference, or to 
 defeat < delay the operation of the Act (re Scull, 10 B. R. 165). 
 The mt admission of the service of the summons does not amount 
 uo a procuring of his property to be taken on legal process where 
 it is only done at the instance of the creditor's attorney, and with- 
 out any collusion < complicity between the parties (re King, 10 
 B. R. 10.3). Everv ordinary person knows that a judgment is 
 regularly followed by an execution, in other words, that the ten- 
 dency of procuring a judgment is that the execution shall follow. 
 It is not, howeve an aKsolute legal inference that a man who 
 procures a judgme.it to be obtained against himself intends that 
 
>a 
 
 36 
 
 tHE INSOLVENT ACT. 
 
 . , 
 
 an execution shall follow, but a (|ue.stion of fact (re Woods, 7 B. R. 
 L^o). The question is whether the debtor wilfully facilitated, 
 either directly or indirectly, the taking of his property on execu- 
 tion (ib). 
 
 It would seem that the terms " any process or execution " are 
 not confined to any particular form of writ, execution or attach- 
 ment {Hardy v. Binninger, 4 B. R. 2(52). 
 
 /. Or if he has been actually imprisoned or upon tlie gaol luuita for more 
 than thirty clays, in a civil action founded on contract for the sum of two 
 hundred dollars or upwards, and still is so imprisoned or on the limits ; or if, 
 in ease of such imprisonment, he has escaped out of prison, or >Tom custody, 
 or from the limits. 
 
 The Act in force in tlie United States speaks of more " than 
 twenty " days instead of "thirty." Under this Act it was held that 
 an imprisonment commencing on the forenoon of Septomljer 
 8th, 1870, and terminating before noon on the 28th of that month 
 was not sutticient. In legal contemplation the debtor was in pri^sl)n 
 nineteen entire days and portions of two other days, and the first 
 day being excluded this made only twenty days (Hunt v. Fooh, 
 5 B. K 161). 
 
 g. Or if he wilfully neglects or refuses to appear, on any rule or order re- 
 f|uiring his appearance, to be examined as to his debts under any Statute oi 
 law in that behalf ; 
 
 h. Or if he wilfully refuses or neglects t(j obey or comply with any such 
 rule or order made for payment of his debts or of any part of them ; 
 
 I. Or if he wilfully neglects or refuses to obey or comply with an order or 
 decree of the Court of Chancery or of any of the judges thereof, for payment 
 of money. 
 
 j. Or if he has made any general conveyance or a.ssignment of his property 
 for the benefit of his creditors, otherwise than in the manner prescribed by 
 this Act ; or if, being unable to meet his liabilities in full, he makes any sale 
 or conveyance of the whole or the main part of his stock in trade or of his 
 assets, without the consent of his creditors, or without satisfying their claims. 
 
 An assignment for the benefit of creditors not under or pui-port- 
 ing to V>e under the Act, subjects the estate of the debtor to compul- 
 sory liquidation, and if proceedings are afterwards taken against 
 the debtor to force him into insolvency the assignment will be void 
 

 '4 
 
 
 '^ 
 
 
 "1 
 
 Is, 7 BR. 
 
 
 Lcilitated, 
 
 
 )n execu- 
 
 1 
 
 :ion," are 
 
 
 r atbacli- 
 
 
 s ii>v more 
 
 
 lUii of two 
 
 
 nits ; or if, 
 
 
 m custcxly, 
 
 
 re " than 
 
 '( 
 
 held that 
 
 
 eptomVier 
 
 
 at uKJiith 
 
 
 in prison 
 
 
 I the first 
 
 
 V. Pooh\ 
 
 
 r order re- 
 
 
 Statuto ui 
 
 
 ACTS OF RANKRUFTCY. 
 
 37 
 
 h any such 
 
 m order or 
 
 
 )r payment 
 
 
 3 property 
 
 
 scribed by 
 
 
 us any sale 
 
 i 
 
 e or of his 
 
 
 leir claims. 
 
 
 pui-port- 
 
 
 ) couipul- 
 
 
 1 ai,'ainst 
 
 '* 
 
 11 be void 
 
 ■vi 
 
 as against the assignee (Wilson v. Cramp, 1 U. C. L. J. N. S., 
 217 ; 11 Grant, 444 ; Calvin v. Tranchemontagne, 14 L. C. J. 210). 
 
 And on a bill filed by the assignee in insolvency, the Court 
 will order the delivery of all books of accounts, vouchers, deeds, 
 papers, and documents, and all the goods and chattels, and also a 
 conveyance of the land, to be made by the person, taking under 
 the general conveyance or assignment (Wilson v. Cramp, supra). 
 
 Such an assignment has ab-o been held void as against an 
 execution creditor of the debtor who afterwards placed a writ of 
 execution in the sheriff's hands (Thome v. Torrance, 16 C. P. 
 U. C. 44.5) ; affirmed in appeal, 18 C. P. U. C. 29). 
 
 In this case certain debtors executed a deed of assignment for 
 payment of creditors, but not in accordance with the Insolvent 
 Act of 1864. The defendant subsequently to this deed issued a 
 writ of execution against the debtors, and then took proceedings 
 in insolvency under the Act of 1864, against their estate for the 
 general benefit of creditors. It was held that the assignment was an 
 act of bankruptcy, and void. ?-.nd could not be set up for any purpose, 
 and that therefore the defendant, the execution plaintiff though 
 petitioner in insolvency, could notwithstanding his proceedings in 
 insolvency enforce his execution against the debtors of the estate 
 to the postponement of the rest of the ci'cditors. This decision 
 was followed in Rose v Brovm (16 C. P. U. C. 477), where it was 
 held that the/?. /«. of the execution creditor being in the sheriffs 
 hands before the issuing of the attachment in insolvency, bound 
 the goods at conunon law from its date, and under the Statute 
 of Frauds fi-om its delivery to the sheriff But under the 83rd 
 section of this Act, the execution creditor, in such a case as the 
 above, would have no lien or privilege for the amount of his 
 execution on the effects or estate of the debtor, if before the pay- 
 ment of the money to liim l>y the sherifi', an attachment in insol- 
 vency issued or assignment was made, and the latter will supersede 
 a writ of execution unless there is an actual payment over to 
 the execution creditor of the money levied before the attachment 
 issues or the assignment is madt\ 
 
 It has been held in the Province of Quebec that a creditor who 
 lias consented to his debtor, making an assignment otherwise 
 
38 
 
 THE INSOLVENT ACT. 
 
 ! li 
 
 than under the provisions of the Act, cannot avail himself of such 
 an assignment as a gi'ound for obtaining a compulsory liquidation 
 under the Act (Whyte v. Cohen, 14 L. C. J. 83) ; the consent doing 
 away with the act of bankruptcy so far as the consenting creditor 
 is concerned. 
 
 It has long been settled that an assignment by a trader of the 
 whole of his property, or the whole substantially, and with only 
 a colourable exception to secure, or, in satisfaction of, an existing 
 debt, is fraudulent within the bankrupt law and an act of 1)ank- 
 ruptcy (Siehert v. Spooner, 1 M. »Sj W. 714 ; Lindon v. Sharp, 6 
 M. & G. 895 ; Lomax v. Btixton, L. R. 6 C. P. 107). 
 
 The assignment of the whole of a debtor's property, even though 
 made for the benefit of creditors generally, has always been lield 
 to be an act of bankruptcy {Kettle v. Hdmmond, Cooke 80 ; 
 Stewdrt v. Moody, 1 C. M. & R. 777) ; and the express enactment 
 in the present Act that it shall be so, has in no way altered the 
 law (re Wood L. R. 7 Ch. 302). . 
 
 The assignment of the whole of a debtor's property for the 
 benefit of one creditor or several, to the exclusion of the otliers, 
 is fraudulent ; the necessary consequence of such an assignment 
 being to defraud the excluded creditors ( Worsley v. Be Maffos, 1 
 Burr. 467 ; ex parte Luckes ; re Wood, L. R. 7 Ch. 302 ; 41 L. J. 
 Bank. 21). Not every transfer, however, of the whole of a 
 debtor's property is fraudulent, for the ca.ses have gradually 
 established that the general proposition is subject to the following 
 limitations : — 
 
 In Rose v. Haycock (1 Ad. & E. 400), Baxter v. Pntchard (1 
 Ad. & E. 450), WhitweU v. Thompson (1 Esp. 07, per Lord Ken- 
 yon), it was held that the sale of all a trader's property was not 
 an act of bankruptcy, because there it was really intended to 
 enable the trader to carry on business.* Gradually it came to be 
 held that a mortgage or an assignment, not by way of sale in the 
 ordinary course of ])usiness, of the whole of a debtor's property, 
 was not necessarily an act of bankruptcy (see Whitwcll v Thomp- 
 son, Esp. 08, cited in M. k, A. Bank. 2nd Ed., p. 70, as an authority 
 for a new and <1oubtful doctrme). 
 
 But for a long time it was considered that to prevent such a 
 

 ACTS OF BANKRUPTCY. 
 
 81) 
 
 f of such 
 [iiitiation 
 nt doinjr 
 r creditor 
 
 3r of the 
 '^ith only 
 existing 
 of bank- 
 Sh'irp, 6 
 
 n though 
 )eeii liekl 
 )oke 8(j ; 
 nactinent 
 tered the 
 
 • 
 y for the 
 le otliers, 
 (ignnient 
 Maffos, 1 
 ; 41 L. J. 
 ole of a 
 gradually 
 uUowing 
 
 chdvil (1 
 jrd Ken- 
 was not 
 ndod to 
 nie t(j l»e 
 le in the 
 )rop.'rty, 
 Thomp- 
 uthority 
 
 it sueh a 
 
 i 
 
 moi-tgage or assignment from being an act of bankruptcy, the 
 object of the mortgage or assignment must have been to secure a 
 present, or present and future advances ; and that if the con- 
 sideration of the assignment were wholly or paitly an antecedent 
 debt contracted without security, such an assignment was an act 
 of bankruptcy (see Graham v. Chapman, 21 L. J. C. P. 173 ; 
 Biftleston v. Cooke, 25 L. J. Q. B. 281 ; Hatton v. Crnhvell, 22 I- 
 J. Q. E. 78, where all the old cases on the subject will be found 
 collected). 
 
 A long series of more modern cases, beginning with Pennell v. 
 Reynolds (11 C. B. N. S. 71<i), and followed V)y Mercer v. Peterson 
 (L. R. 3 Ex. 105 ; 37 L. J. Ex. 54); Lomax v. Buxton (L. R. 6 C. P. 
 107 ; 40 L. J. C. P. 150), have, however, conclusively established 
 that an assignment, partly in consideration oi an existing debt 
 and partly as security for a further advance, is not necessarily, 
 an<l as a conclusion of law (apart from evidence of fraudulent i)re- 
 ferencj;), an act of bankruptcy (see also Kevan v. Maivson, 24 
 L. T. N. S. 390 ; ex parte Fisher, re Ash, L. R. 7 Ch. G3G ; 41 L. J. 
 Bank, 02). 
 
 The reason why a substantial present advance operates to pre- 
 vent an assignment of the whole of the delator's property from 
 being an act of bankru{)tcy, is, that it is deemed equivalent to 
 such a substantial exception of a part of a del)tor's property from 
 the assignment as would save that assignment from covering the 
 whole of the debtor's property, and from being as such, an act of 
 bankruptcy (see Lomax v. Buxton, L. R. C. P. 107). A debtor^ 
 by a bill of sale, assigned to a creditor, in consideration of a then 
 existing debt, and without any present consideration^ the whole 
 of his property, except a pension of lOs. Od. a day, to which he 
 was entitled as a military officer, retired from the service of the East 
 India Company. It was held that the bill of sale was void, as against 
 the tiustee under the bankruptcy of the debtor, as it was prac- 
 tically an assignment of the whole of the debtor's pi-operty to 
 secure a })ast ilebt, the pension not being pioj)erty which would 
 pass to the trustee (ex parte Hawker, 20 L. T. N. S. 54 ; L. R. 7 
 Ch. 214.) 
 
 An a.ssignment of all a trader's effects, to secure a present ad- 
 
N 
 
 ■ 1 1 
 
 h' 
 
 I 'I 
 
 li: 
 
 40 
 
 THE INSOLVENT ACT. 
 
 vance, or present and future advances, or future advances bov<i 
 fide made, or to l)e made, for tlie purpose of enal)ling him to 
 cany on his business, is not an act of bankruptcy (Bittlestow v. 
 Cooke, 2 Jur. N. S. 7o8) ; so also an assio^nment by a trader, of all 
 his effects to secure an advance, to enable liim to satisfy a pressi no- 
 demand, and thus to continue; his business, is not of itself an act of 
 bankruptcy (re Colemere, L. R. 1 Ch. App. 128 ; Lomax v. Buxton, 
 L. R. () C. P. 107) ; and if the advance be to pay off a subsisting;- 
 charge on the property, the transaction will be protected, although 
 tlie security is not transferred ; but a new mortgage is executed 
 (ex parte Harrh, L. R. 19 £([. 253) ; and this, although the per- 
 son advancing the mone}^ had notice of an act of banki'uptcy 
 connnitted by the debtor (ex parte Coatefi, 31 L. T. N. S. (522). 
 A security comprising all the debtor's property for an ex- 
 isting debt arising from a loan previously made, will not 
 be an act of bankruptcy, if it is made in jierformance of 
 an agreement entered into at the time of the loan (Mercer v. 
 Peterson, L. R. 2 Ex. 304 ; ib. 3 Exch. 104 ; Jones v. Harher, L.R. 
 Q.B. 77 ; ex-parte Fisher, L. R. 7 Ch. App. 030 ; ex-parte Izurd, 
 L. R. 9 Ch. App. 271). But an agreement of this sort will not 
 protect the transaction, if the giving a bill of sale is purposely 
 postponed until the debtor is in a state of insolvency, in order to 
 prevent the destruction of his credit, which would result from 
 registering the deed. Such a postponement will be regarde<l as 
 evidence to commit a fraud on the general credito)"s (ex-parte 
 Fislier, .sujyra) ; and where an assignment, l>y way of security, was 
 executed upon an understanding that it was not to be registered 
 under the Rill of Sales Act, 18,54, but was to be renewed from 
 time to time, it was held that a substituted bill of sale reciting 
 the former deed, which was not itself fraudulent within the policj- 
 of the bankrupt law, but invalid because unregistered, could not 
 be supported (ex-])arte Foxleij L. R. 3 Ch. App. 515 ; ex-parte 
 Stevens, L. R. 20 Ya\. 786). It is not necessarily evidence of fraud, 
 in cases of an advance, that the property comprised in the security 
 is large in proportion to the amoinit of tlie advance. But if the 
 circumstances are such as to aflord no reasonable expectation that 
 the advance will enablethe debtor to carry on his business,and both 
 
ACTS OF BANKRUPTCY. 
 
 41 
 
 Ithoiioli 
 
 parties know this, that fact will be evidence of a fraudulent intent 
 (ex-parte Fisher, L.R. 7 Ch. App. G3G). An assignment by a debtor 
 of thi' whole of his eflects, in consideration, partly of an existing 
 debt and partly of an adva: .e, is not an actof bankruptcy where the 
 advance is of a substantial sum and made bona fide to enable the 
 debtor to meet his engagements, and, if a trader, to carry on his 
 business (Bell v. Simpson, 2 H. i: N. 410; Allen v. Bonnett, L. 
 R. .) Ch. App. 577; ex parte Winder, L. R. 1 Ch. D. 290), and it 
 is not necessary that the advance shoiild be immediate, provided 
 there is an agreement to make it and it is made (ex parte SJieen 
 L. R. 1 Ch. D. 560 ; ex parte King, L. R. 2 Ch. D, 256). If, how- 
 ever, the circumstances of the case are such as to shew that the 
 real object in making the advance was not to enable the debtor to 
 continue his trade or meet his engagements, but to secure to the 
 creditor the rei)ayment of the debt previously owing to him, the 
 transaction will be regarded as a fraud on the other creditors and 
 an act of bankruptcy (ib). The principle on which sales by the 
 debtor and securities for advances are protected is, that the debtor 
 receives an equivalent for his property oi" for the security. It is 
 not essential, however, to the validity of transactions of this sort 
 by way of security, that the advance should be of equal value 
 with the property charged, if it be made honajide to enable the 
 debtor, if a trader, to carry on his business (ex parte King, L. R. 
 2 Ch. D. 256). Neither is it essential that the equivalent should 
 be a sum of money paid down. But if the debtor has something 
 done for him to enable him to carry on his business that will 
 be a sufficient equivalent, as where the drawer of bills of exchange 
 took them up at maturity at the request of the acceptor (ex parte 
 Reed, L. R. 14 Eq. 593 ; see also observations of Bramwell, B. in 
 Philps V. Hornstedi, L. R. 8 Ex. 26 ; s. c. L. R. 1 Ex. D. 62) : 
 so also where the agreement was to supply goods on credit (ex 
 pai-te Winder, L. R. 1 Ch. D. 290.) 
 
 Where, however, a creditor had levied execution by seizure of 
 the debtor's goods, under circumstaneos which would have made 
 the transaction an act of bankruptcy if a sale took place and the 
 debtor made an assignment of all his effects to the judgment credi- 
 tor, by way of security for his debt, in order to induce him to 
 
I , 
 
 i i| 
 
 , ! 
 
 19 
 
 ^1 
 
 42 
 
 THE INSOLVENT ACT. 
 
 withdraw the execution, this was held t(j be an act of bankruptcy, 
 on thegrouTid that if the law had been allowed to take its course, 
 and a sale effected, another creditor mif^ht have taken proceedings 
 in bankruptcy against the debtor and secui-ed the prcjceeds for the 
 benefit of the general creditors, and therefore such creditors de- 
 rived no benefit from the withdrawal of the execution {WdoiI- 
 house V, Murray, L. R. 4 Q. B. 27). 
 
 An assignment of all a debtor's property for a past debt is an 
 act of bankruptcy. A merely nominal exception of part of the 
 property will not prevent this ; but an exception of a substantial 
 part will prevent it. If the assignment includes substantially all 
 the property, and is made in consideration of a past debt an<l of 
 a further advance made at the time, the further advance, if sub- 
 stantial, has the same ett'ect as a suljstantial exception out of the 
 property. If, therefore, there is a substantial further advance 
 made honajidc for the purpose of enal)ling the debtov to carry on 
 his trade, the assignment will be good (ex parte Kiwj, L. R. 2 Ch. 
 D. 25G). 
 
 On the nth September, Martha Hui-st and Richard Huist, her 
 husband, made a chattel mortgage to the Dominion Bank to secure 
 a previous indebtedness of Ricliard Hurst to the bank. No futun; 
 day was named for the payment, and the proviso to hold posses- 
 sion till default was struck out. A writ of attachment in insol- 
 vency was issued against Richanl Hurst on the 4th October, 1N75, 
 and the assignee took possession of the mortgaged chattels then in 
 the debtor's possession. The l)ank claim 'd the chattels under the 
 mortgage, which the assignee contended was void as against the 
 creditors. 
 
 Tiie bank thereupon petitioned for an order, directing the as- 
 signee to deliver up the goods. It appeared also that the debtor 
 had long previously been embarrassed ; that most of his paper was 
 under protest ; that his real estate was mortgage<l to the bank and 
 others ; but he had been frequently asked to reduce his indebted- 
 ness, and the mortgage was given by him after repeated solicita- 
 tions and upon a threat of legal pioceedings. 
 
 The intention was that all the personal property of the mort- 
 gagor should be included in the mortgage, and the bank were not 
 
ACTS OF BANKRUPTCY. 
 
 4a 
 
 t'dinifs 
 
 IS an 
 
 
 I 
 
 aware when it was given that the mortgagor was insolvent, but 
 no fresh advance was made, nor any promise given of such ad- 
 vance. The evidence of pressure in the case was uncontra- 
 dicted ; but there was no promise at the time the money was ad- 
 vanced to give the mortgage. 
 
 The Judge in Insolvency declined to gi-ant the order petitioned 
 for, holding the mortgage void under sections 130 and 133 of the 
 
 Act. 
 
 Harrison, C. J., under these circumstances, after an elaborate 
 review of the English and Canadian authorities bearing on the 
 subject, held, that the chattel-mortgage was fraudulent and void, 
 as against -creditors, on the ground that it covered the whole of 
 the debtor's trade property and enabled the creditor to put a stop 
 to his' business (re HiLvst, 6 P. R. U. C. 329 ; see also ex parte 
 Trevor, L. R. 1 Ch. D. 297). 
 
 The result of the authorities is that where a debtor assigns 
 his wliole property as a security for a past debt only, it is an 
 act of bankruptcy, whatever the motives of the parties may have 
 been. If there is, also, a further advance, it is not a question 
 whether the further advance is great or small, but whether there 
 was a bona Jide intention of carrying on the business (ex parte 
 Ellis, L. R. 2 Ch. D. 797, Mellish,*^ L. J. ; see also Kalm v. Her- 
 (jert, 1 Appeal Reports [Ont.] 75, and cases there cited) ; but the 
 crucial test in all these cases is the existence of a hona. ficle 
 intention to carry on the business, and where the evidence does 
 not satisfy the Court that the transaction was entered into with 
 the hona Jide expectation and intention that the business would 
 be carried on through the relief afforded by the fresh advance, but 
 on the contrary, that it was a mere device to enable the mortga- 
 gee, or holder of the security, to receive payment in full, the 
 secm-ity will be void, not only as to the antecedent debt, but also 
 as to the fresh advance {Kaidus v. Hergert,ubi supra; as to being- 
 void in toto under such circumstances, see Coates v. Joslin, 12 
 Grant, 524). 
 
 A sale by a trader of all his stock in trade and effects to a bomt 
 fide purchaser, at a fair price, is not an act of bankruptcy (Baxter 
 V. Pritchard, 1 Ad. k, E. 456). The debtor gets an equivalent in 
 
I 
 
 I •! 
 
 ' I 
 
 :'i 
 
 ■! 1 
 
 I' 
 
 ■44 
 
 THE INSOLVENT ACT. 
 
 value for his property, and the effect of the transaction is merely 
 to change its character; and in a case of this sort, it is immaterial 
 tliat the trader intended at the time of the sale to misapply the 
 purchase money, if tlie buyer, at the time of the transaction, had 
 not notice of such intention, or any reasonable ground to suspect 
 that the seller meant to get the money for himself in fraud of liis 
 ci-editors (ib. and see ex parte Wilnon, 29 L. T. N. S. 860). If 
 the transaction >, not a real honafide sale, but a mere contrivance 
 to give a preference to the pretended purchaser, although it is 
 not sale of the whole of the debtor's effects, it will bo fraudulent 
 and void as against the general creditors (ex parte Pearson, L. R. 
 8, Ch. App. 607). So also, if the object of the transaction is to 
 protect the goods against the general creditors, for the Ijcnefit of 
 the debtor, t will l)e fraudulent and void as against such credi- 
 tors (Graham v. Furbcr, 14 C. B. 410). 
 
 In Brooks v Taylor (:J6 C. P. U. C. 443) the Court declared 
 that independently of tht element of fraud which appeared in 
 that case the sale of the wh.ci<3 of a trader's stock in trade is in itself 
 an act of bankruptcy. 
 
 The conveyance of the whole property of a debtor affords a 
 very violent presumption of a fraudulent intent so far as existing 
 creditors are concerned. When the effect necessarily is to delay 
 creditors the intent ought to lie presumed. When the defence is 
 that the property was conveyed in pursuance of a secret trust 
 under wliich it was held and parol evidence by the Statute of 
 Frauds cannot be admitted to prove such trust so that, in case of 
 attachment or bankruptcy, before the conveyance was made, the 
 conveyance would be conclusively held to be in the debtor, it is 
 questionable whether he ought to be admitted to show this alleged 
 trust even on the question of intent. When the creditor is a wit- 
 ness, the fact that he has acted in a harsh and oppressive manner 
 towards the debtor may be shown in evidence, for the purpose of 
 affecting his credibility (re Alexander 4 B. R. 178 ; ThornhiU v. 
 Lml\ 8 B. R. 621). 
 
 An assignment for the equal benefit of all creditors is in con- 
 travention of the spirit and policy of the Bankrupt Act, even when 
 made in good faith. The intention of the Act clearly is, that 
 
 ■t 
 
 I 
 
 Jij — 
 
ACTS OF BANKRUPTCY. 
 
 45: 
 
 when a failing debtor is conscious of his inability to prosecute his 
 business and pay his debts, he should at once subject his property 
 to such a disposition as the Bankrupt Act has provided for. The 
 property then becomes a sacred trust for the benefit of creditors, 
 who have a right to insist that it shall be administered, not 
 according to the wish or preference! of the insolvent, or in accord- 
 ance with the insolvent laws of a State, but according to the pro- 
 visions of the national Bankrupt Act. Practically an assignment 
 defeats or delays the operation of the Act. It deprives creditors 
 of a legal right under the Statute, and is clearly in contravention 
 of its spirit and its letter. It commits the disposition and the dis- 
 tribution of the property to an assignee selected by the debtor, and 
 deprives his creditors of the right given them by the Bankrupt Act 
 to choose an assignee for that pui*pose. It takes from the Courts of 
 Bankruptcy the legal .supervision and control — the legal and equi- 
 table jurisdiction — which they, under the Act, are to exercise in re- 
 spect to such property, and the hostile claims and adverse interests 
 of the creditors, and the marshalling of the debtor's assets as wcdl as 
 in respect to his conduct, property, and person ; and it also defeats 
 its operations in many other respects, by preventing the property 
 assigned from being brought within the operation and protection 
 of other provisions of great importance, the infraction of which is 
 punishable as a heinous crime. Such an assignment necessarily 
 and absolutely defeats tlie operation of the Bankrupt Act. The 
 provisions of the Statute fully authorize, if they do not abso- 
 lutely re([uire, this construction {Perry v. Lavgley, 1 B. R. .559 ; 
 s. c. 1 L. T. B. 34 ; s. c. 7 A. L. Reg. 429 ; in re ^. T. Smith, 3 
 B. R. 377 ; s. c. 1 L. T. B. 147 ; s. c. 4 Bt. 1 ; Anon. 3 B. R. 78 ; 
 Sir'icer et al. v. Ward et al. 3 B. T. .512 ; Curran v. Muwjer, i] B. 
 R. 33 ; in re Qohhchmidt, 3 B. R. 1G5 ; s. c. 3, Bt. 379 ; in re Pierce 
 & Holbrook, 3 B. R. 258 ; s. c. IG Pitts L. J. 204 ; in re Randall 
 cfc" Sutherland, 3. B. R, 18 ; s. c. 2 L. T. B. G9 ; s. c. Deady 557 ; 
 Wells et al 1 B. R. 171 ; s. c. 1 L. T. B. 20 ; 7 A. L. Reg. 1G3 . 
 in re Burt, 1 Dillon 439 ; contra Peiry v. Langley, 2 B. R. 59G ; 
 s. c. 8 A. L. Reg. 427 ; in re Kintzing, 3 B. R. 217 ; Smith v. Teu- 
 tonia Ills. Co. 4 C. L. N. 130). 
 
 ■« 
 * 
 
 ;1 
 
 I 
 
h'r 
 
 i 
 
 46 
 
 THE INSOLVENT ACT. 
 
 A. Or if he permits any exocution iss'iud ayainst him under which any of 
 his chattels, land or property are seized, levied upon or taken in execution, 
 to remain unsatisfied till within four days of the time fixed by the sherifl'or 
 officer for the sale thereof, or for fifteen days after such seizure,— subject, 
 however, to the privileged claim of the seizing creditor for the costs of such 
 exocution, and also to his claim for the costs of the judgment under which 
 such execution has issued, which shall constitute a lien upon the effects seized, 
 or shall not do so, according to the law as it existed previous to the passing 
 of this Act, in the Province in which the execution shall issue. 
 
 Persons who are parties or privies to a deed or disposition of 
 projterty, ojjerating as an act of bankruptcy, and persons claim- 
 ing uniler them, cannot set it up as an act of bankruptcy, (ex 
 parte Stray, L. R. 3 Cli. App. 374 ; re Bnh'vs Trusts, L. R. 10 E^. 
 o.')0), unless indeed the deed be fraudulent as against the pei-son 
 impeaching it, as for instance on the ground of a secret preference 
 given to some particular creditor (ax parte Marshall, 1 M. D. & D. 
 575). Deeds wliidi are fraudulent under the Statute 13 Eliz. 
 chap, 5, and also deeds which are fiwiduient within the policy of the 
 bankrupt law, may be impeached, or used as acts of l)ankiuptcy, 
 by any person who was a creditor of the grantor or settlor at the 
 date of the transaction {Osivald v. Thompson, 2 Exch. 215) ; pro- 
 vided he was not a party or privy to the deed. It has been ques- 
 tioned whether persons who have l)ecome creditors subsequently, 
 can impeach such deeds. It may, however be considered as now 
 settled, that such creditors aie entitled to the benefit of proceed- 
 ings instituted by creditois at the date of the deed (ex parte 
 Philpott, r>e Gex 340 ; Barlingv. Bishopp, Jur. N. S. 812) ; and 
 also that subsequent creditors, or the assignee as representing them, 
 can impeach .such deeds if there is a debt remaining due, which 
 was owing at the date of of the deed (ib), or if the deed appears 
 to have been executed for the purpose of defeating future, as well 
 as ]M-esent creditors (Jcnkyn v. Vaughan, 3 Drew, 419 ; Ware v. 
 Gardner, L. R. 7 Eq. 317). But if the assignee in insolvency ap- 
 plies to the Court to compel the holder of a deed, fraudulent as 
 against creditors, to deliver up to him the proceeds of the sale of 
 the goods comprised in the deed, he affirms the sale, and cannot 
 afterwards maintain an action of trover for the difference between 
 
DEMAND OF ASSIGNMENT. 
 
 47 
 
 tlif value of the goods and the junount realized {Smith v. Baker, 
 L. R. S C. P. 380). 
 
 4. 1 f a debtor ceases to meet his liabilitiei:, e;enerally as they become iluu, 
 any oiio or more of hia creditors for unsecured chiims of not less than (Jiie 
 Innuhvil dollars oach, and amounting in the agLjroguto to five hundred dul- 
 liirs, may make a demand upon him either personally or at his chief place of 
 business, or at his domicile, upon some grown up person of his family or in 
 his employ (Form A.), reciuiring him to make an assignment of his estate and 
 effects for the benefit of his creditors. Bnt the said deirand ^hall not bo 
 made until the creditor or creditors making the same shall have filed with 
 the clerk or prothonotarj' of the court, in which the proceedings in liq\iida- 
 tion (if any) will be carried on, his or their affidavit verifying his or their 
 debt or debts, and that he or they is not, f>r are not, acting in collusion with 
 the debtor, or to procure him any undue advantage against his creditors : 
 
 The creditor or creditors making such demand of assignment shall in such 
 demand elect and appoint a domicile or domiciles, resi^ectively, within the 
 district or county in which such affidavit is filed, at which service of any 
 answer, notice or proceeding may be served on him or them ; and the said 
 clerk or prothonotary shall keep the original affidavit and give a certified 
 copy to the creditor or creditors ; and such copy shall be annexed to the 
 notice served on the debtor. 
 
 The 39th Yict. chap. 3(), s. 2, amended this section, by adding, 
 after the word " original," in the third line from the end, the 
 word " affidavit." 
 
 Prior to the Act of 18G9, in England it was held that a mere 
 e([uital lie del)t, though proveal»le in hankriiptcy, would not support 
 a petition for adjudicsition (ex parte Ilylliard, 1 Atk. 147 ; ex- 
 partc BImcoive, L. R. 1 Ch. App. 302) ; but the Act of 18G9 pro- 
 vides that a sum due at law or in equity, })rovided it is a liqui- 
 dated sum, will support a petition. 
 
 The debt, however, nmst be a sum due, and, therefore, a debt 
 dei)endent on a contingency will not support a petition (ex parte 
 Page, 1 G. & J. 100). 
 
 In Ontario " The Administration of Justice Act " of 1873 (36 
 Vict. chap. 8, s. 2) provides that any person having a purely 
 money demand may proceed for the recover} thereof by an ac- 
 tion at law, although the plaintiff's right to recover may be an 
 equitable one only, and ho plea, demurrer, or other objection on 
 the ground that the plaintiff's proper remedy is in the Court of 
 
48 
 
 TIIK INSOLVENT ACT. 
 
 : , 
 
 Clmncury, shall be nllowi'M in such action. It wouhl seetn that 
 a chiiin wliicli comes within this Statute wouM ho HufHcient to 
 autlioiise a (loiiian'l uikUt tiiis section. 
 
 This section speaks of " liahilities generally." It does not in 
 any way <letini' these liahilities as connnercial or nonconuneieial. 
 Tlio Act of 1804 (s. :\ ,s,s. 2) rot'erred to "connnercial liabilities." 
 As a trader may have debts not of a connnercial nature, it is im- 
 portant to consider whether such debt can be made the tbunda- 
 tion of a demand under this section. It was decided in Quebec, 
 under sec. 14 of the Act of iMOt), that a cieditor of a debt of a 
 non-connnercial nature could make the demand (liacli(i)i(i.ii v. 
 McCormick, 19 L. C. J. 29). The ilebt in this ca.se was for 
 money loaned, secured by three deeds of obligation, and a judg- 
 ment had also been obtained for part of the sum. The judg- 
 ment had been appealed from, but the debtor afterwards ga\e a 
 written consent that executitjn for the enforcement of said judg- 
 ment shoull issue in due course of law, and gave .security for 
 costs only, and it was held that that was a sufficient debt on which 
 to make a demand. 
 
 The Act in force in the Unitctl States declares that a trader 
 who " has stopped or .suspended, and not resumed })ayment with- 
 in a ])eriod of forty days of his connnei'cial paper," shall be 
 deemed to have connnitted an act of bankruptcy. On this clause 
 it has been held that if a man declines to pay solely becausf he 
 is not liable to pay, or because he has a valid claim against the 
 paper, or a set-off that is not a stoppage or suspension within the 
 meaning of the Act (re WeHfcoff, 7 B. R. 2S5 ; re Tkoinpf«))i, 3 
 B. R. 1<S.')), the Court of Bankrujitcy will not .sit to try the 
 validity of the rea.sons for non-payment of the note or bill. It is 
 not a Court for the mere collection of debts, and each case nmst 
 be considered by itself in connection with the circumstances 
 surrounding it. The non-payment of one piece of pa''ier is not 
 in itself suspension for there may be good reason for it. But 
 when he fails to pay for want of means, and continues unable 
 to pay, he has suspended within th(i meaning of the Act, 
 although but a single cheque is show^n to have laid over unpaid 
 
 |1 * ^ 
 
 I I ( 1 ; 5 
 
 L. 
 
DKMANI) OF ASSIONMENT. 
 
 49 
 
 for forty flays (McLcnn v. Brmmi, 4 B. R. oHo ; ro Herculei^ 
 hixnrdiwe Com/xi iiy, H. R. tVAH). 
 
 But it is not sntHcifiit to (K't'cat tln' opt-ratioii of tlic liankrupt 
 law to simply deny liahility upon i\\v coiiuut'rcial papci'. The 
 party must satisfy tlic Court tliat he has ^^ood reason to dispute 
 his lialiility, and tliat his lial>ihty is involved in douht, at least he- 
 fore a Bankrupt C^ourt will refuse to proceed (re Minm, 7 B. R., 
 4(18). 
 
 Tt is enoMuh tliat the alle^'ed ilehtor could, and did, honestly en- 
 tertain the lielief that he was not le-;ally hound t(j pay the paper 
 till it should he so adjudged. Such a ease is not one for an ad- 
 iudieatidU of hankruptcy, hut for a suit on the paper in the proper 
 trihunal (ih. ; re \Ve.^fc<»it, 7 B. R. 285). 
 
 A sus])ension which has taken jJaee on account of an injunction 
 against the dehtor, restrainini,' him from making any transfer or 
 disposition of his pi-operty is not an act of hankruptcy (re Pratt, 
 !) B. R. 47). Evidence that the del »tor is a man of means, and has mot 
 his other pai)er as it hecame due, may tend to rehut the presump- 
 tion of insolvency and to .shew that the failure to pay the note was 
 from other cau.se.s, not making him amenahle to the Banlo-upt Act 
 (re S///,r.s', oBi.s,s. li:3). 
 
 A corporate hody ought to make the demand in its corporate 
 name (re Calfhrop, L. R. 8 Ch. App. 252), and in England it is held 
 that an incorporated joint stock company luay file a petition in 
 hankruptcy against one of its shareli oldens (ih.). 
 
 According to Rohson (3rd. Ed. 170), an infant cannot be a peti- 
 tioning creditor hy n^ason of his liability for the costs of the peti- 
 tion. Under section 5 a creditor making a d(naand may be con- 
 demc<l to pay treble costs if the demand is made without reason- 
 able gi'ounds. It wouhh therefore, seem that an infant cannot 
 legally make the demand under this .section. Under the Statute of 
 Ontario (35 Yic. chap. IG, sec. 2), all the wages and personal 
 earnings c[ a married woman, and any acquisitions therefrom, and 
 all pn-oeeds or profits from an}' occupation or trade which she car- 
 ries on st'parately from her hu.sband, or derived from any literary, 
 arUstic or scientific .skill, and all investments of such wages, earn- 
 ings or property, shall thereaftia- be free from the debts or dispos- 
 
< i 
 
 'I 
 
 13 
 
 ! li 
 
 
 
 SO 
 
 THE INSOLVENT ACT. 
 
 itions of the husband, and shall be hold and unjoycd l)y such mar- 
 ried woman, and disposud of without her hushand's consent, as 
 fully as if she were a feme sole ; and no ordei- fin- protection sliall 
 thereafter become necessary in respect of any sucli earniiitis or 
 acquisitions. Under this Statute, a married woman woulil seem to 
 be entitled to join in a demand on a debtor, in lespect of a delit 
 due to her in business, carried on separately from iu-r husliand. 
 In fact, a married woman would seem to have this \h wer in any 
 case in which she is entitled to the <lebt for her separate use. or in 
 which she can briny an action or maintain a suit as a feme xolc for 
 the recovery of the <lebt (.see S>ni,mi'r/< v. Cit/j Bank, 43 L. J, (J. P. 
 2G1 ; f,ee Robson, :]rd Ed. 170). 
 
 Tlie Act does not contain any jirovision expressly relating to 
 denizens and aliens; but, without such provision, an alien oi' ileiii- 
 zen woidd seem to V)e entitled to make a demand against a debtor 
 amenal)le to the jurisdicfion of the court (Robson, ."h-cl Ed. 171). 
 But an alien enemy cannot do so, unless it be in respect of a dflit 
 contracted by a British subject under the sanction of the Crrnvn 
 (see Williams v. Nann, 1 Taunt. 278 ; ex i)arte Pascal, 24 \V. 
 R. 203). 
 
 It is to lie observeil that no creilitor can join in the dfiiiand 
 under this section, unless he has an unsecured claim of not less 
 than (me hundre<l dollars. Tliougli the language of the Statute is 
 not very clear, it seems a single creditor whose claim amounts to 
 or exceeds five hundred dollars iiiiiy make the demand. If a 
 debtor has no creditor whose claim amounts t(> two hundre(l 
 dollars who can iiiake the attidavit re(piireil under section 11. 
 and the aggregate of the claims of his creditoi's (whose claims are 
 over one hundred doUar.s) does not amount to live hundred dol- 
 lars, he cannot be placed in insolvency under the Act. Sueli 
 a debtor ma}' be subject to the provisioris of the Act, but there is 
 no person competent to })ut the machinery of the Act in motion, 
 as the Act deprives the debtor of tlie [)ower to avail himself of its 
 provisions. 
 
 " Unsecured claims" in this .section must mean un.secured for 
 the amount for wliich the demanil is made. It does not deliar a 
 
 ■J 
 
DEMAND OF ASSIGNMENT. 
 
 uch inar- 
 mscnt, as 
 ion sliall 
 •iiiiiLi-s or 
 
 ll SCl'lU to 
 
 of a I lei it 
 hu.sliaiiil. 
 r ill any 
 use. or in 
 e -Si lie for 
 L. J. C. P. 
 
 'latiiiin' to 
 
 I or (leiii- 
 
 a (lelitiir 
 
 Ed. 171). 
 
 of a del it 
 le Crown 
 :il, 24 W. 
 
 3 (leiiiaml 
 if not less 
 Statute is 
 uouiits to 
 ii.l. [f a 
 liuiidn^il 
 ;ectioii !>. 
 ?laims are 
 ulreil (lol- 
 et. Such 
 it there is 
 n motion, 
 iself of its 
 
 3cure(l for 
 )t dehar a 
 
 secured creditor as such from joinint,^ in the demand (see sections 
 !) and 106 and notes thereon). 
 
 Tlie Statute of Ontario (35 Vict. chap. 12) provides that every 
 debt and chose in action arising out of contract shall be assign- 
 a])le at law, by any form of writing, suliject to such conditions or 
 restrictions with respect to the right of transfer as may be con- 
 tained in the original contract, and the assignee thereof shall 
 sue thereon, in his own name, in such action and for such relief 
 as the orijifinal holder or assignor of such chose in action would 
 be entitled to. There would seem no doubt that the assignee under 
 this Statute may make the demand, when the assignment is bona 
 lidc made before the demand, and not for the purpose of 
 (>nabling the assignee to take proceedings under the Act. The 
 29 section only refei's to claims purchased after insolvency. In 
 Englaml the equitalile assignee of a debt not assignable at law 
 may petition alone (ex parte Cooper, 32 L. T. N. S. 780). 
 
 The Act of 1(S()9, in the .sections corresjionding to the 4th and 
 !)th of the present Act, used the word " claimant " instead of the 
 word "creditor." Butj under the Act of 18()9, the word claimant 
 was held to mean creditor (Dever v. Morris, 1 Pugsley, 270). 
 
 This case of Dever v. Morris settles an important point in refer- 
 ence to insolvency proceedings. The creditor making the demand 
 has not the sole control over it. The other creditors have a richt 
 to avail themselves of the demand, though the creditor making it 
 should accept payment of the debtor, or settle the proceedings 
 with him. 
 
 M., a creditor of defendant, made a demand upon him to assign 
 his estate, for the benefit of his creditors, under the 14th section 
 oftheActof 18CJ). No petition against this demand was [ire- 
 sented within five days, as re(iuired by the Act, but after that 
 time the defemlant settled his debt with M., who took no further 
 proceedings. The (A)urt held that the estate of the defendant 
 was nevertheless subject to compulsory licpiidation, and that 
 the demand of M. enured to the benefit of the other creditors of 
 the def(>ndant, the creditor making the demand havinn- no i ioht 
 or power to release, absolve, or discharge the estate of the insol- 
 vent from the liability to compulsory liipiidation which had ae- 
 
I ( 
 
 iHi i 
 
 ii 
 
 \ 
 
 i 
 
 1 
 
 t 
 
 1 
 
 I 'h 
 
 5-2 TllK INSOLVENT ACT. 
 
 crued fioin tlif non-coiitcstation of tlie demand {Deverv. Morris, 
 supra, s. c. Sk'plien's Digest, N. B. Reports, :i2.S ; see ex parte 
 Brigffoel; L. R. -t Ch. D. .S4.S). 
 
 8o, under tlie Act of 18(59, it was held that after tlie expiration 
 of tlnve days from the return day of tlie wi'it of attachment, the 
 plaintiff could not settle with the defendant or withdi'aw his 
 writ. The estate was then in insolvency, and subject to compul- 
 sory li([uidation, and the creditois had ac([uired sucli an inteicst 
 in the estate as entitled then, to have a mci'tinij held under the 
 27th section of that Act, and the writ could not lie witlnh'awn 
 hy the creditor suing it out, so as to disi'utitle anothei' rreditor 
 to intervene under this 27th .section {Woii/ii iii/toii v. T(i>jloi\lU 
 U. ( ". L. J. :VS:i ; Logic, Co. J.). 
 
 This section does not expressly provide tliat the affidavit may 
 he made ity an agent. The 10.")th .section refers to proceedings 
 in insolvency, and would seem more properly to iipply to affidavits 
 roaiired after the issue of a writ of attachment, ov the making of 
 an assigmuent. There seems no oI)ji'Ction, nowever, to an athdavit 
 hv an agent, having a personal knowledge of the facts. The 
 demand niiglitalso, it is apprehended, he signed hy a <luly authoi'- 
 izeil iigent. 
 
 'i'hei-e is no form of affiilavit given by this .section. In practici', 
 the affidavit required by .section !), form B., is generally u.'-ed. 
 Till' third paragraph of this affidavit is not strictly aitjdicabh , 
 nor is it necessary. It refers to some act of bankruptcy coiii- 
 niitted by the debtor. 
 
 Whereas, under this .section, an act of bankruptcy may not be 
 connnitted when the affidnvit is made, and it is only in the event 
 of the contingencies specified in section 7 arising, tliat the estate 
 of the debtor is liable to be placed in i)isolvency under .section f) of 
 the Act. The form of affidavit re(iuire<l by .section !) gives, in the 
 style of cause, the residence and de.scri])tion of the plaititiff and 
 defendant. These would not be necessary in the affidavit under 
 this .section, and it would .seem that the affidavit under this section 
 need not be entitled in any cause. Sharji v. MdthcvH (!) U. (\ P. 
 R. 10) would not apply in this case. It was decided on the 
 ground that the form was intituled in a cause, ami the body of the 
 
 ij i u. 
 
DEMAND OF ASSIGNMENT. 
 
 :>3 
 
 . Morria, 
 ex parte 
 
 ^piration 
 
 lent, tlie 
 
 (li'aw his 
 
 compul- 
 
 I intei'est 
 indi'i' till' 
 itliilvawii 
 • ere'litoi' 
 ii'jlor, 10 
 
 avit may 
 )Cee(lili_ns 
 atiitlavits 
 lakiiii;- of 
 allitlavit 
 Its. TIk' 
 y autlior- 
 
 pi'actice, 
 
 II y u.^ed. 
 [)plicaMe, 
 )tey coiii- 
 
 ly not be 
 the event 
 lie estate 
 ction of 
 es, in tile 
 ntiti' and 
 vit undei- 
 is section 
 I U. ( \ P. 
 1 on the 
 i<ly i)f the 
 
 ^ 
 
 ■I 
 •'I 
 
 affidavit referred to a cause. There the opinion of the Court was 
 that the plaintitl' properly followed the form given. 
 
 If the claim of one of the creditors is l)ased upon a transfer of a 
 debt to him by a third party, l)ut the transfer is not si<,mitied to 
 the. debtor until several days after the demand, this will not be 
 s\it}ifi ' ;o supi)ort the demand, for at the time of the demand 
 tJ'.e debtoi' 20uld not know of the transfer {Tiirycon v. Ta'dlon, 13 
 
 L. C. J. IIO- 
 
 As tiiis section is worded, it would seem that if the debtor is out 
 of the eoui; \ district in wliich he has his chief place of business 
 or domicile, he may be sei'ved Avnth a demand personally. In 
 other wt)r(ls, if there is personal service of the tk.iiand on the 
 debtoiv it is not necessary that the service should be either at 
 his pi I'-e (if business or domicile. To whom would the assign- 
 ment be ma le in such case ( According to the decision in New 
 Brunswick, to be hereafter i-eferred to, the Judge having jurisdic- 
 tion in the county or district in which the demand was served 
 could alone determine its validity. It would seem imder the 
 14th section of the Act, that there is no authority for an assign- 
 ment to any official assign<?e not appointed for the place of the 
 deljtor's domicile or chief place of Itusiness. A further question 
 arises in such a case as the above. In what Court would the affi- 
 davit recpured to lie sworn to imder this -iction be filed ? 
 
 It would .seem it should be tiled in the comity where the debtor 
 resides or carries on business. The intention of the Act is, that 
 proc"edings .should be initiated in that county or district, and 
 the autiiorization of service on the debtor personally would seem 
 intended to meet ca.ses where the debtor had removed to some 
 other jtart of Canada, and the're Avas no other jierson who could 
 be served. Besides if, on neglect of assignment by the debtor, the 
 creditor applied foi' an attaehnient, under section 9, he could 
 only apply to the Judge of the coimty or district where the trader 
 has his chief or (me of his pi-incipal places of business. The pro- 
 ceedings in li(|uidation would be carried cm in that county or dis- 
 trict, and the affidavit undtu- this 4tli secticm, nuist be filed in 
 that county or district. The Act in force in the United States 
 provides that the petition in bankiu])tcy is to be addressed to 
 
^7 
 
 54 
 
 THE INSOLVENT ACT. 
 
 h I 
 
 II 
 
 ill 
 
 f % 
 
 i ^m 
 
 the Jmlffe of the district in wliich the dehtor " lias resided or car- 
 ried on husincss." Wliere tlie delator carries on itusiness would 
 surely be his jdace of l)usiness within the meaning- of (jur Statute, 
 On tliis Statute, the American courts have declared that in a cer- 
 tain sense the place of the most transient stojipa^e, a mere pur- 
 chase, a l)ar<j:ain made l)y a man on his transit thixmyh a place, 
 would render it foi' the time being' his place of business. Pei'sons 
 resorting to market towns to dispose v)f produce, (jr make pur- 
 chases, would have, in literal acceptation, their place of business 
 there in eon<lucting such transactions. It cannot, however, satisfy 
 this provision of the law to [jrove the fact that the bankrupt is 
 doing some kind of business at the place where the petition is tiled, 
 if his legal residence is difi'erent. It must appear distinctly that 
 he has a fixed and notorious employment pursui'd by him in such 
 a manner as to di'uoti' a place of business established l»y him dis- 
 tinct from his place of residence. A fugitive or ec^uivocal occupation 
 that may contiiuie for a long period, or niay terminate instan- 
 taneously Avithout any outward change or indications calcidated 
 to mark its ctjutinuance oi- character, will not Ik; sutficient to 
 satisfy this provision of the law (re Kinsman, 1 N. Y. Leg. Obs. 
 309). 
 
 An agent wIkj is merely temporai'ily executing his agency in a 
 di.strict does not have a jilace of V)usine.ss in the district (ib). 
 
 In its broadest sen.se, the teiiii " business " includes nearly all 
 the affairs in which either an individual or a corpoiation can be 
 actors. Indulgence in pleasuie, ])articipation in domestic enjoy- 
 ment, and engagement in the otHces of merely ])er,s()nal religion 
 may be exceptions in the case of an individual, but the employ- 
 ment of means to secure or provide for these would to him be 
 business, and to a corporation these exceptions can have no appli- 
 cation. The conduct of any and all of the atfaii's of a cor[)oration 
 is business. There are, in the carrying on of a business, many 
 affairs which are merely incidental, and which may be and olten 
 are transacted elsewheie than at the place where the business — 
 that which is the real design and purpose or ol)ject in view — is 
 located, and such transactions may be of such frequent and even 
 daily occurrence as to require an agency of considerable duration. 
 
DEMAND OF ASSIGNJIENT. 
 
 55 
 
 Such transactions are not a carrying on of business in the sense 
 of the law. " Carrying on business " looks to the scheme and pur- 
 pose to whicli such transactions tend, and not to the incidental 
 transactions themselves. The debtor may find it necessary or ex- 
 pedient in aid of his business, to employ agents or agencies in 
 other places than those in which his business is carried on ; but 
 the tran.sactions of stich agents are only collateral or incidental. 
 They do not in a just sense constitute the l)usiness of the deV)tor 
 (re. 'aIl k Choi. R It. Co., G B. R. 107 ; i) Blatch. 81)1). 
 
 Under this section of the Act, the demand may be made either 
 at till- domicile or at the chief place of business of the debtor. 
 Section 9 speaks only of the chief or one of the principal places 
 of business of the debtor, while section 14 again seems to refer 
 to domicile as distinct from the place of business of the delator ; 
 and it would seem that the term is used in this sense in the Act, 
 except in the latter part of the 4th section, in reference to the 
 domicile f(jr service. 
 
 By the term " domicile " in its ordinary acceptation is meant 
 the place whei-e a per.son has his home. In this sen.se the })lace 
 wilt 're a person has his actual residence, inhabitancy, or commo- 
 rancy is sometimes called his domicile. In a strict and legal 
 sense, that is properly the domicile of a per.son where he has his 
 true rixed p<'rmanent home and principal establishment, and to 
 which, whenever he is absent, he has the intention of returning 
 {an i III us reverfe ndl). 
 
 Two things then must occur to constitute domicile — first, resi- 
 dence, and .secondly, the intention of making it the home of the 
 party. There must be the fact and the intent, for, as Potliier has 
 truly observed, a person cannot establish a domicile in a place 
 except it be (tnliivt et fiuio. From these considerations and rules, 
 the conclusion may be deduced that domicile is of thi'ce sorts; 
 domicile by bii'th, domicile by choice, and domicile by operation 
 of law. The first is the common case of the place of birth, domi- 
 cilii' m oviginis ; the second is that which is voluntarily ac([uired 
 by a jiarty, propria mot a; the last is conse([nential, as that of a 
 wife arising from marriage (Story's Contl. of Laws, 34(5). The 
 best definition as applied to an acquired domicile is, — that place 
 
'. I 
 
 i 1 
 
 Ij 
 t 
 
 ', ; 
 
 
 ) 1 
 
 1 
 
 
 i 
 
 5G 
 
 THK IxNSOIA'ENT ACT. 
 
 in wliich a man has voluntai'ily fixed tlic habitation of hiinsrlf 
 and family, not for a mero special or tempoiary purpose, but with 
 the present intention of makin;,f a permanent home, until some 
 unexpected event shall occur to induce him to adopt some otlier 
 permanent homo (fjord v. Colc'iu, 4 Drew., .'J(i(J, see Wharton's 
 Law Lexicon, Gth Ed. 310). 
 
 5. If the debtor, on wlioin hucIi ilemaiul is made, contends that the same 
 was not made in ( iiformity with this Act, or that tlie chiims of such creditor 
 or creditors do not amount to one h\indred dollars each or to five hundred 
 dollars in the aggregate, or that they were la-ocured in whole or in part for 
 the ])ur{)ose of enabling such creditor or creditors to take proceedings vuider 
 this Act, or tliat tin stoppage of payment l)y such debtor was only temporary, 
 and tliat it was not caused by any fraud or fraudulent intent, or by the in- 
 sulticiency of the assets of such delitor to meet his liabilities, he may, after 
 notice to sucli creditor or creditor.s (but only within five days from such 
 demand), present a petition to the judge praying that no further proceedings 
 under this Act may be taken upon such demand, and, after liearing the 
 parties and such evidence as may l)e adduced before him, tlie judge may 
 grant or reject the prayc^r of liis petition, with or without costs against cither 
 party, but if it appears to the jmlge that such demand has been matle with- 
 out reasonable grounds, and merely as a means of enforcing itayment tinder 
 colour of proceeding under this Act he may condemn the creditor or credi- 
 tors making it to pay treble costs. 
 
 The 4th section, as we have seen, authorizes a <lemand on the 
 debtor when he is out of the county in which he resides, 
 provided the demand is made upon him personally. In such case 
 it lias Iteen held in New Brunswick, that the t.'ountv Court Jud«'e 
 of the coimty in which the debtor is at the time of the service of 
 the demand is the piopt^r party to hear the petition under this 
 section, althou^di tlu' debtor may reside and do liusiness in anothei 
 county (ex parte T/iomuft, 2 Hannay, l(i2, H'ui). The writer disap- 
 proves of the decision in this ca.se as applied to the present Act. 
 LTnder section 2 ((/) "Judge" nieans a judpi havino; juristliction 
 in the county or district where the proceedings .shall be had luidei 
 the Act. As we have already seen, tlie proceedings must, under 
 section 4, be had in the place of the debtor's dondcile or chief 
 place of business, and th<- creditor must appoint the domicile for 
 .service in this place. The debtor woidd lie iv(|uired to serve his 
 
PETITION AOAINST DEMAND. 
 
 57 
 
 f himself 
 ')Ut with 
 iiti) .some 
 nie otluT 
 
 V'hill tOllH 
 
 t the same 
 ch creditdr 
 o liuiulrcil 
 in i»iu't for 
 iiigs undor 
 toiiip-»rjiry, 
 l)y tlie in- 
 iiiiiy, aftiT 
 from siich 
 in)Ct.'0( lings 
 oaring tlie 
 ju(li,'0 may 
 linst cither 
 nadu witli- 
 lont under 
 f or credi- 
 
 1 nil the 
 
 resides, 
 
 iuch case 
 
 rt .Iiidui'O 
 ci'vice i»f 
 tich'V til is 
 1 another 
 ei" (lisap- 
 seiit Act. 
 
 istlictioii 
 ad under 
 st, under 
 
 or el lief 
 iiicile for 
 serve his 
 
 «i 
 
 4^ 
 
 ■0 
 
 i 
 
 petition and notice there, and it certainly appears to the writer 
 that the .'udge of the domicile for .service is " the Judge " con- 
 templated by this section. 
 
 When a Statute fixes the time within which an act must be 
 done, the Courts have no power to enlarLfc it, althon<,di it rel.ites 
 to a mere (juestion of practice: so wliei'e an appeal to be valid 
 nuist be made witliin ten (hiys, it is void if taken on the eleventh 
 (ex parte Ostrander, 1 Denio CSO ; Blecckerv. W'lsehiirn, o Wend. 
 I'M) ; as to computation of time, see Hood v. Dodds, 111 CJrant, 
 (;39-(i42). 
 
 It would seem, under this section that, the petiti(jn nuist be pre- 
 sented within the five days and, as by tlie lOHtli section, <»ne 
 clear day's notice nuist be fjiven, tlie notice would require to 
 be given tm the third day, otherwise there could be no presi'iit- 
 ment on the fifth. 
 
 Where a demand was made under the 14th .section of the Act 
 of 18(!I), re(juiring a debtor to make an assignment f<»r the benefit 
 of his creditors, and the debtor did not, w^ithin five days after the 
 demand, present a petition, under the loth section, to sta}' pn)- 
 ceedings, it was held that his estate on the expiration of such 
 five days became subject to compulsory liquidation, though on 
 the same day that the writ issued, the de])tor made a voluntary 
 assignment under the Act. In other Avoids if the debtor allows 
 the five days to elapse he cannot afterwards make a volun- 
 tary assignment which will jtrevent his estate being placetl in 
 compulsory li(|uidation, and a ])etition ])resented, after the ex- 
 piry of the five days, to stay proceedings on the ground of the 
 debtor having made a voluntary assignment is too late (llKnaas 
 (Hid Murthi, 17 L. C. J. 11, confirming s. c. In L. (J. J. -i-SC.-T; 7 
 C. L. J. N. S. 302). 
 
 Two creditors, whose claims together amounted to five hun- 
 dred dollars, made a demand against their debtor for an assign- 
 ment of his estate and effi'cts under the Act of 1.S64, section 3, 
 sub-.section 2, and it appeared in evidence cm the debtor's petition 
 to stay proceedings that one of the credit(us had made the de- 
 mand solely in order to obtain payment of the amount due him. 
 The Court held that the demand was "made without reasonable 
 
t 1 
 i I 
 
 "■ If 
 
 
 \i 
 
 ■ i 
 
 11 
 
 ! I 
 
 oS 
 
 TIIK INSOLVENT A<T. 
 
 I^fvonnds and mcroly as nioaiis of enf()rcin<4 piiynicnt" aiul was 
 tlinrforc contrary to section 3, ss. li, and proceedings wi-rc con- 
 si'(|uently stayed {LdnmJw v. hawlnl, KJ L. C II. l(Hi ; I L. ( '. L. 
 J. 110). 
 
 It would .seem that this power to condemn the creditor to pay 
 trehle costs is mei'ely cumnlativi', and does not interfere with any 
 reimdy which the delitor may have at the common law. It 
 would .seem that an action miiiht he maintained for a malicious 
 prosecution if the demand were .served without rea.sonalile and 
 proliaMe cause, and merely as a means of enforcinjf payment 
 (see .Jolnmn, v. IJnwmw, L. R, C Kxch. .S2!) ; -J.') L. T. N. S. IW). 
 
 Jt would not he sufficient in an action for malicious prosecution 
 to allege tliat the demand waf^ .served maliciously, Itut it would l)e 
 necessar}' to go farther and state that there was no reascjnahle oi- 
 proliahle cause for serving it. The demand could not amoinit to 
 a lihel mile.ss it was puhlished to a third per.son. A l)arty could 
 not he sued foi' serving a demand of this kind upon the plaintiff 
 personally, urdess there was want of n^a.sonahh^ or piohahle cause, 
 nttr could he be treated as having pidtlished a false and malicious 
 liliel liy puhli.shing it to the plaintiff himself. The demaml l»eing 
 a legal proceeding would he prima facie privileged, and no action 
 would lie for delivery of it to a tiiird pcjr.son for .sei'vice on the 
 plaintiff, unless upon proof of express malice ; but if a paity with- 
 out having any debt due to him, and knowing that there was no 
 debt due to him, chose to put such a demand into the haiuls of a 
 thii'd person for the j)uriio,se of being served, that would be a pub- 
 lication and might amount to a libel if express malice were pioved, 
 B<nd' of B. iV. A. and titrowj, L R. 1 P. C. I), .S07, 'M'!). 
 
 The o'ltiiK prohiDxll of shewing that the stoppage of payment 
 was only temporary and not caused l>y any fraudulent intent or 
 the insufliciency of as.sets to meet liabilities is on the insolvent 
 when he applies under this section. To do this it seems he nuist 
 show lie is not insolvent, that he is possessed of property, out of 
 which the claims may be paid, and he mu.st i)roduce a schedule 
 of assets and liabilities {MrCmubj ivai\ Leami/, 11 L. ('. J. 1!)3). 
 
 So, in the United States it has been held that if the del)tor is 
 unable to pay his debts as they become due, tl>e burden of 
 
PKTITION AGAINST DKMANU. 
 
 51) 
 
 proving that his property is sutticiuut to pay his Uchts rests upon 
 iiiiii (re Ibjiva, 2 Saw. 411). 
 
 A third party cannot object to tlu; rey;ularity of the proceed- 
 ing's taken against a dehtor under tlie In.solvcnt Act of IHOO. 
 In tills case the property ehiiined hy the tliird person had been 
 seized under a writ of attaehuieiit, and it was lield that he must 
 resoi't to Ids eonnnon law remedy therefor, and could not pro- 
 ceed sininnarily under section 12.') of the Act {ClementHon v. 
 Hammond, East. T. IS71; Steplien's Digest N. B. lleports, 227). 
 
 Wlicn the Court sees that a l)aid<ruptcy petition has heen 
 made use of for an ine(piital>le purpose, as for instanei" to e.\tort 
 money from the debtor, it will refuse to make an adjudication, 
 even though then; is a good petitioning creditor's debt, and an 
 act of bankruptcy has been committed (re Dafics, L. R. 3 Ch. D. 
 
 461). 
 
 The H4th secti(m of the English Act of 1<SG!> gives the Court 
 power in certain cases to annul an adjuuication of bankruptcy. 
 If there are no assets, and the baid<iui)tcy is a mere sham, it 
 ought to be annulled (ex parte Emjlhli J. S. Btfuk, L. R. 6 Ch. 
 App. 7!>; see as to annulling, e.x parte Shif, L. R. 20, E(i. 77.S; ex 
 parte AHhworih, L. R. IS, Eip 705; Ih-vcU v. Bluke, L. R. 7 (1 P. 
 300 ; rx parte Hooper, 34 L. T. N. S. 202 ; ex parte L'tiulmy, L. 
 R. 1!» Ki[. 52; ex parte Tlioday, L. R. 2 Ch. 1). 22!) ; ex parte 
 Fostn\ L. R. 10 Ch. App. 59 ; ex parte WiUton, L. R. 10 Ch. App. 
 21.5j. 
 
 0. If lit the tiino of such domaiid the duhtor w.ia iibaent from tlie Pro- 
 vince wherein sucli service was made, application may be made after due 
 notice to tlie creditor (ir creditors, within the said period of five days to the 
 judge on his behiilf, for an enlargement of the time for oitlior contesting 
 such demand or for making an assignment ; and thereupon, if such debtor has 
 not returned to such I'roviiice, the judge may make an order enlarging 
 such jieriod and fixing the delay within which such contestation or assign ■ 
 ment shall be made ; luit such enlargement of time may be refured by the 
 judge if it be made to appear to his satisfaction that the same would be 
 prejudicial to the interest of the creditors. 
 
 Probably any person who may, under the Act, l)e legally served 
 with the demand, has tlie power to apply, under this .section, on 
 
r 
 
 I! 
 
 I ? 
 
 OO 
 
 TIIK INSOF-VKNT ACT. 
 
 liclijilf i>f the dclitoi'. Tliis section docs not say that tlic applica- 
 tion must 111' liy |u'tition, of that it must Im- pit'scnti'd witliin 
 the five (lavs, l)ut it is jjicsiinu'd that this is what is meant, and 
 the ohservations ah-eady ma<le as to secti(»n ii\r will apply to this 
 also, The judye to l»e applied to, in this instance, would clearly 
 be tlie Judge of the domicile. 
 
 7. If siicli petitinii bo rojocted, or if, whilo sucli pelitidii Ih iifii(hii',s tlio 
 (lo)>tnr, without tlio leivvo of tlie ju(li,'u, or otliurwisc thiin on tlio tontis 
 l)ru8cril>L'(I by liim, continues hi.s trado, or procoods witli tlio roiiHzation 
 of lii.s uHsotH, or if no sucli petition bo presented within the aforesaid time, 
 and the delttor during the same time nei,'leets to make an as.sii^innent of 
 liis estate and eU'ects for the ben(>flt of liis ereditors, as hei-einafter pro- 
 vided, his estate sliall become subject to licpiiihition under tliis .\et. 
 
 Under this section tin- liahilit}' to compulsory liipiidalion is so 
 ahsulute, under the circumstances stated, that it cannot, as we 
 have ali'eady seen, he waived hy the creditor nud\ino- the ilciiiand 
 (Dcrn- v.Murrls, 1 Pn«rsley, 27(»)- '''he policy of the Act i> that 
 the creditor makin;^ tlu' demand is actino; in the interest of the 
 general ht>dy of creditors, and hi' caiuiot hold the demand in 
 alieyance, or use it for his private ptnposes. If he does so. he is 
 puni.shahle at conunon law, as well as by the expre.s.s provisi<ni of 
 the Act (see ante 51-2.). 
 
 If the debtor wishes lO continue his trade during the pendency 
 of the petition, he nuist ai)ply to the judoc for leave to do so ; on 
 negh'ct to do .so, his estate will become subject to li([uidation un- 
 der the Act ; but pi'oceedings must'be taken under , section !), u])oii 
 tlie estate becoming liable to li(juidation under this .section. 
 
 8. No such proceedings as aforesaid sliall be taken under this Act to jiliiw 
 the estate of an insolvent in li(|uidation, unUss the same are taken within 
 three months next after the act or omission relied upon as subjecting sucli 
 estate thereto ; nor after a writ of attachment in li(pudation has been issued 
 while it remains in force ; nor after an assignment has been ma<le under 
 this Act. 
 
 This .section does not apply to contiiuious acts of bankruptcy, 
 such as remaining out of (Canada under .section 3 (b) (ex paite 
 Banney, 1 De G. & J. 30'J ; 3 Jur. N. S. 1141); , so the non-j.ay- 
 
 i 
 
 
 %^,.^ 
 
CONTINrors A<TS OK HAN KIM 'I' rev 
 
 01 
 
 a|))ilica- 
 (I witliin 
 
 lUlt, Rlnl 
 
 y to tills 
 (1 clearly 
 
 Mitlinu, tlia 
 tlie tonus 
 reiilizatiini 
 L>siii(l tiiiii', 
 i,'iiim.'nt <if 
 
 llftl'l' pI'D- 
 
 Act. 
 
 lioii is so 
 lit , us we 
 ' (IchiuikI 
 I't is that 
 st nf the. 
 ■inand in 
 ; so. lie is 
 jvisioii of 
 
 pendency 
 
 lo so : oil 
 atioii iiti- 
 
 111 !), U])oM 
 
 ion. 
 
 .Ct to ])l!lL'(' 
 
 <t'n witliui 
 icting siicli 
 )eoii issmd 
 ii(U' under 
 
 ikruptcy, 
 (ex J)arte 
 non-pay- 
 
 i^ 
 
 M 
 
 iiiriit of coiiiiiicrcial paper at maturity ami the contwiiicd suspen- 
 sion iiinl neglect of payment ar*' a continuous act of haikruptcy. 
 Thr dflitor. in such case, is in a state of suspension ami non- 
 resumption of payment. His duty to pay is just as dclinite on 
 any day after tlie day on wliicli his commercial paper is liy its 
 terms payalile, as it is on that <lay ; and on any such day, he is in 
 the Very position, as lietweeii him and the creditors, of neolcctiii;^' 
 his duty, suspeiidiiiL;', Ueei)in<,Mn suspense, and not resuming' pay- 
 ment, and whether his continued suspension and non-resumption of 
 payment lie termed a continuous act of liankruptey, or he re;4arded 
 as daily successive acts of lianUruptcy, is not material. So loni,^ 
 as it continues, the creditors may avail Lhemscilves of it as an 
 act of liankruptey, cummitteil as truly witliin the {)recedino' three 
 months as on tlie day on which the delitor violated his commercial 
 olili^ation (re Ra/jnor, 7 H. H. '>'17). 
 
 It is ])i'olialile that the acts of bankruptcy mentioned in section 
 '} ('/, // and i) are continuous .st) louif as the dehtor iiej^lects to 
 comply with the rules and orders tlu'rein mentioned. 
 
 In (^iieliec, it has been held that a general conveyance or assign- 
 ment which would lie an act of bankruptcy undei' section .'{ (,yJof 
 the Act, does not autlu)rize proceedings to lie taken in compulsory 
 li(|uidation after the expiration of thive months from the date of 
 the assignment (//('/(.'/(,/ //« v. Colw.ii, W L. C. J. 85) ; and under this 
 8th section it would ai)pear that ])r<x'ecdings to })lact.' the estate 
 of an in.solveiit in liipiidation must lit,' taken within three months 
 next after the act or omission relied upon as sulijecting such 
 estate thereto, otherwise the lapse of time will purge the act of 
 liankruptey. If a deed executed l>y a debtor cannot beset aside 
 under the statute, I.*} Eli/, chap. .'>, or generally as fraudulent 
 against creditors, but only on the grountl that it is an act of 
 bankruptcy within the policy of the bankrupt law, it will, 
 under this section, become valid and unimpeachable after the 
 lapse of three montlis from its execution, if, tluring that jjeriod, 
 no procee<lings have been taken to place tlie estate of the 
 debtor in liipiidation (Allen v. Jionnctt, L. E. 5 Ch. App. 577; see 
 also Jones v. Harper, L. R. 0, Q. B. 77). 
 
^^ 
 
 
 IMAGE EVALUATION 
 TEST TARGET (MT-3) 
 
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 Hiotographic 
 
 Sciences 
 
 Corporation 
 
 23 WEST MAIN STREET 
 
 WEBSTER, N.Y. 14SS0 
 
 (716) 872-4503 
 
fi2 
 
 THE INSOLVENT ACT. 
 
 I il 
 
 WRITS OF ATTAt'UMENT, ET(.'. 
 
 U. Any creditor upon his aftid.avit, or that of his elork, or other diilj' auth- 
 orized agent, that a trader is indebted to him in a sum proveable in insolven- 
 cy of not less than two Innidred d<jllars, over and above the value of any secur- 
 ity which he holds for the same, and provided the atKdavit or aHidavits tiled 
 disclose such facts and circumstances as will satisfj' the .Tnd^e or Prothono- 
 tary of the Superior or County Court, in the county, province, or district, as 
 the case may be, in which such trader has his chief, or one of his principal 
 places of business, that such trader is insolvent, and that his estate has be- 
 come subject to liquidation under the provisions of this Act, and that he does 
 not act in the premises in collusion with such trader nor to procure him any 
 undue advantage against his creditcirs (Form B) shall bo entitled to a writ of 
 attachment (Form C) against the estate and etiects of such trader, addressed 
 to the Official Assignee of the county or district in which such writ shall issue, 
 reijuiring such Official Assignee to seize and attach the estate and effects of 
 such trader, and to sunnnon him to appear before the court or a judge there- 
 of on a day therein mentioned, to answer the premises. Concurrent writs of 
 attaclinieiit may be issued when re(]nired, addressed to the Official Assignee 
 of other ccmnties or districts in any part of the Donnnion other than the 
 county or district in which the same shall be issueil. 8uch writs sliall be 
 subject as nearly as can be to to the rules of pnjcediue of the court in ordi- 
 nary suits, as to their issvieand retm-ii, and as to all pmeeedings subsecjuent 
 thereto before any comt or judge. 
 
 Creditor in this section would st'cni to niesm secui-ed ci'cditor 
 as well as an unsecured creditor. Section lOO of the Act provides 
 that the creditor, l)y his affidavit foi- the issue of a writ of attach- 
 ment, .shall put a value on Jiis security, and he may exei'cise all the 
 lights of an ordinary creditoi- in respect of the l)alance, after de- 
 duction of the value of Ids security. When a secured civditor 
 applies for a writ of attachment under this .section, his affidavit 
 must shew that the Defendant owes him " not le.ss than two hun- 
 dred dollars over and ahove the value of any .si'curity which lie 
 holds for the claim " {McDoivddw Clc/dnd, <> IMl. U.C. ^!»2j. 
 
 So in the Uiiiteil States a secured creditor may he a petitioning 
 creditor, hut the amount at which his deht is to lie reckoned is to 
 be ascertained liy deducting the value of the .security (re (Jolifor- 
 nia P. R. 11. Co., 11 B. R. l!)8). 
 
 In the United Statt's it is held that a party has the right toi)nr- 
 chase a claim in good faith with a view to enahle him to join in 
 
 \ 
 
WRITS OF ATTACHMENT. 
 
 ()3 
 
 a petition in order to make up the number there re(|uired to tile a 
 petition in liankruptey (re Woodford, 13 B. K. ;")7;')). But this is. 
 as we have seen, one ground for setting aside a demand umlcr 
 section five of the Act. 
 
 The same nund)ei' and amount of creditors must join in a pro- 
 ceeding to force a coi'poration into bankruptcy as is re(juired in the 
 case of an individual (re Leavenworth, S. B. 14 B. 11. 82-!):^; re 
 Oreuon B. c£; P. Co., 14 B. R 394). 
 
 Proceedings under this clause are not in any sense proceedings 
 merely for the collection or security of the particular debt of the 
 creditor — they are for the benefit of all the creditors. The fact 
 that the creditor making the affidavit has a provable debt to the 
 re( pi isite amount, is necessary to be shown for two purposes, viz. : 
 1st. To show that the alleged debtor occupies that relation : 2nd. 
 To show that the creditor has the requisite qualifications to com- 
 mence the proceedings. After the issue of the attachment, the 
 plaintiff in the suit, or the creditor who initiates the proceedings, 
 stands in no better or more favourable position than any other 
 cre<litor. He nnist prove his debt in the course of the proceedings, 
 the same as any other creditor. His debt may be opposed, adjudi- 
 ciited u}>on, and allowed, abated or expunged, the same as any 
 other debt (re Sheelum, 8 B. R. 345 ; re Fveedlcy, Gvahlie, .■)44 ; 
 re Mnidcn h(dl, 9 P. R. 380 ; re Lacey, 10 B. R. 477 ; see also Devar 
 v. Morrh, I Pugsley, 270 ; Worthhvjton v. Taylor, 10 U. C. L. J. 
 333). 
 
 The debt nuist be contratted liefore the act of bankruptcy in 
 respect of which proceedings are taken (ex parte Sharp, 3 M. I). 
 cV D. 490 ; ex parte Hayuwd, L. R. (5 Ch. App. r^■^C>). It would 
 be manifestly Vinjust that a per.son who commits an act of bank- 
 ru})tcy, and who hap])ens to have no creditors, or who pays all his 
 cieditoi's in full, sliouhl be liable to be made V)ankrupt (m account 
 of that act, by some pei'son to whom he afterwards l)ecomt' in- 
 delited (ex parte Ifayicard, sn])vei). The holder of a bill of ex- 
 change or promissory note, accepted, drawn, made or indorsed, by 
 the l)ankrupt before the act of banki'uptcy, though it be not ac- 
 tually endorsed to the holder until after such act, may take pro- 
 ceedings, founded on such bill or note after it becomes due and 
 
 *?i 
 
 '.* 
 
 'ikl! 
 
 .* 
 
 '4 
 
 il 
 
 - -•«-- -rf I 
 
m li \'- 
 
 J 
 
 64 
 
 THE INSOLVENT ACT. 
 
 payalilo, liocausc the indorsoment or assigniiR-nt to the holder has 
 relation to the ori«;inal deht (Glu/isfe)' x, Ileiver, 7 T.liAi)^ ; ex 
 parte (';jrus, L. R. 5 Ch. App. 17<)). 
 
 The ei-editor autliorized to tak(,' pi-oceedings is one . i\ )se debt is 
 provable. Under the (SOth section of the Act, debts flue but not 
 payable at the time of the issue of tlie attaclnnent, or the making 
 of the assi<'niaent, have the right to rank on the estate — so a debt 
 existing when the affidavit is made is sufficient to sui)port the 
 proceedings (Fhdps v. Classen, 3 B. R, S7). A claim for unliqui- 
 dated damages would not be sufficient to ground an attaclunent 
 nor any claim wliich is not ]»rovab]e under the Act. But a credi- 
 tor whose (lel)tis inunature, may commence proceedings 1)}' attach- 
 ment against his delator who is irisolvent in like manner as he 
 mi'dit do if his debt were overdue at the time. But in a case 
 where it appeared that the del)tor did not owe more than 8100 
 beyond the creditor's debt, none of which was at tlie time due, 
 tlie Court directed that he sliould Ite alhiwed further time to 
 show if he could tluit he was not in fact insolvent and so not 
 liable to have Ids estate placed in compulsory liquidation (re 
 Moore V. Luce, 18 0. P. U. (\ 44G). 
 
 This case has been followed in New Brunswick, (re Perks 2 
 Hannay, 121), and it seems it would also be followed in the Pro- 
 vince of Queljec (Sinclair v. Ferguson, M L. C. R. 23i) ; Leduc v. 
 To\iri<jiiij, 5 L. C. J. 123; Wotherspoon, Ins. Act, 35), and such is 
 also the law in the United States. A debt not payable is })rov- 
 i^ble, and being provable is sufficient to authorize proceedings 
 {Linn v. Smith, 4 B. R. 4Gj. 
 
 The decision in Moore v. Luce, supra, was under the Act of 
 18G4. Section 3, ss. 7 of that Act, corresponding to this section 
 of the present Act, did not use the words in the second line of 
 this section, namely, that a trader is " indebted," but the affidavit 
 the creditor was required to make under tlio Act of 18G4 stated 
 " that the defendant is indebted to the i)laintiff." Mr. Justice 
 Adam Wilson, who delivered the judgment in Moore v. Luce, 
 pointed out the difference between the affidavit and the Statute 
 itself, but declared that the statement in the affidavit, that the 
 insolvent was "indebted," might be read in the light of the Sta- 
 
 : 
 
 IS 
 
 pr< 
 L. 
 
 of 
 
WRITS OF ATTACHMENT. 
 
 65 
 
 tiite, which in effect made an undue debt to be due, and so the 
 l)arty indebted, for the purposes of this Act. This reasoning 
 would seem to show that the word " indebted " being used in the 
 present Statute does not change its interpretation, and that the 
 debtor may be " indebted " in respect of a debt not ac- 
 tually payable at the time of the issuing of the writ of attach- 
 ment. 
 
 In Moore v. Luce, tlie delator against whom the proceedings 
 were taken was the maker, not the indorser of the note. Rob- 
 son, ill his treatise on bankruptcy (^3rd edition, 173). says it seems 
 questionable whether a bill before notice of dishonour will now 
 hv a good petitioning creditor's debt as against the drawer or 
 indorser, who are only liable if the acceptor fails to take up 
 the liill (Brett v. Levett, 13 East, 213) ; for until then it cannot be 
 said that there is any debt due from the drawer or indorser. Bur 
 as against the acceptor a bill before the time for payment ha • 
 arrived wonld, pri'ma facie, be sufficient, for a del)t may be pro- 
 perly said to be due in the sense of being owed before it is ac- 
 tually payable (re Bank of Hindustan, L. R. 5 Ch. App. 402). 
 The last Act in England speaks of " a sum due," and this has 
 been held to mean a debt presently payable (ex parte Sturt, L. R. 
 13 Eq. 309). 
 
 Under the 80th section of the Act an indorser of a note, who 
 is compelled to pay it, would seem entitled to issue a writ 
 of attachment against the maker, and any surety who pays 
 the debt for his principal may proceed under this section, so 
 proceedings might be taken against a surety (see section 2 h). 
 The holder of a note dated jn-eviously to proceedings in compul- 
 sory litjuidation, need not prove that it was really made at its 
 apparent date, and the fact that the note has been given as colla- 
 teral security does not prevent the holder from adopting thereon 
 proceedings in compulsory liquidation (Hutchins v. Cohen, 14 
 L. C. J. 85). 
 
 A writ of attachment maj' issue under this section against the 
 
 members of a partnership after the dissolution of the firm (Cit;/ 
 
 of GlasgoTM Bank v. ArbucUe, 16 L. C. J. 218). The wi-it 
 
 of attachment must be indorsed with a declaration show- 
 
 E 
 
 iii 
 
I 1 
 
 
 ^Q 
 
 THE INSOLVENT ACT. 
 
 ing that it is issued iinder and by virtue of the order of the 
 Judge of the Court granting it, but if this is not shown on tlie 
 face of the attach iiiciit, an amendment may be granted on pay- 
 ment of costs (Mclnfies v. Bruoks, 1 U. C. L. J. N. S. 162 ; Law- 
 
 der, Co. J). 
 
 Under this section it is necessary that an affidavit .should bo 
 made to ground the writ of attachment, and if the statement in 
 writing does not amount to an affidavit the attachment must be 
 .set aside. Thus when a quaker was tlie plaintiff suing out the 
 attachment, and his affirmation merely declared and affirmed that 
 he was one of the society called (piakers, without, also, solennily, 
 sincerely and truly declaring to the contents of the affiimation as 
 required by the Con. Stat. U. C. chap. 32, s. 1, it was held that 
 both these formalities were required to give the affirmation the 
 effect of an affidavit, and the attachment was set aside {HUlhoni 
 V. Mills, 5 U. C. L. J. N. S. 41 ; Hughes, Co. J). 
 
 If, therefore, an affirmation is made by a quaker, menonist, oi- 
 tunker, or other person refusing from conscientious motives to be 
 sworn, it is necessary that the affirmation .should follow the form 
 prescribed by the Statute of Ontario, (33 Vict. chap. 14, s. 1). This 
 section requires that the party shall declare that the taking of an 
 oath is according to his religious belief ' nlawful, and also that he 
 does solemnly, sincerely and tiuly de> .re and affirm, &:c. Under 
 the lOoth section, any affidavit required to be sworn in proceed- 
 ings in insolvency may be sworn before any commissioner for 
 taking affidavits, and it has been held tliat an affidavit for a writ 
 of attachment sworn before the plaintiff's attorney in the pro- 
 ceedings was good under this section, the attorney being a com- 
 missioner for the taking of affidavits (ib ; Hughes, Co. J). 
 
 This is contrary to the rule prevailing in the Superior Courts 
 of Ontario, in which no affidavit can be read or made use of, if 
 sworn before the attorney of the party in the cause on whose be- 
 half the affidavit is made or before the clerk or partner of such 
 attorney (Rule No. 114). 
 
 An affidavit to support an attachment should state definitely 
 the act of insolvency relied on, and when the affidavits referred 
 to the sale of some property in such an indefinite manner that it 
 
WRITS OF ATTACHMENT. 
 
 67 
 
 was impossible to say whether the act relied on as subjecting the 
 estate of the debtor to compulsory liquidation, was the sale of the 
 property or an attempt to sell it, the ; 'achment was set aside 
 {Royal C. Bank v. Matheson, G U.C. L. J. N. S. D). 
 
 This decision, though under the formei" Act, woidd probably still 
 apply as by the affidavit, form B, the creditoi' is required to state 
 concisely the facts relied upon as rendering the debtor insolvent. 
 
 An attachment may be issued under this section after demand 
 made, under section 4 of the Act, if the petition to set aside 
 the demand is rejected, or if the debtor continues his trade while 
 the i)etition is pending, without the leave of the judge, or if no 
 petition is jiresented within the proper time (see section 7). But 
 it does not seem necessary in proceeding under this 9th section 
 that a demand should be previously served on the debtor under 
 section 4. If the debtor becomes insolvent under section 3, he 
 may be proceeded against under the 9th section, without a pre- 
 vious demand. 
 
 Section 4 seeins to supply the power of placing a debtor's estate 
 in insolvency, where section 3 does not apj)ly. One creditor may 
 proceed under this 9th section, though several have joined in the 
 demand, under section 4 ; and it would seem that a creditor pro- 
 ceeding under this 9th section might avail himself of a demand 
 made by another creditor, under section 4, and might do so if 
 the contingencies specified in section 7 had ari.sen, even if the 
 debtor had, after demand, settled with the creditor making the 
 demand (see Dever v. Morris, 1 Pugsley, 270). 
 
 "The Interpretation Act" (31 Vict. chap. 1, s. 7), thirty-firstly, 
 i-nacts that where forms are prescribed, slight deviations there- 
 from, not affecting the substance or calculated to mislead, shall 
 not vitiate them ; and in Ontario, '• The Administration of Justice 
 Act of 1873," s. 49, nrovides that no proceeding at law or in 
 ocjuity shall be defeated by any formal objection. 
 
 But, in reference to the affidavit prescribed by this section, it is 
 best to follow the forms given by the Act, and the affidavit should 
 be entitled in the cause with the name of the plaintiff and de- 
 fendant, although until the issuing of the writ there is no cause 
 in court (Sharp v. Matthews, 5 U. C. P. R. 10). 
 
 ('/' 
 
 )) 
 
t ' 
 
 i U 
 
 68 
 
 THE INSOLVENT ACT. 
 
 The 20th .section of the Act of 1«()9 required the affidavits of two 
 credible persons showing the fact of insolvency, and also the affida- 
 vit of the creditor proving the indebtedness. It was held that 
 this section was complied with, although the creditor or his agent 
 deposing to the debt was also one of the two persons testifying to 
 the facts and circumstances which were relied on as constituting 
 insolvency (Sharp v. Matihewa, 5 U. C. P. R. 10 ; 5 U. C. L. J. 
 
 N. S. 97). 
 
 This section .speaks of the " affidavit or affidavits filed " con- 
 taining a reference to more than one affidavit. It cannot lie 
 necessary that more than one affidavit .should be filed under this 
 section, though in Edgar & Chrysler's Ins. Act, }). 54, it is stated 
 that it will still be prudent to strengthen the case of the applying 
 creditor by the adffiavits of other witnesses. 
 
 Under section 4 an affidavit must be filed prior to making the 
 demand. In proceeding for an attachment under this 9th section, 
 when the contingencies specified in section 7 have arisen, it would 
 still be necessary to file the affidavit, form B, under this section. 
 Probably the reference to affidavits has in view such a case as 
 this, where an affidavit would already be filed under sec tiou 4, 
 and a second affidavit would be filed under this 9th section. 
 
 It would seem that under section 9, form B, of the Act the 
 mere omission to describe the parties in the intituling of the 
 affidavit, is not an objection, if they are sufficiently described in 
 the body of the affidavit, and if it plainly appears that they are 
 the same parties whose names are in the intituling. Where the 
 body of the affidavit gives the name, residence, and descri})tion 
 that is, in the opinion of the Court in {McDonald v. Cleland, G 
 P.R. U. C. 289), plainly .sufficient, though the intituling gives the 
 name only. But where the name only of a defendant was men- 
 tioned in the intituling, and in the body of the affidavit he was 
 described as a lumber manufacturer, but no where as to his lesi- 
 dence throughout the affidavit, Mr. Justice Wilson expressed an 
 opinion that this was clearly an irregularity {McDonald v. de- 
 land, 6 P. R. U. C. 289). 
 
 It is to be observed, however, that in this case the Court did 
 not decide positively as to the omission of the residence and de- 
 
WRITS OF ATTACHMENT. 
 
 (i9 
 
 scription of the parties in the intituling of the affidavit. As we 
 have seen where a secured creditor applies for a writ of attach- 
 ment under this section, he must show that the balance of his 
 claim after deduction of the value of his security amounts to 
 two hundred dollars. The creditor making the affidavit was 
 secured in the case in which this decision was rendered. But 
 the Court seemed to be of opinion that the same rule would 
 apply to an unsecured creditor (McDonald v. Cleland, 6 P. R. 
 U. C. 292). The form B does not contain any words showing 
 that the creditor is unsecured, but it would seem advisable at all 
 events to show this in proceedings under this section. 
 
 A demand was served under the fourteenth section of the Act 
 of 18G9 on the 31st day of January. On February tlie 6th 
 (the 5th being a Sunday) an order was granted for, and an 
 attachment issued. One of the affidavits filed in the application 
 for the attachment was sworn on February the 4th. The Court 
 held that the order for the issuing of the writ was not made too 
 soon, and that it was immaterial that one of the affidavits was 
 made within the five days allowed for petitioning under section 
 15 of the Act, or for making an assignment in accordance with 
 the demand (Mclnnes v. Brooks, 1 U. C. L. J. N. S. 162 ; Lawder 
 Co. J). 
 
 The twelfth rule of practice in the Province of Quebec pro- 
 vides that whenever a particular number of days is prescribed for, 
 the doing of an act in insolvency, the first and last days shall not 
 be included, nor any fractions of a day allowed, and when the 
 last day shall fall upon a Sunday or holiday the time shall be 
 enlarged to the next juridical day. 
 
 The grounds of the decision are not given in the report of the 
 foregoing case of Mclnnes v. Brooks, supra, and it seems clear 
 that under the i-ule referred to it would not be an authority in the 
 Province of Quebec. The writer doubts its authority in Ontario. 
 It seems clear that the djiy of service of the demand would be 
 excl ded from the computation (see Young v. Higgon, 6 M. & W. 
 t!)), and the last day of the five would be included. Thus, if 
 the demand were served on the first of the month, the petition 
 should be presented not later than the sixth. If the offices are 
 
 \ 111 
 
 I 
 
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 M 
 
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 ■ •■) 
 
 i i\ 
 ■ i 
 
 7({ 
 
 THE INSOLVENT ACT. 
 
 closed on the last day, the rule seems to be to allow the doing 
 (jf the act on the following day (Mumford v. Hitchcock, 32 L. J . 
 C. P. 1()8; Hwjhes v. OrlpK 13 C. B. N. S. 324; Connclbj v. 
 Bremner, L. R. 1 C. P. 557 ; Mayer v. Hardln<j, L. R. 2 Q. B. 410 ; 
 Houd V. Dodd.K, 19 Grant, ()3!) : see, however, Moore v. Giui/iid 
 Trwik Railway Cooujyany, 2 P. R. U. C. 227; Ganieron \ 
 Cotuvron, ih. 250). 
 
 This .section assimilates the procedure for obtaining an attach- 
 ment in all the Provinces. Seeti(jn 3, s. s. (i of the Act of l<S(j4 
 re(juired that a declaration should accompany the writ in the Pro- 
 vince of Quebec; but this was irregular under the Act of IcStJ!) 
 {Machitosh v. Davis, 14 L. C J. 2.*)5), and ofcour.se is not re(juired 
 under the present Act. 
 
 Where a trader in Ontario became insolvent and an attachment 
 in insolvency w^as i.s.sued to the sheritf of the county in which he 
 resided, it was held under the Act of 18G4, that the County ('ourt 
 Judge of such county had jurisdiction to issue another attach- 
 ment to the sheriff of any county in Ontario, or any of the other 
 Provinces of the Dominion in which the in.solvent had property 
 (re Beard, 15 Grant, 441). 
 
 This section of the present Act expressly authorizes the issue of 
 concurrent writs, when re(iuired. Such writs will be required when 
 the insolvent has property outside of the limits of the county or 
 district for which the official assignee to whom the ori<dnal writ is 
 directed is appointed, for such assignee can only seizt; the pi'operty 
 of the insolvent within the county for which he is appointed 
 (see section 12). 
 
 It would .seem that concurrent writs of attachment should not 
 be issued merely for the purpose of etfecting service on the in.sol- 
 vent, or upon several insolvents in the case of a firm. This is 
 sometimes advantageously resorted to in Ontario in cases of ordin- 
 ary writs of summons (.see Harrison's C. L. P. Act, 25, and note v.). 
 
 Although concurrent writs are subject to the rules of procedure 
 of the court in ordinary suits as to their issue, and although 
 " ordinary suits " would seem to refer to suits commenced by writs 
 of summons and not to attachments under the Abscondinij Debtor's 
 Act, or writs of capias, and although as we have seen concurrent 
 
SKRVICE OF WRIT OF ATTACHMENT. 
 
 71 
 
 .. J. 
 
 writs of suuiinonH in Ontario are issnud merely to facilitate service, 
 yet as concurrent writs of attachment may l)e executed without 
 lieinj^ served (see section 10), it would seem that they are only re- 
 ([uired to reach propei'ty which the insolvent may he ])ossessedof 
 outside of tilt; c(junty in which they issm;. It would seem that in 
 Ontario the concuirent writ may he had as of course at any time 
 within six months from the issuing of the original writ (sec Har- 
 rison's ( ". L. P. Act, section '20). 
 
 10. Tlio servicu of u writ of jittiichiiiont issiiud ugainst ii debtor under this 
 Act, may be made upon liim as provided for the service of an ordinary writ 
 of aniumous in tlie I'rovince where the service is to l)e made ; and if sucii 
 debtoi'reuiains witliout.suoli I'rovince, orconceals himself witliins\icli Province, 
 or lias no domicile in any Province of the Dominion, or absconds from his 
 domicile, in every such case service shall be made l)y such notice or advertise- 
 ment as the judge, or in the Province of Quebec, the judge or prothoiKjtary , 
 may order : 
 
 Concurrent writs of attachment issued against a debtor may be executed 
 without being [aeviously served upon him, except in rases where suchdebtcji- 
 has his domicile or a [ilace of business in the county or district in which the 
 same is to be executed, when the writ may be served at such ;l(jmicile or 
 place of biisiness. 
 
 In < )ntario the service of an ordinary wi'it of summons must 
 111.' [R'rsonal, whenever [)racticahle, hut this section provides for 
 suhstitutional service in the cases named therein. 
 
 A di'htor who has made an assignment otherwise than under 
 tlie Act cannot he served at his old place of husiness when he has 
 really ^eased to do l)usiness there and the husiness has heen con- 
 timied there merely hy the assignee (Hutchins v. Cohen, 14 L. C. 
 J. 11.3). 
 
 A ju<lge in insolvency has })0wer to rescind an order made by 
 him for substitutional service of a writ of attachment (Eaton v. 
 Shannon, 17 C. P. U. C. 592). 
 
 Great difficulties might, however, arise in setting aside an order 
 for a writ of attachment after the appointment of an assignee, 
 and the transfer of all the debtor's estate to him especially if the 
 proceedings have gone any length, such as the declaration and 
 payment of dividends, etc. 
 
 
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 72 
 
 THE INSOLVENT ACT. 
 
 11. Writs of attachment sliall be made roturnalilo forthwith after the ox- 
 ecution thereof : and iiuniodiivtely npon the rocoij)! of a writ of attachment 
 issued under thia Act, the OfHciiil AHsignco shall ^ivc notice of tlie JHsuinu' 
 thereof by advertisement (Form D), to bo inserted once in the OIHcial (.'n- 
 xette and once in one local or the nearest publish jd nowpaper (40 Vict. s. 2). 
 
 It will bu ()l)Horvo(l that this Huction uiaki's tho writ rotunmhlo 
 forthwith after the exocutiontlu;reof,\vlu!rca.s under section ninetiu^ 
 defendant nuist he snninioned to appear on a day mentioned in the 
 writ: and the writ of attaclunent (Fonn 0) sjieciHes a day certain. 
 Tht) object would seem to be to make the writ i-eturnable when 
 served as in tho case of ordinary wi'its of sunniions. Would a 
 soivice of a writ of attachment after the day specified in the writ 
 for its return be good ! 
 
 The 29 Vict. chap. 18, s. 8, provided that writs of attachment 
 might be made returnable in five days from tlie service thereof. 
 
 A writ of attachment is.sued on the llth of Mai'cli, was made 
 retin-nal)le on the 22nd, a day certain instead of after the expiiy 
 of five (lays from the service thereof, and the writ was .served more 
 than five days before tlie 22nd. McQueen, (Jo. J., held that as tlie 
 insolvents were not [)rejudieed by the irregularity, the attach- 
 ment might he amended by the plaintitts on the authority of 
 (re Owens, 3 U. C. L. J. N. S. 22; Gore Bank, v. £aton, 3 IT. r. L. 
 J. N. S. 207 ; 3 L. C. Gazetfe 122). 
 
 A writ of attachment served after tlie day specified therein for 
 the defendant's ai)pearance would seem to be at least irregular- 
 Possibly it might be amended so as to cure the defect. 
 
 The writ of attachment is not recpiired to designate the parties 
 by their names, residences, and descriptions, and the notice under 
 this section does not so designate them, and though the affidavit 
 for the writ is re(iuire(l to designate the parties in the intituling 
 V)y their name, residence and description, but the assignee does not 
 see this affidavit, and may therefore omit the residences and de- 
 scriptions of the parties in this notice (see McDonald v. Cleland, 
 G P. R. U. C. 292). 
 
 Would the non-insertion of this advertisement invalidate the 
 proceedings of the assignee under the writ ? In the United 
 States it is held that the ])rovision recpiiring notice of the a])- 
 
NOTICE OF WRIT OF ATTArilMENT. 
 
 78 
 
 pointmont of an assij^neo is di rectory only, though the Statute 
 iiHOH iiiipiirativi.' lurif^'uage. 
 
 "The Interpretation Act," (31 Vict, cliap. 1, s, 6, ss. 3) pro- 
 vides that the word " shall " is to l)o construed as imperative, and 
 the vv(jrd " may " as ]»ermissive. Nicholson v. (htnii (35 Q. B. (J. 
 C 7), has some bearini,' on the point, and would seem to show that 
 the word " shall " in this section is imper; Mve, and that the pul>- 
 lication of the notice is necessary to the clFicacy of proceedi)i^'s 
 under the attachment. 
 
 The adveitisement of the issue of Ho writ of att'ichnient ii« to 
 prevent third parties from permittini^ or narUci])ating in any 
 attempt to make away witli the estate, and ;.tter such an adver- 
 tisement the public is bound to know the incapacity of an insol- 
 vent to sell any of his property, and this incapacity continixes. 
 and the public is bound to know it during the pendency of an 
 api)eal from a judgment which (piashes the attacliment. A sale 
 made l)y the insolvent of property, even when not seized under 
 the attaclunent, in conse(|uence of its being secreted, is absolutely 
 null, and not annullable only (M'dlette v. Whjjfe, 12 L. C. J. 22!)). 
 in this ease the attachment issued on the 23rd day of August, 
 IcSOG. Tlie insolvent contested the writ and it was quashed by 
 judgment of the Superior CVjurt on the 2()t]i day of October, 
 IS66. The guardian appeale(l from this judgment, and on the .5th 
 of March, 1867, the judgment in appeal reversed the former 
 judgment, and maintained the writ. The pr()])erty in question 
 was a horse, valued at two hinidred and fifty dollars, and on the 
 same 5th of March, 18G7, the insolvent offered it for sale on the 
 public street, and it was purchased by defendant for one hun- 
 dred and twelve dollars. On the 9tli of March, the guardian 
 ol)tained an order, authorising him to institute conservatory pro- 
 cess for the recovery of the liorse, and caused proceedings to l)e 
 taken. On the 2()th of April he was appointed assignee, and on 
 the 25th he intervened in the cause, and claimed the horse as 
 part of the insolvent's effects at the issue of the writ of attach- 
 ment, and, therefore, vested in him from that time. It was held 
 that the defendant was bound by the advertisement of the issue 
 of the writ, and that the assignee was entitled to recover the 
 
 m 
 
[ 
 
 i 
 
 74 
 
 THE INSOLVENT ACT. 
 
 horse without indemnifying the defendant for the sum he had 
 paid. 
 
 12. The Official Assignee, by himself or by such deputy (which word shall 
 in this Act include deputies) as he may appoint, shall, under sucli writ 
 of attachment, seize f nd attach all the estate, property and efteots of the In- 
 solvent, within the limits of the county or district for which he is appointed, 
 including liia books of accounts, moneys, securities for moneys, and all hi.s 
 office or business papers, docimients, and vouchers of every kind and descrip- 
 tion ; and shall return witli the writ a report under oath stating in general 
 terms his proceedings on such writ. 
 
 It will be observed that, under this section, the official assignee is 
 only authorized to seize tlie estate, property and effects of the in- 
 solvent situate within tlie limits of the county or district for which 
 he is appointed. If these effects aie not witliin this county a con- 
 current writ must be issued to the assignee of the county in which 
 they are situate, and if this county is not within the Dominion, 
 the writ cannot be issued, and, as we shall see hereafter, the Act 
 provides no means of reaching property out of Canada. 
 
 A moi'tgao'ee of o'oods and cliattels under chattel niorto'ao'e re- 
 tiuested an auctioneer to remove the gotxls and sell them, and the 
 latter removed the same and was proceeding to sell them when 
 they were seized under a writ of attachment in insolvency and 
 claimed by the assignee, on the ground that the chattel mortgage 
 was void. An ordei' for an interpleader was granted on the 
 application of the auctioneer ( Watson v. Henderson, (J P. R. U. 
 C. 299). 
 
 Under the Statute 2H Vict. chap. 19, ap[)licable to the Province 
 of Ontario, if a claim is made to any property taken in execution 
 under any process issued by or under the authority of any of the 
 Superior Courts of Law, or any County Court, on behalf of any 
 person not being the person again.st whom the execution issues, 
 then on the application of the officer to whom the writ is directed, 
 the Court may order an interpleader. 
 
 Where a sheriff had seized goods under an execution on the 
 31st of August, and on the 7th of September following, a writ of 
 attachment in insolvency issued, and the guardian of the insolvent 
 claimed the goods, it was held that an interpleader might be 
 
 „4^ 
 
ASSIGNMENTS. 
 
 75 
 
 
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 CV 
 
 
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 ordered, notwithstandins; objections that the attachment was suV)- 
 sequent to the execution, and tliat the guardian in insolvency had 
 no title to the property {Burns v. Steel, 2 U. C. L. J. N. S. 189). 
 
 13. If the official .'issignee or his deputy ia unable to obtain access to the 
 interioi" of the house, shop, store, warehouse, or other premises, of the insol- 
 vent named in the writ, by reason of the same being locked, barred, or fast- 
 ened, such official assignee or deputy is hereby authorized forcibly to open the 
 same in the presence of at least one witness, and to attach the property found 
 therein, 
 
 ASSIONMENTS AND FKOc.'EEDIXOS THEKEON. 
 
 14. A debtor on whom a demand is made by a creditor or creditors wlio 
 has or have filed t.ie affidavit rocjuired, may make an assignment of his estate 
 to the official assignee appointed for the county or district wherein he has his 
 domicile, or wherein he has his cliief place of business, if he does not reside 
 in the county or district wherein ho carries on his business ; and in case there 
 is no official assignee in the county or district whore lie resides, or whereiri 
 he carries on liis business, then to the otHcial assignee f(jr the nearest adjoin- 
 ing county i)T district, but such assignment may be set aside or annulled by 
 the coui't or judge for want of, or for a substantial insufficiency in, the affi- 
 davit requiretl by section four, on sunnnary petition of any creditor to the 
 amount of not less than one hundred ilollars beyond the amount of any 
 security which ho holds — of which petition notice shall have been given to 
 the debtor iind to the creditor who made the demand of assignment within 
 eight days from the publication of the notice thereof in the Official Gazette. 
 
 The 30 Vict. chap. 30, s. 3, provided that, " The 14th section of 
 the said Act is hereby amended, by striking out the words ' or 
 against whom a writ of attachment has issue<l as provided by 
 this Act,' in the second, third, and fourth lines, and the words, 
 ' or writ of attachment' in the twelfth line, and by striking out 
 the words, ' or by section 9 ' in the fifteenth line, and the words, 
 ' or who issued the writ of attachment,' in the nineteenth and 
 twentieth lines." 
 
 The section is given above to read as amended by the 39 Vict, 
 chap. 30, s. 3. 
 
 In McDonald v. Cleland (6 P. R. U. C. 292), Wilson, J.,expressed 
 an oj)inion in reference to section 14 of the Act of 1875, which 
 applied also to the affidavit under section 9, form B., that a cre- 
 ditor could not taKC the objection that the affidavit was not pro- 
 
 1 'i? . 
 
 I*::. ■ 
 
76 
 
 THE INSOLVENT ACT. 
 
 perly entitled, showing the residence and description of the 
 plaintiff and defendant as required by this form, but it being a 
 statutory enactment the debtor might raise the objection (see 
 ex parte King, L. R. 7 C. P. 94). This section as amended is 
 limited to assignments after demand under section 4, and the lat- 
 ter section does not prescribe any form of affidavit, and, as we 
 have already seen, entitling in a cause is not necessary in the 
 affidavit required by section 4. 
 
 As this section was originally worded, it seemed to intend an 
 assignment after writ of attachment issued against the debtor ; 
 but as the attachment itself vests the estate in the assignee, this 
 provision was wholly unnecessary, and has therefore been ex- 
 punged from the amended Act. 
 
 Under this section a creditor con move to set aside the assign- 
 ment, though the right to set aside an attachment is, as we shall 
 hereafter see, personal to the debtor, under the 18th section of the 
 Act, and cannot be exercised by a creditor or by an assignee of the 
 debtor. 
 
 The publication in the Gazette referred to in this section is the 
 insertion of the notice (form G) under section 20, and the creditor 
 must give notice of his aj^plication to set aside the assignment 
 within eight days from the iirst publication of the notice in the 
 Gazette. 
 
 A secured creditor could ju'obobly ap])ly to set aside the assign- 
 ment under this secticm and whether secured or unsecui'ed it 
 would seem necessary for the creditor to show that the insolvent 
 wns indebted to him in an amount not less than one hundred 
 dollars beyond the amount of any security which he held 
 (sec McDonald v. Cleland, G P. R. U. C. 292). Would it be 
 necessary that the creditor should also prove his claim in the 
 ordinary way l)efore applying under this section ? Under sec- 
 tion 2 (/i) a creditor has no voice in any consent or action with 
 regard to the management or disposal of the estate until his claim 
 is proved. And there seems no obstacle to making proof by the 
 creditor as soon as the notice (form G) is published. 
 
 This section, it will be observed, authorises a debtor to make 
 an assignment after demand made upon him by a creditor. He 
 
ASSIGNMENTS. 
 
 77 
 
 has no power of his own motion to make such assignment with- 
 out demand, the present Act abolishing assignments which are 
 purely voluntary. But in the event of the debtor not making 
 an assignment under this clause, after demand made upon him, 
 he is subject, as we have seen, to the issue of a wrJc of attach- 
 ment under section 9 of the Act. 
 
 Tliere are two modes of vesting the estate in the assignee, one 
 l(y operation of law, as the issuing of a writ of attachment, the 
 other by the insolvent's own act, as the execution of a deed of 
 assignment after demand made upon him to do so. Where an as- 
 signment is made, the estate vests in the assignee from the time 
 at wliich the deed is executed. If a writ of attachment is issued, 
 the result will be the same, and the estate will vest in the 
 assignee from the time at which it is actually issued (see 
 WIn/te V. Treadwell, 17 C. P. U. C. 492). 
 
 It was held in an unreported case before the late Judge Duggan, 
 of the County of York, where a writ of attachment was issued, 
 directed to one official assignee, and afterwards, on demand made 
 against the debtor, he assigned to an assignee other than the one 
 to whom the wi*it was directed, that the assignee under the wr* 
 of attachment was entitled to priority. A somewhat similar deci- 
 sion was rendered in Thomas v. Martin (17 L. C. J. ll,Gr!te. p. o7). 
 In this case it was held that when the attachment issued regularly, 
 it prevailed over a voluntary assignment made on the same day. 
 
 In Douglas v. Wright (11 L. C. J. 310), it was held that a 
 voluntary assignment must be made to an official assignee resi- 
 dent in the district in which the insolvent resides and carries on 
 his business (s. c. 4 L. C. L. J. 12 ; see also Hingston v. Campbell, 
 11 L. C. J. 315 ; 2 U. C. L. J. N. S. 299 ; }^hite v. Guthhertson, 17 
 C. P. U. C. 377), and under this section the assignment must be 
 to the official assignee appointed for the county or district wherein 
 the insolvent has his domicile, or wherein he has his chief place 
 of business, if he does not reside in the county or district wherein 
 he carries on his business. 
 
 It was held in the Province of Quebec, that, under the 29 Vict, 
 ch. 18, s. 2, taken in connection with the Act of 1864, an in- 
 solvent might validly make a voluntary assignment of his estate 
 
 i 
 
 / :i 
 
 ILi 
 
:■'! 
 
 H 
 
 II 
 
 78 
 
 THE INSOLVENT ACT. 
 
 and eft'ects to any official assignee, whether resident within the 
 district or county wherein such insolvent had his place of business 
 or not {Bvoion v. Douglas, 13 L. C. J. 20 ; ex parte Smith, 12 
 
 L. C. J. 57). 
 
 Under the Insolvent Act of 1869, section 2, assignments in in- 
 solvency could be made only to an official assignee resident within 
 the county where the insolvent had his domicile. Where an 
 official assignee, resident within the City of Montreal, was, under 
 the Act of 18G4, appointed such " for the judicial district of Mon- 
 treal," and continued in office under section 31 (last clause) of the 
 Act of '09, the Court held that he had not, under the latter Act, 
 the riirht to receive an assignment from an insolvent domiciled in 
 a county being part of tlie district of Montreal, if there was an 
 official assignee appointed under the Act for that county and 
 resident therein {Gravel and Stewart, 17 L. C. J. 320). 
 
 If the assignment is not made to the proper assignee, it may, 
 perhaps, be set aside by the judge in insolvency at the instance of 
 any of the creditors who choose to complain of it ; but it seems the 
 creditors may by acquiescence and by acting under the assignment, 
 render it valid. It would be a serious matter to set aside the 
 whole proceedings under the Act, after lands had been sold by the 
 assignee, debts collected and dividends ])aid {McWkirter v. Lear- 
 iiiouth, 18 C. P. U. C. 130). 
 
 If the debtor's chief place of business is in one county or district 
 and his domicile is in another, and proceedings are initiated in 
 either county or district, and an assigimient made to the official 
 assignee of that county or district, it is a necessary consequence 
 that the like proceetl'ngs cannot be had in the other, and the juris- 
 diction isexclusive in that court where the jurisdiction firstattaches 
 (see re Hall, .5 Law Rep. 269). In the case of an attachment 
 the proceedings would be carried on where the debtor has his 
 chief, or one of his principal places of business as the writ must 
 be issued by the judge of, and directed to the assignee of, that 
 county. The same rule would .seem to api)ly to the case of con- 
 current writs, and in case of assignment under this section it is 
 required to be to the assignee for the county wherein the in.sol- 
 vent has his domicile or chief place of business. 
 
ASSIGNMENTS. 
 
 79 
 
 A petition calling in question the validity of an assignment 
 under the Insolvent Act, of 18G9, to an official assignee on the 
 ground that the assignee was not resident within the county or 
 place where the insolvent had his domicile, was held to require 
 service upon the insolvent as well as upon the assignee (Gravel and 
 Stetvart, 17 L. C. J. 23). 
 
 The Act of 18G9 required the deed of assignment to be in 
 duplicate and, where the insolvent possessed real estate, the assign- 
 ment was also required to be registered in the county in which 
 such real estate was situate. It was held that to make the deed 
 effectual to i)ass the title to real estate under this Act, it should 
 have been executed in duplicate and registered, and this not hav- 
 ing been done the title remained in the debtor executing it 
 {Parleey. Agricultural Insurance Govvpany,^ Pugsley, 476). The 
 deed of assignment in this case was in the form prescribed, but, in 
 addition to not being executed in duplicate or registered, it did 
 not appear that any meeting of creditors had been called under 
 the Statute, or that anything had been done under the assignment, 
 and it was held that it did not even estop the debtor executing 
 it. Fi'om this case we may deduce the conclusion that the assign- 
 ment to be effectual must be in the form prescribed by the Statute, 
 and must be executed and registered as therein req\iired. From 
 tlie cases already cited, it may be seen that the assignment being in 
 a special statutory form and not being couched in terms sufficient 
 to pass all descriptions of property at common law, and deriving 
 its efficacy solely from the Statute, that the form must be followed 
 to give it effect under the Statute. The present Statute does not 
 expressly require its execution in duplicate. As a certified copy may 
 Ke registered under the 19th section, this would not be absolutely 
 necessary, though convenient in most cases. 
 
 It was held by Sherwood, Co. J., that under the 7th section of 
 the Act of 1869, the deed of assignment was required to be in 
 tluplicate, and when not in duplicate, that it did not comply with 
 the Statute which was mandatory. Where the assignment was 
 in one part only, and the insolvent had not kept any books of 
 account, his discharge was refused (re Sullivan, 5 U. C. L. J. N. 
 S. 71 ; Sherwood, Co. J). 
 
^ 
 
 I 
 
 80 
 
 THE INSOLVENT ACT. 
 
 It was held, under section 2 of the Act of 18G4, that a vohmtaiy 
 assignment was not valid, unless accepted by the assignee. In the 
 case in which this objection was held good, the as.signee had not 
 executed the assignment or in any way acted under the provisions 
 thereof, nor was the assignment deposited or filed in the office 
 of the proper court in that behalf, or registered in the registr}- 
 ofiice of the county {Yarrington v. Lyon, 12 Grant, 308). 
 
 This decision was followed in a case where the assignee refused 
 absolutely to be an assignee of the insolvent's estate and to accept 
 the assignment, and nothing whatever was done under the assign- 
 ment, and the estate still continued in the possession of the insol- 
 vent himself, and it was held that a discharge issued by a judge, 
 however inadvertently, would not relieve the insoh ;nt from his 
 debts (Becker v. Blackburn, 23 C. P. U. C. 207). 
 
 The cases of Yarrhujton v. Lyon and Becker v. Blackburn, be- 
 fore referred to, were both decided on the Act of 1804. Section 
 2, s.s. 4 of that Act contained words indicating that consent was 
 necessary when the assignment was to a creditor as it might be 
 under that Act. In Broivn v. Wrlgkt, 35 Q. B. U. C. 378, 
 on the Act of 18G9, Morrison, J., in delivering judgment, says : 
 " I find nothing in the Act requiring any as.sent to or execution 
 by the official assignee of the voluntary assignment to give it opera- 
 tion. The insolvents were enabled by the Statute to make the 
 voluntary assignment to the official assignee, and it becomes the 
 duty of the official assignee named therein to act upon it, in whom 
 all the property of the insolvents is vested for the benefit of -li the 
 creditors, and for ett'ecting the object of the Act ; " and !• 
 ment having been executed bona fide, and the asf^igr '. . 
 acted on it in about a month after, it was held to hay 
 effect on the day it was made. 
 
 It is doubtful whether the old rule as to acceptance by the 
 assignee being necessary would obtain under the present Act, at 
 all events, in the case of an attachment. The official assignee is 
 made an officer of the Court. The estate, while in his possession, 
 is in the custody of the law in the same manner as if he were a 
 sheriff {Barclay v. Sutton, 7 P. R. U. C. 14), and it seems the duty 
 of the official assignee to accept the estate. 
 
 il- 
 
 'vinn- 
 vicen 
 
ASSIGNMENTS. 
 
 81 
 
 Wliore an assignment is executed in good faith, the assets of the 
 insolvent pass to the assignee thereunder, although he does not 
 act upon it for some time after. A. Division Court V)ailiff received 
 an execution against R. on the 12th of May, 1S7J3, on a judgment 
 rec(^vered on that day, on which, on the 1 4th, he seized two liorscs. 
 On tlie 10th, R. executed a voluntary assignment under the Insnl- 
 vi'ut Act, but the assignee on being made acijuainted with it ad 
 vised a private settlement, and did not receive and act on the 
 assignment until the 7th June. The bailiff, who had left the 
 horses in R's. possession, taking a Viond for theii- forthcoming, took 
 them again and advertised them for sale on tlie 2nd of June ; but, 
 (111 lifing notified by th(3 official assignee he delivered them over to 
 till' assignee on tht; nth ; and, in an action against the l)ailiff for 
 iit'Lili'c't in levying, it was held that the horses passed to the assig- 
 nee on the executi(m of the assigmuent, thougli lie did not clai i 
 anvtliing under it until the Otli of June {Broum v. Wrhjlif, 85 ' ] 
 B.'r. C.37S). 
 
 The mere fact that certain creditors have notice of an as- 
 signment does not make the deed irrevocable {Spooner v. 
 Jonr^, 3 Ch. Chamb. 481). 
 
 iVii assignment l)y a person with no assets for the assign- 
 ment to take effect upon and for the purpose of defeating a 
 creditor, who is at the time suing ,^uch person, is fraudulent, 
 and a discharge in such insolvency proceedings is void and 
 does not prevent the del)tor's arrest on a Ga. Sa. {Thomas v. 
 HaJL a P. R. U. C. 172). 
 
 This case is based upon the ground that the evidence 
 showed it to l)e a mere fraudulent device contrived for the 
 express purpose of defeating the plaintiff's recoveiy by a 
 fraudulent abuse of the provisions of the Act. The plaintiff 
 in the action was the only creditor, and the assignment .seems 
 to have been made with a view of defeating his action. The 
 Court uses language to indicate that re Brett (unreported) and 
 re Thomas (15 Grant, 196), may be no longer binding autho- 
 rities, the latter case being a decision on the Act of 18(i4, 
 which applied to non-traders as well as traders. However, in 
 Parke v. Day (24 C. P. U. C. 619), the same learned judge 
 
 .( 'I 
 
■ I 1 
 
 82 
 
 THE INSOLVENT A('T. 
 
 who delivered the judgment in Thomas v. Hall explains that 
 the judgment does not profess to decide that an assignment 
 in insolvency executed l)y a person having at the time of its 
 being executed no property, is for that reason voitl. Assets 
 might l)e ac(|uired hefoi-e the insolvent a])plies for a discharge. 
 But if there were no assets at the time of assignment, or at 
 the time of application for the discliarge, the learned judge was of 
 opinion this would be the stiongest proof that it was not 
 made bona, fide, but was made in fiaud of the Act. The 
 cases of re Thomas and re Brett are disapproved of Itut not 
 overruled. 
 
 Where several ])ersons are in partnership, an assignment by 
 one of them, in his own name, will pass his interest in the 
 partnership property, and also his own individual property, l»ut 
 it will not constitute the other partners insolvent, or transfer 
 their .share or interest in the partnei'.ship property to the as- 
 signee. But it will dissolve the partnership (see section 40). 
 In the case of a partnership, where there are several mendters 
 residing in different counties, an assiginiient nuist be made in 
 the names of all the paitners in the county where the chief 
 office or place of business of the ])artner,ship is ; in other words 
 the domicile of the partners. Where this i,s done the entire 
 partnershi]) effects as well as the interest therein of each part- 
 ner will pass (re McKevzk, 31 Q. B. U. C. 1). 
 
 This decision was under the Act of 18(59. Section 2 of this 
 Act did not give the option of assigning to an official assignee 
 for the county or district wherein the debtor had his chief place 
 of business. It required the assignment to be to the official as- 
 signee, resident within the county or district wherein the insol- 
 vent had his domicile, and section 143 of the Act declared t)iat 
 the chief office or place of business of the partnership 
 should be their domicile or place of business for the purposes 
 of the Act. 
 
 An assignment made b}^ a co-partnership vests in the assignee 
 the separate estate of each partner, as well as the co-partnership 
 estate, and a subsequent assignment by one of the partners indi- 
 vidually can have no effect (re Macfarkme, 12 L. C. J. 239). 
 
ASSIGNMENTS. 
 
 83 
 
 When Jin assignment is made l^y the members of a partnership, 
 it will pass their separate property, as well as the property of the 
 firm, though an intention is shewn to limit the opera ion of the 
 assignment to the property of the firm, Ijy inserting arter the 
 general description of property, in the statutory form of assign- 
 ment, the words "of and belonging to the said co-partnership" (re 
 McLaren and Chdbners, 1 Appeal Reports, Ont. 68). 
 
 One of two partners, a few days before a writ of attachment 
 against both, under the Insolvent Act of 1864, had issued, as- 
 signed all his se])arate estate to the defendant for the general 
 benefit of the creditors of the assignor, "pari jnissu, and without 
 any pi-eference or priority, accoi'ding to the provisions of the In- 
 solvent Act of 1864." The defendant was not the official assijrnee 
 in insolvency, and it was held that the plaintiff, as official assignee 
 under the Act, and joint assignee of the estate of the two part- 
 ners, was entitled to claim the individual property of one of them 
 (Wihon y. Stevention, 12 Grant, 239). 
 
 It would seem that, on the appointment of an assignee to a 
 partnership firm, the separate estate of each of the partners, as 
 well as their joint estate, vests in him. The separate creditors of 
 one of the partners, therefore, though they may afterwards resolve 
 to accept a composition in satisfaction of their separate debts, can- 
 not vest the separate estate in any other trustee. But it is the 
 duty of the assignee appointed by the joint creditors, to adminis- 
 ter the separate estate in accordance with the resolutions of the 
 sepai-ate creditors, and then to carry over the surplus to the joint 
 estate (ex parte P/n'?/w, L. R. 19 Va[. 2.i(i). 
 
 Persons may be jointly adjudicated bankrupt, who are not, 
 strictly speaking, partners, provided they are jointly indebted in 
 a suflicient amount, and the property, if any, in which they are 
 jointly interested for the pui'pose of a joint adventure, in respect 
 of which the joint debts were contracted, will be for all purposes 
 joint estate (re Lcrjrjatt, L. R. 8 Ch. 965) ; where there is a joint 
 adjudication, the whole of the property of the bankrupts, whether 
 partner,ship or separate i)roperty, vests in the trustee and is ad- 
 ministered by him (re Moore, L.R. 19 Eq. 25G). 
 
 Two partners carried on business in England and Ireland. One 
 
84 
 
 THE INSOLVENT ACT. 
 
 i 
 
 • V 
 
 if the partners executed an assignment in En^'land for the bene- 
 fit i)f liis creditors, and was afterwards adjudicated a bankrupt in 
 England. Some of tlie joint estati; of the partners came into tlie 
 hands of the trustees of tlie deed, who sold it, and the proceeds of 
 the sale were, under the order of the C<nu't, deposited in a bank 
 in tlie joint names of the trustees of the deed and the trustee in 
 the baid<ruptcy. Before this was done, a j(jint adjudication of 
 bankruptcy had been made against the two partners in Ireland. 
 On an application by the Irish assignees of tlie joint estate, to have 
 the proceeds of sale paid t)ver to them, it was hold that the 
 trustee under the separate adjudication in England, and the 
 assignees under the joint adjudication in Ireland, were tenants in 
 connnon of the joint assets ; and that the latter had no better 
 title to the proceeds of the sale in (piestion than the former, and 
 the adjudication was refused on that ground, and also on the 
 ground of convenience, as the greater nundier of the joint creditors 
 lived in England, and wished the fund hi (|uestion to remain in 
 this country (ex parte Javics, 29 L. T. >J. 8. 701; L. 11, !) Ch. App. 
 74). 
 
 V. and J. D. being in partnership, J. D. went out, and his father, 
 D. D., took his place in the firta. About six months after this, V. 
 assigned to D. D. all the stock in trade, but the possession was 
 not changed nor the assignment filed. The plaintiff's sul)se([uently 
 became assignees of the firm under the Insolvent Act of 1SG4, and 
 of each of the partners. In an interpleader issue to try their right 
 as against an execution creditor of V. alcjne, the execution beina' 
 after the assignment to D. D., but whether Itefore or after plain- 
 tiffs' title accrued did not appear, the Court held that they must 
 succeed ; that they were clearly entitled to the goods themselves, 
 for defendant, as creditor of one partner, could not seize them 
 out of the possession of the assignees of the firm, although he 
 might have a right to V.'s share of the proceeds, if any, after 
 paying the partnership debts (Wilson v. Vugf, 24 Q. B. U. 0. 03.)). 
 
 A partner of a mercantile firm has no power, either during the 
 existence or after the dissolution of a partnership, to make an 
 assignment of the property and effects of the firm to a trustee 
 for the benefit of creditors (Stevenson v. Brown, 9 L. J. U. C. 110). 
 
FORM OP ASSIGNMENT. 
 
 86 
 
 '!|- 1 
 
 1"). Tho assignment mentioned in the next preceding section may be in the 
 form E; and in the Province of Quebec the deed of assignment may bo re- 
 ceivod by a notary in tlio authentic form. 
 
 The Acts of 1804 and 1809 required that a copy of tho list of 
 ptcditors produced at the first uieeting should be appended to the 
 deed of assignment (see Klnrj v. Smith, 19 0. P. U. C. 319). This 
 would seem to be unnecessary under the present Act. 
 
 It was held under the Act of 1805, that where the assignment 
 was made to an official assignee, a copy of the list of creditors pro- 
 duced at the first meeting of creditors need not be appended, for 
 in fact no such meeting is held (Iliwjston v. Gamphell, 11 L. C. J, 
 31.5 ; 2 IT. C. L. J. N. S. i!99). 
 
 Under section 2 (</) the assignment in the Province of Que- 
 bec must be before a notary, and, in that Province, the acceptance 
 of an a.ssignment mu.st be made by the official assignee, and cannot 
 be made by attorney (Hervey v. Rimmer, 14 L. C. J. 24). 
 
 10. Whenever an insolvent shall have made an assignment, and in case no 
 assignment shall have been made, but a writ or concurrent writs of attach- 
 uiunt shall have issued as provided for by this Act, such assignment or such 
 wTJt or writs of attachment, as the case may be, shall vest in tho Official 
 Assignee of the county or district wherein the same shall have issued, all 
 right, power, title and interest which the insolvent has in and to any real or 
 personal property, including his books of account, all vouchers, letters, ac- 
 counts, titles to property and other papers and documents relating to his 
 business and estate, all moneys and negotiable papers, stocks, bonds and other 
 securities, and generally all assets of any kind or description whatsoever 
 which he may be possessed of or entitled to up to the time of his obtaining a 
 discharge from his liabilities, under tho same charges and obligations as he 
 was liable to with regard to the same ; and the Assignee shall hold the same 
 in trust for the benefit of the insolvent and his creditors, and subject to the 
 orders of the court or judge ; and he may upon such order and before any 
 meeting of the creditors, institute any conservatory process or any iiroceed- 
 ing that may be necessary for the protection of the estate ; he may also 
 upon such order, sell and dispose of any part of the estate and effects of the 
 Insolvent which may be of a perisliable nature : such assignment or writ or 
 writs of attachment shall not, however, vest in the Assignee such real and 
 personal property as are exempt from seizure and sale under execution, by 
 virtue of the several Statutes in that case made and provided in the several 
 Provinces of the Dominion respectively, nor the property which the insol- 
 vent may hold as trustee for others. 
 
 
 ■44 
 
86 
 
 THE INSOLVENT ACT. 
 
 :<lli|| 
 
 I « 
 
 Ah a general rule, all powers and authorities relating to his 
 property granted \>y tlif ins(jlvent hefore his insolveney, which 
 are revocable, will be revoked by his insolvency, as against his 
 trustee (ex-parte SmncbitU, L. R. 7 Ch. App. y.U). Jhit if, after 
 the act of bankruptcy, and before the adjudication, property is 
 conveyed under such a power to a bona Jhlc purchaser, who has 
 no notice of the act of bankruptcy, tlie purchaser may liold tin; 
 pidl)erty as against tlie trustee (ib.). 
 
 Section 40 of the Act of lcS(i!) provided that all powers vested 
 in any uisolvent, wliich lie miglit legally execute for his own l)ene- 
 tit, should vest in and be executed by the assignee. There is no 
 analogous jirovision in the present Act, but probably this section 
 will be held sufficient to pass sudi powers (see also section 3(Sj. 
 
 The woi'ds " which he may l»e possessed of" up to tile time (jf 
 obtaining his di.seharge, kii., are inserted in this Act foi- the Hrst 
 time. Under the reputed ownershii clause hi the English Act, the 
 reuistration of a bill of sale has no oi)eration whatever if the veil- 
 dor or mortgagor be allowed, although by the terms of the deed, 
 to remain in possession, he is in such case in possession as appar- 
 ent or reputed owner with the consent of the other {titanxjicld v. 
 Cublti, 2 De.G. ^^ J. 222 ; Asldon v. Blachhaiv, L. R. 9 Eip 5l(); 
 ex parte Human, L. R. 12, Eij. o'JS). This clause of our Act does 
 not, it would seem, introduce the English law as to reputed owner- 
 ship. The latter law is aimed at property in the pos.sessi(jn of 
 the bankrupt at the commencement of the bankruptcy. These 
 words in our Act .seem directed to propei'ty iu the possession of the 
 insolvent after assignment, and before discharge, and the registra- 
 tion of a bill of sale would oe unart'ected by anything contained 
 in this section, on the mere ground of the vendor remaining in 
 possession. Under the Act of 1 S(j9, the assignee took what was the 
 property of the insolvent, that is such jiroperty as he had a legal 
 and equitable title to ; or, what Avas In etfect, in many cases, the 
 same, he took the debtor's pro})erty subject to all legal and e([uit- 
 able claims upon it. A bill of .sale filed or not filed was a legal 
 charge upon the property and goods as against the insolvent, and 
 good therefore as against his assignee, who took no more than the 
 insolvent himself had a title to. So also an equitable mortgage 
 
 , 
 
UIGHTS UNDKU AHSrONMKNT. 
 
 87 
 
 or iiii e(iiiital)lL' assininnciit of a <lel»t oi' otlu-r appropriation of 
 his cstato ;^ood a^^aiiist the insolvent would he good also a;j;ainst 
 his assignee in insolvency (re Colcmitii,, .SO Q. B. 1 1, i). 'xSJl ; per 
 \Vils..n, .1.)- 
 
 Property in th»( possession of an insolvent, for tlu^ purpose of 
 lieing sold on connuission, will not pass to the assignee, as the order 
 and ilisposition clause of the Knglish Act is not in force here. In 
 the case of Cohnnmi above refernsd to, it was held that partiits 
 holding warehouse receii)ts for coal, in the possession of the insolv- 
 ent, were entitled to the coal as against the assignee, though the 
 receipts were not strictly regular under the Statute, the partii-s 
 having at least an eipiitaltle if not a legal charge upon the coal 
 speciHe<l in the receipts (ih. ').')!l), 
 
 If goods are sent to a factor or agent to he disposed of, and 
 he hecoines insolvent, and the jjoods remain distininiishahle from 
 the general mass of his property, tlu; [)rincipal or owner may 
 recover the goods in sptscie, and is not di'iveii to the necessity of 
 pioving his deht in insolvency. The law is the same, even if the 
 goods are sold and reduced to money, provided that the money re- 
 ceived he distinguishahle from the factor's other property. The 
 plaintiff purchased harley from R., telling him to consign it to C, 
 and draw on C for the puichase money. 0. was to keep the harley 
 as plaintitt's agent until the plaintiff directed him to sell, the plain- 
 tiff paying him such a smn as he might recjuire, hy way of margin, 
 to protecthimself againsta fall in price. C, to reinihursehisadvance 
 on R.'s draft, ohtainod a discount from the hank on his own note, 
 secured l)y the warehouse receipt for the l)ai'ley, which he transfer- 
 red to the l)ank. While C. held the l)arley, the i)laintiff paid to 
 him ii^o-tO as margin, to hold or "carry " it for him notwithstanding 
 decline in pi'ice. The harley was shipped by plaintiff's instrnc- 
 tions to Osw^ego, to tlie order of the hank, where it was sold, and 
 the hank received the proceeds on the 2nd of December, having 
 previously had notice that the plaintiff owned the barley. The 
 money never came into the hands of the insolvent, but remained 
 with the bank until ordered to be paid into court. About the 17th 
 November, C. left the country, and an attachment in in.solvency 
 having issued against him, an interpleader was directed to try 
 
t 
 
 88 
 
 THE INSOLVENT ACT. 
 
 whether the balance of such ])roceeds above the bank's advances 
 belonged to his assignee or to the plaintiff. While C. held the 
 barley, it was spoken of, and dealt with, by him as the plaintiff's. 
 The Court held that the phuntiff was entitled to it, for the barley 
 was his, and the money, the proceeds of its sale, never came into 
 C.'s hands, or was mixed with his general assets, and could thure- 
 fore be easil}' distinguislied. C. had advanced, by })ayiny' R.'s 
 draft, more than the proceeds of the barley, and it was contended, 
 therefore, that there was no surplus available for the i)laintitf, 
 but the court held that the plaintiff was entitled to deduct from 
 such advance the sums paid by way of margin. 
 
 After C. had absconded, the plaintilf ^weut to his ofiice to ask 
 about his barley, and there saw R., the manager of C.'s business, 
 who went with liim to the bank, and had a conversation witli tlie 
 cashier ; and it was held, that their evidence of what passed was 
 clearly admissible (Cotter v. Mason, 30 Q. B, U. C. 181). 
 
 It would seem, under the latterpart of this section, that goods de- 
 posited with a firm, to be sold on commission, are property held for 
 the benefit of another, and do not vest in the assignee. Such 
 goods cannot be detained from the owner by the assignee, though 
 they were seized by the landlord on the premises of the insolvent, 
 prior to the attachment of the estate under the Act, and he has 
 filed a claim with the assignee, asseiting his lien upon them foi- 
 unpaid rent (Latvlor v. Walker, 17 L. C. R. 34<9). 
 
 The Statute in force in the United States pnjvides that no pro 
 perty held by the bankrupt in trust shall pass by the assignment. 
 There it is held that the trustee, meant by this clause, can only 
 be a mere naked trustee, who holds the legal title, but has no 
 beneficial interest in the subject of the trust. A vendor is not 
 such a trustee for the vendee, if all the purchase money has not 
 been paid {tiivepson v. Rouse, Go N. C. oi). 
 
 The Statute api)lies to all estates where the trust can be 
 legally established, and is effectual against one claiming under 
 the assignee, who is not in the position of a purchaser without 
 notice. Information of a fact coming from a source which 
 ought to be heeded is sufficient notice {Faxon v. Folvey, 110 
 Mass. 392). 
 
RIGHTS UNDER ASSIGNMENT. 
 
 89- 
 
 Land held by tlic bankrupt, under an agreement to reconvey 
 upon the payment of a certain note, is held in trust and does 
 not pass to the assignee (ib.). Tlie tiust property must be property 
 that can be followed or distinguished. There must be some ear- 
 mark by whicli it can be recognised — as for instance, where goods 
 are sen<^ to a factor to be dis[)osed of, and the factor becomes 
 insolvent, and the goods yet in his possession can be distinguished 
 from the general mass of his property, the })rincipal maj'^ re- 
 covei' them in t^pecie, and is not obliged to prove his debt in the 
 insolvency proceedings. Even where the insolvent has sold the 
 i^ijods, if he has kept the money received from the sale in sep- 
 aiate bags, the principal has Ijeen permitted to claim and hold 
 the money against the assignee. Where, however,the trust pro- 
 l)erty does not remain in specie, but has been made away with 
 hy the trustee, the cestius que trustent have no longer any specilic 
 remedy against any part of his estate on his insolvency ; but they 
 must come in pari pafisu with the other creditors, and prove 
 against the trustee's estate for the amount due them (re Janewd]/, 
 4 B. R. 100 ; Wood v. Brooke, !) B. R. 395). 
 
 It is not essential to the effective assertion of a beneficial title 
 to a trust fund that the fund shall be susceptible of separate iden- 
 Lification. No more is recpiired than proof of substantial identity. 
 Money has no eai marks by means of which it can be specifically 
 identified. Into whatever form it may be changed, if it can be 
 clearly traced, e(|uity will rescue it from a wrongful appropria- 
 tion, and give ettect to the right of its real owner (Voight v. Levjts, 
 33 Leg. Int. 404). 
 
 Tf the insolvent deposits the trust funds in a bank with his 
 own in his own name, the mode of ascertaining how much be- 
 longs to the trust estate is to take the depo.sits and withdrawals 
 in the order of their dates, find out how much of the balance; 
 belongs to the trust and how much to the general fund, and 
 divide accordingly (re Hapgood, 14 B. R. 335). 
 
 Goods and chattels, which are in the possession of the insolvent 
 for a specific [>uqiose, will not, as a general rule, pass to his as- 
 signee. Such property is in fact clothed with a species of tru.st, 
 and subject to the same principles as trust property (ex parte 
 
•00 
 
 THE INSOLVENT ACT. 
 
 i 
 
 Warlny, 2 G. & J. 404 ; Steele v. Staart, L. R. 2 Eq. 84 ; ex parte 
 AwjeMein, L. R. Ch. App. 479). 
 
 Where accoimuodation bills were drawn by a niercliant abroad 
 upon merchants in England, and the latter coni])ounded with their 
 creditors, it was held that bills remitted to them by the diuwer 
 to meet the accomuKjdation l)ills, and remaining- in their haiids, 
 belonged to the drawer, subject to his indonmifying them in re- 
 spect of the compensation paid by them to the holders of thoir ac- 
 ceptances (exparte Gomez, L.R.IO (Jh.Ap]).(i31); see alsoreyf//e.s/^'.s, 
 L. R. 10 Ch. App. 0;J5 ; ex parte Lamhton, L.R. U) Ch. App. 40.5). 
 
 Bills of exchange were <lrawn by the vendor and shii)pei- of 
 goods upon tlie purchaser, for tlie invoice prices of the goods, with 
 a direction to place the same to the accoinit of the shipments. On 
 the acceptance of the bills liy the purchaser, the lulls of lading 
 were handed over to him. The bills of exchange were dishonoured 
 at maturity, and the purchaser l)ecame ins(jlvent. It was held 
 that there was no specific appropriation of the proceeds of sale of 
 the goods to meet the bills of exchange (re /'Juhvistle, L. R. 3 Ch. 
 D. 477). 
 
 A. and H., a firm doing business in Hamilton, had a di'aft for 
 81,200 accepted by B. at Montreal, for their accoimuodation, falling 
 due on the 27th of A])ril. H., in order to oittain funds to meet it, 
 on the 2()th of Api'il, procured a draft on B. for $000, to be dis- 
 counted by the plaintiffs, telling them that it would be acceptt'il, 
 and the proceeds of it were place<l to the general credit of the 
 firm. This draft was sent to B. for acce])tance, and H. on the 
 same day wrote to hiju, enclosing the him's cluMpie for 81,200 on 
 the Bank of Montreal, to take up the 81,200 draft and reipiesting 
 him to accept that for 8000. On the 27th, B. duly paid the draft 
 for 81,200. On the 28th, A. and H. had a difference, and A. hear- 
 ing from H. that the firm were in difficulties, and that he intended 
 using their funds in paying B. and another person, A. th(fi'euj>on, 
 on the 29th, drew out on the checiue of the firm their balance in 
 plaintiffs' l)ank, consisting of the [)roceeds of the draft for $600, 
 of which A. knew nothing, and of other moneys, and handed it to 
 their solicitor, for the benefit of the creditors generally. Between 
 the 2oth and 29th, both the debtor and creditor side of the firm's 
 
RIGHTS UNDER ASSIGNMENT. 
 
 91 
 
 account had been dealt with, and the balance increased in their 
 favour. H., on the 29tli, on hearing what A. had done, wrote to B. 
 that, in conse(|uence, the cheque sent him could not be paid, and B 
 then refused to accept the draft. On the 2nd of May, the firm be- 
 came insolvent, andan assignee was appointed to whom the solicitor 
 handed over the nKmeys deposited with him. The plaintiffs, how- 
 ever, claimed the amoimt of tlie $600 draft, contending that it 
 was only discounted on the faith of its being accepted, and that 
 as one of the partneis had caused its non-acceptance by his letter 
 to the drawee, thei-e was a failure of consideration, and that they 
 were therefore entitled to follow the money in the assignee's 
 hands ; but the ('ouit heldthat they wero not so entitled, and that 
 the case was the oi'dinary one of the discount of a draft, on the 
 Itelit'f that it would he accepted, and that the money formed part 
 of the firm's general assets and j)assed to the assignee (Can. Bank 
 Com. v. Davidson, 25 C. P. U. C. 537). 
 
 Defendant purchased goods from L., who said he would draw 
 on tlefendant throuixh the Merchants' Bank, and L. accordinjjlv 
 did so, but the draft was never accepted l)y the defendant. The 
 manager of the ])ank swore that he discounted the bill for L. on 
 the faith of his representation that defendant owed him the 
 money, and would call and accept it; but there was nothing to 
 show that the discount was made on the faith that it would be 
 repaid out of the specific de1)t which defendant owed to L. It was 
 held tliat this was not sufhcient to constitute an e(|uital)le assign- 
 ment of the debt by L. to the bank ; and that the payment of the 
 draft by the defendant to the bank after L 's ins(jlvency, was there- 
 fore no defence against a purchaser of L.'s estate from the official 
 assignee, on the pui'chaser afterwards suing for the price of the 
 goods (Lanih v. Satherhmd, 37 Q. B. U. C. 143). The Court ex- 
 presse<l an opinion that if L., at the time of the discount, had said 
 to the l)ank, " I want t(j draw on defendant for so nuich money, 
 as he ow(;s me, and I will guarantee that he pays you that debt ;" 
 or " I will pledge that debt to you," that this would have been a 
 good equitable assignment of the debt (ib.). 
 
 The mere fact that a merchant has drawn upon the bankrupt 
 for the price of goods will not give him a right to insist on the 
 
 m 
 
i M 
 
 ! 
 
 J 1 
 
 92 
 
 THE INSOLVENT ACT. 
 
 appropriation of the goods, to the payment of the price even 
 though the goods remain in specie in the hands of the bankrupt 
 at the time of the bankruptcy ; nor does a trustee in bankruptcy, 
 by receiving goods sokl on credit after the bankruptcy, create any 
 trust in favour of the vendor or consignor (re Shackelton L. R. 10 
 Ch. 440). 
 
 Tf an account is, in plain terms, headed in such a way that a 
 banker cannot fail to know it is a trust account, the moneys 
 standing to that account, if a failure of the person keeping it 
 occurs, will belong to the trust ; and when a customer has 
 opened with his bankers separate accounts, specially headed with 
 the names of the trusts to which the moneys paid into those 
 accounts belong, the bankei's are not at liberty upon the bank- 
 ruptcy of the customer, to apply those moneys in payment of the 
 balance due to them upon the customer's oveidrawn private 
 account (ex parte Kingston, 25 L. T. N. vS. 250; L. R. Ch. 63'2). 
 
 If the assignee allows the insolvent, before his discharge, to trade 
 and contract deV^ts, and he assigns the property acquired by him 
 in such trading to secure a delit so contracted, and the creditor 
 has not notice of the ijisolvency, the title of the latter will prevail 
 against that of the assignee, if the latter had notice of the tradin 
 
 ex 
 
 and acquiesced in it {Emjclhach, v. Nixon. L. R. 10 C. P. 045 
 parte Bird, L. R. 1 Ch. 521). 
 
 The assignee is entitled to any beneficial contract of the insol- 
 vent. It would seem that the party damnified by breach of such 
 contract could not biing an action against the insolvent, but 
 must prove against his estate. When the assignee did not dis- 
 claim a contract under the 23rd and 24th sections of the English 
 Act of 18G9, but carried it on for a time for the benefit of the 
 estate, it was held that he was still at liberty, on finding it un- 
 profitable, to cease to perform it, and in that case the other party 
 to the c<mtract was held entitleil, under .section 31 of the Act, to 
 prove against the estate for the damages occa.sioned by the breach 
 of contract, that thifc was his only remedy, and that the assignee 
 was not liable personally or on behalf of the estate (re Sneesum, 
 L. ]{. 3 Ch. D. 463). 
 
 In order to justify a vendor in refusing to complete a contract 
 
RIGHTS UNDER ASSIGNMENT. 
 
 93 
 
 foi' the sale and delivery of goods, on the ground of the insolvency 
 of the purchaser, there must either be actual insolvency on the 
 part of the purchaser, or such proof or admission of the insolvency 
 of the puichaser at the time, as amounts to a declaration of inten- 
 tion not to pay for the goods (re Phamlc B. S. Co., L. R. 4 Ch. 
 I). 108 ; see this case, as to what is sufficient declaration of 
 insolvency ; see also ex parte Cludmci'n, L. R. 8 Ch. 289-293). 
 
 The mere insolvency of the vendee does not of itself authorize 
 tliL' vendor to rescind an executoiy contract for the sale of goods. 
 Ill March 1872, the plaintirt", a merchant at Orillia, gave to ]). tU'.' 
 tra\ riling agent of defendants, who were merchants at Montreal, 
 an order for certain „ >ds, amongst which were oOO kegs of nails, 
 at ."rro'SO per ton which D. accepted, — the goods to be delivered 
 monthly during the season, or sooner if required, by the plaintiff, 
 at six months' credit. In May following, after all the goods, ex- 
 cept the nails, had been delivered, the i>laintiff was burned out, in 
 ceiisequence of which he became insolvent, and so notified his 
 creditors, giving them a statement of his assets and liabilities, 
 and oiFering them a composition of sixty cents in the dollar, which 
 they accepted, and a deed of composition and discharge was 
 executed, the coinposition being payable by instalments at certain 
 stated periods, the plaintiff to give his creditors his promissory 
 notes f(jr the .said instalments, and to assign to a trustee certain 
 polices of insurance and other securities for the due payment of 
 the instalments, but on the jiayment of the instalments at the 
 times specified, tl ■ creditors were to release the plaintiff from all 
 their claims. 
 
 Xeitlier at the meeting of plaintiff's creditors, nor at the time 
 the deed was executed, was any mention made of the plaintiff's 
 intention to require the performance of the contract as to the 
 nails, nor did he include it as one of his assets, either in his state- 
 ment delivered to his creditors or in the schedule attached to the 
 deed. There was contradictory evidence as to a rescission of the 
 contract in fact, but the jury found there had been none. The 
 plaintiff having subsequently sued defendants for non-delivery of 
 the nails, it was held by the Court and affirmed on apjieal, Draper, 
 C. J. of Appeal, dissenting, that the evidence showed a rescission 
 

 J1 
 
 94 
 
 THE INSOLVENT ACT. 
 
 in law of tlie contract, the conduct of tho plaintiff having l)een 
 such as to justify the defendants in the belief that he intended to 
 abandon it upon his insolvency, and there being evidence that the 
 defendants in such belief likewise abandoned it {Bhujham v. Mid- 
 hollaml, 25 C. P- U. C. 210). 
 
 Where a pai'ty, who becomes insolvent, has a contract for the 
 delivery from time to time of certain goods, the insolvency will 
 destroy the vendor's obligation to make delivery until he is paid 
 for the whole of the goods delivered and to be delivered, although 
 he may have agreed to give credit for the goods. But the mere 
 fact of the insolvency of the purchaser does not put an end to the 
 contract. If the purchaser can still comply with the contract on his 
 part, and gives notice thereof to the seller, the latter would bo 
 bound to complete the contract, and it seems to be the duty of 
 a })urchaser having beneficial contracts to inform his creditors 
 if he becomes insolvent, that they may be in a position to take 
 advantage of them (ex parte Chalmers, 28 L. T. N. S. 325 ; L. R. 
 8 Ch. 280). 
 
 By the 23rd and 31st sections of the English Act, it is quite clear 
 that where there is in existence, at the date of the insolvency, a 
 contract between the insolvent and any other person, the assignee 
 of the insolvent has the option either to accept or repudiate it ; 
 but whether he accepts or repudiates it, the insolvent is thence- 
 forth discharged from liability. If the assignee repudiates the 
 contract, the section provides that the person injured by the 
 assignee's repudiation shall be deemed a creditor to the extent of 
 the injury and may prove the same as a debt under the insolvency 
 (see ex parte Waters, 28 L. T. N. S. 757 ; L. R. 8 Ch. App. 5G2). 
 
 But there seems to be an exception to this rule in the case of 
 contracts involving the personal skill of the insolvent, such con- 
 tracts the assignee cannot insist on performing vicariously for the 
 bankrupt, since he cannot sue the party refusing to ji.ay for the 
 work, because the work, not being done by the insolvent })ers()nally, 
 is not the work contracted for {Knight v. Bv.njess, 33 L. J.Ch. 727). 
 
 An opinion is, however, expressed in Robson (3rd Ed. 36(5), that 
 under the 19th section of the English Act of 18()9, which retjiiivfs 
 the bankrupt to aid to the utmost of his power in the realization 
 
RIGHTS UNDER ASSIGNMENT. 
 
 05 
 
 of his j)roperty, and the distiibution of it amongst his creditors, 
 the trustee will be entitled to require the bankrupt to give his aid 
 in coiii))leting any contract unexecuted at the time of his bank- 
 ruptcy (see section 25 of our Act). 
 
 The assignee has an election to rej)udiatc a contract, if it may 
 more; properly be rogiirded as a burden than a privilege, as for 
 instance, where, fro'.ii the conditions of the contract, he can derive 
 no benefit for the cr^iditorp and may subject the estate to loss if 
 he assumes the contract (Streeter v. Sumner, 31 N. H. 542 ; 
 Ihiijley v. RohhiHov, If) Ala. 404). 
 
 The assignee is not, at least, ordinarily bound to take into his 
 possession property which will be a burden in.stead of a benefit to 
 the estiite. If he elects not to take, the property remains in 
 the insolvent, and no one has a right to di.spute his possession. 
 His possessor}- title is good against all the world but his assignee 
 {Smith V. Gordon, 2 N. Y. Leg. Obs. 325). 
 
 But some period must be limited within which the election is 
 to be made, for he cannot be allowed to hold the title in abeyance 
 for an indefinite jieriod. If with the knowledge of the insolvent's 
 title, ()]■ with means of knowledge, he stands by for a length of 
 time without asserting his claim and alloAvs a third person to ac- 
 ((uire an interest in the })roperty, it is too late to assert his claim 
 and the time for election is past (Smith v. Gordon, 2 N. Y. Leg. 
 Obs. 325). 
 
 The interest and rights of the insolvent, under contracts, are 
 transferi'ed to the assignee. Whatever the rights are, the assignee 
 can claim and enforce. It is not the purpose of the insolvent law 
 to interfere wdth or avoid contracts made by the insolvent with 
 other parties, or to prevent their execution {Foster v. Hochley, 2 
 B. R. 40G). 
 
 An agreement that the title to property sold to the insolvent 
 should not vest in him, until all thii purchase money has been paid, 
 l)inds the assignee, even if the insolvent has paid all but a small 
 l)ortion of the purchase money. The ownership remains in the 
 vendor until the final payment. Creditors cannot enforce their 
 claims without paying to the vendor the remaining portion (re 
 Sym, 7 B. R. 182). 
 
 I 
 
 
' 
 
 96 
 
 THK INSOLVENT ACT. 
 
 I 
 
 m 
 
 The assignee takes the property of the insolvent, sii})jeet to all 
 legal and eciuitablo claims of others. He is affected Vty all the 
 e(|uities which can be inged against the insolvent (Cork v. TuUix, 
 9 B. R. 43:3). 
 
 The insolvent is personally released by a discharge ; but the 
 property and rights of property vested in the assignee are subject 
 to tlie creditoi-s, and are held in trust for them, in whatsoever 
 hands these may be found (Clark y. Clark, 17 How, 315). 
 
 The Statute iloi's not create any estate of inheritance in the 
 assignee himself, although he may, by his othcial action, convi-y 
 lands. Whatever rights vest in him are otheial, and not personal, 
 and are not heritable or corporate (Steevcas v. Earles, 25 Mich. 40). 
 
 A.ssignees in bankruptcy do not like heirs, and executors, take 
 tlie whole legal title in the bankrupt's property. They take such 
 estate only as the bankrupt had a lieneficial, as well as legal, inter- 
 est in, and which is to be applied for the payment of his <lebts 
 (Rhoudy w.Blad'hton, lOG Ma.ss. SSI). 
 
 As soon as a will of real or personal estate is admitted to 
 proljate, the title of the legatee or devisee takes ette'ct, by relation 
 from the death of the testator. If the devisee or lej^atec is declared 
 insolvent, in proceeding.s conunenced after such dt.'ath, and befovt' 
 the prol)ate of the will, the legacy or devise will pass to his as- 
 signee, if he has never lenounced or disclaimed the legacy or dcvisu. 
 After the commencement of the proceedings in insolvency, he has 
 no right to disclaim or I'cnounce it (re Fuller, 2 Story. 827) ; a de- 
 vise of property to a trustee to pay the income thereof to a third 
 person, free from liability for his deljts, is not such an interest as 
 will pa.ss to the latter's assignee (Nichols v. Eaton, 13 B. R. 421). 
 The growing croj) passes to the as.signee, and should be placed 
 upon the .schedules as personal propei'ty (re Schumpert, 8 B. R. 
 415). 
 
 A debtor has no right to reserve from his estate a sum of money 
 sufficient to meet the expenses of procuring his discharge (re 
 Thompson, 13 R. R. 300). 
 
 Not only does the assignee take all the property that the in- 
 solvent was entitled to at the time of the assignment, but in some 
 cases he takes property that the insolvent could not a.ssert a claim 
 
 to. 
 
 propi 
 
 nee 
 
 the 
 
 solvt 
 
 111. 
 
 does 
 
RIGHTS UNDER ASSIGNMENT. 
 
 97 
 
 to. Thus, if the insolvent has made a fraudulent conveyance of 
 property, tliis would be good against the insolvent, but the assig- 
 nee is, nevertheless, entitled to claim it, and the assignment vests 
 the property in the assignee, although it is not shown in the in- 
 solvent's statement of property and assets {Hulbrook v. Coney, 25 
 111. 543). The title to real estate situate in a foreign country 
 does not vest in the assignee, for a statutory conveyance can have 
 no extra territorial effect upon real estate (Oakej/ v. Bennett, 11 
 How, 33 ; see also Robson, 3rd Ed. 419-420). No doubt, under 
 the power to issue concurrent writs of attachment, the real or per- 
 sonal estate in any part of Canada might be made to pass, but it 
 is doubtful whether the assignment would operate even as to per- 
 sonalty outside of the Dominion. In Roe v. Smith (15 Grant 344), 
 the Court seemed to be of opinion that money with which the in- 
 Siilvent had absconded could not be recovered from him in the 
 United States. In this case the defendant had left for the United 
 States with a considerable sum of money ; he was pursued there 
 by one of his creditors, and by threats made to hand over S880. 
 A suit was instituted by the assignee in insolvency against the 
 creditor to recover this sum, on the ground that its payment to 
 the weditor gave him an unjust preference over the other creditors. 
 Th« Court declared : " The money which was handed over to the 
 defendant was not within the reach of our laws ; it would not 
 have formed any part of the insolvent's estate for distribution. 
 It had been withdrawn from the estate, and was beyond the reach 
 of any assignee of it, and could not have benefited the creditors." 
 But the personal estate out of England of a bankrupt in England 
 will vest in his trustee, subject, nevertheless, to any lien upca it 
 ac({uired by the law of the country where the property is situate 
 previous to bankruptcy {Hunter v. Potts, 4 T. R. 182 ; Selkrig v. 
 Davies, 2 Rose, 291 ; see also McDoTiald v. Georgian Bay L. Co., 
 24 Grant, 356). 
 
 As a general rule, policies of insurance will pass to the assignee 
 ( West V. Reid, 2 Hare, 249). But under the Statute of the late 
 Province of (Canada 29 Vict. chap. 17 : amended in Ontario by 
 the 33 Vict. chap. 21, and 36 Vict. chap. 19), the insurance money 
 
 
 a 
 
 J^Jiii 
 
98 
 
 THE INSOLVENT ACT. 
 
 if 
 
 is payable according to the terms of tlie policy, free fi'om the 
 claim.s of any creditor or creditoi's whomsoever. 
 
 Where notice is reciuired to complete the title to an equitahle 
 chose in action, the assignee is as much honnd to use diligence in 
 giving notice as an assignee for value, and in order to complete 
 the title of the assignee, nijtice thereof should bo given to the 
 person having the legal control over or liable to pay the fund or 
 debt, the insolvency proceedings not being notice of the assignee's 
 title, so a.s to defeat the title of a sul)se(iuent assignee or purchasei- 
 for value without notice, who gives prior notice of the assign- 
 ment to him (see re RitHsrirs Truxi, h. R. L') Eq. 26 ; 27, L. T. N. 
 S. 706; StMtrt \. Cocke n'n,'L.'R. 8 Eq. (i07 ; re London it P. 
 T. Co., L. R. 9 E.|. (i.)3 ; Lloyd v. Banks, L. R. 4 Eq. 282. 
 
 The assignee takes those rights and intei-ests which are bene- 
 ficial to the creditors ; all property and assets, and all rights of 
 action affecting such property and assets. But the assignee is 
 not entitled to hire the banki'upt out, and he cannot, therefore, 
 brinof an action to recover for merely personal service performed 
 by the insolvent after the assignment (ChippendUe v. Toinlhi- 
 80ti, 4 Dougl. 318 ; see also 13 Jur. 928 ; Wlll'iami^ v. Chambers, 
 10 Q. B. 337 ; White v. ElHoff, 30 Q. B. U. C. 2o3). 
 
 The insolvent may, therefore, sue for all wages earned by him 
 after the assignment, and the assignee cannot interfere (see how- 
 ever re Doviiwj, L. R. 4 Ch. D. 689 ; but if tlie action is brought 
 before he obtains his final discharge, it is apjirehended he would 
 have to give security for costs under the 39th section of the Act. 
 
 Causes of action arising from purely personal wrongs connnitted 
 against the insolvent do not pass t' > the assignee, but only such 
 rights of action as affect his property and assets. Tlie insolvent, 
 before the assignment, sued A. for slander and enticing away his wife 
 and as.saulting her, and special bail was put in to the action by A. 
 Before obtaining judgment, and while the action was pending, he 
 made a voluntary assignment in in.solvency under the Act of 1864. 
 Before obtaining his discharge, he sued the bail on their recogniz- 
 ance, and it was held that he was entitled to recover for the causes 
 of action, being for purely personal wrong, did not pass to the 
 assignee {White y]Elllott, 30 Q. B. U. C. 253). 
 
UIGHTS UNDER ASSIGNMENT. 
 
 99 
 
 1 n such a case as tliis it would seem that the assignee could not 
 iiitiTvene to prevent the insolvent going on with the suit, and, if 
 he does not intervene, the insolvent has a clear right to recover 
 (ib. ; see also Dunn v. Irwin, 25 C. P. U. C. Ill ; Smith v. Com- 
 mercial Union Ins. Co. 33 Q. B. U. C 535). • 
 
 In a case of this sort if there is only one cause of action it cannot 
 he split so as to give the insolvent a right to recover special dam- 
 age, and the assignee pecuniary and ordinary damage, but if there 
 are two causes of action it would seem that the insolvent may re- 
 cover in respect of one, and the assignee of the other {Hodgson v. 
 Sidney, L. R. 1 Exch. 352). The right of action for a false repre- 
 sentation whereby the insolvent sustained a pecuniary loss, was 
 held to pass to his assignee {Morgan v. Steble, L. R. 7 Q. B. Gil). 
 But although the contract may be one which relates innnediately 
 to the person of the insolvent and not to his estate, still if it is 
 stipulated that, in case of a breach, a sum of money shall be paid 
 to him by way of penalty, and a breach takes place before his in- 
 solvency, the right of action for the penalty will pass to the 
 assignee {Wadliwj v. Oliphant, L. R. 1 Q. B. D. 145). 
 
 Riglits of action for tort pass to the assignee if they relate to 
 real or perscmal ])roperty, or to the unlawful taking or detention 
 of property, or to injuries thereto, and do not relate to mere pei'- 
 sonal injuries to the insolvent {Noomin v. Orton, 12 B. R. 405). 
 Tile rights of action which pass to the assignee are those that are 
 founded upon beneficial contracts made with the insolvent where 
 the pecuniary loss is the substantial and primary cau.se of action, 
 and for injuries affecting his property so far as they do not involve 
 a claim for jiersonal damages {Dillard v. Collins, 25 Gratt. 343). 
 A right of action for damages arising from a fraudulent and de- 
 ceitfid reconunen<lation of a pei'son as worthy of trust and confi- 
 dence does not pass to the assignee {Crockett v. Jewett, 2 B. R. 208). 
 
 A bankrupt who had never obtained his order of discharge or 
 pjissed his final examination, ])rocured employment as editor of a 
 weekly newspapei', without the i)ermission or knowledge of hi,s 
 trustee ; and six years after bankruptcy he was awarded by the 
 decree of a competent Court £104, as six months' salary in lieu of 
 proper notice of dismissal. It was held that the assignee could 
 
 
 I I 
 
 ' I 
 
100 
 
 THE INSOLVENT ACT. 
 
 claim tlii.s money before it was paid to liim, as against creditors 
 subseciuent to, and without notice of'.the bankruptcy ; for that first 
 the assignee had been guilty of no breach of duty towards such 
 creditors so as to estop him from setting up his claim ; and second- 
 ly, that the money was not the pi'oceeds of the bankrupt's per- 
 sonal labour subsi'ipient to his bankruptcy, but a compensation for 
 the breach of a contract which Ijecame part of his estate in bank- 
 ruptcy {Wadlinii V. Oliphant, L. R. 1 Q. B. D. Uo). 
 
 The lien of an unpaid vendor for his pui"chase money is not 
 such an interest as will pass to the assignee. 
 
 Land subject to a vendor's lien for unpaid piu'chase money was 
 sold under execution at a sheriffs sale to a purchaser without 
 notice. The execution debtor subse(iuently repurchaseil the land 
 fiom the sheriff's vendee in the name of a third party, who con- 
 veyed to a brother of the debtor in trust, for the latter, who hav- 
 ing V)ecome insolvent made an assignment under the Insolvent Act 
 of 1804) ; it was held that the vendor's lien attached on the lands 
 in the hands of the as.signee {Van Wagner v. Findlay, 14 Grant. 
 53). 
 
 Such is also the the law in the United States (re Perdue, 2 B. 
 R. 188), where it is also helil that the lien is not waived by taking 
 a mortgage C/U the land therefor (re Bryan, 8 B. R. 110; re Huifo, 
 4 B. R. 787). 
 
 The right to the rents of land vests in the assignee from the 
 time of the assignment, and an agreement that the vendor may 
 collect them and apply them to the unpaid purchase money is 
 thereby terminated {Hall v. Scod^l, 10 B. R. 295). 
 
 Where an insolvent had a contingent interest in certain property 
 under his father's will, but at the time of the assignment the pro- 
 perty was still subject to the control and disposition of a trustee 
 and depended upon the latter dying without conveying or dividing 
 the property among the other children of the testatoi', it was held 
 that this interest would pass to the assignee, subject to be defeat- 
 ed by the trustee disposing of the property according to the will, 
 and that such interest should have been stated as an asset in the 
 insolvent's schedule of assets and liabilties. It was however held 
 that omitting it from the schedule was not an act of fraud, the 
 
-m 
 
 RKIHTS IJNDKK ASSKINMKNT. 
 
 101 
 
 
 insolvent Hwcaiiii;!; Iit^ was advisod to omit it by his solicitor (re 
 Jom's, 4 U. C. P. R. .SI7). 
 
 A'^d insolvent's I'cversionary interest in an estate passes to his 
 assij^nee and entitles the assi<>nee to maintain a suit in a proper 
 ease for the appointment of new trustees, and for an account of 
 the estate ; but the Court refused to make an order for the sale of 
 such reversionary interest {Gray v. II (itch, IH Grant, 72). 
 
 But und(!r this section the assijjfnment will only pass such real 
 I'state as is vested in the insolvent at the date of the assi^mment. 
 If prior to the assignment, the insolvent has sold real estate and 
 the deed has been executed, such real estate will not ])asH to 
 the assignee, though the purchaser tluireof neglects to register the 
 deed until after the appointment of the assignee, and an assignee 
 in insolvency cannot acquire priority over a prior vendee of the 
 insolvent, Ity prior registration of the instrument appointing such 
 assignee {Golloer v. Skdw, 19 Grant, 50!)). 
 
 When an action is brought against a person who afterwards 
 in the course of the proceedings pay.^ money into the Court, it is 
 ditiicult to say whether such money would pass to the assignee on 
 the suhsequent insolvency of the person paying. In England it 
 lias been held under the Bills of Exchange Act of 1855 (which 
 empowers the judge to give leave to a defendant to appear and 
 defend the action under certain circumstances, on paying the 
 money into Court), that money paid into Court under the Act, 
 pursuant to a judge's order, to abide the event of an action then 
 ])ending, forms no part of the debtor's estate, but is a security to 
 the creditor for the amount recoverable in the action, notwith- 
 stending that the matters in dispute in the action have been re- 
 ferred, and bankruptcy has supervened before any proceedings are 
 taken in the matter of arbitration (ex parte Boomer, 30 L. T. N. 
 S. 620 ; L. R. 9 Ch. 37!)). 
 
 Moneys seized by a judgment creditor of the insolvent prior 
 to the assignment, but, at the time of the assignment, pending in 
 Court, are ve..ted in the assignee to be divided among the creditors 
 generally according to the j)ro visions of the Act, subject to the seiz- 
 ing creditor's lien for costs under the 83rd section of the Act (Ba- 
 con V. Douglas, 15 L. C. R. 45G). 
 
 Bin .'irl.tii- 
 
 "vn 
 
 li 
 

 102 
 
 THE INSOLVENT ACT. 
 
 By an assignment the insolvent's entire property is transfi'iifd 
 to the assignee, whether inchuled in his statement or not, antl he 
 cannot afterwards make any application founded on his property 
 in the effects transferred. 
 
 Thus where plaintiff, a judgment creditor of defendant, proved 
 his claim befon; the assignee under the Insolvent Act ; afterwards, 
 and before defendant obtained his discharge, the plaintiff issued 
 execution on his ju igment, and levied upon property which the 
 insolvent had not iacluded in his schedide of assets. The Court 
 held that whether the property belonged to the defendant at the 
 time of his insolvency, or was the property of a third person, he 
 had no right to apply to set aside the execution, as in either case, 
 he could have no right to it (Jones v. Des Bv'isay, Trin. T. 1871, 
 Stephen's digest, N. B. Reports, 227). 
 
 In the Province of New Brunswick, where judgments registered 
 form a lien upon the lands of the judgment debtor, it has l)een held 
 that a judgment, a memorial of whicli has 1 )een registered, is a charge 
 upon the real estate of the debtor who afterwards becomes insol- 
 vent, and that such judgnv-nt can be enforced against the yqv\ 
 estate which belonged to th-^ debtor and was transferred to his 
 assignee by his assignment under the Act (Devcber v. Austin., 3 
 Pugsley, 55). 
 
 The Act secures to the insolvent certain parts of his estate which 
 ai"e set off to him free from the claims of creditors — of these he in 
 fact becomes the purchaser, the consideration for the purchase 
 bei' ." .-he surrender of all his estate, and the sanction for his title 
 being in the supreme law of the land (re Hamhriyht, 2 B. R. 408). 
 
 The insolvent cannot claim exemptions to the prejudice of a 
 creditor who holds a valid lien on the property. The Legislature 
 did not intend that the Act should override cases of that nature 
 (re Perdiw, 2 B. R. 183 ; re irntto, 3 B. R. 787) ; and where the 
 property claimed to be exempted is subject to a mortgage, the 
 assignee will discharge his whole duty if he designate the ex- 
 empted property, and then leaves the insolvent and mortgagee to 
 settle their respective rights by themselves (re Lambert, 2 B. R. 
 426). 
 
 A mortgagee, therefore, whohasdonenothingby proof of hisdebt 
 
EXEMPTIONS. 
 
 103 
 
 or otherwise to waive his mortgage, may hold the exempted pro- 
 perty as security for his debt, and tliis right cannot be affected by 
 the insolvent's discharge {'ruesley v. Robinson, lOS Mass. 558). 
 
 The insolvent cannot claim any exemption in property conveyed 
 l)y him prior to the connnencement of proceedings in insolvency 
 in fraud of his creditors, and afterwards recovered to the estate. 
 The; sale is good as against him, and in attemj)ting to place his pro- 
 perty beyond the reach of his creditors he placed his exemption 
 l»eyond his own reach (re Graham, 2 Biss. 44')). 
 
 Upon the death of the insolvent the title to exempted property 
 vests in his executor or administrator (re Hester, 5 B. R. 285). 
 
 By the 23 Vict. cha[). 25, in the Province of Ontario, the fol- 
 lowing chattels arc declared exempt from seizure under any writ 
 issued out of any Court whatever in the Piovince, namely : — 
 
 1. The bed, bedding and bedsteads in ordinary use by the deb- 
 tor and his family. 
 
 2. The necessary and ordinary wearing apparel of the debtor 
 and his family. 
 
 3. One stove and pipes, and one crane and its .appendages, 
 and one pair of andii-ons, one set of cooking utensils, one pair of 
 tongs and shovel, one table, six chairs, six knives, six forks, six 
 plates, six teacups, six saucers, one sugar basin, one milk jug, 
 one teapot, six spoons, all spinning-wheels and weaving-looms in 
 domestic use, and ten volumes of books, one axe, one saw, one gun, 
 six traps, and such fishing-nets and seines as are in common xine. 
 
 4. All necessary fuel, meat, fish, flour, and vegetables actually 
 pro\ided for family use, not more than sufficient for the ordinary 
 ccmsumption of the debtor and his family for thirty days, and 
 not exceeding in value the sum of forty dollars. 
 
 5. One cow, four sheej), two hogs, and food theiofor for thirty 
 days. 
 
 G. Tools or implements of, or chattels ordinarily used in, the 
 debtor's occupation, to the value of sixty dollars. 
 
 In Quebec, by the Code Civ. Pro. Arts. 55G and 558, the follow- 
 ing is the list of exemptions : — 
 
 1. The bed, bedding and bedsteads in ordinary use by the deb- 
 tor and his family. 
 
 ii' 
 
 
 ■ !;Ji 
 
 ^\V 
 
 m 
 
 
 
104 
 
 THE INSOLVENT ACT. 
 
 2. The necessary and ordinary wearing apparel of the debtor 
 and liis family. 
 
 3. One stove and pipes, and one crane and its appendages, one 
 pair of andirons, one set of cooking utensils, one pair of tongs 
 and shovel, one table, six chairs, six knives, six forks, six plates, 
 six teacups, six saucers, one sugar basin, one milk jug, one tea- 
 pot, six spoons, all spiiming- wheels and weaving-looms in domes- 
 tic use, and ten volumes of books, one axe, one saw, one gun, six 
 traps, and such fishing nets and seines as are in common use. 
 
 4. Fuel and food not more than sufficient for thirty days, and 
 not exceeding in value the sum of twenty dollars. 
 
 5. One cow, four shec]), two hogs, and food therefor for thirty 
 days. 
 
 6tli. Tools and implements oi- other chattels ordinarily used in 
 the debtor's occupation, to the value of thirty dollars. 
 
 7. Bees to the extent of fifteen hives. 
 
 In the Province of Manitoba, by an Act relating to homesteads, 
 assented to May 3i'd, 1871, chap. 1(5, of that year, the following 
 personal and real estate are, by the Act, free from seizure by vir- 
 tue of all writs of execution issued by any Court of the Pi ovince, 
 namely : — 
 
 1st. The bed, the bedding and bedsteads in the common r.se of 
 the debtor and his family. 
 
 2nd. The necessary and ordinary clothing of the debto!' and 
 his family. 
 
 3rd. A stove with its pipe, a table, the nece.s.sary and ordinary 
 kitchen utensils and ta])le crockery belonging to the debtor and 
 his family, a spinning-wheel, a wc^aver's loom, the books cf a pro- 
 fessional man, one axe, one saw, one gun, six traps, the nets and 
 .seines used by the debtor. 
 
 4th. The neces.sary food for debtor's family during thirty days. 
 
 5th. One cow, two oxen, one hoise, four sheep, two pigs, and 
 the food for the same for thirty days. 
 
 0th. The tools and neces.saries used by the debtor in the pi-actice 
 of his trade or profession, to the value of one hundred dollars, in 
 the supposition that the debtor is a mechanic, but up to the value 
 
EXEMPTIONS. 
 
 105 
 
 of two hundred dollars if the debtor is a farmer or a professional 
 
 man. 
 
 7th. The articles and furniture necessary to the performance 
 of religious services. 
 
 8th. The land cultivated by the debtor, provided the extent of 
 the same be not moi'o than one hundred and sixty acres, in which 
 case the surplus may be sold, with privileges of fii'st mortgages. 
 
 9th. The house, stable, barns, fences on the debtor's farm, sub- 
 ject, however, to the same privilege as mentioned in the previous 
 clause. 
 
 In New Brunswick, wearing apparel and kitchen utensils to the 
 amount of fifteen pounds, and in Nova Scotia the wearing apparel 
 and l)edding for the debtor and his family, and the tools or imple- 
 ments of his trade or calling, not exceeding forty dollars in the 
 whole, are exempted (see as to Prince Edward Island, Local 
 Statute, 80 Vict. chap. 18). 
 
 By an Act passed by the Legislature of New Bi'unswick (31 
 Vict. chap. 25) it is provided that the family homestead of every 
 head of a family to the value of six hundred dollars, shall be 
 exempt from levy or sale under execution, and provision is made foi' 
 setting off the homestead in case of a fi- fa- in the sherift's hands. 
 
 This section provides that nothing shall pass to the assignee, 
 which, under any Act of a Legislature, is exempt from seizure and 
 sale under execution. Harrison and Potter both became in.sol- 
 vent, and by two several deeds assigned their estates to the official 
 assignees. At the tinje of his assignment, each was possessed of 
 a house and land, on which he resided, each being under mort- 
 but the equity of redemption exceeding in value six hun- 
 •lollars in each case. The assi<rnees having: advertised the 
 
 gage 
 dred 
 
 properties for sale, and refusing to comply with an application of 
 the insolvents to have a homestead set otf to them, they peti- 
 tioned the Judge of the Insolvent Court for an order directing 
 thi' assignees to comply with such re(]uests. 
 
 The judge having ordered the sales to proceed, and the proceeds 
 to the amount of S(iOO, to be handed over to each of the insol- 
 vents ; it was held that there was no power to make such an 
 or<ler (re Jlarviwv, 2 Pugsley, 11). 
 
 V 
 
 h 
 
 I J; 
 
 ill 
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 i 
 
 mnrtf I 
 
 Ji' 
 
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J,;;j 
 
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 lOG 
 
 THE INSOLVENT ACT. 
 
 In the Province of Nova Scotia, where a law as to the registra- 
 tion of judgments is in force, it has been heltl,'on the Act of IHCA), 
 that a bona fide judgment creditor, wlio has (hily registered liis 
 judgment in the proper office, within thirty days of the defend- 
 ant's assignment, under the Insolvent Act, was entitled to priority 
 over the assignee in insolvency {Muvdock v. W(dsh, 9 C. L.J. N. 
 S. 198). 
 
 Goods and chattels in the possession of a mortgagee of them 
 cannot be seized and sold, and the proceeds paid over to a sheriff, 
 acting under a writ of attachment in insolvency against the 
 mortgagor. The possession of a part}'' to whom such goods are 
 sent by the mortgagee to be sold, and their proceeds to be paid 
 over to the mortgagee is the possession of fhe latter, and if the 
 asent in such case allows the goods to be seized and sold bv the 
 sheriff, he is liable to repay them to the mortgagee {Watf^on v. 
 //(^?((?own,25C.P.U. C. 5(i2). 
 
 Though this section provides that the assignee shall take the 
 assets under the .same charges and obligations as the in.solvent, was 
 liable to, in regard to the same ; yet an assignee, under the Act, 
 cannot be held liable on a guarantee in i-espect of a matter for 
 which the insolvent was, at the date of the assignment, liable to 
 the party holding the guarantee, and the only remedy of the lat- 
 ter is, to file a claim, duly attested, against the estate of the insol- 
 vent {Ihdchms v. Cohen, 15 L. C. J. 235). 
 
 An assignee under the Act camiot be sued for the recovery of 
 the price of real estate sold to the insolvent {Kupev v. Steivart, 11 
 L. C. J. 85). 
 
 There was a proviso in suction 10 of the Act of 1809, that no 
 pledgee of any of the effects of the insolvent, or any other party 
 in possession thereof, with a lien thereon, should be deprive<l of 
 the possession thereof, without payment of the amount legally 
 chargeable as a preferential claim upcjn such effects. This proviso 
 is not contained in the present Act, and it seems unnecessary, as 
 the common law will sufficiently protect the pledgee or lien holder 
 where the law us to re|)uted ownership does not prevail. This 
 proviso in the Act of 1809 prevented the as.signee of an insolvent 
 recovering from a carriage-maker, a carriage in his po.ssession be- 
 
RIGHTS UNDER ASSIGNMENT. 
 
 107 
 
 longing to the insolvent, it appearing that the carriage-maker had 
 (lone work upon it, in the way of repairs (Stewart v. Ledoux, 2 
 Revue Critique, 482). 
 
 This section authorizes the assignee to institute conservatory 
 process for the protection of the estate. Under the former Acts, a 
 guai'dian, under a writ of compulsory liquidation in insolvency 
 matters, had a right to take out a sdisie revendication against a 
 seizing bailiff, and the creditor, who, although well aware of the 
 issuing of the compiilsory writ, persisted in holding the estate of 
 the insolvent, under an ordinary writ of execution ; in this case, a 
 writ oi'saisie gagerie ; the bailiff was condemned, jointly and sever- 
 ally with the landlord, to deliver the estate to the guardian, and 
 to pay the costs {White v. Bisson, 1 Revue Critique, 474). 
 
 All property which the insolvent becomes entitled to up to the 
 time of obtaining his discharge passes to the assignee, but it 
 would seem that property acquired after discharge would not pass, 
 though the estate of the insolvent was not then wound up (see 
 Reg. V. Roberts, L. R. f) Q. B, 77 ; 20 L. T. N. S. G7 ; Ehhs v. 
 Bonlnois, L. R. 10 Ch. App. 471) ; overruling re Bennett's Trust, 
 L. R. 19 Eq. 245). The assignee will take the property, with all 
 the burthens and equities to which it was subject in the hands of 
 the insolvent, and which are not inconsistent with the principles 
 of the insolvent law (ib. ; ex parte Holthati^,en, L. R. Ch. App. 
 722). 
 
 In Reg. v. Roberts, .supra, it was held that the trustee of a pri- 
 soner, who was adjudged bankrupt after his apprehension, took 
 his property subject to an order for the costs of the prosecution 
 being paid out of it. 
 
 So in England, the bankrupt is entitled to any property ac- 
 quired by him after the close of the bankruptcy, although he has 
 not obtained his discharge (re Pettit's Trusts, L. R. 1 Ch. D. 478) ; 
 and he is also entitled to any property acquired by him after his 
 discharge, although bankruptcy is not closed (Ebbs v. Boidnois, 
 L. R. 10 Ch. App. 479 ; re Bennett's Trmts, L. R. 10 Ch. App. 
 490). 
 
 The assignee of an insolvent is not the assignee of his creditors, 
 nor of all the judgments, executions, liens, and mortgages out- 
 
 
j I 
 
 108 
 
 THK INSOLVENT ACT. 
 
 standing against his propcn-ty. He takes only the bankrupt's in- 
 terest in ])roperty, nor has he the right, title, or interest which 
 other parties have therein, nor any control over the same, further 
 than is given expressly by the Act as auxiliary for the jjreserva- 
 tion of the insolvent's interest for the benefit of his creditors gen- 
 erally (Goddard v. Weaver, G B. R. 440). 
 
 Except where there is an offence againt the insolvent law, or 
 agfjin.'^ '^ "e law in favour of creditors, the assignee is merely 
 thj 1'- •• ;>resentative of the debtoi-, with such rights as he 
 would .,, J '.; d if not insolvent, and no other. When, therefore, 
 M., who owed B. one hundred pounds, for which he had given no 
 securuy, w ite tc '^ telling him that he had forged his name to 
 a bill of exchang'.. for ono hundred pounds, which he had dis- 
 counted with his bankers, that the bill was just due, and that he 
 was unable to meet it, and entreating B. to pay the bill, and thus 
 save him and his family from the ruin which would result from 
 exposure, M. jn-omised, if B. would do this, to give him a bill of 
 sale of* all his property, to secure what he owed him. B. acceded 
 to the request. A bill of sale of all M.'s property was given to 
 him to secure two hundred pounds, and B. paid the one hundred 
 pounds to the bankers. Soon afterwards M. was adjudicated 
 bankrupt. The Court held that, if there was a legal misde- 
 meanor in compromising the foi-gery, the bankrupt was a party 
 to it, and could not recovei' the goods from B., and that as no of- 
 fence against the bankrupt law had been committed, the a.ssignee 
 had only the same rights as M. (re Maplebad; L. R. 4 Ch. D. 
 loO). 
 
 The parties to a contract for the sale of goods have, till the 
 rights of third persons intervene, an undoubted right to rescind 
 the contract. If the vendee can Itigally rescind a con- 
 tract for the purchase of goods, and does so before an as- 
 signment, or the issue of a writ of attachment, the goods will not 
 pass to his assignee in insolvency. In the case of Mason v. Red- 
 path (39 Q. B. U. C. 157), tlie learned Chief Justice of the 
 Court of Queen's Bench in Ontario, assumed for the puri)Oses of 
 his decision (but did not decide) that the vendee could not, under 
 the Act of 18()'J, rescind the contract for the purchase of goods 
 
RIGHTS UNDKR ASSKiNMENT. 
 
 109- 
 
 after the commission of an act of bankruptcy by him. In this 
 case the goods purchased, some fifty-nine barrels of sugar, were 
 delivered by the railway company to the vendee on the 27th and 
 28th of November, 1874. The vendee refused to receive them, 
 and, with the consent of the vendor and at his instance, trans- 
 ferred them to another party. The vendee made an assignment 
 on the oth of December following, and it was held that there was 
 a legal rescission of the contract of sale, and ^that the sugar did 
 not pass to the assignee in insolvency of the vendee. 
 
 A l)ill of sale of chattels was executed, but not registered. The 
 mortgagor executed a second bill of sale of the same chattels to 
 another person, which was registered. Afterwards the mortgagor 
 tiled a petition for li(|uidation, and it was held that the second 
 mortgagee was entitled as against the trustee in liquidation, to 
 such of the chattels as had not been seized by the first mortgagee 
 before the licjuidation (ex parte / cinan, L. R. 4 Ch. D. 23 ; L. R. 3 
 Ch. 1). 324 ; ex parte Cochrane, L. R. 3 Ch. D. 324). 
 
 Where a father agreed to appoint a share of a trust fund to his 
 son, on condition that it .should be applied in recouping the father 
 moneys which he agreed to advance for payment of his son's debts, 
 and which he advanced accordingly, and after the debts were paid 
 the appointment was made by the father, in ignorance that the son 
 had in the meantime committed, an act of bankruptcy upon which 
 he was adjudged bankrupt, it was held that the tru.stee of the son 
 wiis not entitled to the appointed share, but that it was applicable 
 to recoup the father (ex parte Angerntein, L. R. 9 Ch. App. 479). 
 
 A lease of a piece of land was granted to a trader, he coven- 
 anting to build upon it a steam saw-mill, messuages, or dwelling- 
 houses, and at the end of the term to yield up to the lessor, the 
 land, buildings, and fixtures, except the steam saw-mill, machin- 
 ery, fixtures, and things connected therewith, which it was agreed 
 the lessee might remove. The lessee afterwards mortgaged the 
 property, the mortgage deed assigning the land, together with the 
 steam saw-mill and the building thereon, and the steam-engines, 
 boilei-s, fixed and moveable machinery, plant, implements, utensils 
 fixed to, placed upon, or used in or about the ground, heredita- 
 ments, saw-mills, and buildings, to hold the hereditaments and 
 
 i| 
 
 fl' 
 
110 
 
 THE INSOLVENT ACT. 
 
 
 ! 
 
 i '} 
 
 1 1. 
 
 sucli of the iiiachiuery, plant, etc., a.s were in the nature of land- 
 lord's fixtures, to the mortgagee for the residue of the term ; and 
 as to such of" the machinery and premises as were in the nature of 
 tenant's or trade fixures, to the mortgagee, absolutely, subject to 
 redemi)tion. 
 
 The deed contained a power for the mortgagee, in default of 
 payment of the mortgage mone}', to sell the premises, or any part 
 or parts thereof, either together or in parcels. The deed was not 
 registered under the Bills of Sale Act. The mortgagor filed a 
 liquidation petition ; the mortgage money remained due ; the 
 mortgagee had not taken possession of any of the property com- 
 prised in the deed, and the Court held that the eliect of the deed 
 was to authorize the mortgagee to sever the trade fixtures from 
 the premises, and to deal with them separately, and consequently 
 that the deed not having been registered under the Bills of Sale 
 Act was void, qua the trade fixtures as against the trustee in the 
 li.iuidation (re Eslick, L. R. 4 Ch. D. 503). 
 
 17. The Insolvent shall, within seven days of the date of the assignment, 
 or from the date of the service of the writ of attachment, or (if the same be 
 contested) within seven days from the date of the judgment rejecting the 
 petition to have it ()[iiashed, furnish the Assignee with a correct statement 
 (Form F) of all his liabilities direct or indirect, contingent or otherwise, in- 
 dicating the nature and amount thereof, together with the names, additions, 
 and residences of his ci'editors and the securities held by them, in so far as may 
 be known to him. The Insolvent shall also furnish within the same delay a 
 statement of all the property and assets vetited in the Assignee by the deed 
 of assignment or by the writ or writs of attachment issued against him, and 
 such statement shall in all cases include a full, clear, and specific account of 
 the causes to which he attributes his insolvency, and the deficiency of his as- 
 sets to meet his liabilities. The Insolvent may at any time correct or sup- 
 plement the statements so made by liim of his liabilities and of bis property 
 and assets. 
 
 If I 
 
 I 
 
 The 40 Vict. s. 3 amended this section by striking out the word 
 " ten," in the first and third lines, and inserting in lieu thereof the 
 word " seven." 
 
 It seems that in computing the time under this section, the day 
 on which the assignment was made, or attachment issued, would 
 
STATEMENT OF ASSETS. 
 
 Ill 
 
 bu excluded (see Young v. Higijon, 6 M. & W. 49; Williarrv< v. 
 liarijr.xx, 12 A. & E. G3.5). 
 
 Although the statement of assets and liabilities must be furnished 
 by the insolvent, and left with the assignee within the seven days, 
 yet it is not sworn to by the insolvent until the first meeting of 
 creditors (see sec. 23). 
 
 The provision recjuiring the insolvent to give a full, clear, and 
 specific account of the causes to which he attributes his insol- 
 vency, and the deficiency of his assets to meet his liabilities is in- 
 troduced for the first time in tlie present Act. It will probably 
 assist the creditors in determining whether a discharge should be 
 granted. It is to be observed that under section 140, the insol- 
 vent is guilty of a misdemeanor, if, with intent to defraud his credi- 
 tors, he does not, on examination, disclose fully, truly and clearly 
 the causes to which his insolvency is owing. The same conse- 
 (piences follow if he wilfully and fraudulently omits from his sche- 
 dule any eft'ects or property whatsoever. 
 
 Section Gl of the Act specifies the manner of inserting the par- 
 ticulars of negotiable paper in the schedule of liabilities, when the 
 holilers thereof are unknown. 
 
 The existence of a properly drawn schedule of liabilities, bind- 
 ing on the insolvent, is a matter of the highest importance to the 
 erticient working of the insolvent law, and the insolvent cannot 
 obtain a discharge from any debt not inserted in the schedule, 
 either originally or by supplement {King v. Smith, 19 C. P. U. C. 
 319). 
 
 But under the sixty-fii-st section, if the insolvent furnishes a 
 sup])lementary list of creditors previous to his discharge, and in 
 time to admit of the creditors therein mentioned obtaining the 
 same dividend as the other creditors upon his estate, this will be 
 sufficient to bar the claims of the creditors whose names ap})ear 
 in the supplementary list {Preaton v. Hunton, 37 Q. B. U. C. 177). 
 
 It was held that, under the Act of 1869, a statement of the 
 insolvent's afi'airs must be exhibited at the first meeting of his 
 creditors, and a list of the creditors also. The names of the credi- 
 tors nuist also be given. But where the plaintiff" was shown in 
 the statement to be the accommodation maker of notes in favour 
 
 » I 
 
 <""" ■'1, 
 
 I 
 
 jg 
 
112 
 
 THE INSOLVENT ACT. 
 
 i \: 
 
 of the insolvent, which were held by the bank, and the name of 
 the bank was mentioned as the creditor, it was lield that the 
 plaintifi's name was .sufficiently shown as a ci-editor, it appearing 
 that the ))laintiff' was, at the time, tlie actual creditor, having paid 
 the bank shortly before the assignment, but having concealed that 
 fact from the insolvent (Predon v. Hantou, 37 Q. B. U. C. 177). 
 
 It wa.s held, under the Act of 1809, that if the schedule and 
 statements referred to in section 3 of that Act, which coi-res- 
 ponded with this seventeenth section of the present Statute, 
 were not prepared by the assignee, and the insolvent was not 
 asked at the meeting held under the section corresponding to sec- 
 tion 23 of the present Act, to file the declaration on oath, stating 
 whether or no such statement and schedide were correct, and the 
 creditors did not require such schedule and statement, and there 
 was in fact, therefore, nothing to verify the declaration on 
 oath, the Court would not refuse to discharge the in.solvent 
 from arrest under the one hundred and forty-fifth section of the 
 Act of 1869, corresponding to the one hundred and twenty- 
 seventh section of this Act, on the mere ground that he had not 
 filed the declaration on oath, referred to in the section, where the 
 insolvent attended the meeting and submitted to be examined 
 on oath under this section (Hood v. Dodils, 19 Grant, 639). 
 
 Under the Act of 1869, it was the duty of the assignee to pre- 
 pare the schedule and statement, and of the insolvent to assist 
 in the preparation, and the neglect of the assignee was held no 
 ground for refusing the final discharge of the insolvent (re 
 Thomas, 15 Grant, 190). 
 
 Under the present Statute, however, the primary duty of fur- 
 nishing the statement and schedule .seems to be imposed on the 
 insolvent, and under the fifty-sixth section fraudulent retention 
 or concealment of any portion of the estate is a ground for with- 
 holding the confirmation of a deed of composition. It is, also, a 
 ground for withholding a discharge (see section 65). 
 
 In Hood v. Dodds (19 Grant, 646), in approval of the principle 
 which this section enforces, in requiring a specific account of the 
 causes to which the debtor attributes his insolvency, the Court 
 declared that where creditors are called upon to accept a compo- 
 
 u: 
 
STATEMENT OF ASSETS. 
 
 113 
 
 sition from their debtor, the least satisfaction they may demand 
 is to know where the goods or money entrusted to the dehtor 
 liave gone, and to what cause the loss is to be attributed, in order 
 tliat they may k-arn whether for the future it is the insolvent 
 trader they are to avoid as one incapable of carrying on that 
 which he lias undertaken, or the class of biisiness in which he 
 has been engaged as one apt to lead to bankruptcy (Hood v. Dodds, 
 10 Oi-ant, 04() ; see sections oO, 6.'), and ItO). 
 
 The Act in force in the United States provides that every 
 bankrupt shall be at liberty from time to time upon oath to 
 amend and correct his scheclule of creditors and property so that 
 the same shall confoi'm to the facts. Under this Act, it is hold 
 that the application for leave to amend is ex jparte, and no notice 
 is necessary. No crculitor has a right to oppose the application., 
 The allowance of an amendment does not prejudice the rights of 
 a creditor. He is not a party to the ])roceeding, and is not 
 estopped by the order (re Widts, 2 B. R. 447 ; re IlcUer, 5 B. R. 
 46). The inscdvent has a right to amend his schedules by 
 striking out the names of persons who have been improperly 
 and inade([uately inserted as creditors (ib.). 
 
 In the United States tlie term " assets " has been held to in- 
 clude the following tilings, to wit : A claim for unlicpiidated 
 damages (re Orne, 1 B. U. '^1) ; property conveyed to the insol- 
 vent in fraud of the* creditors of the grantor (re (fBannon, 2 
 B. R. 15) ; a vested interest expectant on the termination of a 
 life estate (re Bc/tineU, 2 B. R. 181) ; an insurance on the debtors 
 life for the benefit of his wife, whereon premiums have been 
 paid by the debtor after his insolvency (re Ivrhen., 2 B. R. 181) ; 
 property in the p(jssession of the debtor which l)elongs to a firm 
 of which he has been a member (re Beol, 2 B. R. 587) ; the inte- 
 rest of the debtor in the riglits of action and credits of a firm of 
 which he was a member, although his interest in the firm has been 
 levied on and and sold {Moore v. Rosenberger, 4 W. J. 204) ; pro- 
 perty conveyed by the debtor in fraud of his creditors (re Huhs- 
 VKiii, 2 B. R. 437) ; i)ropeity in the poss(,'ssion of the debtor cov- 
 ered by a fraudulent assigiuiient, to which the creditors have 
 never assented {AshUy v. Robinson, 29 Ala. 112). 
 
 H 
 
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 M 
 
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 'Mil 
 
114 
 
 THE INSOLVENT ACT. 
 
 il' 
 
 i ^^1 
 
 t 
 
 Propei-ty held de facto tliough by a do^'msiblo title (re Beal, 2 B. 
 
 R. 587). 
 
 The hu.shand's share in property left to him in trust for thi> 
 sole and separate iise of the wife during her life and, after hta- 
 death, to 1 o erpially divided between the husliand and the ehild- 
 ren, share and share alike, even thongh there is a provision in the 
 will that the property shall not be liable to the payment of the 
 debts of any present or fut/Ure husband (re Myvick, 8 B. II. 154). 
 
 The interest of the bankrupt under a will in an estate in ex- 
 pectancy (re Convell, 3 B. R. 448). 
 
 The term assets has lu'cn held not to include the following things 
 to wit: The right to a share in the net profits of a business con- 
 ducted in the name of the insolvent, allowed as a compensation 
 for services (re BeiuxMey, 1 B. U. 304 ; re Brum, 5 Law Rep. 121) 
 j)roperty held by a tru.stee for the benefit of the insolvent's wif^, 
 wherein the insolvent's equitable interest has been sold under ex- 
 ecution (re Pomct'oij, 2 B. R. 14) ; money invested in the name of 
 the insolvent's wife which has been earned by her (re Ilummitsfi, 
 2 B. R. 12); a claim against a person for falsely recommending 
 another as worthy of trust (Crockett v. Jeivctt, 3 B. R. 208) ; a chose 
 in action on which a suit has been brought but which has been 
 assigned in good faith for a full and valuable considei'ation 
 {Valenthie v. Hold man, 03 N. C. 475). 
 
 18. The Insolvent may present a petition to the judge at any time within five 
 days from the service of the writ of attachment ; and may tliereliy pray for 
 the setting aside of the attachment made under such writ, on the ground that 
 the party at whose suit the writ was issued has no chiim against liim, or that 
 his claim does not amount to two hundred dollars beyond the value of any se- 
 curity which he holds, or is not provable in insolvency, or that his estate has 
 not become subject to liquidation, or for want of, or for a substantial insuf- 
 ficiency in the affidavit required by section nine ; or if the wi'it of attachment 
 has issued a^'ainst a debtor by I'eason of his neglect to satisfy a writ of execu- 
 tion against him as hereinbefore provided, then on any of the above grounds 
 or on the ground that S' "h neglect was caused by a temporary embarrassment, 
 and that it was not caused by any fraud or fraudulent intent, or by the insuf- 
 ficiency of the assets of such debtor t(j meet his liabilities ; and such petition 
 shall be heard and determined by the judge in a summary manner, and con- 
 formably to the evidence adduced before him thereon ; and the judgment sub- 
 ject to appeal as hereinafter provided, aluill be final and conclusive. 
 
I'ETITION TO SKT ASIDE ATTACHMKNT. 
 
 115 
 
 The 30th Vict, chap 30, h. 3, ntiit'n<l<'<l tlit- ahovo Moction, hyin- 
 sfrtinj; after tlie wuid " licjiiidation " in tlie ninth line, the fol- 
 lu\vin<f \v()i<ls, " or forwant of, or for a substantial iiisuttieiency in 
 the attidavit reciuired hy section nine." 
 
 The time for conte.sting the attachment under this section, will 
 he I'oinputed on the .same piinciple as the time for furnishini,' 
 statement kc, is computed undei'the preceding section of the Act. 
 The day of .service of the attachment will he excluded (see ante, 
 p 110-111). 
 
 Under this .section relief may he granted to the insolvent in the 
 fnllowing cases: (1) Where the party, at whose suit the writ was 
 issued, has no claim against him ; (2) or his claim does not amount 
 to $'100 beyond the value of any security which he holds; (3) or is 
 not piovalile in in.solvency ; (4) or his estate has not liecome 
 suliject to compulsory liipiidation. The.se, probahly, are matters 
 which the dehtor must, in most cases, shew by counter affidavits, 
 as it isnot likely that the petitioning creditor's own affidavit should 
 shew that he had no claim against the insolvent. The Act of 
 LS7o did not, as wo have seen, expressly em[)ower the insolvent 
 to object to the want of, or to the sufficiency of, the affidavit re- 
 (|uired by wection nine of this Act ; fnit it was, nevcrthele.ss, held 
 that, when a debtor ajiplied to .set aside an attacliment against 
 him under this section, he could object to the sufficiency of the 
 creditor's affidavit undei' section !), or could object to the want of 
 it, in the same manner as a creditor is empowered to do under 
 section 14. Although this section only specifies certain grounds 
 on which the debtoi' may apply, still it seems that he may take 
 advantage of any defects ai)[)earing on the creditor's case, for he 
 can object to the creditoi''s case on the face of it, as well as show 
 by contra evidence that it is not maintainable, and if the (lel)tor 
 can show that the writ never should have i.ssued, he is entitled 
 not only to have the attachment made under the writ set aside, 
 but also the writ itself, in like manner as a creditor is entitled un- 
 der section 14, thougli the section .speaks only of the debtor 
 setting aside the dttachiiient made under the writ (McDonald v. 
 aieland, P. R. U. C. 289). 
 
 Under the 26th section of the Act of 18G9, a debtor could not 
 
 '!■■,; 
 
 
 
 [III 
 
 
 ■'; i 
 
IIG 
 
 THE INSOLVENT ACT. 
 
 petition against the attachment, if he had previously petitioned 
 against the demand preceding the writ. The grounds for con- 
 testing the demand under section .5, are very similar to the 
 grounds spe-ilied in the section now under consideration. But 
 there seems no objection to the insolvent's contesting the attach- 
 ment under this section, tliough he has also contested the demand 
 under section .5 of the Act, and, in some cases, the attachment 
 will be issued without demand. 
 
 It was held under the Acts of liSG-t-.'S, by Hughes, Co. J., that 
 a judgment cre<litor of the insolvent, who had an execution 
 against the insolvent in the hands of a bailiff' of the Division 
 Court, might move to .set aside the proceedings in compulsory 
 liquidation. The former Acts were similar to section 15 of the 
 Act ol IfSGO, and contained no provision for setting aside pro- 
 ceedings at the instance of any one but the insolvent himseii 
 {HiUboru v. 3Illh, .5 U. C. L. J. N. S. 41 ; Hughes, Co. J.) 
 
 In the opinion of the writer, the case of Hillhorn v. Mills can- 
 not V)e sustained on the above point. It is opposed to the decision 
 in City of Glasgoiv Bank v. ArhudU (16 L.C.J. 218). In the 
 latter case it was held, on section 20 of the Act of 18G9, where n 
 writ of attachment issued against a hrm who took no })roceedings 
 to contest it within the tiu.o allowed by law , that an indivi<lual 
 creditor of one of the firm had no right to petition against the 
 attachment ; and in Watnun v. Ciijj of GliMjow Bank (14 L. C. J. 
 309), the right was held personal to the debtor, and not exercis- 
 able by his a.ssignee. In this case, a writ of attachment issued 
 against a firm who took no steps under the Act to contest it, but 
 one of them made a vohnitary assignment to another assignee, and 
 it was held that the latter had no right to set aside the attachment 
 (ib.), neither had a creditor of the partner who made the separate 
 assignment such right (City of Glasgow Bank v. Arhitckle, IG L. 
 C. J. 21S). 
 
 In the latter case, a wiit of attachment was issued at the in- 
 stance of persons who became creditors of a firm before its dissolu- 
 tion, and the partner.ship propei'ty was attached thereby ; l)ut the 
 Court held that an individual creditor of one of the partners had 
 no right to oppose the attachment {City of Ghuvjow Bank v. 
 Arhuckle, 1GL.C. J. 2lb). 
 
REGISTRATION. 
 
 117 
 
 The proceedings under this section must be taken within the 
 time specified. When a debtor, against whom a writ of attach- 
 ment issued, took no proceedings to set aside tne same for the 
 period of six months, but during that period acquiesced in the 
 proceedings, it was lield that it was then too late to set the same 
 aside {Fulton v. Lefebvre, 21 L. C. J. 23). 
 
 Under the Act of 1861; it was lield that the defendant would 
 not be allowed to appear in the cause after the expiry of five 
 days from the retrtrn day of the writ, even though his motion 
 to that efiect was supported by affidavit, that it was through an 
 eiToi' on the part of his attorneys that the appearance was not 
 filed before the expiry of the five days, and one of the attorneys 
 swore that, in his belief, the insolvent had a serious defence 
 (Mmj V. Larue, 10 L. C. J. 113; 1 L. C. L. J. 97). 
 
 19. A copy of the deed of assiginuent or a copy of the writ of attachment, 
 as the case may be, certified by the assignee, or in Quebec by the proper 
 notary or by the clerk of the Court, shall foi'thwith be registered in the 
 registry office of the county wherein the insolvent resides, and also in every 
 county or registration district wherein he may liave any real estate ; in the 
 Province of Quebec such copy of the deed of assignment or writ of attachment 
 shall be accompanied by a description of the real estate behinging to the in- 
 solvent, and shall be registered in the county or registration district wherein 
 the same is situate, with a notice that the same has, by such assignment or 
 writ of attachment, been transferred to the assignee. 
 
 The 40 Vict. SL'C. 4, amended this section by adding after the 
 word " or " in the third line, the words " in Quebec by the proper 
 notary, or by," and adding after the word " such " in the seventh 
 line, the words " copy of the." 
 
 This section contains anew provision in reciuiringa copy of the 
 writ ot attachment to be registered. The Act of 18(5!) only }'o- 
 quired the assignment to l)e registered when the insolvent pos- 
 sessed real estate. Now registration is necessary in all cases in 
 the county or district where the insolvent resides. 
 
 Although this section requires the registration to be made 
 forthwith, it is apprehended this means forthwith after the de- 
 lay within which tlu attachment may be contested, or after the 
 rejection of the contestation, if made. 
 
 I 
 
 "' 
 
 1 
 
 I 
 
118 
 
 THE INSOLVENT ACT. 
 
 In the United States it has been held that the title of a party 
 who claims under the assignee will prevail against a party who 
 obtained a conveyance from the insolvent after the commencement 
 of the proceedings in insolvency, with notice of such title, 
 although the assignment to the assignee was not acknowledged 
 and recorded according to the laws of the State where the lAnd 
 was situated (Bradij v. Uti% 14 B. R. 34.')). 
 
 According to the decision in Parlee v. Agricalfiiral In-^. Co. (3 
 Pugsloy, 47G), on the Act of 1<SG(), the assignment will not pass the 
 title to *^he insolvent's real estate to the assignee unless it is 
 executed and registered as re(iuired by the Act. 
 
 The decision in the latter case was, that the assignment not 
 being executed in duplicate, or registered, the property never left 
 the debtor, and he still had an iiisurable interest therein. The 
 seventh section of the Act of 1809 re(piired the assignment to l)e 
 in duplicate. This decision may be sustained, so far as it is based 
 on the ground that, by reason of the defective execution, the 
 instrument was not really an assignment within the Act. If the 
 assignment is properly executed, it will surely pass the property 
 to the assignee. The non-registration is a subsequent matter 
 which cannot affect his title, whatever effect it may have on pur- 
 chasers from him. Even if the assignee does not act on the 
 assignment a re-conveyance by suHicient deed at common law, 
 would seem necessary to divest the estate. The 30th section 
 of the Act pi-escribes a form of conveyance on transfer of the pro- 
 perty, frouj the otticial to the creditors' assignee. This form being 
 statutory is sutKcient, if eom[)lied with, to transfer the estate. 
 But under section sixty .>f the Act, where no form is provided 
 for the reconveyance of the estate from the assignee to the insol- 
 vent, the instrument of reconveyance must be suthcient to i)ass the 
 property at counnon law. 
 
 The Court, in Parlee v. AyricnUavdl Ins. Co., supra, expressed 
 an opinion that, if the deed of assignment were properly e.Kecute<l, 
 no insurable interest wouhl remain in the debtor ; but they seemed 
 to be of opinion that, without registry, the pioperty would not 
 pass to the assignee. 
 
 The purpose, in requiring the assignee to cause the assignment 
 
FIRST MEETING OF CREDITORS. 
 
 119 
 
 to be recorded, is, that every purchaser of land at an assignee's 
 sale may have recourse to a certified copy of such registry, as a 
 link in his chain of title in any suit he may bring for the posses- 
 sion, or in any suit in respect to the })roperty which he or his 
 heirs, or others claiming under him, may desire to bring thereafter. 
 The object is not to vest the title in the assignee, for he has title 
 though the assignment may never be recorded ; and the assignee 
 may use it as evidence of his title in the Court, though the same 
 may not have been recorded (re Nenle, 3 B. R. 177 ; Holbrook v. 
 Conoj, 25 111. 5-t'3). The assignment itself passes the property, 
 and all sulwefjuent purchasers are affected accordingly, whether 
 they purchased before assignment actually made, or afterwards. A 
 purchaser from the insolvent, after assignment, although he has 
 no notice thereof, will take no title. The question of notice can- 
 not arise, the i)urchase being of what the insolvent debtor had 
 at tlie time; and, all his interest having passed to the assignee pre- 
 viously, the purchaser ac(|uires no title as against the assignee 
 (Davis V. Anderson, B. R. 145). 
 
 20. Iinmeiliately after the assigiunent shall have been made, or in the case 
 of an attachment, immediately after the delay within which the attachment 
 can be contested or innnediately after the contestation has been rejected, or, 
 with the consent oi the insolvent, immediately after the writ shall have been 
 returned, the official assignee shall forthwith call a meeting of the creditors 
 of the insolvent to be held within twenty-one days at the place and on the day 
 and hour to be mentioned, notice of which meeting, in the Form G, shall 
 be published at least once in the Official Gazette and once in one local or the 
 nearest published newspaper, the first publication of which notice shall be at 
 least ten days before the day fixed for such meeting ; provided Jilways, that, 
 if the assignee omits to call such meeting to be held within the time above 
 limited, the judge shall, on the application of the assignee, or of any creditor, 
 onler the meeting to be called for the earliest possible day thereafter ; and, 
 should the said omission have arisen from the negligence of the assignee, 
 the judge shall order him to pay the costs of the application : provided also 
 that, on api)lica<ion of any creditor, the judge on being satisfied that there are 
 creditors <jf the insolvent wh(J8e unseciu-ed claims amount to at least one-third 
 of his direct liabilities, resident in any j)lace from whence their attested claims 
 cannot with due diligence bo received before the day of the meeting, may order 
 that the meeting be adjourned to some day not more than a week thereafter, 
 a copy of the order shall forthwith be served on tlie assignee who shall forth- 
 
 I i 
 
120 
 
 THE INSOLVENT ACT. 
 
 with, by prepaid letter or circular, iKjtify each creditor of the adjournment. 
 In case such order be made, no Imsiness shall be transacted at the meeting 
 which shall stand adjourned according to the terms of the order. 
 
 The 3f) Vict, cliap. 30, s. 4, {unendod tliis section by .strikino- out 
 the w'^onl "twice" in the third line fi'oni the end thereof, and in- 
 sertino- in lieu thereof the woixl " once" and by inserting after the 
 word " Gazette " in the same line the words following, " and once 
 in one hjcal or the nearest published newspaper." 
 
 The 40 Vict. s. 5, also amended it ' y adding after the word 
 "held" in the .seventh line the words "within twenty -one days" 
 and by striking out the words "three weeks" in the eleventh line 
 and inserting in lieu thereof the words "ten days" and l)y adding 
 inunediately after the last word in the .section the proviso given 
 above (.see also 40 Vict. s. 38). 
 
 The meeting is now to be held within twenty-one days from the 
 assignment, although the notice, form G, need not be published 
 until ten days before the meeting. 
 
 It is important that the notice, form G, under this section, 
 should state also that the meeting is called for the ordering of 
 the ati'airs of the estate generally, for, in such case, all the matters 
 and things resj)ecting which creditors may vote, resolve or order, 
 or which they may regulate under the Act, may be voted, resolved, 
 or ordered upon, and may be regulated at such meeting without 
 having been specially mentioned in the notices calling such meet- 
 ing (.see sec. 103). It would .seem that the 101st section of the 
 Act does not apply to the first meeting of creditors. 
 
 Notices need not be sent to creditors whose debts are illefifal, 
 as in the case of illegal societies (e.\ parte Day, L. R. 1 Ch. 1). ()!)9). 
 
 This section does not .show where the meeting is to be held, 
 nor does the notice, form G, tlu-ow any light on the matter- 
 There seems no doubt it ought regularly to be held at the office 
 of the assignee (see section 34). 
 
 Under the 2nd section of the Act of 18(59, the first meeting of 
 creilitors was to be called at the insolvent's place of liusiness. A 
 meeting for the public examination of the insolvent, under the 
 lOi)th .section, could only be called to be held at the county town 
 
FIRST MEETING OF CREDITORS. 
 
 121 
 
 
 of the county in which the assignment was made, and the notice 
 callin<f tlie meeting was required to be published in the Gazette, 
 and also in a newspaper published at or nearest to the place 
 where the jiroceedings were carried on. Where an assignment 
 was made at Brantford and filed in the County Court of the 
 cou::ty, but a meeting for the public examination of the insolvent 
 was called to lie held in Hamilton, and the notice calling the meet- 
 ing was published in a Hamilton paper only, besides the Gazette, 
 tile notice of the meeting was set aside on the application of the 
 in.solvent, and it was held that the in.solvent might also .set aside 
 any proceedings at the meeting so far as they related, to his own 
 examination, but as the meeting was also called for " the ordering 
 of the affairs of the estate generally," anything done in further- 
 ance of that object could only be impeached by a creditor, for the 
 insolvent was not interested therein (re Atkins, 2 U. C. L. J. N. 
 8. 2') ; Jones, Co. J.). 
 
 The lODtli section recjuired that the insolvent bo summoned 
 to attend the meeting for his examination. It was not 
 necessary that a judge's order for his attendance .should be 
 procured ; but if the assignee notified him to attend, that was 
 sufficient (ib.). 
 
 A meeting of creditors duly convened under the In.solvent Act 
 may be lawfully a<ljourned to a subsequent day without repeating 
 the adverti.sements and notices required for meetings of creditors 
 (re Macfarlane, 12 L. C. J. 241 ; see also ex parte Till, L. R. 10 
 Ch. Aj.p. G31). 
 
 In this ca.se, a meeting was calle<l by advertisement, for the 
 public examination of the insolvent, and the oidering of the 
 artairs of the estate geneially, to take place on the 12th May. 
 The meeting was then held, and adjourned to the Oth June, when 
 it was again held and adjourned to the 23rd of June, and then again 
 it was held and adjourned to tlie 1st of September.at which meeting 
 the removal of the first assignee, and the ai)pointment of a second, 
 took place. 
 
 It was held, that the adjourned meetings might be considered 
 the same, as the meeting originally called, that no notice to the 
 first assignee was necessary, and that the meeting on the 1st of 
 
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 122 
 
 THE INSOLVENT ACT, 
 
 September was regular without repeating the notices and adver- 
 tisements. 
 
 21. The assignee shall also forward by mail, prepaid and registered, at least 
 ten days before the meeting takes place, a notice of such meeting, and a list of 
 the inuolvent's creditors, and the amounts of their respective claims, to every 
 creditor mentioned in the original or any corrected or supplementary list or 
 statement furnished by the insolvent, or who may be known ',o him to be a 
 creditor, and give such other notice as the circumstances of the case may 
 require. 
 
 The 40 Vict. s. 4, amended this section, by adding after the wonl 
 " mail " in the first line the words " prepaid and registered," and 
 by striking out in the second line the words " in writing," and in- 
 serting in lieu thereof the words " of such meeting, and a list of 
 the insolvent's creditors, and the amounts of their respective 
 claims ; " and by striking out all after the word " require " in the 
 seventh line to the end of the section. 
 
 Under this section the computation of time is different from 
 what it is under some of the |)receding sections. The notice 
 must be forwarded at least ten days before the meeting. This is 
 ecjuivalent to ten clear days, for where an act is required to be 
 done so many days at least before a given event, time mu.st be 
 reckoned excluding both the day of the act and tliat of the 
 event (Rex v. Jw^fices, d-c, 3 B. & Al. 581 ; Zouch v. EmpHcy, 4 
 B. \: Al. 522 ; Rey. v. Jmtices, c£-c., 8 A. & E. 17:3 ; Mitchdl v. 
 Foster, 12 A. ^ E. 472; Murell v. Wilmott, 20 C. P. U. C. 371), 
 per Gwynne, J.). 
 
 EXAMINATION OP INSOLVENT.S. 
 
 22. The creditors at their first meeting held at the time and place fixed fur 
 that purpose, may appoint one of themselves as chairman of the meeting ; 
 and at all subsequent meetings the assignee shall be chairman in default 
 of an appointment of chairman by the creditors. 
 
 The 40th Vict, (section 7) amended this section by adding 
 thereto the words " in default of an appointment of chairman by 
 the creditors." This amendment gives the creditors the power 
 to appoint a chairman at all subsequent meetings, if they think 
 
EXAMINATION OF INSOLVENT. 
 
 123; 
 
 fit SO to do. It is improper for the official assignee to act as 
 chairman at this meeting (re Harris, 12 C. L. J. N. S. 251). 
 
 For the meaning of the words " default of appointment," in 
 this section, see notes to section 29 of the Act. 
 
 23. The insolvent shall be bound to attend at the first meeting of his credi- 
 tors, and after making such corrections &s he may deem proper to his 
 statements of liabilities and assets, shall attest the same under oath. He 
 may also be examined under oath before the assignee, by or on behalf of any 
 creditor touching his affairs ; and more especially as to the causes of his in- 
 solvency and the deficiency of his assets to meet his liabilities. 
 
 The insolvent may be examined under this section, when present 
 at the meeting, without any order being obtained for such exam- 
 ination. The examination may be on behalf of any creditor. In 
 reference to proceedings at meetings, section 2 (h) defines a credi- 
 tor to signify any per.son who has proved a claim to the amount 
 of one hundred dollars or upwards. Has a creditor a right to 
 examine if he has not proved a claim to the amount of one hun- 
 dred dollars ? It would seem that he is not a creditor within this 
 section unless he has done so. The as.signee is the proper party 
 in this case to administer the oath to the insolvent, when the 
 latter is examined before the assignee. " The Interpretation 
 Act " (31 Vict. chap. 1, s. 7), " Sixteenthly : providing that in every 
 case where an oath or affirmation is directed to be made before 
 any person or officer, such person or officer shall have full ])ower 
 and authority to administer the same and to certify its having 
 been made." The oath which the insolvent is required to take as 
 to the correctness of his statements of liabilities and assets .seems 
 to be placed on a different ground. It should properly be taken 
 before a couunissioner or person authorized to take such affidavit 
 in the respective Provinces. 
 
 When the insolvent netrlects or omits to give a full and satis- 
 factory statement of his affairs at the meeting, it is only reasona- 
 ble that his examination should be adjourned until such statement 
 is given. In England, under the 19th section of the Act of 18G9, 
 and No. no of the Bankruptcy Rules, 1870, the examination 
 may be adjourned at the discretion of the Court, and it would 
 
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124 
 
 THE INSOLVENT ACT. 
 
 seem to l)e the duty of tlie Court to a<ljourn the examination of 
 the bankrupt, if tlie statement of his affairs, filed pui-suant to sec- 
 tion 19 of tlie Act, be insufficient to inform the trustee of all the 
 facts relating to the estate, and the Itankrupt's dealings there- 
 with (ex parte Mihir, 28 L. T. N. S. 175 ; L. R. 8 Ch. App. 500). 
 
 A power to adjourn is incident to the power to examine (ex 
 parte Crump, L. R. 1 Ch. D. 530; ex parte Till, L. R. 10 Ch. App. 
 031 ; 32 L. T. N. S. 521). 
 
 In England there is no authority for putting written ri-quisi- 
 tions to the bankrupt (ex parte Crump, sui)ra). 
 
 It is the duty of the assignee to call ui)On the insolvent for the 
 fullest information respecting his property and affairs, to point 
 out to him the precise matters as to which he rocjuires information 
 or explanation, and to assi.st him so far as he can in making out 
 his accounts so that they may be as comjilete as possible when the 
 insolvent comes up for examination ; and, if the assignee has any 
 difficulty in procuring proper exi)lanations or information fnjm the 
 insolvent, he nmst apply to have him examined before the Court 
 (re Laivrence, 22 L. T. N. S. 246 ; ex i)arte Crump, L. R. 1 Ch. D. 
 530). 
 
 It has been held in Quebec that an insolvent cannot be cross-ex- 
 amined by his counsel on his examination by the creditors in 
 Court (re Lamontaijne, 2 Quebec Law Rcp(n-ts, 15G). 
 
 A debtor refusing to answer under the advice of his solicitor, 
 would do so at his own peril (ox paite Macke)izii:, L. R. 10 Ch. 
 App. 88). 
 
 24. The insolvent shcall sign his examination or deehire the loasMiis why 
 he refuses to sign, and the examination shall be attested l>y tlie assignee. 
 
 25. Tlie insolvent shall, at all times until he shall have obtained a con- 
 iirmation of liis discharge, be subject to the order of the Court or judge, and 
 to such other examination as the judge, the assignee, the inspectors herein- 
 after mentioned, or the creditors may require ; and he shall, at the expense 
 of the estate, execute all proper writings and instruments, and perform all 
 acts reciuired by the Court or judge touching his estate : and in case the in- 
 solvent refuses to be sworn or to answer such (piestions as may be put to him, 
 or to sign his answers or the writings or instruments, or refuses to perform 
 any of the acts lawfully retjuired of him, such insolvent may be committed 
 and punished by the Court or judged as for a contempt of court. 
 
EXAMINATION OF INSOLVENT. 
 
 125 
 
 The insolvent will not be allowed to protect himself by any- 
 technical rules as to evidence from making a full discovery of his 
 atfairs, and therefore, although according to the established prac- 
 tice of the English C(nn-ts, founded upon the principles of the com- 
 mon law, no man is bound to criminate himself, still in furtherance 
 of the great object of the bankrupt laws to procure a discovery 
 and ecpial distribution of the bankrui)t's property amongst all his 
 creditors, a ([ualification of this rule has prevailed in bankruptcy ; 
 and it is now well settled that a bankrupt is boimd to answer all 
 ([uestions respecting his property, be the consequences what they 
 may, with this exception, that he cannot be recpiired to answer a 
 ((uestion whether he has done some specific act clearly of a criminal 
 nature (ex parte Kirhy, M. & M. 225 ; ex parte Heath, 2 D, & E. 
 114). He cannot, however, when examined touching his estate 
 trade or dealings refuse to give any information respecting them, 
 merely liecause such information may incidentally show that he has 
 been guilty of some crime or misdemeanor (ib.), and his examina- 
 tion may be used as eviilence against him on a criminal charge 
 (Reg. V. Widdap, L. R. 2 C. C. R. 3 ; Robson, 3rd Ed. .581). 
 
 In the United States it is held that an insolvent is bound to 
 answer all (piestions respecting his propei'ty, be the consequences 
 what they may, with this exception, that he cannot be required 
 to answer a (piestion whether he has done some specific act clearly 
 of a criminal nature. He cannot, however, when examined touch- 
 ing liis estate, trade or dealings, refuse to give any' information 
 res})ecting them merely because such information may incidentally 
 show that he has been guilty of some crime or misdemeanor (Rob- 
 son, 3rd Ed. 581 ; re Bromlei/, 3 B. R. 680). 
 
 The insolvent must state whether or not he has played cards, 
 faro or any other game of chance with a ceilain person named in 
 the interrogatory, and whether he has lost any money at games 
 of chance ; even though he declines t(j answer on the ground that 
 his answers would criminate or degrade himself (re Richards, 4> 
 B. P. 93). 
 
 The Court has no poAver to order the trustee to deliver written 
 requisitions for the examination of the bankrupt, as to matters on 
 which he requires information, although it would seem that it 
 
 Mi 
 
 w^ 
 
 W 
 
f 
 
 12G 
 
 THE INSOLVENT ACT. 
 
 may order written questions to ho put to tlio bankrupt at the re- 
 (piest of the trustee (ex parte Crump, L. R. 1 (Jh. D. o30). 
 
 A creditor is not debarred from his ri<,dit to examine the in- 
 solvent under oath before a Judge, by tlie mere fact that a com- 
 position deed, purporting to \)e duly executed, has been deposited 
 in Court, and that notice has been given by the insolvent of his 
 intention to seek its confirmation, and such insolvent may be 
 examined by a creditor at any time Ijefore the deed is confirmed 
 (ve Botuie,U L. C.J. 191). 
 
 It would seem that under this section the insolvent might be 
 examined at any time after the issue of the writ of attachment, 
 or the making of the assignment, although befoi'e the first meet- 
 iuL' of creditors. If the insolvent is examined at the first meet- 
 iny; of his creditors under the 2th-d section no order 
 for such examination is re(juired. Under this section an order 
 for the examination must be obtained from a judge. In one 
 case within the writer's experience (re Wee/ces), the late Judge 
 Duffiran made an order for the examination of a debtor on whom a 
 demand had been served under section 4 of the Act, requiring him 
 to assign, and such order was made, although a petition was then 
 pending on the insolvent's behalf, under section o of the Act, to 
 set aside the demand, ami no assignment had l)een made or at- 
 tachment issued. The grounds on which the order was made 
 were that, from the examination, evidence might be obtained, 
 clearly showing the debtor's insolvency. This section says the 
 "insolvent" shall at all times, kc, be subject to examination, 
 and it seems very doubtful whethei' a de])tor is an "insolvent" 
 within the meaning of the section, meiely becau.se a deinantl is 
 served upon him — as the decision of the learned judge goes so 
 far as to hold that, by the .service of the demand, the debtor is 
 an " insolvent " within the section. Section 2(f) defines an insol- 
 vent as a debtor subject to the provisions of the Act, unable to 
 meet his engagements, or wdio .shall have made an assignment of 
 his estate for the benefit of his creditors. If there were an ad- 
 mission of insolvency by the debtor, after the demand made, the 
 case would be dift'erent, but where the debtor is contestintr the 
 demand, and prior to an adjudication it is submitted the Act does 
 
EXAMINA1I0N OF INSOLVENT. 
 
 127 
 
 not authorise his examination. In the United States it is held 
 tliat a delttor may in certain cases be examined prior to adjudi- 
 cation (re Salke;/, J) B. R. 107 ; re Mevdenha/l, 1) B. R. 28.5 ; re 
 Hcnsi^.d, 5 Law Rep. 51( ). But this power .seems to spring from 
 the dirt'erent procechu'e which obtains there. 
 
 It was held in the Province of Quebec, under a .section of the 
 Act of 1H64 (section 10, s.s. 2), similar to this section, that an in- 
 solvent or party summoned for examination as to his estate, and 
 ert'ects upon oath under the Act could not be cross-examined (re 
 Fraser, 12 L. (J. J. 272). 
 
 The insolvent is subject to examination until he ol>tains a 
 confirmation of his discharge, and he should attend personally 
 when making application for the confirmation, in ordei- that he 
 may then be examined by any creditor (see also .section Go). 
 
 The time to examine the insolvent does not expire with the 
 making of his ap])lication for his discharge (re iSo//.s, 4 B. R. 08). 
 The words " at all times " nmst be read in connection with the 
 subsequent sections of tlie Statute. All these provisions tend to 
 .shew that it is (^nly until his discharge that the insolvent is 
 under the summary jurisdiction of the Court to be proceeded 
 against bv order in its discretion. He cannot, therefore, be re- 
 quired to submit to an examination after he has obtained his dis- 
 charge (re Dale, 7 B. R. .')38). 
 
 The insolvent is entitled to a reasonal)le time aftcn- notice of 
 the application for his examination, but such time depends on 
 the cii'cumstances of the particular case, the distance he is from 
 Court, or the place of his examination, and, also, upon what, if any, 
 particular facts he is to be examined (re Bromley, 3 B. R. 086). 
 
 If the insolvent on examination admits the possession of pro- 
 perty, he must clearly account for the same to the satisfaction of 
 Court, otherwise he will be held to still have it in his po.sses- 
 sion, and to be able to hand it over to the assignee ; and on failing 
 or refusing to account in a reasonable manner for the disposition 
 of assets wliich are traced to him, he may be committed for con- 
 tempt (re Salkey, 11 B. R. 423). The insolvent is made ,sul)ject to 
 the order of the Court or judge, not for the purpose of punish- 
 ment, but to enable the Court to enforce the distribution of his 
 
 ■ri,; 
 
 fii 
 
 i'; 
 
128 
 
 THE INSf)LVENT ACT. 
 
 estate acconliti",' to the provisions of the Act (re Brimley, 3 B. R. 
 ()8(j). 
 
 An order was recently made in Montreal, directinjir an insolvent 
 to pay over a sum of money which he admitte<l liavinn;; jn his pos- 
 session. 
 
 26. The Court or jiulgo may ako, on tlie application of the assignee, of the 
 inspectors, or of any creditor, order any other person, including the husband 
 or wife of the insolvent, to appear before the Court or judge or the assignee, 
 to answer upon oath any question which may bo put to him or her touching 
 the affairs of the insolvent, and his conduct in the management of his estate ; 
 and in case of refusal to appear, or to bo sworn, or to answer the (|uestions 
 submittodi such person may bo comuutted and punished by the (-ourt ()r judge 
 as for a contempt of court. 
 
 The 89 Vict. chap. 30, s. .'), amended the section by inserting 
 jifter the word " answer," in the fifth line thereof, the words "upon 
 oath ; " and by striking out the word " and " in the eighth line, 
 and inserting in lieu thereof the words " or to he sworn or." 
 
 In Ontario, the 30 Vict. chap. 10, s. 10, provides that no husband 
 shall be compellable to disclose any communication made by his 
 wife during the marriage ; and no wife shall be compellable to 
 disclose any connnunication made to her by her husband during 
 the marriage. 
 
 In passing the Insolvent Act, the Legislature nnist, as we have 
 seen, be deemed to have had the existing law in view, and therefore 
 in Ontario, the section of the Act relating t(j evidence would proV»- 
 ably still apply. 
 
 It has been held that the insolvent is not entitled to r' .y- 
 
 ment of his expeases before being sworn. The 1 13th n)n of 
 the Act of 1869, provided that, for every attendance, the iii^<ilvcnt 
 should be paid such .sum as should be ordered as such meeting, no 
 less than one dollar (Worthinyton v. T<iylor, 10 U. C. L. J. 304 ; 
 Logic, Co. J.). There is nothing in this or the preceding section 
 authorizing the payuient of conduct money to the insolvent on his 
 examination. ProbaV>ly, therefore, the insolvent is bound to 
 attend without being paid (re Okell, 1 B. R. 303 ; re McNair, 2 
 B. R. 219). 
 
 But a witness appearing for examination under this section is 
 
 
EXAMINATION OF WITNKSSRS. 
 
 20 
 
 not boiind to <,nvr ovidonco until liis cxpenHOH am paid ( W'nftltiii;/- 
 h,u V. Toijlor, 10 U. C. L. J. ;}04, Lof,de Co. J. ; ro MrXnlr, 2 B. 
 li 210). 
 
 The wift' of the iiisolv»,'nt is cntithMl to witness fees foi- attend- 
 ance and travel, the same as any otliei- witness (re Ui'iffcn, I H. R. 
 .S71); and she is not lM)nnd to appear unless the fees are paid or 
 tendfsred to her at the time of the service of the order (ro Van 
 Tnifl 2 \\. R. 70; see also section 113). 
 
 In the United States, it is held that an assifj^nee may be suli- 
 po'naed and rt-cpiired to testify in the same manner as any otlier 
 witness (re Sviilh, 1+ B. R. 4:12) ; also that a preferred creditor 
 may he examined on the application of the assignee (GdrriHun v. 
 Murkh'}/, 7 H. R. 24(1). 
 
 It was held under the 112th section of the Act of I860, that 
 any person, whether a creditor of tlie insolvent or not, might be 
 examined as to tlie estate and effects of the insolvent, and tliat a 
 person suirnnoned as a witness could not refuse to give evi<lence 
 respecting Ins own dealings with tlie insolvent, by alleging that 
 lie was a creditor, but that such examination would not be pressed 
 against a person claiming to be a creditor, unless it ajipeared 
 necessary in the interest of the creditor.s that the examination 
 .should proceed (re Hamilton, I U. C. L. J. N. S. 52 ; Logic, Co.J). 
 
 It is inipoi'tant to consider whether a creditor of the insolvent 
 can be examined under this TGth section. In case of fraudulent 
 <lealin<rs between the in.solvent ami one of his creditors, to the 
 jirejudice of the others, very material information might be ob- 
 tained by such examination, and there seems nothing in the sec- 
 tion to prevent an order for the examination of any creditor. 
 
 It V as held under section 10, sub-section 4, of the Act of 
 l(S(i4, that the wife of the insolvent could not be examined as to 
 his estate and effects (ro Feron, 10 L. C. J. Ill ; 1 L. C. L. J. 90) ; 
 but this section now alters the law in that respect, and in jirovid- 
 ing for the examination of the " husband " of the insolvent, it 
 shows that the framers of the Act contemplated the case of the 
 estate of a married woman being administered in insolvency. 
 
 A petition for the examination of witnesses in insolvency should 
 set forth satisfactory reasons for the examination — an order for 
 I 
 
 m 
 
 :4 
 
 
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 ;'"(i 
 
 a li 
 
 i 
 
 I 
 
 ;•• 
 
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 'hi 
 
 i-- 
 
 130 
 
 THE INSOLVENT ACT. 
 
 such examination made on the day of tlie assignment of a partner- 
 ship estate by two out of three paiiners of wliom the firm consists 
 is irregular (re X«.4', 17 L. C. J. 47). 
 
 There is nothing in this section indicating tlie time when the 
 appHcation may be made. Probably at any time after the delay 
 for contesting the assignment or wiit of attachment. 
 
 A reasonable time ought to be allowed a witness after the service 
 of the summons for his attendance for examination {Groocockv. 
 Cooper, 8 B. kC 211); but the fact of his private business re([iiir- 
 ing his attention will not, as a general rule, be allowed as a suffi- 
 cient impediment to his complying Aviti- the (jrder (ib.), and he is 
 bound to wait until he is examined or urtil his attendance for that 
 purpose is dispensed with (Wright v. MduJe, IG M. & W. 527j. 
 A witnes.s is bound to answer all lawful (juestions ])rovided they 
 ai'e material and pertinent to the enquiry respecting the insolvent 
 or liis trade, dealings, or propeity — a witness, therefore, may be 
 asked as to the residence of another person who can give informa- 
 tion respecting the iiisolvt.'ut or his property. But if his know- 
 ledge of such residence was obtained confidentially, as the solicitor 
 of such person, he will not, on the ground of pi'ivilege, be bound to 
 answer the question (ex parte Campbell, L. R. 5 Ch. App. 703). 
 
 The words "any creditor" in this section me^n any creditor 
 who has proved his claim. Befoi'c a creditoi* can apjdy for an 
 order to examine the insolvent h'j must j)rove his claim (re Ray, 1 
 B. 11. 203 ; see also, section 2 (h). 
 
 The insolvent and all other persons are suliject to examination 
 at all times, at the instance of the assignee or of any creditor or of 
 the Court. A creditor may make an application at any time after 
 he has proved his debt (re Baiin, 1 B. R. ') ; re Brandt, 2 B. R. 
 215). Every creditor has the right to exan/ne the insolvent. 
 Such examination enures to the benefit of all the creditors. But 
 the fact that one creditor has exatnined the insolvent is no reason 
 for withholding the privilege from another creditor (re Adams, 2 
 B. R. 272 ; re Gilbert, 3 B. R. 152). But whethei- the Court in the 
 exercise of its discretion will direct a second examination depends 
 on the facts of each particular case (re Frisble, 13 B. R. 349); and, 
 if a full examination has been already had, either upon the applica- 
 
 1 -n 1 
 
 IL 
 
EXAMINATION OF WITNESSES, 
 
 131 
 
 tion of the assignee or of any other creditor, a subsequent ap- 
 plication may be denied, unless it is made to appear that the first 
 examination was either collusive or deficient in some material and 
 specified particulars (ib.). A distinction may, perhaps, be drawn in 
 the case of one examination being by the assignee, and another by 
 the creditors. An assignee might not direct his enquiries to the 
 matters which would be of interest and importance to the credi- 
 tors — a creditor, therefore, might have a right to examine from his 
 standpoint. 
 
 In England, the IGOtli Rule in bankruptcy, 1870, allows the issue 
 of a subpcL'ua for the attendance of a witness, on the application 
 of " a debtor." Where it apjieared that if proof by a mortgagee, ten- 
 dered for a large amount, were lejected, there would be a surplus 
 in the estate for the debtor, and the trustees, with the sanction of 
 the committee of inspection, made an arrangement with the mort- 
 gagee to admit the proof at .£2(),()00, on the terms that he was to 
 receive nothing until the other creditors had received 18s. in the 
 pound : on application by tlie debtoi, an order was made for the 
 examination of the mortgagee (ex parte Austin, L. R. 4 Ch. D. 13). 
 
 In England, the trustee himself may be summoned foi- exami- 
 nation as to the property of the bankrupt (re Taylor, L. R. 13 Eq^ 
 408). There it is held, that j. (piestion cannot be put to the bank- 
 rupt which does not toucli Ins ti'ade, dealings, or estate, or the 
 direct object of whicli is to shew that he has committed a criminal 
 act ; yet he cannot refuse to answer a cjuestion which does touch 
 his trade, dealings or estate, altliough the answer may tend to 
 shew that he has concealed his efiects, or been guilty of any other 
 oft'ence connected with his bankruptcy (see lictj. v. ^coft, 25 L. J, 
 M. C. 12!); Re<j. v. Hohinmn, L. R. 1 C. C. R. 80 ; R(y. v. Wtddop^ 
 L. R. 2 C. C. R. 3). 
 
 TheOOth .section of .the English Act of 186!) provide.; that the 
 Court may, on the application of tlie trustee, summon before it 
 the bankiupt, or his wife, or any person whatever, known or 
 suspected to have in his posses.sion, any of the estate, or effects 
 belonging to the bankrupt, or supposed to be indebted to the 
 Itankrupt, or any person whom the 0<iurt may deem capable of 
 giving information respecting the bankrupt, his trade, dealings, or 
 
 yi 
 
 
 
 J 
 
 
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 III? 
 
 132 
 
 THE INSOLVENT ACT. 
 
 property. Under this .section, it is held tliat a creditor who makes 
 a i:)rima facie case for the examination of the bankrupt, or any 
 other person, may apply for his examination, if the tru.steo is un- 
 willing to do so, subject nevertheless to the risk of having to pay 
 the costs (ex parte Sivlft, 26 li. T. N. S. 22(5) ; and that this right 
 extends to the examination of the trustee himself (ex parte CVos.s- 
 ley, L. R. 13 Etp 409). 
 
 A solicitor acting foi' two clients in the same matter is privi- 
 leged, upon examination before the Court, from disclosing to one 
 client professional instructions given him by the other (ex parte 
 AssUjncesy. Uhsdell, 27L.T. N. S. 400). 
 
 A,SSIGNEE.S AND IN.Sl'ECTOKS. 
 
 27. The Governor in Council may ai)i)oint in the several Provinces of 
 Canada, except the Province of Quebec, one or more persons to be official as- 
 signee or assignees or joint official assignee in and for every county ; and iu 
 the Province of Quebec, such appointmentment of an official assignee, or 
 official assignees, or joint official as.signee, shall be made in and for each judi- 
 cial district in the Province, except that in each of the judicial districts of 
 Quebec, Montreal, and St. Francis respectively, such appointment may be 
 made either for the whole district or for one or more electo'-il districts in tlie 
 same ; and the word " district " shall mean either a judicial or an electoral 
 district, as the context may re(iuire. 
 
 Under the Act of 18()0, section 31, the j)ower of appointing official 
 assignees was vested in the Board of Trade for the county or dis- 
 trict in which the board existed (as to appointments under the 
 Act see Newton v. Ontario Bank, 13 Grant 052 ; Blakeley v. //((//, 
 21 C. P. U. C. 13H) 
 
 28. Each person so appointed assignee or joint assignee shall hold office 
 during pleasure, and before acting as auch shall give security for the due 
 fulfilment and discharge of his duties in a sum of two thousand dollars, if 
 the population of tlie county or district for which he is appointed does not 
 exceed one hundred thousand inlia1)itants, and in the sum of six •housand 
 dollars, if the population exceeds one hundred thousand, such security to be 
 given to Her Majesty for Her benefit and for tlie benefit of the creditors of any 
 estate which may come into his poasesssion under this Act ; and in case any 
 sucli assignee fails to pay over the moneys receiveil by him or to account for tlie 
 estate, or any part thereof, the amount for which such assignee may be in de- 
 fault may be recovered from his iiureties by Her Majesty or by the creditors 
 
ASSIGJJEES. 
 
 133 
 
 or subsequent assignee entitleil to the same, by adopting, in the several Pro- 
 vinces, such proceedings as are required to recover from the sureties of a 
 sheriff or otlier public officer : provided always that when any person appointed 
 assignee or joint assignee under the provisions of the twenty-seventh section has 
 given the security for the due fulfilment and discharge of his duties required 
 by the preceding part of this section, then any person who has become 
 surety in that behalf, when no longer disposed to CKutiiiue his suretyship, 
 may give notice thereof in writing to his principal ar'' also to the Secretary 
 of State of Canada, and all accruing responsibility on the part of such pcr- 
 s )n as such surety shall cease at the expiration of three months from the re- 
 ceipt of the last of such notices or upon the acceptance by the Grown, of the 
 security of another surety wliichever shall first happan, and the principal 
 shall within one month fr.im the receipt of the last of such notices give the 
 security of another surety, but if it appears to the Governor in Council that 
 the period so limited for giving the security of a new surety is, for any reason, 
 insuftioient the Governor in Council may allow such further period forgiving 
 the security of such new surety as appears to him proper, but such extended 
 period shall in no case exceed two months beyond the one month within 
 wliich such now security is required to be given as above-mentioned ; and 
 this proviso shall apply to tlie case of any new security which may from time 
 t> time be given (40 Vict. s. 8.) ; 
 
 (I. The oHicial assignee may also be required to give, in any case of insol- 
 vonc3', such further security as, on petition of a creditor, the court or judge 
 m.ay order, such additional security being f(jr the special benefit of the credi- 
 tors iif the estate for which the same shall have been given ; 
 
 b. The official assignee shall bo <an officer of the Court having jurisdiction 
 in the county or district for which he is appointed. He shall as such be sub- 
 ect to its summary jurisdiction and to the suiumiry jurisdiction of a judge 
 thereof, and be accountable for the moneys, property and estates coming into 
 his possession as such assignee, in the same manner as sheriffs and other 
 officers of the court are. 
 
 r. No assignee shall directly or indirectly, at any time, advance or lend to 
 any creditor any money, or become lia1)lo for any creditor to any other per- 
 son, for any money up )n the sofinrity or collateral security of such creditor's 
 claim against the estate, or of any dividend declared or to be d iclared there- 
 on, or of any security hold by or f^r such creditor upon any part of the estate. 
 
 (/. Every official assignee sliall print, and cause to be posted up in a con- 
 spicuous place in his office ; sections thirty-two, forty -three, and forty-five of 
 the said Act, as amuided, and a*^^ every meeting of creditors a printed copy 
 of the said section i shall be laid upon the table. 
 
 '•. If it appears to the Court or judge, that an offi ;ial assignee haa been 
 guilty of any fraud, breach of duty, or, wilful vi )lati(jn of any of the provi- 
 sions of the Insolvent Act of 1875, or the amending Acts, or has inserted any 
 improper charge in any account or claim preferred by him against the estate, 
 
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 V 
 
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 :i 
 
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 I 
 
 I 
 
 ; I 
 
134 
 
 THE INSOLVENT ACT. 
 
 the Cimrt or judge shall forthwith make a ropoi-t of the facts to the Set retary 
 of State of Canada for the information of the G<ivernor. 
 
 /. The assignee shall, within the first five' days of each calendar month, 
 file in the office of the Clerk of the Court a statement of the receipts and dis- 
 bursements of the estate during the last preceding month, showing also the 
 balance of cash then in bank (40 Vict. ss. 33, 34, 35, and 37). 
 
 The additional security which may l)e called for uiidor (<i.), is 
 for the benefit of the cre<litors of the estate, in which the creditor 
 applying for the security is interested. The other sccuiity 
 seenus to bo general. The Coui t of (Jhancery will interfeie, to 
 prevent any obstruction of the assignee, in the course of his otlicial 
 duty. Thus where V. and D., traders, made an assignment in in- 
 solvency to the plaintiff, on the 9th of January, 1865, and in pur- 
 suance of the provisions of the Act of 18()4. A judgment at law 
 having been ol)tained against V., his interest in the partnership 
 assets was sold for a nominal consideration to C, who had notice 
 of the insolvency proceedings, and was also informed that the 
 partnershi]> estate was insolvent. C. then entered into possession 
 of, and otherwise interfered with, the partnership goo<ls, so as U) 
 hinder the plaintiti* from exercising the duties of his office. The 
 purchase was not bona fide, and C's conduct appeared to have 
 been either wholly vexatious, or ])ursued in order to coerce the 
 a.ssignee into a settlement of the defendant's claims. An injunc- 
 tion was granted, on the application of the assignee, to restrain 
 the defendant from furthei- interfc;rence (Wilson, v. Corby, 11 
 Grant, 92). 
 
 The assignee being amenal)le to the summary jurisdiction of 
 the Court, he may be oi'dered to refund any money paid to him 
 through a mistake (ex-parte Jitraes, L. R. 9 Ch. App. (5(9). But 
 the assignee will not be liable to make good moneys boiutJuU 
 applied by him under a mistake (ex-parte (hjlc, L. R. 8 Ch. App. 
 711). He will, however, be liaV>le to pay personally any costs of 
 litigation ordered to be paid by him, and which the assets are in- 
 .sufficient to pay (ex-parte Anyerstein, L. R. 9 (]h. App. 479). 
 But an assignee cannot be aompelle<l to appear before the supe- 
 rior court to declare what moneys he has in his hands belonuiu'- 
 
ASSIGNEES. 
 
 135 
 
 to the defendant in a saisie arret after judgment (Orone v. Lehe/m, 
 20 L. C. J. 30). 
 
 The 5 1st section of the Act of 18G9 provided that aa assignee 
 removed should, nevertheless, remain liable to the summary juris- 
 diction of the Court and of the judge thereof, until he should have 
 fully accounted for his acts and his conduct while he continued 
 to be assignee. No doubt a removed assignee would still be liable 
 under this clause for any misconduct while in office. 
 
 The latter part of the 51st section of the Act of 1869 gave the 
 same fidl and summaiy power over a removed as over an existing 
 assignee as to all his duties. The expression in the clause, " fully 
 accounted," was not limited merely to the rendering of an ac- 
 count, but necessarily meant accounting and paying over ; ard it 
 was held that as there was the same authority over a removed as 
 an existing assignee, the former might be compelled, by an appli- 
 cation to the judge, under the section, to pay over all moneys 
 shown to be in his hands belonging to the estate, for until he had 
 done so he had not, in the words of the statute, " fully accounted 
 for his acts and conduct." The assignee is bound, as one of his 
 duties, not to retain any money in his hands as his remuneration, 
 to which Ijy law he is not entitled, an<l the creditors can, by an 
 application under the section, compel him either to account there- 
 for to the estate, or to pay the same into the bank, as directed by 
 the Statute, in the name of the estate, or apply it, with any other 
 moneys, towards payment of a dividend (re Botsfor<l,'2'2 C.P.U.C. 
 65). 
 
 The duties of the assignee are to conform himself to the law, 
 and in the case of a removed, as well as that of .n existing, 
 assignee, the judge has power to audit his account and fix the 
 amount of liis remuneration. 
 
 29. The creditors, at their first meeting or iit any subseciuent meeting 
 called for that purpose, may appoint an assignee, who shall give security to 
 Her Majesty in manner, form and eftoct as provided in the next preceding 
 section, for the duo performance of his duties to such an amount as may be 
 fixed by the creditors at such meeting, hx default of such appointment the 
 official assignee shall remain the assignee ul the estate, and shall have and 
 exercise all the powers vested by this Act iu the aosignee. The creditors 
 
 i«) 
 
136 
 
 THE INSOLVENT ACT. 
 
 1^ 
 
 
 may also, at any meeting called for that purpose, remove any assignee, and 
 appoint another in his stead. A certified copy of any resolution of the cred- 
 itors appointing an assignee shall be transmitted in every case to the clerk of 
 the court wherein the proceedings are pending, to remain of record in his 
 office. 
 
 No creditor shall vote at any meeting unless present personally or repre- 
 sented by some person having a written authority, to be filed with the assignee, 
 to act at any or all such meetings on his beiialf, and no more than one per- 
 son shall vote as a creditor on any claim for the same debt ; persons pur- 
 chasing claims against an estate after insolvency, shall not be entitled to vote 
 in respect of such claims, but shall, in all other respects, have the same 
 rights as other creditors ; and no claim after being proved shall be divided 
 and transferred to another person or party to increase the number of votes 
 at any meeting : each claim shall continue to have one vote only in number. 
 
 It will be observed that the 28th section recjuires an official 
 assignee on being appointed by the Governor in Council, and be- 
 foreacting,to give security for the benefit of the creditors generally. 
 He is also, under section 28(a), on assuming the management of 
 any estate, liable to give such further security as, on the petition 
 of a creditor of that estate, the judge may order. Under this 
 section, the assignee appointed at the first meeting of creditors 
 mu.st give security to such an amount as may be fixed by the 
 creditors at the meeting. 
 
 It would seem that if the creditors' assijjnee is also an assignee 
 appointed by the Governor in Council, and has already given 
 security under section 28, he is not bound to give fresh security 
 under this section, though he may be called upon to increase it. 
 But if he has not given security when chosen assignee by the 
 creditors, this section comjiels him to do so to such an amount as 
 the creditors may then fix. 
 
 It seems intended chiefly to meet the case of the creditors' 
 assignee not being an official assignee, and not having already 
 given sticurity to the Crown (see also Churcher v. Coicshis, 28 Q- 
 B.U.C. 540). 
 
 a. All securities given or to be given under the 28th and 29th sections of 
 the said Act shall be deposited with the judge, and kejit as part of the records 
 of the Court, subject to the right of any person entitled to sue upon any 
 such security to such production and delivery thereof as may be necessary in 
 order to the exercise of such right. 
 
ASSIGNEES. 
 
 187 
 
 b. Any creditor of the estate may, in the case of any person required under 
 the said 28th and 29th sections to give socurity, have inspection of such 
 security, and may, if in his opinion the surety or sureties in such security are 
 insufficient, apply, on notice to the judge, for an order that new or additional 
 sureties be furnished, and the judge may, upon such application, make 
 such order as shall seem reiisonivble, both as to the furnishing of sureties and 
 as to tlie costs of the application (39 Vict. chap. 30, ss. C and 7). 
 
 In I'eference to the meaning of the words, " in default of such 
 appointment," the cases liave not been uniform. In a case in 
 Quebec, at the first meeting of creditors under the Act of 18G9, 
 the majority in value voted that one S. should be assignee, while 
 the majority in number voted that one G. should be assignee. A 
 reference, under the llSth section of the Act, was made to the judge 
 under the above state of facts, and it was held that there was a 
 failure of election of assignee, and that the interim assignee, under 
 the Gth section, became assignee (reil/rt7'«^i.ss,3Revue Criti(iue,136). 
 But in Ontario, in a county court case, it was laid down that the 
 words " default of appointment," in this section, do not refer to a 
 case where the creditors attend the first meeting, and the majority 
 in number vote for one assignee, and the majority in value vote 
 for another. That, in such case, there is really an election, and 
 the judge, under the 102nd section of the Act, must decide who is 
 the assignee (re H<iri'if<, 12 C. L.J. N. S. 2.')1). In both the cases 
 referred to, the matter was brought before the judge for decision, 
 under the above section of the Act. The writer is of opinion 
 that re 3Farstiss is not sound, for the matter having come before 
 the judge, he had the power of determining the appointment. 
 But if the matter were not brought before the judge, and it would 
 not be unless some party moved in the matter, there would surely 
 be a default of appointment. Re Harrw seems to be correctly 
 decided on the facts, thouidi the lantruasfe used wovdd lea<l to the 
 conclusion that if the matter was not brought before the judge 
 there would be an election. If a meeting were called, but the 
 creditors entitled to appoint an assignee did not attend, or attend- 
 ing did not make an appointment not seeing fit to do so, there 
 would l)e a default (re //(t/Ti.s, 12C.L.J.N.S.25: McDonald, J. J.,. 
 Bump, on Bankruptcy, 9th Ed. 472 ; see 40 Vict. s. 23). 
 
 'i 
 
 
 iV' 
 
 if 
 1 
 
 
 '1 
 
 I 
 
 
 i!| 
 
 IS 
 
 iflt 
 
138 
 
 THE INSOLVENT ACT. 
 
 In re Harris, supra, it was liel<l,also, that the assignee appointed 
 under this section need not be an official assii^nee or a resident of 
 the county ; and the Act would seem to show that this is tlie case, 
 thoutrh the writ <jf attachment must in the fii'st instance he 
 directed to an official assignee, or the assignment made to such 
 assignee (see section 2 (a). 
 
 Where the character or capacity of the assignee is called in 
 question, it will be sufficient to show that he duly became the offi- 
 cial assignee of the estate ; for by this section, in default of 
 appointment by the creditors, the official assignee becomes the 
 assignee of the estate ; and the assignee, if there is any defect in 
 his election, may rely upon his position of assignee by operation 
 of law (Marsh v. Sweeny, 2 Pugsley, 454). 
 
 It is apprehended, however, that after proof of the pai'ty being 
 official assignee, it would be necessary to show that the circum- 
 stances unuer which the latter becomes assignee had occurred. 
 The 144th «<>r»,tion of this Act, contains provisions as to the method 
 by which the appointment of an assignee may be proved. When 
 a party ha,s proved his claim on a composition deed, and has also 
 obtained an order to set aside the insolvent's discharge, with costs 
 te be paid to him out of the estate, he is precluded from oltjocting 
 that the assignee is not duly appointed {Allan v. Garratt, 80 Q.B. 
 U.C. 165). 
 
 When an action is brought by an assignee as such, on a plea 
 denying that the plaintiH' is assignee, he would be compelled to 
 prove the necessary preliminary proceedings which conferred 
 upon him the office of assignee, an<l among them, that the person 
 of whose estate he claimed to be assignee, was a trader, subject to 
 the provisions of the Act (Groves v. Mc Anile, 33 Q. B. U. C.252; 
 Butler \. Hobmn, 4 Bing. N. C 290). 
 
 The Act of 1809, section 144, provided as to the appointment 
 of an assignee, and proceedings preliminary to such appointment ; 
 that after the expiration of a year, as to all })ersons not previously 
 contesting the appointment or preliminary proceedings, the same 
 should be conclusively presumed to be valid. It was held that 
 the section could not apply to persons, such as debtors of the in- 
 solvent, who could not contest such proceedings, and that a debtc^r 
 
 of t 
 insd 
 tion 
 33 
 
ASSIGNEES. 
 
 139 
 
 
 of the insolvent, might, wlien suod by the assignee, set up that the 
 insolvent was not a trader, though there had heen a full adjudica- 
 tion on this point in the Insolvent Court (Orooes v. McArdh, 
 33 Q. B. U. C. 252). 
 
 It seemed to be the opinion of the Court in Newton v. Ontdrio 
 Bank (15 Grant 283), that, if an assignment were bona fide made 
 to an orticial assignee, who had not been duly appointed, the credi- 
 tors might take advji.ntage of the irregularity of the apjjointment, 
 l)Ut that, if they accepted and acted on the assignment, the insol- 
 vent could not impeach the appointment, the making of the as- 
 signment Ijeing his own voluntary act, nor could persons claiming 
 adversely to the creditors, raise the objection fsee Groves v. 
 McA rdlc, supi'a). 
 
 A ])erson claiming, as agent or attorney, to represent a creditoi", 
 at the first meeting called for the choice of an assignee, must have 
 authority from the creditor, by a duly authenticated letter of attor- 
 ney, and such authority must be filed, before the party is entitled 
 to vote (re Qtmphell, 1 U. C. L. J. N. S. 135). The creditois pre- 
 sent may, however, if they choose, waive the objection. 
 
 At a meeting of creditors, held foi- the purpose of giving their 
 advice upon the appointment of an official assignee, it was held, 
 that the creditors of the individual partners had the right, as well 
 as the creditors of the firm, to vote in the choice of an assignee 
 (Laxfon v. Hamilton, 10 IT. C. L. J. 334). 
 
 Under "The Inter])retation Act" (31 Vict. chap. l,s. 7), "Twenty- 
 seventhly : Words atithorizing the appointment of any public officer 
 or functionary, or any deputy, shall include the power of remov- 
 ing him, reappointing him, or appointing another in his .stead, in 
 the discretion of the authority in whom the power of appointment 
 is vested. 
 
 " Twenty-eiglithly : Words directing or empowering a public 
 officer or functionary to do any act or thing, or otherwise, apply- 
 ing to him, by his name of office, .shall include his successors in 
 such office, and his or their lawful deputy. 
 
 " Twenty-ninthly : All officers now appointed, or hereafter, to be 
 appointed by the Governor-General, whether by commission or 
 
 m 
 
ilif 
 
 t 
 
 140 
 
 THE INSOLVENT ACT. 
 
 otlierwise, shall remain in officu during pleasui-e only, unless 
 otherwise expressed in their commissions or appointments." 
 
 The Act giv(vs express power to remove the assi<^nee at any 
 meeting called for that purpose. This meeting would, no douht, 
 re(iuire to be called in the manner prescribed by section 101 of 
 the Act. 
 
 It was held that a removal of an assignee, at a meeting of credi- 
 tors, called unrler section 11, .sub-section 8, of the Act of ISO 4, 
 bad the eliect of removing, with respect to the separate as well as 
 the joint estates, in the case of an assignment by a copartnership; 
 though thea.ssignee removed, claimed under a subsequent assign- 
 ment, from one partner individually (re Mac/a rlane, 12L. C J. 
 239). 
 
 An a.ssignee is not appointed simply for his own profit, but as 
 trustee for the creditors, and he is bound to exercise due dili- 
 gence in collecting and disposing of the property of the insolvent, 
 and in distributing the proceeds among the creditors. If he is 
 guilty of gross and culpable neglect of duty in this respect, he 
 may be removed (re Aforse, 7 B. R. oG) ; and when the assignee is 
 removed for misconduct, he may be compelled to pay the costs of 
 the proceedings for his removal (ib). 
 
 No particular mode or manner of voting is prescribed by the 
 Act. It may be assumed, therefore, that any mode or manner of 
 voting by which the choice of each creditor entitled to vote, is 
 clearly expressed, is sufficient. It may, no doubt, be taken V)y 
 ballot, or viva voce. It may be taken by calling the name of each 
 creditor, or by calling upon the person or persons representing 
 creditors, by power of attorney, to name the choice of the creditor 
 or creditors represented by him. The latter mode cannot be re- 
 commended as the most approved mode ; but can hardly be said 
 to be incompetent or irregular, so long as it clearly appears that 
 the choice of each creditor, who has proved his claim, is thereby 
 clearly expressed (re Lake Superior G. R. & 1. Co., 7 B. R. 37<3). 
 
 In England at the fii'st meeting for the appointment of a trus- 
 tee, the practice, where the registrar or chairman is in doubt as 
 to the right of a creditor to vote, is to allow the vote and state 
 the objection on the back of the proof (re Hoare, L. R. 18 Eij., 705). 
 
 
 to 
 
CREDITORS lilGHT TO VOTE. 
 
 141 
 
 It has also been held that if a creditor having a clear right of 
 proof he exchided from voting in the appointment of a trustee by 
 reason that liis [troof h i-ejected, and the proof be afterwards sus- 
 tained, the Court will vacate the appointment so made and order 
 a new choice (ex parte Crouiher, 24 L. T. N. S. .S.SO). 
 
 There is no doubt that, at this meeting, any creditor who desires 
 to take part in the ])roceedings must prove his claim. 
 
 No creditor has any right to be heard either in ))erson or by 
 attorney upon any part of the proceedings until he has proved his 
 claim (re IJIll, 1 B. R. 1(5 ; re Jonc^, 2 B. R. 5!)). 
 
 Proof means not merely making affidavit in the form prescribed 
 by the Act, Init also tiling the affidavit (see also lioone)/ v. Lyon, 
 Q. B. U. C. 187(5). 
 
 A creditor, who retains the affidavit in his own possession, is not 
 a creditor who lias pi'oved his debt within the technical meaning of 
 those terms in the Act (re Sheppard, 1 B. R. 430). 
 
 A creditor, holding security, cannot vote for an assignee (re 
 Davis, 1 B. R. 120 ; re Purhs, 10 B. R. 82). 
 
 But if the balance of his claim, after deduction of the value of 
 the security, exceeds one hundred dollars, there seems no objection 
 to the vote on proof of the claim. 
 
 The security must be upon the property of the insolvent, other- 
 wise he may prove the full amount of his claim and vote (re Crom, 
 1 B. R. ')()4). Where a creditor has two claims, one of which is 
 unsecured and the other secured, he may prove the former and vote 
 (re Parkes, 10 B. R. 82). 
 
 In order to vote for an assignee, the attornej must be an attor- 
 ney in fact, and nmst be ai)pointed by a power of an attorney (re 
 Purvis, 1 B. R. 1(53). 
 
 One member of a firm may execute a power of attorney author- 
 izing a person to vote for assignee, in the name of the firm, and 
 bind all the other members thereby (re Barrett, 2 B. R. 533). 
 
 When an agent executes a power of attorney in the name of 
 the principal, he must prouuce legal evidence, that he is duly 
 authorized to execute the power of attorney (re Knolpfel, 1 B. R. 
 23). 
 
 Where the authority is joint, it must be exerci.sed by all to 
 whom it is given (re Phelps, 1 B. R. 525). 
 
 B. 
 
 \i 
 
 
142 
 
 THE INSOLVENT ACT. 
 
 1 ! 
 
 Whon a letttjr of an attorney addi'e.ssed to a firm doivs not 
 authorizo eitlier of partners to act separately, one partner cannot 
 act alone and without the co-operation of his co-partner (re Fravl>\ 
 5 B. R. 1{>4). 
 
 A power of attorney, not containing a power of substitution, does 
 not confer any authority upon any other than the person duly 
 constitute<l agent thereby, to act for the creilitor, nor can any one 
 else sign the nauie of such agent to a paper on behalf of the credi- 
 tor (re V-'a/mer-, 3 Jl R. .SOI). 
 
 The Act no where directs, nor does it seem to contemplate a 
 postponement of the vote for assignee where some creditors have 
 proven their debts in order to enable others to do so; on the con- 
 trary, it seems to contempliiU' the utmost practicable expedition 
 in choosing the assignee, and for a very gcjod reason, because, 
 until there is an assignee there is no one to represent or whose 
 official duty it is to look after the interests of the estate. The 
 creditors, who have proved their claims and are entitled to vote 
 for assignee, may no d<;ubt consent if they see fit, to wait for 
 others to prove before proceeding to choose the assignee. It is, 
 however, optional with them. But even this power should be 
 exercised sparingly, and the vote ought always to l)e taken at the 
 earliest practical »le moment (re Lake Superior C. R. cC- /. Co. 7 B. 
 R. 370 ; re Northcra Iron Co. 13 R. R. 3o(i). 
 
 Where, at the first meeting of the creditors, only one creditor 
 appears and proves liis debt and there are no other debts proven, 
 the right to choose an assignee beloJigs to this sole creditor who 
 has proved his claim (re Ilnynes, 2 B. R. 227). 
 
 It is the policy of the Act to give the ci'editors of tlie insolvent 
 the choice, in the first instance, of the pei'son who is to take tlie 
 assets and manage them. It is only when the creditors fail to 
 elect, that the official assignee becomes the assignee of the estate 
 (re Smith, 1 B. R. 243 ; re Sclteifer, 2 B. R. 591). 
 
 An assignee should be appointed, even though no debts have 
 been proved (re Cogswell, 1 B. R. 02). So an assignee should be 
 ajipointed, even though there are no a})parent assets, for he is de- 
 signed by the Statute to act as a trustee on behalf of the creditors. 
 
CIIEDITOUH UIOIIT TO VOTK. 
 
 143 
 
 niul it is his duty to .searcli out and collect every species of pro- 
 ))erty helonfifin^' to the insolvent (re Grdven, 5 Law Rep. 25. 
 
 The Act does not allow a party to vote in respect of a claim 
 purchased after the insolvency. It would seem that the vendor 
 under such circumstances could not vote. The act contemplates 
 claims owned hy the persons who seek to vote. Wlien a creditor 
 sells or assi<,Mis his deltt after it has been proved he has no fui-ther 
 husiiK'ss in Court, althoujjfh the proceedings must he carried on in 
 his name. The actual owner and assit^nee must control the debt 
 and rcct'ive the dividend. Where .several claims have been assij,'ned 
 to one jierson, he has but one vote (re Frank, 5 B. R. lit'i). 
 
 Jf a purchaser honn Jide buys a claim against the debtor, he 
 may ]>rove for the full amount, although he paid a less sum 
 therefor. At least, this is the law in reference to bills or notes 
 of the debtor (ex-parte Lee, 1 l\ VV. 7<S2j. It is immaterial, for 
 this purpose, that the bills or notes were bought in after the in- 
 solvency of the jtarty against who.se estate proof is made, if at the 
 time of the insolvency they were in the hands of persons entitled 
 to ])rove them (ex-parte Jio(jcrs, Buck. 4!)()). If, however, the 
 purchaser has notice or reason to sus])ect that the bills were, as 
 between the drawer and acceptor, issued fi'audulently, for the 
 purpose of raising money on the eve of insolvency to the detri- 
 ment of the general creditors, he will not be allowed to prove for 
 more than he gave for the liills (ex-i)arte Gordon, L. R. 1 Ch. D. 
 i;}7 ; Rokson, 3rd Ed. 22-')). 
 
 30. As soon as the security re(|uire(l from the assij^iee appointed by the 
 creditors sliall have been furniahod by liiin, or if no security be required then 
 immediately on his appointment, it shall bo the duty of the official assignee 
 to account to him for all the estate and property of the insolvent which has 
 come into his possession, and to pay over and to deliver to him all siwh 
 estate and property, including all sums of money, books, bills, notes and 
 documents whatsoever belonging to the estate, and to execute in his favour 
 a deed of assiginnent in the Form H. 
 
 The -iOth Vict. s. 1), amended this section, by adding, after the 
 word " him," in the second line, the words, " or if no security be 
 required then immediately upon his appointment." As we have 
 already seen, it is necessary that this Form H should be strictly 
 
 I ; 
 
 
 tiH 
 
 
 li 
 
144 
 
 THE INSOLVENT ACT. 
 
 followed in the transfer from the official to the creditors' assignee, 
 as it derives its efficacy solely from the Statute. There seems to 
 l)e no ohlif-ation on the official assignee to make the transfer until 
 the security is perfected, when security is rec^uired. 
 
 31. Every as.signoo, on lua becoming such, shall give notice of his appoint- 
 ment as snch by advertisement, to be insertcvl once in the Official Gazette, in 
 the Form J., and by a copy thereof sent to each creditor by post and post- 
 |)aid. 
 
 The 40th Vict. s. 10, amended this section, by adding, after the 
 word " advertisement," in the .second line, the words " to be in- 
 serted once in the Official Gazette." 
 
 It has been held in the United States that the publication by 
 the assignee of his appointment is not essential to the regularity 
 of the proceedings. This provision of the Act is merely directoiy 
 to the assignee, and not intended so nuich for creditors as for per- 
 sons owing debts to or otherwise having business with the estate 
 [L-e Littlctiebl '^ B. R. o7). 
 
 The Statute on which this decision was rendered provides 
 " that the assignee shall immediately give notice of his appoint- 
 ment by i)ublication," k.Q,. (see notes to section 11). 
 
 32. No person shall act as the attorney (jr agent of any creditor upon any 
 question as to the appointment of such person as assignee, or in reference 
 to any claim or demand of snch creditor on an insolvent estate of which 
 such person is the assignee, nor shall any partner or employee <if any person 
 act as the attorney or agent of any creditor in any matter in which under this 
 section such person himself could not act, nor shall any assignee employ any 
 person, being his partner, as cimnsel, advocate, attorney, solicitor, or agent 
 for such assignee in the respect of the insolvent estate. 
 
 This section is now substituted in lieu of the thirty-second 
 section of the Act of 187o by the -tOth Vict. s. 11. 
 
 33. An assignee may, however, on being authorised by the juJge, act as 
 tl;e attorney or agent of a creditor when the atition to be taken is in the in- 
 terest of the estate or of the creditors yemrally. 
 
 34. The creditors may, from time to time, at any meeting, determine 
 where subsequent meetings shall be held ; and until they .shall have passed 
 a resdlution to that effect all meetings of the creditors shall be held at the 
 office of the iissignee, unless otherwise ordered by the judge. 
 
l\SPEf;TORS. 
 
 145 
 
 35. Tho creditors, at any meoting, may apjxjint (jne or more inspectors, 
 who shall superintend and direct the proceedings (jf the assignee in tho man- 
 agement and winding np of the estate ; and they may also, at any snbse- 
 • liiL-nt meeting held for that purpose, revoke the app(jintnient of any or 
 all the said inspector" ; and upon such revocation, or in case of death, re- 
 signation, or absence from the Province of such inspectors, may ajipoint 
 others in their stead ; and such inspectors may he paid such remuneration 
 us the creditors may determine ; and whenever anything is allowed or 
 directed to be done by the inspectors, it may or shall be done by the sole in- 
 spector, if only one has been api)ointed. liut no assignee (jr inspector of any 
 insolvent estate shall purchase directly or indirectly any paii; of the stock in 
 trade, debts or assets of any description, of such insolvent estate, or any 
 claim against such estate, nor shall any assignee employ any insj)ector, nor 
 shall any inspector employ any i)erson being his partner, or being the partner 
 I if any assignee, or the partner of any inspector as counsel, advocate, attorney, 
 snlicitor, (jr agent in respect of the insolvent estate (40 Vict. s. 12), 
 
 Tlif .Si)th Vict. (chap. IM), s. H) ainendcd this .section by 
 striking out the word " as " between tlie words "assignee" and 
 " insjH'ctijr " in tlie fouith line from the end, and inserting in lieu 
 thereof tlie word " or." 
 
 All inspector stands in very much the san)e position as the 
 debtor would have done if no assignment liad been made, 
 Wlure th»i plaintiff, as assignee of the estate of an insolvent, 
 brought rei)levin, the writ being directed to and served l»y tlie 
 sheriff, who was also an ins])eet(M' to the estate, it was held that 
 the sheriff as inspector was interested in the suit, and the writ of 
 replevin was set aside (i^a//7fef(</tc'/' v. Xevern, 11 C, L. J. N. S. 
 258 ; 2 Pugsley, 52 -t.) 
 
 It does not seem necessary tliat the ins[)ector shall be a creditor 
 on the estate though creditors are usually appointed to this 
 position. 
 
 In Enghuul, in cases where there is a conflict of interest Ijetween 
 the joint and separate creditors of an insolvent, an inspector has 
 been appointed to pi'otect the interests of the .sej)arate creditors. 
 One of three jtartnejs was separately adjudicated a banki-upt 
 under the Act of LSUl. Joint creditors of the tirm proved debts 
 amounting to £.S!),0()(), and two of the joint creditors were ap- 
 pointed creditors' assignees. The separate debts amounted to 
 not more than i!S,0(>(). There was no joint estate, and the .sepamte 
 
 H 
 
 « V 
 
 1 
 
 ' 'f 
 
 '•a 
 
M' 
 
 14*6 
 
 THE INSOLVENT ACT. 
 
 estate only amounted to £3,850. On the application of almost 
 all the separate creditors that the separate creditors might be at 
 liberty to appoint an inspector of the sejiarate estate to protect 
 their interests the application was granted upon the condi- 
 tion that the inspector should take no stej) without the approval 
 of the registrar (ex parte Mdbotirn, 25 L. T. N. S. 308 ; L. R. (! 
 Ch. App. C4,835). 
 
 30. The creditors may, at any niuctiiig, pass any resolution or order direct- 
 ing the assignee imw to dispose of the estate, real or personal, of tlie insol- 
 vent ; and, in default of their doing so, the assignee shall be subject to the 
 directions, orders and instrucfons he may, from time to time, receive from 
 the inspectors, with regard to the nioile, terms and conditions on which he 
 may disjjose of the whole or any jnirt of the estate, subject to the proviso as 
 to sale CH blue contained in the thirty-eight section of this Act. 
 
 \l I 
 
 The 39 Vict. cha}). 30. s. !•, amended this .section by adding the 
 following words " subj'.^ct to the proviso as to sale en bloc con- 
 tained in the thirty-eightii .-ection of this Act." It thei'eforc 
 api)ears that no sale of the estate ea bloc can take place without 
 the sanction of the creditors given at a meeting called specially 
 for the pui'pose of considering such sale, it will be observed that 
 the G7th section of the Act re(|ui res debts to be .sold by public 
 auction. 
 
 37. Any one or more creditors, whose claims in the aggregate exceed tive 
 hundred dollars, who may be dissatistied with the resolutions adopted or 
 orders made by the creditors or the in.spectors, or with any action of the iis- 
 signee for the disposal of the estate or any part thereof, or for postponing 
 the disposal of the same, or with reference to any matter connected with the 
 management or winding u^i of the estate, may, within twenty-four hourr 
 thereafter, give to the assignee notice that he or they will a[)ply to the Court 
 or judge on the day and at tlie hour fixed in such notice, and not being 
 later than forty-eight hours aitei' .such notice shall have been given, or as 
 soon thereafter as the parties may be heard before such Court <>r judge, to 
 rescind such resolutions or orders. And it shall be lawful for the Court or 
 judge, after hearing the inspectors, the assignee, and creditors present at the 
 time and place so fixed, to approve, rescind, or uxodify the said resolutions 
 or ordei-s. In case (jf the application Ijeing refused the party applying shall 
 pay all costs occasioned thereby, otherwise the coats and the expenses shall 
 be at the discretion of tlie judge. 
 
 
POWERS OF ASSIGNEE. 
 
 147 
 
 It would be necessary for tlie creditor to prove his claim be- 
 fotv applying under this section. When can the vesolutions be 
 CMinsidered as adopted, or orders made within this section { When 
 actually recordetl, or wlien the creditor receives notice thereof ? 
 What length of notice is required ? The appointment is to be 
 not later than forty-eight hours aflsr such notice shall have been 
 given, but the Act does not say how long before the appointment 
 must the notice be served. 
 
 38. The assignee shall exercise all the rights and powers of the insolvent 
 ill reference to his property and estate. And ho shall wind np the estate of 
 the insolvent by tlie sale in the ordinary mode in which such sales are made, 
 of all bank or other stocks, and of all nio\able property belonging to him, by 
 the collection of all debts or by the sale of the estate of the insolvent, or 
 <'uiy jiart thereof, if snch be found more advantageous, at such price and on 
 sucli terms as to tlie payment thereof as may seem most advantageous : 
 
 Provided that no sale of the estate en bloc shall be made without the pr«- 
 viuUH sanction of the creditors given at a meeting called for that purpose ; 
 and provided also that no such sale shall ati'oct, diminish, impair, (jr postpone 
 the payment of any mortgage or privileged claim on the estate, or property 
 of the insolvent, or on any portion thereof. 
 
 (•J.) it shall not be necessary to advertise under the provisions of the 
 .seventy-tifth .section of tliis Act any proposed sale of the estate tn bloc under 
 this section, although the estate may comprise real estate (39 Vict. chap. 30, 
 s. 10). 
 
 Where both partnership property and individual propei'ty of 
 till' members of the firm passes under the as.signment or the writ 
 of attachment, a sale of the whole partnership property, indu- 
 pendcntly of the individual property of the members of the firm 
 will be a sale ^'u bloc, within this .section, and will require the 
 previous sanction of the creditors to give it validity (re McLaren 
 and (Jhdbners, 1 Appeal Reports, Out. G8). 
 
 It would seem, also, that a .sale of the entire separate property 
 would be a sale en Jdoc. 
 
 At a meeting of creditors, called for the purpose of disposing 
 of the entire ostatf- and effects of the insolvent en bloc, the cre- 
 ditors are not bound to accept the highest tender for the es- 
 tate, but may, in their discretion, accept the lowest if it is more 
 satisfactory, as being accompanied with security. A judge in iu- 
 
 t ,' 
 
148 
 
 THE INSOLVi'NT ACT. 
 
 '■ ! 
 
 : ; 
 
 solvency will not inttM-fere to rescind such a decision made by the 
 majority of the creditors at a meeting called for the pur])ose. 
 legally held, unless fraud he proven (Lafoie v. Hiulon, 18 L. C. J. 
 13i))." 
 
 30. The assignee, in his own name as such, sliall have tlie exclusive right 
 to sue for thfj recovery of iilhlobts clue to or chuuiod hy the insolvent of eveiy 
 kinil and nature whatsduver ; f<ir rescinding agreements, deeds and instru- 
 ments made in fraud of creditors, and for the recovery back of moneys alleged 
 to have been paid in fraud of creditoi's, and to take, both in the prosecutiDU 
 and defence of all suits, ail the jiroceedings that the insolvent miglit ha\e 
 taken for tiie benetit of the estate, or that any creditor miglit Imve taken for 
 the benefit of the creditors generally; and may intervene and represent the 
 insolvent in all suits or proceedings by or against liim, which are pending at 
 the time of iiis appointment, and on his application may have his name in- 
 serted tlierein in the place of tliat of tlie insolvent : and, if after an assign- 
 ment lias been made, or a wiit (jf attachment has issued under this Act, 
 and before he has obtained his discharge under tliis Act, tlie insolvent sues 
 out any writ, or institutes, or continues any proceeding of any kind or nature 
 whatsoever, lie shall give to the opposite party such security for costs as shall 
 be ordered by the Court before which such suit or proceeding is pending, be- 
 fore such party shall be bound to appear, or plead to the same, or take any 
 further proceeding therein. 
 
 This section only applies to an assignee under the Insolvent Act, 
 and an assignee under an assignment to him by an insolvent, for 
 the genei'al benetit of his creditors, not maile under the provisions 
 of the Act, is not entitled to sue in his own name for anything 
 connected with such assignment (Prevost v. Drolet, 18 L. C. J. 
 300). 
 
 The as.signment, under the Act of 1804, was held to suspend 
 lawsuits pending by or against the insolvent. After a.ssignment, 
 the assignee may move in any suit for the suspension of the pro- 
 ceedings until after he can formally appear therein to prosecute 
 or defend it in his otticial CK\)i\Q,\ty {Harlan d v. Larocque, 12 L. 
 C. J. 202). 
 
 But the assignment does not deprive the in.solvent of all right 
 of action. Where a party has properly brought an action in his own 
 name, before the appointment of an a.ssignee in insolvency, he 
 he may continue it in his own name, so long as the assignee does 
 
 tl. 
 
ASSIGNEKS RIGIII.^ OF ACTION'. 
 
 ]i9 
 
 not intervene, and desire his name to lie inserted as jjlaintiff. 
 "When the action, after the appointment of an assi^^nee is con- 
 tinued in the insolvent's name, for tlie l)enefit of the creditors, and 
 tliey give security for the costs, if a i)lea is jjleaded to the fuither 
 maintenance of the action, setting uj) the plaintiff's insolvency, 
 and consecjuent vesting of the riglit of action in the assignee, the 
 jiroper rei)lication for tlie jHaintiff is, tliat the action was continued 
 for the benefit of tlie creditoi's after tiie appointment of the assignee, 
 instead of alleging that the action was so brought (Du nn v. Irwin, 
 
 2.', c. p.u. c. ni). 
 
 It would seem that this section does not oblige the assignee to 
 intervene in pending suits. It only becomes a duty for an assignee 
 to prosecute a suit when the interest of the estate demands it, of 
 which the assignee is in the first instance the judge (Reave v. 
 Waterhouse, 10 B. R. 277). 
 
 Neither the insolvent nor his attorney has the authority to 
 settle a suit in the name of the insolvent, after the commencement 
 of the proceedings in insolvency (Home Ins. Cu. v. Hollis, 14 B. R. 
 337). 
 
 An insolvent cannot represent his creditors, who must be repre- 
 sented by the assignee, and therefore, as a general rule, an insol- 
 vent cannot maintain a suit in respect of property vested in his 
 assignee under the insolvency proceeding.s (Payne v. Dicker, L. R. 
 G Ch. App. 578) ; neither can an insolvent maintain a suit against 
 his assignee and an alleged debtor to his estate, on the ground of 
 fraud and collusion (Motion v. Moojen, L. R. 14 Eq. 202) ; and a 
 jjankrupt who has not obtained his discliarge cannot, except 
 perhaps in the case of after acijuired property, where the trustee 
 has not interfered, and in the cases where the right of action 
 does not vest in the trustee, bring an action or suit in equity, 
 and this, altliough the bill charges fraud against all the defend- 
 ants, including among them the trustee (Motion v. Moojen, L. R. 
 14 Kq. 202; Payne v. Dicker, 24 L. T. N. S. 4!)2). 
 
 An insolvent cannot be joined as co-plaintiff with his assignee 
 in a suit in ecpiity (Johnson v. Montreal I. My. Co., 22 Grant, 
 290; see Bennett v. Gamgee, L. R. 2 C. P. D. 11). 
 
 There is nothing in the Insolvent Act to take away the right 
 
150 
 
 THE INSOLVENT ACT. 
 
 of a creditor to sue his debtor, who may have made an assign- 
 ment of liis property under the Act. The mere assignment would 
 form no defence to such a suit until the debtor obtained his final 
 discharge, and a debtor wlio is arrested in a capias ad responde'n- 
 dmn after assignment, by a creditor who has proved on his estate, 
 has no remedy but an api>lication to tlie Judge in Insolvency for 
 discharge from custody under the 127th section of the Act (Ilegav 
 V. Jones, 2 Pugsley, 2!»()). 
 
 It has been held, in the Province of Qmc^k'c, that & capias ad 
 respondoulitm may issue against a debtor after he has made an 
 assignment under the Insolvent Act (Beaiidin v. Roi/ 20 L. (!. J. 
 3()H ; 5 Revue Legale, 282); or that such writ may issue concur- 
 rently' with the assignment (Stevenson v. McOvan 3 L. C. L. J- 
 3iS). There is certainly nothing in the Statute to prevent the 
 issue of such writ, and if, at the meeting of his creditors, or at any 
 time afterwards, it appears that the insolvent has been guilty of 
 fraud, it is important that tlie creditors should have the power to 
 arrest him in the event of his threatening to go beyond the juris- 
 diction of the ('ourt fsee also Jinhertsci) v. II((le, 21 L. C. J. 
 :]'.), In Thomas v. Ilidl (U P. R. U. C. 172), a sunnuons obtained 
 by a debtor to set aside a writ of capias ad sutisfaciendv m. 
 issued against him after his assignment under the Insolvent Act 
 of ISO!), was discharged with costs, the evidence satisfying the 
 Court that the assignment was not executed hona jidc, but was a 
 fraiidulent device contrived for the express purpose of defeating 
 the plaintilt's recovery, Ity fraudulent abuse of the provisions of the 
 Act (see also Gault v. La(jardv, Wotherspoon's Ins. Act, ID-t--")). 
 
 When a creditor brinj-s an action at law a<rainst his debtoi'. and 
 afterwards sues out a writ of attachment in in.solvencv. and both 
 proceedings against the debtor are pending at the same ti)iie, the 
 pro])er course for the latter is to contest the claim of the creditor 
 in in.solvency, or to apply to the Court in which the action is 
 brought to stay the ])roceedings in the action. The i)endency of 
 the insolvency proceedings cannot, in the action at law, be set up 
 by the debtor as an absolute bar to the further maintenanci of 
 the action {Baldwin v. Pcferman, 2 U. C. L. J. N. S. 12.S; 16 C. 
 P. U. C. 310). 
 

 LIMTTATrON OF ACTION. 
 
 151 
 
 Tho mere issuing of the attachment is not an absolute bar to 
 the action, for the attachment may be set aside (ib.). 
 
 There is nothing in this section, or elsewhere in the Act, to 
 fix the time within which actions Ity the assignee must be brought. 
 The Statutes of Limitation affect the remedy only, cand as to this 
 the law of the place where Lhe remedy is sought prevails. Iti.s 
 presumed, therefore, that the assignee is bo.ind by the Statute 
 of Limitations, and that, in each Province, he vould be required 
 to commence proceedings within the time fixed by the laws of that 
 Province for instituting the jiarticular kind of action. It may be 
 n.seful, therefore, to consider when the cause of action accrues 
 to the assignee. In the United States it has been hel<l that tlie 
 cause of action accrues on the execution of the assignment, and 
 tlie limitation lu-gins to run from that time {Lafhrop v. Drake, 30 
 Leg. Int. 141). 
 
 Tliis is the rule as to all matured claims and demands. On all 
 others the Statute runs from their maturity, or from the time 
 when an action Avill lie, and h;: must sue from these dates re- 
 spectively {N,>vfo)> V. De ht Villeheiirc, 13 B. R. 3C4). 
 
 In the United States it is held that the plaintiff must prove 
 himself to be the duly appointed a.ssignee by producing a certified 
 copy of the reconl or of the assignment (le McTver, 1 Cranch, C. 
 ('. ilO). 
 
 P>ut if the insolvency is expres.sly admitted, and the right of 
 the assignee to sue is not put in issue by any of the pleas, it is not 
 incuud)ent on the a.ssignee to prove the assignment (Zanfzingcrv. 
 RiUhlc, 4 B. R. 724). 
 
 The 144th .section of this Act contains ])rovisions as to proof 
 of tlie appointment of the a.ssigneo, and of the regulai'ity of all 
 proceedings at the time thereof and antecedent thereto (see notes 
 to this secfion\ 
 
 An assignment by a bankrupt vests tlie estate in the assignees, 
 who may bring an action thereon in their own name without 
 notice. No notice of a.ssignment is necessary wli.n the debt re- 
 mains due, and is not attached by the other creditors, even on 
 the common a.ssignment (Gotei^ v. Another, I Revue ('riti(|ue, 481)' 
 
 Tht' assiL'nee can only, imder this section, .sue for the propfity 
 
 
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 -:-i 
 
 m 
 
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 .If' 
 
It '' 
 
 lo2 
 
 TRK INSOLVENT ACT. 
 
 or riglits of action wliicli }>as,s to liini iis assioiK'cj, and can only 
 prosecuto actions of a liko cliaracter in his own name {Nooium v. 
 Oi'ton, 12 B. R. 4()o), and thou;j;li tliis scftion is woided s(» as to 
 confer an extensive power, it is limited by section IG to sncli in- 
 terests as pass to the assignee. After tlie execution of a dei'(l of 
 assin;nment oi' tlie issue of a writ of attachment, the insolvent is 
 entirely dive.sted of his projierty and tlie same is v(!Sted in tlie 
 assignee. There is no residuary intere.st in tlu; insolvent. It le- 
 sults as a necessary legal con.setpience that the a.ssignei! may and 
 can alone mtiintiun vjivdnwut (lidrsfoiri v. Ad avis, 2 Day, 70 A 
 right of action again.st a shcriH' for negligence in the levy of an 
 execution, whereby the claim was lost, vests in the a.ssignee of the 
 judgment ci'editor (SnHii'iin v. Brhh/e, 1 Ma.ss. oil). 
 
 An assignee ma}' maintain an action to .set aside fraudulent con- 
 veyances made by the (U'litoi-, Itefore he was adjudged insolvent 
 (Bradshaic v. Klc'ni, 1 B. 11. -Hilj. After the commencement of pro- 
 ceedings in insolvency, no one but the a.ssignee can liring or main- 
 tain an action to set aside a fraudulent conveyance made by the 
 insolvent (re M>"yn-^<, 1 B. R. 581 ; Alien v. MunUjoriwru, 10 B. R. 
 503; Thurmond v. Andrews, 13 B. R. 157). 
 
 If one partner fraudulently indorses bills in the name of the firm 
 to .secure his private debt, the fii-m will not be bound if the indorsee 
 was cognizant of the fraud, and, in the event of th»! insolvency of 
 the delinquent partner, the assignee undei- the insolvency and the 
 .solvent partner may bring an action against the indoisee to n>cover 
 such bills or the proceeds of them (Ifeilhut v. Nevill, L. R. 4 C. P. 
 354). 
 
 An assignee in in.solvency sued in trover for the conversion of 
 goods in taking possession of same, as such a.ssignee cannot set up 
 that the insolvent became entitled to them under a sale which may 
 have been an act of liankruptcy {McKenzie x. Davidsov, 27 C l\ 
 U. C. 188). 
 
 Where there was a fraudulent sale by tlie insolvent of all his 
 property, le.ss than three months before the a.ssignment, and , on 
 the a.ssignee being appointed, he took pos.session of the property, 
 and advertised it for sale, but oppo.sition was made by the pd.son 
 to whom the in.solvent sold, and large ex[)en.ses were thi.-reby in- 
 
ASSIONKKS HKJIITS OK ACTION. 
 
 1.53 
 
 
 
 ciirivil l)y tlu- assi^iuto for insuranci!, a<lvt'rtisin<f, law costs, guar- 
 dian and watclunan's fees in preserving' tlic property, it was held 
 that the assignee, in estahlishing liis i-ii^dit to the property, niijjfht 
 maintain iin action against the person to whom it was sold for 
 the loss occasioned to the estate, and that it was n(jt neccissaiy 
 that the assignee shoild he spc^cially authorized to l)ring such 
 action l»y the creditors holding hyphothecary claims on the real 
 estate (lirown v. Smilh, U L. C. J. 2SS). 
 
 The assignee cannot avoid a transaction of wliich lie has taken 
 tiif licneHt, thus he cannot, having received tlie proceeds of a sale, 
 aftei'waids treat that sale as tortious, and sue the seller in trover 
 (Smith V. liakcr, L. R. 8 C. P. 350 ; Birwcr v. Sjvirrow, 7 B. & 
 ('.310). 
 
 The words "opposite party," in this section, are used to desig- 
 nate all against whom the insolvent, after attachment or assign- 
 ment issued, or l)efore discharge obtained, " sues out any writ, 
 or institutes or continues any proceedings of any kind or nature 
 whatsoever." These words apply to the assignee when lie is 
 made a defendant to a suit by the insolvent. Thus where the in- 
 solvent filed a bill to set aside an attachment, as fraudulently 
 issued, and made the assignee of his estate a defendant, although 
 no party to the alleged fraud, an order was granted under this 
 section, requiring the pliiintiff to give security for the costs of the 
 defendant, the assignee {L^c v. Moffatt, (I P. R. U. C. 284). 
 
 The Bankruptcy Act of 1H(!(), in England (section 12), j)rovides 
 that when a (iebtor shall be adjudicated a bankrupt, no creditor 
 to whom he is indebted, in res])ect of any debt provable in bank- 
 ru]»tcy, shall have any remedy against his property or person in 
 resj)ect of such debt, except in the manner directed by the Act. 
 Power is also given })y the Court to restrain further proceed- 
 ings in any action, suit, execution, or other legal process against 
 the bankrupt in respect of any debt prova,ble in bankru])tcy 
 (see the following cases under the English Act: Ex parte Diiton, 
 L. R. 1 Ch.D. 557 ; ex parte Rocke, L. R. (5 Ch. App. 795 ; ex parte 
 Andn-son, L. R. 5 Ch. App. 473 ; ex parte Tait, L. R. 13 Eq. 311; 
 re Chapinayi, L. R. 15 Eq. 75 ; ex parte Is(((i.c, L. R. 6 Ch. App. 
 5H ; ex parte Warren, L. R. 10 Ch. 222 ; ex parte Mills, L. R. 6 
 
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154 
 
 THE INSOLVENT ACT. 
 
 Ch. App. 504; ex parte Ilwjhes, L. R 12 E<\. 137 ; ox parte IVir- 
 mingham A S. G. Co., L. R. 11 Eq. G15 : ex parte Coker, L. R. 10 
 Ch. App. 052). 
 
 40. If a partner in an unincorporated trading' company or co-partnership 
 becomes insolvent within the meanini; of this Act, and an UHsigneo i.s ap- 
 pointed tu the estfite of such insolvent, such partnership shall thereby bo 
 held to be dissolved ; and the assignee shall have all the rights of action 
 and remedies against the other partners in such company or co-partnership, 
 which the said insolvent partner C(tuld have or exercise by law or in ci(iiity 
 against his co-partners after the dissolution of the firm, aud may avail him- 
 self of such rights of action antl remedies, as if such co-partnership or com- 
 p.any had expired by cfHux of time. 
 
 41. Every official assignee, or a.ssignoe appointed by the creditors, shall in 
 every case in which he acts as such, keep a register showing the name of each 
 insolvent who has made an assignment, or against whom a writ of attach- 
 ment has issued, his residence, place of business, and the nature of his 
 trade or business, the date of the assignment, or of the issue of the writ 
 of attiichment, the amount of liabilities ackno'- ledged by the insolvent in 
 his schedule of liabilities, the amount of claims proved, the amount of com- 
 position, or of dividends paid— and whether a discharge has been granted 
 within une year or not — the amount of dividends remaining unpaid af'a r 
 three months from the declaration of the last dividend, with such oth'^r in- 
 formation as the assignee may deem of general interest with reference to each 
 estate — which register shjvU bo open to the inspection of the public, witliin 
 oftice hours, u' the ottice of such assignee ; and the official assignee, or the 
 a-ssigneo, as soon as he takes charge of any estate, shall open a separate book 
 for each such estate, showing a debtor and creditor account of all his receipts 
 and disbursements on account thereof : 
 
 And every assignee, other than an official assignee, shall within one month 
 after he shall have wound up the estate of any insolvent, and obtained his 
 discharge, deposit the register kept by him as aforesaid, with reference to 
 8\ich estate, in the office of the ofticial assignee of the county or district, 
 where it shall remain for the like jjurposes, and under the same jirovisions as 
 the register kept by the official .assignee. 
 
 And everj' register of, or coming into possession of, an official assignee ami 
 every other record required to be kept by an official assignee in connection 
 with the performance of his duties shall be lield to be the property of Her 
 Majesty, and upon the death of an official assignee, or his ceasing to hold 
 office, the Judge shall l)e entitled to, and shall assume pfissossion and control 
 of such register or other record which shall thereafter be kept among the re- 
 cords of the Court open to inspection as aforesaid (39 Vict. chap. 30, s. 11). 
 
 Every assignee shall, before the end of October in each year, fill up and 
 
DUTIE8 OP ASSKJNKPX 
 
 1 " ■ 
 
 lo.- 
 
 transmit to tho Minister of Agricul iiro, or in case this branch of the 
 subject of statistics and the registration thereof bo by tlio fiovernor in Council 
 transferred to any other Minister, then to such other Minister a schedule 
 showing tho partic\ilars contained in the register to be kept by him nnder the 
 forty-first section of the said Act, and such other schedules for tho year end- 
 ing tho thirtieth day of Septoinl)er next preceding, relative to tho insolvency 
 matters transacted by him as shall be from time to time prescriliod by tho 
 (iovornor in Council according to forms published in tho i\nt,<uln Gazette, 
 and it shall be tho <luty of eveiy assignee to make from day to day, and to 
 keep entries and records of tho particulars to bo comprised in such schedules 
 (30 Vict. chap. 30, s. 18). 
 
 Any assignee neglecting or refusing to fill up and transmit any schedule 
 under the eighteenth section of this Act, or wilfully making a false, partial, 
 or incorrect schedule therenndor, shall forfeit and pay the sum of forty dollars 
 togotlier with full costs of suit, to bo recovered by any person suing for the 
 same, by action of debt f)r information in any Court of record in tho Pro- 
 vince, in which such return ought to have been made, or is niailo, or in the 
 Exchofpior Court of Canada, and one moiety whereof .shall be pa'd to the 
 party suing, and the other moiety into tho hamlsof Her Majesty's Receiver 
 (joneral, to and for tho public uses of Canada (3!) Vict. chap. 30, s. 19). 
 
 The statistics collected by the Minister of Agriculture or such other Mini- 
 ster as aforesaid, under this Act, shall be abstracted and registered and the 
 results thereof shall be printed .and published in .an annual report (30 Vict, 
 chap. 30, 8. 20). 
 
 TliL' insolvent lia.s no action against tlie n.ssij^mee to his estate, 
 even after liis discliarge, to compel him to render an account of his 
 administration. His recourse is by petition or motion, and if he 
 claims under deeds of composition and discharge these mast have 
 been first deposited with tho assignee to enable him to give notice 
 of the same under the Act (Frawr v. Paffersmi, 1 Revue Critique, 
 
 ASSUiNEKs' ACCOUNTS, C(»MM ISSION, itc. 
 
 42. Every assignee, under this Act shall, within thirty days after ob':aining 
 his discharge, and every assignee under any Act hereby repealed shall within 
 thirty days after obtaining his discharge, or the closing of his accounts as 
 such, or within thirty days after the coming into force of this Act, if he has 
 obtained his discharge or closed his acct)unts before its coming into force, 
 pay over to the Recoiver-General all moneys belonging to the estate then in 
 his hands, not required for any purpose authorized by this Act or any Act 
 herel)y repealed, as the case may be, with a sworn statement and account of 
 such moneys, and that they are all he has in his hands, nnder a penalty of 
 
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150 
 
 THE INSOLVKNT ACT. 
 
 not exceeding ten dullars for each day on which he shall neglect or delay such 
 payment ; and he shall be a debtor to Her Majesty for such moneys and may 
 be compelled as such to account for and pay over the same. 
 
 43. The assignee shall be entitled to a coinniissicjn on tbe net proceeds of 
 the estate of the insolvent of every kind, of five per cent, on the amount 
 realized not exceeding one thousand dollars, the further sum of two and a 
 half per cent, on the amount realized in excess of one thousand d(jllars 
 and not exceeding five thousand dollars, and a further sum of one and a 
 quarter per cent, on the amount realized in excess of live tliousand dollars — 
 Avhich. said commission shall be in lieu of all fees and charges for all his ser- 
 vices and disbursements in relation to the estate, exclusive of actual expenses 
 in going to seize and sell, and of disl)ursements necessarily made in the 
 care and removal of property : 
 
 The creditors ma}', in case, in their opinion, the remuneration of the as- 
 signee under the preceding part of this .section is inadecpiate, at any meeting 
 called for the purpose, fix such additional remuneration to be paid out of the 
 estate to the assignee as they shall think reasonable. 
 
 No assiL'ree shall employ any counsel or att(jrney-at-law without the consent 
 of the inspectors, or of the creditors ; but expenses incurred by employing 
 such counsel or att'-rney with such consent, shall be paid out of the estate, if 
 not recovered from any party liable therefor. 
 
 The remuneration of the official assignee, when he is superseded by an 
 assignee appointed by the creditors, and the remuneration of the assignee, 
 whether he be the official or the creditors' assignee, in cases in which the 
 estate is settled by composition, shall be fixed l)y the creditors at their first 
 meeting or by the inspectors within one week tliereafter, subject in either 
 case to revision by the Court or judge, and in default of being si^ fixed sliall 
 be settled by the Court or judge, and taxed by the proper officer, and shall 
 be the first chai'ge on the (istate. 
 
 Any assignee who shall insert any charge in his account, above or beyond 
 the remuneration allowed to him by law, and who shall not remove it there- 
 from at the request ""in writing of any creditor, or of the inspectors, within 
 three days after the receipt of such rerpiest, shall forfeit and pay, in case 
 the judge shall so order, treble the amount of the overcharge to the funds 
 of the estate (30 Vict. chap. 30, s. 12 ; 40 Vict. s. 13 j. 
 
 By the 40 Vict. s. 34, every official a.ssignee is re(][uii'ed to print 
 this section as amended, and he must cause the same to be ]io.sted 
 up in a conspicuous place in his office, and at every meeting of 
 Ci'editors a printed copy of this section must be laid on the table. 
 
 According to the reading of this section, the assignee's commis- 
 sion is five per cent, on the first tliousand dollars realized ; seven 
 
ASSIGNKES REMUNERATION. 
 
 157 
 
 i 
 
 and a half per cent, in all, on the .sum actually realized, when it 
 exceeds one, and is under live thousand dollars ; and eight and 
 three-fourths per cent, in all, on the sum realized when it exceeds 
 five thousand dollars. 
 
 Rent for the use of premises to store goods of the insolvent 
 from the time of the conunencement of the [)roceeding-s to the date 
 of surrender, should he pai<l l»y the assignee, and charged as c6 
 part of his expenses (re Hafna<je[, 12 B, R. 554). 
 
 The assignee had, under the former Acts, the sole right to 
 appoint antl select his own pi'ofessional adviser to act as the soli- 
 citor of the estate; ami he could not be made to change his solicitor, 
 unless upon some i-easonahle ground, and, even in that case, the 
 only way of getting rid of the objectionable solicitor, was by re- 
 moving the assignee from his office, if he refused to change his 
 solicitor (re Lnmbe, 17 C P. U. C. 183-5 ; ex parte Tomlinson, 2 
 Rose, 0(5). 
 
 But now under this section, no assignee .shall employ any coun- 
 sel or attorney-at-law, without the consent of the inspectors, or of 
 the creditors. 
 
 It seems, that the attorney of the assignee would have a lien 
 upon all documents, which came into his hands in the course of 
 his employment, as the fruit of his labour or expense (ex parte 
 Y<dden, L. R. 4 Ch. D. 129 ; re MesseyKjer, L. R. 3 Ch. D. 317). 
 
 44. The assignee shall call meetings of creditors whenever required in 
 writing so to do, by the inspectors or by five creditors, if there are five, or 
 mure, or by all the creditors, if there are lesstlian live, or by the judge, and 
 he shall state succinctly in the notice calling .any meeting, tlie purpose thereof. 
 
 !;! 
 
 . 
 
 The 39 Vict. chap. 30, s. 13, amended this section, by adding 
 after the words " five creditors," the following words : " if there 
 are five or more, or by all the creditoi's, if there are less than five" 
 (see as to creditors' meetings, .sections 100-1-2-3). 
 
 45. The assignee shall deiiosit at interest in some chartered bank, to be 
 indicated by the inspectors (.r by the judge, all sums of money whicli he may 
 have in his hands belonging to the estate, whenever such sums amount to one 
 hundred dollars ; such deposit shall not be made in the name of the assignee 
 generally on pain of dismissal, but a separate deposit account sh.all be kept 
 
158 
 
 THE INSOLVENT ACT. 
 
 Ill 
 
 for each estate of the moneys belonging to such estate, in the name of the 
 assignee and of the inspectors (if any) and such moneys shall be withdrawn 
 only on the j(jint che([ue of the assignee and of one of the inspectors, if 
 there be any. 
 
 The interest accruing on such deposit shall appertain to the estate, and 
 shall be distributed in the same manner and .sul)ject to the same rights and 
 privileges as the capital from whicli snch internst accrued. 
 
 If in any account or dividend sheet made subsetpient to any deposit in a 
 bank, the assignee omits to account for or divide the interest then accrued 
 thereon, he shall forfeit and pay to the estate to which such interest apper- 
 tains, a sum etjual to throe times the amount of such interest ; and he may 
 be constrained so to do by the judge, upon summary petition and by im- 
 prisonment as for a contempt of Court. 
 
 At every meeting of creditors, the assignee shall produce a bank pass book 
 showing the amount of deposits made for the estate, the dates at which such 
 deposits shall have been made, the amounts withdrawn and dates of such 
 withdrawal, of which production mention shall be made in the minutes of 
 such meeting, and the absence of such mention sliall be prima facie evidence 
 that it was not produced thereat ; the assignee shall also produce such pass 
 book whenever so ordered by the judge, at the re<iuest of tlie inspectors or of 
 a creditor, antl v\\ his refusal to do so he shall Ije treated ua being in contempt 
 of Court. 
 
 The assignee wlio .shall make or cause to he made any false entry in such 
 pass book, witli a view to deceive the ins})ect(jrs, creditors or judge, shall be 
 guilty of a nnsdemeanor, and shall be liable, at the discreti'tn of the Court 
 before which he shall l)e convicted, to punishment by imprisonment for a 
 term not exceeding three years, or to any greater punishment attached to the 
 otlence by any Statute. 
 
 A copy of this suction must liu jiriiitcd l>y tlic otticial assignee, 
 and po.sted uji in a conspicuous place in his uthce, and at every 
 meeting of creditors a printed copy thereof must be laid on the 
 table (see 40 Vict. s. 34). 
 
 4G. Upon the death of an assignee or official assignee, or upon his removal 
 from otHce, or upon his discharge, the estfite shall remain unde;* the control 
 of the judge until the appohitment of another assignee or official assignee, 
 as the case may lie, wlien the estate shall liecome vested in such other assignee 
 or otiicial assignee. 
 
 47. After the declaration of a final dividend, or if, after using due diligence 
 the assignee has l)een unable to realize any assets to be divided, the assignee 
 shall prepare his final account, and present a petition to the judge for his 
 discbarge, after giving notice of such iietitiim ti> the insolvent, and also to the 
 
DISCHARGE OF ASSIGNEE. 
 
 159 
 
 [iIFjli 
 
 inspectors, if any have been appointed, or to the creditors by circular, if no 
 inspectors have been appointed ; and he sliall produce and file with such poti- 
 tioii a bank certificate of the deposit of any dividends remaining unclaimed, 
 and of any balance in his hands ; and a statement showing the nominal and 
 estimated value of the assets of the insolvent, the amount of claims proved, 
 dividing them into ordinary, privileged or secured and hypothecary claims, 
 ^'le amount of dividends or of composition paid to the creditors of the estate, 
 and the entire expense of winding up the same. And the judge, after caus- 
 ing the acccmnt to be audited by the inspectors, or by some creditor or 
 creditors named by him for the purpose, and after hearing the parties, may 
 yrant conditionally, or unconditionally, the prayer of such petition, or may 
 refuse it. 
 
 48. Any assignee who neglects to present such a petition within six months 
 after the doclfiration of a final dividend, or within three montlis after he 
 sliall have been required by the inspectors or by any creditor of the estate, 
 after it shall have been ascertained that there are no assets whei'ewith to de- 
 clare a dividend, shall incur a penalty not exceeding one hundred dollars. 
 
 (2.) The provisions of the next preceding section shall apply to all per- 
 sons who have acted or are acting as assignees under "The Insolvent Act of 
 1869," or in either of the Provinces of Quebec or Ontario under the Act 
 formerly in force therein, called and known as " The Insolvent Act of 18G4," 
 or any Act or Acts amending or continuing the same or either of them ; and 
 any such pers(jn who neglects to present such a petition as therein mentioned 
 within the following delays respectively, shall incur a penalty of one hundred 
 dollars, that is to say : — 
 
 («) In case x final dividend has been declared before the coming into force 
 of this Act, or in case the assignee has been unable to realize any assets to 
 be di\ ..^ed, then within three months after this Act has come into force ; 
 
 (/>) In case a final dividend is declared after the coming into force of this 
 Act, then within six months after the declaration of such final dividend. 
 
 „!') 
 
 COMPOSITION AND DISCHARGE. 
 
 49, If at the first meeting of the creditors, or at any time thereafter, the 
 insolvent tiles with tlie assignee a consent in writing to his discharge, or a 
 deed of composition and discharge, signed by at least a majority in number 
 of the creditors who have then respectively proved claims of one hundred 
 dollars and upwards, or if at such first or at any subsequent meeting an offer in 
 writing be made by the insolvent to compound with his creditors, specifying 
 the terms and conditions of the proposed composition, and such offer be ap- 
 proved of by a majority in number of such creditors present at such meeting, 
 the assignee shall call another meeting of the creditors to take such consent 
 or such deed or offer of composition and discharge into consideration ; and in 
 every case such deed of coniijosition or offer of composition shall be on condi 
 
 Iff 
 
160 
 
 THE IXSOIA'KNT ACT. 
 
 tion, whether the same be expressed ov not, that if the same lie carried out, 
 the insolvent shall pay the conis incurred in insolvency, including those for 
 the confirmation of such composition. 
 
 It Avill be observed that, under tliis section the assignee must 
 call the nieetiuif when the consent to the discharoe or tlie deed of 
 coniposition is signed l)y the majority of those cieditors who have 
 then pi'oved claims to tlie amount of one hundred dollars or up- 
 wards. In decidintf whether he sliould call the meetins; for the 
 consideration of the consent oi' deed, the assignee need not con- 
 sider wliether the insolvent has obtained the three-fourths in 
 value, although, as we shall hereafter see, the three-fouiths in 
 value must ultimately be obtained to give the deed validity. 
 
 The requirement of the majority in number is a safeguard to 
 prevent the assignee calling the meeting without sutticient cause. 
 The provision requiring the calling of the meeting is as neces- 
 sary in the case of a deed of conqiosition as it is in the ease of an 
 otter by the insolvent to compound or a consent to his discharge. 
 This provision is not merely directory, for, if not conqilied with, 
 the deed will be void as against dissentient creditors (re ^fa- 
 Laren and Chalmers, 1 Appeal Reports Ont., G(S). The inten- 
 tion of the Act was that before a minority were comjolled to 
 accept a certain conqiosition they should have an o[)p junity of 
 explaining their views, and of bi'inging before the general body of 
 creditors their reasons in opposition to the acceptance of a c(jm- 
 position. Until the deed is submitted to such meeting, it is oidy a 
 " proposed conqjosition and discharge " (ib. 71 ; per Moss J. A.). 
 
 In the opinion of the writer, the calling of the meeting of credi- 
 tors to take the consent or deed of coniposition into consideration 
 is a useless and unnecessary proceeding, and Uie provision reqtiir- 
 ing it should be repealed. It seems to have been imported into 
 our Act by analogy to the proceedings in England, in the case of 
 liquidation by arrangement, but in the latter case there is no 
 deed or consent signed by the creditors. The result is accom- 
 plished by resolution. Under our Statute, the meeting is not to 
 be called unless the deed is signed by the majority in number of 
 those who have tlien proved claims, and the meeting is called 
 
DEEDS OF COMPOSITION. 
 
 IGl 
 
 merely to approve of what the creditors have ah-eady approved 
 ot hi siL;'uiiig the deed. In practice, when tlie deed is signed Ijy 
 tlie majority in number and three-fourths in value o* ihe insol- 
 vent's creditors before the meeting takes })lace, no creditors attend 
 the meeting, the composition being already settled by the re(piisite 
 sign"tures ; and even under the o2nd section, the ret^uisite num- 
 ber of signatures carries the matter ])efore the judge, whether 
 tlie creditors at the meeting approve or disap])rove of the deed. 
 Besides, under section 51 a creditor may i»ut in his objections 
 without attending the meeting. The whole matter mi<fht Ije 
 advaiitageously left to tlie judge for decision. 
 
 The !)7th section of the Act of liSGiJ rec^uired the assignee 
 to give notice by advertisement of the de})Osit of the deed with 
 him. The object of this was to inform creditors, who were not 
 assenting jmrties to the deed, to oppose its being acted on {Nicltol- 
 ■soa v.Gimn, 80 Q. B. U. C. 7). 
 
 Under the 9Gth .>-ection of the Act of LSG9, a reconveyance to the 
 debtor, if in accordance with a deed of composition and discharge, 
 was as valid as an ordinaiy sale to a third person after all the 
 preliminary proceedings had been taken (see section GO of this 
 Act) ; but, under the !)7th section of that Act, it was a condition 
 precedent to the assignee making the reconveyance, that he should 
 tirst have immediately given notice by advertisement of the 
 deposit of the deed with hini, and in the absence of such notice 
 his reconveyance was not binding upon non-assenting creditors, 
 and would not confer to the party to whom it was made a valid 
 right to sue in respect of the property conveyed (Xlcholson v. 
 Giinn. SoQ. B.U.C. 7 ; see also Aihmv. aarnUt, 30 Q. B. U.C. 180). 
 
 There are three modes by which an insolvent may obtain 
 a discharge from his liabilities, either by a consent signed by a 
 majority in number of the creditor s who have proved claims of 
 over one hundred dollars, and who represent at least three-fourths 
 in value of all the claims which have been proved, whether aliove 
 or below one hundred dollars, or by a deed of composition, signed 
 in like manner, or, in default of either of these, an order from the 
 judge for his discharge under the G4th section, obtained after the 
 lapse of a year from the assignment or the issuing of the writ of 
 
 K 
 
 :')i , •:• I 
 
 fi: '' 
 
 • '!. 
 
102 
 
 THE INSOLVENT ACT. 
 
 ,1,1 r 
 
 attaclnuent. A consent in writing to a disci )iU'<>e has a diffevcnt 
 ofiect from a deed of coni])osition. The latter involves a restora- 
 tion of the estate to the insolvent. 'J'hefonnerdoes not necessarily 
 involve a composition with the debtor or a restoration to him of 
 the estate. It remains to hi; administered by the Court in insolv- 
 ency for the benefit of the creditors, and the consent operates as 
 a relea.se of the debtor personally, the creditors accepting in satis- 
 faction theii- remedy in the insolver.cy against the in.solvent's 
 estate (see Shiiv v. M<t^.'^i(', 21 U. P. IJ. ('. 27-)). It has been held 
 that a con .sent to a discharge (jf an ins(jlvent is operative even 
 without an assignment, provided the insolvent makes and files an 
 affidavit that he has no estate or effects to assign (re Perry, 2 U. 
 C. L. J. N. S. 75 ; Jones, Co. J). This, however, cannot be regarded 
 as law under the present Act, at all events the consent could not 
 be operative under the Act (see Green v. Sivau 22 C. P. U. C. 
 307; Prn-osi v. JJrolcf, IH L. C. J. 800; Squire v. Watt, 2!) Q. B. 
 U. C. .S28) ; whatever effect it might have at common law, on 
 the creditors who actually signed it (see ante 7-8). 
 
 The word " insolvent " in this section means an insolvent whose 
 estate is being ailministered under the Act, and all these sections 
 as to composition only apply when the estate is in insolvency. 
 A deed of comp(jsitioti and discharge made wdthout any pi'oceed- 
 ings in insolvency (before or after), without any assignee being 
 ajipointed, and altogethei- outside of the Insolvent Court, cannot be 
 a bar to non-assenting creditors, though executed by a majority 
 in number and three-fourths in value of the insolvent's creditors, 
 although, j)erhaps, under the present Act the deed may be invoked 
 and acted on, whether made before, pending, or after an assign- 
 ment, or the issue of a writ of attachment ; but the deed nnist be 
 filed with the assignee, and confirmed and acted on in the same 
 manner as if wholly made after the assignment. The 94)th sec- 
 tion of the Act of 1869, which provided that the deed might be 
 made before, pending, or after proceedings upon an assignment, 
 only meant that if a debtor had proposed an assignment, and a 
 deed had been prepared and possibly executed by some of his 
 creditors, the issuing of an attachment or the execution of a volun- 
 tary assignment should not defeat what had already been agreed 
 
DKKDS OF COMPOSITION. 
 
 1G3 
 
 u}M)n, )mt tliat tlic (Iced min'lit Ix.' proceoilcMl with and acted on as 
 if made after the entrance into in.s(jlvency {Green v. S trail, 22 (J, 
 P. V. C. 307). 
 
 Thon<,di a deed ot'coniposition may, prohahly, 1)e signed before 
 tlic insolvency proceedings, yet it would seem that it cannot be 
 acted on in any way until the first meetiny of creditors for the 
 appointment of an assignee. It may then be Hied under this sec- 
 tion: antl the meeting tor ajiproval called. It is presumed that 
 the judge would bi- justified in contirmiug the deed if, at thu clo.se 
 of this meeting, tlie majority in number and three-foui'tlis in value 
 of those who had tlien proved claims had signcil the deed, al- 
 though there might be a large proportion of ci'editors who had 
 not then proved (see also notes to section .).'}). 
 
 The policy of the Insolvent Act being the e(pial distri1)iition of 
 the assets of the in.solvent among all his credit(n's, no deed of com- 
 position and dischaig(! can be binding on non-assenting creditors, 
 unless it provides e(|ually for the claims of all, whatever may be 
 the proportion of the proposed composition to the original debts 
 which the majority may agree upon. If a deed l.»y express terms, 
 or by implication, Ity not providing for a creditor, excludes liim, 
 such a deed cann(jt be a composition deed within the meaning 
 of the Act. If the deed is made between the several persons 
 whose names and seals are subscribed and afiixed thereto and the 
 del)tor, only the creditors who sign will be jmrties to the deed or 
 bound by it. A non-assenting creditor cannot be regarded as a 
 party thereto, and will not, in any way, be affected by its provi- 
 sions (Shdiu V. AfasHie, 21 C. P. U. C. 20G ; re Raivllngs, 9 Jur. 
 >«'. S. 817 ; ex-parte C'ockburn,9 L. T. X. S. 405 ; ChesterJieldCol. 
 Co. V. HdwkiiiH, J H. & C. 077; Be ah (/in v, Broddharst, 3 H. & 
 C. 472). The deed to be binding on all the creditors must pur- 
 port on the face of it to be for the benefit of all, should, in express 
 terms, be made between all the creditors on the one hand and the 
 debtor on the other ; and, as to non-assenting creditors, the deed 
 .should be so framed as to be binding on the insolvent and that the 
 non-assenting creditor shall receive his com2:)osition eipially with 
 those executing. The amount coming to the non-assenting credi- 
 toi' should be paid to him, or at least tendered to him, unless it 
 
 
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 164 
 
 THE INSOLVKNT ACT. 
 
 is part of the agreenuTit in the (k-ed of composition, that the 
 amount jiayaMe should lie disposed of in some other way. 
 
 It is necessary, under the jnvsent Act, that the deed of com- 
 positioii, or the consent to the discharge, should he signed l>y the 
 majority in nundier of the creditors who have proved claims over 
 one hundred dollars. The creditors who have signed the deed 
 must also represent three-fourths in value of the claims which 
 have been proved, whether these claims are ahove oi- below one 
 hundred dollars (see sections 2 [li] and 50), so that creditors re- 
 presenting claims under one hundred dollars are com))uted in the 
 three-fourths' value, though they ai'e not considered in estimating 
 the maj(jrity in number. There is no doubt that, before tlie sig- 
 nature of a creditor to a deed of composition or a consent to a dis- 
 charge can be of any avail, the creditor must have proved his 
 claim (see also notes to section 52 ; see also Rooney v. L>juii, Q. B. 
 U. C. not yet reported). 
 
 But creditors whose claims are not barred by a discharge, or 
 who hold ])rivileged claims, are not to be computed in the major- 
 ity in numbei' and three-fourths in value rerjuired to give validity 
 to a deed of composition or consent to a discharge (see section (i.S 
 on this, and also as to claims which are not barred by thedischarge ; 
 seeah.o section 2 [//]). 
 
 In estimating the proportion on secured claims, only the l»alance 
 for which the creditor ranks on the estate, after deduction of the 
 value of his security, can be considered (see section 82 ; re Laivson, 
 5 U. C. L. J. N. S. 282 ; see 40 Vict. .s. 21 ; see also Notes to s. 84). 
 
 If the deed of composition is not made between the debtor antl 
 all his creditors, it should be shown that the creditors who are 
 parties to it, ai'e the only creditors within the meaning oi the Act 
 {Dredge v. WaUon, 33 Q. B. U. C. 1G5). 
 
 A deed of composition and discharge made with the insol- 
 vent's partnership creditors only, will be valid where there are no 
 separate or individual cieditors (Preston v. Ilanton, 37 Q. B. U. 
 C. 177). 
 
 But if it appears that the niend)ersof the insolvent firm have 
 individual lial)ilities, and the deed only provides for partnership 
 debts, it will not bind non-assenting creditors, whether they are 
 
DEEDS OF COMPOSITION. 
 
 165 
 
 creditors of the firm or of the individucal partners (Allan v. Gar- 
 ratt, 30 Q. B. U. C. 105). 
 
 Wliere the deed is signed by the majority in number and three- 
 fourths in vaUie, it is binding on a creditor who does not execute it 
 (Preston V. I [union, .supra). 
 
 A deed of composition and discharge made only with an in.sol- 
 vent's partnership creditors is not binding upon his indivi(hial 
 creditors, when I.e has sucli creditors. So the deed must be made 
 witli all the insolvent's creditors, and where a deed was made with 
 the '"several ])ersons whose names and seals are hereunto set and 
 affi.xcd," it was held that it only bouml those executing the deed 
 and not a non-executing creditor {PUhjcon v Martin, 25 C. P. U. 
 (1 233). 
 
 When, after an assignment and the execution of a deed of com- 
 position and discharge, defendant, an insolvent, permitted an arlji- 
 tration upon the plaintiff's claim to be proceeded with, personally 
 attending the arbitraticm, and not setting up the deed as a bar, it 
 was held that this would preclude the defendant from afterwards 
 setting up the deed as ground for setting aside nji.fa. i.ssued 
 against him on the award. Where a deed of composition and dis- 
 charge contained a covenant liy the insolvent with the parties 
 thereto of the first i)art to deliver the notes mentioned in the d(;ed 
 on request, &c., and the covenant had been fulfilled at the time of 
 the application foi" th<^ confirmation of tlic discharge, Logic, Co. J., 
 held on an application to confirm the discharge that the deed was 
 not void for inecjuality (re Lawson, 5 U. C. L. J. N. S. 232 ; Logie, 
 Co. J.). 
 
 A partnership composed of A.and B.having gone into in.solvcncy, 
 an as.signee to their joint and separate estates was in due course 
 appointed. The firm eliected a compo.sition with its joint creditors 
 at the rate of thirty-five cents on the dollar, and the firm's assets 
 were handed over to A. one of the partners. A. also eftected a 
 composition with his separate creditors at the rate of fifty cents 
 on the dollar. He was discharged from his .separate liabilities, 
 and his private estate handiMl over. B. also effected a composi- 
 tion with his separate creditors, at the rate of half a cent on the 
 dollar, and received a discharge from his separate liabilities. The 
 
 
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 'I'l 
 
 
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 : 
 
 'I 
 
 'iM! 
 .'(1 
 
 >4- 
 
 li 
 
 V 
 
106 
 
 THK [N'SOLVKNT ACT. 
 
 creditors in each cltiss were (Iffhucd to lie, aiwl aotiuilly vv< ic, the 
 majority in uiihiImt, lioldiiij,' tlircofonrtli-s of (lie liiiliilitics in sucli 
 class. TIic crcflitors of tlio tirni and of A. individually were (»aid 
 by A., and tlic dcf(l providtMl for a reconveyance of nil tlie estates, 
 firm and individual, to A. on the coni])osition hrin^ paifl. Tlie 
 imlividnal creditors of B. received their coni|iosition front him in 
 cash, and were also ap|)ointed to fjct tlii' tldrty-five cents fivmi 
 thefiini. and tlie fifty cents from A. individually. The conlirma- 
 tion of the deeil of composition was opposed liy u creditor of 
 the firm, on the ;;'ronnil of ine(piality, providing' diH'erent coni]iosi- 
 tions foi' ditferent crt'ditors, that the firm creditors ami the cre(li- 
 tors of each partner itidividually oui;ht to have received the same 
 rate. It appearefl that the contestin<^' creditor oidy I'eceived the 
 thirty-five cents on the dollar, and some of the othei' creditors 
 received the tliirty-tive cents, the fift} cents paid liy A. and the 
 half cent hy B. It was held that the contestin<;' creditor had a 
 rin'ht to the realization Oi" the individual estates of the firm, and 
 that the deed was une(pial,and confirmation thereof was therefore 
 refused (re HutcJihin, \ llesue criti(pie, 1S3 ; citiny Tinnliit v. 
 Diiiton, L. R. 3 Q. B. 4(iG ; Walker v. Xevillr, 3 H.&C. 403). 
 
 W. H. Kerr, Q.C., of Montreal, one of the editors of " La Revue 
 Criti(pie," epitomizes the law in the ca.se of in.solvent partnerships 
 as follows : The creditors of tlie firm, and the .separate creditors 
 of the ])artners, must he placeil on the same footing.;' as rcigards the 
 composition ; the majority of ci'editors in such ca.si- heiny the 
 recjuisite majority in numher and valu',' of all such creditors 
 regarded hut as one mussr ; or each partner may he treated as 
 individually insolvent, the deed of composition heing enteieil into 
 between him and the joint creditors, and his own si-parate credi- 
 tors, all being placed (jii the same footing as regai'ds the comjiosi- 
 tion. The .said deed must not contain any re-conveyance of either 
 estate to the insolvent, but to be mei'ely a discharge from his 
 liabilities, the estates to remain in insolvency (,see aiticle 1, Revue 
 Critique, 171). 
 
 The deed of composition sliouhl pi'ovide for the payment of all 
 claims which are provable against the estate ; and in the ca.se of 
 a partnership should provide for tlie creditois of the respective 
 
DKKDS OK C'OMI'DSITION. 
 
 I(i7 
 
 
 inii'tliLTs, as Well as for tlic ci'iMlitors of the tiiin as [)artTU!rs. 
 Tlioiiyh tilt' (Ici'd is iiiadr after an assi<fimi('iit, it is iiucossary that 
 the insolvent should 1k' a paity to it, and should execnte it. 
 When the tU-v(\ is made liet'oi'e an ussi;^nnient th\s '\s u forfi or l 
 necessary, foi' there is no one else with whom tlu! creditcjis can 
 contract (re Oarraft, 2i^ Q. J3, U. (J. iOli ; sec also Alia a v. Garratt, 
 30 Q. B. IT. C. 1 (i5). 
 
 When a deed of composition is i'ei,'ularly executed hy the 
 majority in luimher and value of the creditors of nii insolvent, it 
 is hindinn- on a ("editor who does m^t «;xecute, and who has nc.^r 
 prov(!d his claim on the estate. In such case, a creditor, whose 
 delit i.. iiiserted in the sdu^dule, is hound to accept the composi- 
 tion payable under the deed, when tendered to him, and if Ik- does 
 not he cannot resort to any other means of recovering' his deht 
 from the insolvent. Jn August, \H7'2, the plaintitt' issued &Ji /a 
 a;i;ainst the defendant's lan<ls, a portion of whi».n defendant, in 
 Novend)er, sold to one K. On the 1st of May, 1^73, defendant 
 made an assignment in insolvency, and, on the 31st obtained a 
 deed of composition and dischar<4e from the necessary proportion 
 of his creditois. On the 12th of Au<,aist, this was confirmed by 
 the county judge ; and, on the loth of Auyust, defendant's estate 
 was reconveyed to him by the assignee. The plaintiff was one of 
 the duly scheduled creditors, but took no p.art in the insolvency 
 proceedings ; and, although re(juested to remove his writ, refused 
 to do so, and advertised the lands for sale, contending that the 
 sale to K. was a withdrawal of these lands from the defendant's 
 assets, so that they never passed to the assignee. The Court held 
 that the plaintiff's del)t was discharged by the insolvency proceed- 
 ings, tliat the fact of the sale to K. could not alter the plaintiff's 
 position, and that his only remedy was under the deed of composi- 
 tion and discharge. The proceedings on the^i. fa. after the assign- 
 ment were, therefore, set a.side (Davuison v. Ferry, 23 C. P. U. C. 
 346). 
 
 Where the plaintiff' obtained a judgment, on the 4th of October, 
 l(S(j4, and nji. fa. lands was issued thtu'tion, and kept renewed from 
 time to time ; and on the Sth of March, 18GG, defendant made an 
 assignment under the Insolvent Act, and obtained a certificate of 
 
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 i-W- 
 
 » 
 
 ii 
 
 1 
 
 1 I 
 
i 
 
 168 
 
 THE INSOLVENT ACT. 
 
 discharge on the 30th March, 18G7, the plaintiff having proved 
 for the full amount of the judgment in the Insolvent Court, the 
 fi. fa. was set aside {Dickinson v. Bunnell, 19 C. P. U. C. 21G). 
 
 Where the assignment is not ipxo facto void, the jurisdiction of 
 the Court attaches so tliat the granting or refusing of a discharge 
 in such case is a (question not of jurisdiction so much as the exer- 
 cise of a legal discretion, and, if not appealed, it may be found very 
 difficult if not impossible to call it in (|Ucstion except it be assail- 
 able on the ground of fraud. Some nine years after defendant 
 had obtained his discharge in insolvency, the ])laintitf, a scheduled 
 creditor, issued a yi. /((. against defendant's goods, on a judgment 
 recovered before the discharge, contending that tlie discharge was 
 void because defendant had, previous to his assignment, fraudu- 
 lently allowed a judgment to be recovered against him and his 
 assets taken ; and also because his assets being so taken there 
 was nothin*' at the time of the assi<jnment on which it could 
 operate. It api)eared, liowever, that the plaintiff consented to 
 the assignment, and did not appeal fi'om the order of discharge ; 
 nor did he when the discharge was being granted raise the objee- 
 tion of no assets. It was held that the //./a. goods must be set 
 aside, and that the plaintiffs remedy, if any, was by action on the 
 judgment {Parke v. Day, 24 C. P. U. C. 010). 
 
 The Statute does not require the assignee to be a party to the 
 deed of composition and discharge. The composition and dis- 
 charge is an arrangement between the creditor and the debtor 
 alone, and where thei'e is an assignment in insolvency, and the 
 deed is acted on and confirmed under the Act, the mere fact of 
 the assignee not being a party to it will not render it invalid 
 {Drohjc V. Wahov, .S3, Q. B. U. C. 105). 
 
 After the dissolution of a partnership one partner may sign the 
 firm name thus " Wakefield, Coate tJc Co., ]X'r F. W. Coate," and 
 it will be a good execution of the deed of composition and dis- 
 charge for tlie firm (re Latvson, 5 U. C. L. J. N. S. 232 ; Logic, 
 Co. J.) 
 
 If a creditor who signs the deed accepts a composition under it, 
 he thereby ratifies the deed and cannot afterwards object to any 
 defect of execution. Thus it was held no objection that some of 
 
DEEDS OF COMPOSITION. 
 
 169^^^ 
 
 the assenting creditors had executed it in the name of their firms 
 liy procuration, and that no power of attorney was proved, it ap- 
 pearing that they had accepted tne composition under it (Allan 
 X. Garratt, SO Q.B.V.C. Wo). 
 
 The Act of 18G9 differed materially from the present Act, in 
 voferonce to the confirmation of deeds of com])Osition and dis- 
 charge. It was not obligatory under the former Act to procure 
 such confirmation. It might he acted on if advertised under the 
 97t]i section, and the only difference between the confinned and 
 unconfirme<l deed was that in the latter case the burthen of proof 
 of the discharge being completely effected, was on thn insolvent. 
 The present Act se<'ms to render confirmation necessary (see sec- 
 tions fil and CO), although under the GOth section of the Act, the 
 assignee is requii-ed to reconvey to the insolvent as soon as the 
 deed of composition is executed (see notes to this section). 
 
 An agreement to accept a composition, in respect of which no 
 default has been ma<le, is a •■•ood defence to an action brouu'ht for 
 the original debt (Shitcr v. Jones, L. R. 8 Ex. 18G). The effect of a 
 default is to remit tlie creditor to his original position (Nevx'll v. 
 Vai) Fnif/h, L. H. 9 C P. f)G) ; and he may then maintain an 
 action for whatever part of the original debt may remain unpaid 
 {Edwards V. Coomhe, L. R. 7 C. p". 519). 
 
 If the creditors have appointed a trustee for the distribution of 
 the composition, who, by no default of the delttor, makes default in 
 the payment thereof, the del)tor is not liable for s\ich default, and 
 an action brought against him will be restrained (re Tai/lor, 43 
 L. J. Bank. 2')). It would seem that the fact that no tender of the 
 composition ha,s been made by such trustee, does not amount to a 
 default, althoiigh a failure by the debtor to tender a composition 
 where no trustee is ajipointed does so (ib. ; see also Goldncy v. 
 Li}r<Hn<i,\j.\\. 8Q. B. 1H2). 
 
 Acceptance of a composition does not, as a general rule, discharge 
 the debt, until pa3'ment is made (Edvards v. Ilancher, L. R. 1 
 C. P. I). 111). But it has been held in England that the creditors 
 may, by their resolution for the acceptance of a composition, pro- 
 vide that the securities for the pay "ict of the composition shall. 
 
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 Mi 
 
 
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 I 4 
 
 '\1 
 
 <\ 
 
 1 
 
 
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 170 
 
 THE INSOLVENT ACT. 
 
 be taken in (liscliai'ge of the original debt (re Hatton, L. R. 7Ch. 
 App. 723). 
 
 A creditor will not be allowed to sue the debtor, if the assignee 
 is supplied b>' tlie debtor with sufficient funds to pay the conii)0- 
 sition, and he neglects to pay it (ex parte Waterer, 29 L. T. N. 8. 
 907; Campbell v. Im. Tlmni, L. R. 1 C. P. D. 207). 
 
 But a creditor cannot sue the debtoi- before tlie time appointed 
 for payment of the composition (Shder v. Jones, L. R. 8 Ex. 
 1(SG). If the composition is not paid or tendered through some 
 act of the creditor, or if the creditor has done something, making 
 it inequitable for liim to enforce liis legal I'ights, it has been held 
 in England that the Court will relieve the debtor from the conse- 
 quences of non-payment of the composition at the proper time (ex 
 parte Peacock, L. R. S Ch. App. (582). It has also been held in 
 England that after a resolution for a composition is passed and 
 registered, until defaidt in payment of the composition, the debtor 
 may deal with his property as owner (ex parte Hoare, L. R. 16 
 E(j. 025 ; see ex parte Burrell, L. R. 1 Ch. I). ;537). 
 
 A comj)osition agreement by several creditors, although by 
 parol so as tt) be incapable of operating as a release, and although 
 unexecuted so as not to amount in strictness to a satisfaction, will 
 be a good answer to an action by a creditor for his original debt, 
 if he accepted the agreement in satisfaction thereof. The defend- 
 ant, a trader, being in insolvent circumstances, wrote to the ])lain- 
 tiff, a creditor, in Scotland, giving him a statement of his account, 
 and informing him of his intention to make some arrangement 
 with his creditors, and that the plaintiff must rank with the othei-s 
 on his estate which he stated would not pay more than tifty cents 
 on the dollar, to which the plaintiff replied expi-essing no dissent, 
 and again that he was satisfied if there was no preference given. In 
 the meantime, the defendant had effected an arrangement with his 
 creditors for a composition of thirty cents in the dollar, on his repie- 
 sentatiou that plaintiff would accept it, without which the whole 
 arrangement would have fallen thi'ough, and the defendant must 
 have gone into insolvency. Defendant, on the same day, by letter 
 informed the |)laintiff of the arrangement, to which the plaintiff re- 
 plied without expi'essing dissatisfaction. Afterwards, without dis- 
 
DEEDS OF COMPOSITION. 
 
 171 
 
 .sent, lie received the instalments of the composition sent to him, 
 and on the receipt of the la.st instalment he acknowledged it as a 
 payment of " the last instalment of your indel^tedness to me." It 
 was held l)y the Court that the plaintiff" nuist be deemed to have 
 accepted the composition with the othei- creditors, and, therefore, 
 that he could not sue defendant for the balance (Mitchell v. 
 Mifchcll, 27 C. P. U. C. 100. This, however, was a composition 
 outside of the Insolvent Act. In proxiny for the original debt, 
 after the failure of the del)tor to pay the amount of a composition 
 which he has agi'eed to pay, the creditor nuist give credit for any 
 .sums paid to him on account of the composition, and also 
 deliver up any .security held f)y him for the payment thereof (ex 
 parte Ellis, 2 M. & A. 870 ; Pike v. Dicl-iiison, L. R. 7 Ch. App. 
 (11). Where the deed of composition [)rovides that the original 
 claims of tlie creditors shall revive on non-payment of the com- 
 position, on such failure, the creditor would only be required to 
 give credit for any sums paid on the original debt and not on the 
 amount of composition. Where the firm of A. & Co., made an 
 assignment, and the Molsons Bank proved a claim against them for 
 S0,7!S-^ and A. k> Co. effected a composition at fifty cents in the dol- 
 lar. ol)tained a discharge, and had their property restored to them. 
 A. (Si Co., then resumed business, and the Molsons Bank received 
 certain sums on account of the composition. A. & Co., failing to 
 pay the whole composition, afterwards made a second a.ssignment 
 and the Molsons Bank filed a claim for the whole amount due at 
 the time of tlie first assignment, namely, S9,785, less what had 
 been paid as composition. It was contended that the Molsons 
 Bank were not, under the ciicumstances, entitled to more tnan the 
 balance of the composition, l)ut the Court held that the agreement 
 for composition was annulled by the default, and that the Bank 
 were entitled to the balance due on the original debt after deduct- 
 ing the composition payments as so nuich cash received thereon 
 (Molsons Bank and Bnchanan, 4 llevue Legale, 225. 
 
 The majority of the creditors of an in.solvent, must exercise their 
 powers bona fide, for the connnon benefit of all, and, if from mo- 
 tives of kindnes,s, or benevolence, towards the insolvent, they 
 enter into any arrangement ])eneficial to him only, it will be a 
 
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 r, "IH* 
 
 "^if^- 
 
172 
 
 THE INSOLVENT ACT. 
 
 r I 
 
 fraud upon the minority ; but the mere fact, that they may have 
 acted partly from such motives, is not per se sufficient evidence 
 of fraud (ex parte Linsley, L. R. 9 Ch. App. 290 ; 29 L. T. N. S. 
 857). 
 
 A vote in favour of the acceptance of a composition, given out 
 of motives of kindness to the debtor, is voiil (re Rusyell, L. R. 10 
 Ch. 25.5 ; re Scdfey, L. R. 8 Cli. 727). But, if the resohition which 
 the creditors have passed, may be considered as beneficial to them, 
 the fact that some of them were partly influenced by motives of 
 kindness towards the debtor will not necessarily make it void (ex 
 parte Lmsley, L. R 9 Ch. App. 2!)0). 
 
 Not only is a vote which is not given bona fide, itself void, Ijut 
 a creditor cannot bring an action upon a promi.se made to him by 
 a .stranger, in order to induce him to vote in a particular manner, or 
 even merely abstain from voting (re Saunderson, L. R. 19 Eq. ()5). 
 
 So also it has been held in England, in the case of liijuidation 
 by arrangement, that if the resolutiims passe<l by the creditors 
 are not honafi.de for the ijenefit of the creditors, but arc passed 
 for the purpose of discharging the debtor, without any real Itenetit 
 to the creditors, as if there are no assets to distribute, they will l)e 
 invalid (ex parte Staff', L. R. 20 Eq. 775) ; so also, a resolution to 
 accept a composition less than the assets would be sufficient to 
 pay, was held to be invalid (ex parte Page, L. R. 2 Ch. D. 323). 
 
 The .statement of aftairs of a delitor, who had tiled a liquidation 
 petition, .shewed that his debts amounted to £11,358, while his 
 as,sets were only £75. Of the debts, the preferential claims 
 amounted to £127. The creditors by the proper statutory ma- 
 jority, resolved to accept a composition of Is. in the i)oun(l, to be 
 paid within one month after registration of the resolution, no 
 security for its payment being offered. The Court held that the 
 creditors were animated by motives of kindness towards the 
 debtor, that the resolution was not in the interest of thecre<litors, 
 bixtfor the beneKt of the debtor, and that it did not bind a <li.s- 
 sentient creditor (re Terrell, L. R, 4 Ch. D. 293 ; approving of ex 
 parte Page, L. R. 2 Ch. D. 323 ; and ex parte Rmsell, L. R. 10 Ch. 
 255). 
 
 If the debtor has kept books in his ^ ti.sine.ss, they mu.stbe pro- 
 
DEEDS OF COMPOSITION. 
 
 173 
 
 diiced on the demand of any inquiring creditor, and the debto'- must 
 answer all inc^uiries in reference to any entry in such books, which 
 hears upon the ([uestion of the exact condition of his affairs (re 
 Ilolmet^, 12 B. R. 86). If a creditor is induced to vote by any 
 unfair means, whether known to the debtor or not, his vote so in- 
 tluenced operates as a fraud on the other creditors, and makes the 
 composition voidable l)y any of them (re Sawyer, 14 B. R. 241). 
 
 A deed of composition and discharge allowed an insolvent to 
 carry on his business, keeping an account of the management 
 thercof,and holding himself responsible to account to the creditors 
 fur the business transacted ; and the deed furtiier instructed the 
 a.ssignee not to make any inventory, or take any proceedings on 
 such assignment, other than those requii'ed to notify his appoint- 
 ment, call in the creditors, and give notice of the deposit of, and 
 act on, the deed of composition. On an application for a confir- 
 mation of the deed of composition and discharge, one of the credi- 
 tors for the sum of Si, 740, duly proved, contested the deed on 
 the ground that the majority in number, and three-fourths in 
 value of the creditors, had no right or [)ower to give such direc- 
 tions to the assignee, or to bind non-assenting creditors. The 
 Court, considering that a large majority of the creditors had signed 
 the deed, that no charge was made, either against the insolvent 
 or the assignee, of any dishonest intention, and that the course 
 authoi'ized was beneficial to the creditors, rejected the application 
 of the contesting creditor, but granted to him "acte" of his petition 
 to avail as a formal protest against in.solvent, assignee, and all 
 others concerned, in so far as the pi'oceedings complained of had 
 an}' tendency to bind petitioner to any greater extent than he 
 could legally be bound by the same (re Lamontagne, 2 Quebec Law 
 Reports, 100). 
 
 A trader, in insolvent circumstances, made an assignment of his 
 proi)erty to several of his princii)al ci'editors, in trust for the 
 benefit of his creditors generally. Afterwards it was agreed that 
 the credit(;rs should accept twenty cents on the dollar, and dis- 
 charge the (lel)tor, whereupon the plaintiffs and other creditors 
 executed a deed to carry out this agreement. Before payment of 
 the composition, however, the trustees reassigned the property to 
 
 -i f 
 
 vS!* 
 
174 
 
 THK INSOLVENT ACT. 
 
 the debtor, on his uiuleitakini,^ to pay tlio several ereilitoi's the 
 amount of their claims, which he <litl [)ay to the trustees, Init 
 failed to pay to the plaintifis. The ('ourt held that the trustees 
 were liable to makej^'ood to the plaintiffs the sum comino- to them, 
 if the })roperty which had been assigned to them by the del»tor 
 was sufficient to realize the amount of the composition agreed on, 
 and as to this, if desired by the trustees, an entjuiry by the mas- 
 tei- was divacttid (X(U I onnl Bank, Albany , v. Moure, 21 Grant, 2(J1)). 
 
 50. Such meotiug sliall be culled by iit least ouo iiclvertisement published 
 in the Olticial Gazette, stating the time, place and object of the meeting, and 
 also by a letter or card postjiaid addressed by mail, at least ten days before 
 the meeting, to each of the creditors mentioned in the list of creditors fur- 
 nished by the insolvent, and to all other creditors who may have proved 
 their claims, although not mentioned in the said list, indicating in substance, 
 in .addition to the time, place and object of the meeting, the terms and con- 
 ditions of the proiiosed composition and discharge ; and such meeting shall 
 not take place less than fifteen days after the first publication of the said ad- 
 vertisement. 
 
 (See notes to section 20; see also section 101.) 
 
 51. The creditors present at the meeting to take into consider.ation the 
 proposed discharge, or composition and discharge, may, by resolution to that 
 effect, express their approval thereof or dissent therefrom ; and any creditor 
 may, at any time before or during the said meeting, file with the assignee 
 his objections in writing to the i^roposed discliarge, or composition and dis- 
 charge. 
 
 If a creditor does not attend the meeting and does not file with 
 the assignee his objections in writing under this section, it would 
 seem that he may still, under the •')8r(l section of the Act, appear 
 and oppose the confirmation of the discharge. 
 
 In reference to the discharge which may be obtained under the 
 G4th section of the Act, there is no provision for filing objections. 
 
 52. If at the close of the meeting or at any time thereafter, the insolvent 
 has obtained the assent to his discharge, or to the proposed composition and 
 discharge, of a majority in number of his creditors who have proved claims 
 to the amount of one hmidred dollars and upwards, and who represent at 
 least three-fourths in value of all the claims of one hundred dollars and up- 
 
DEEDS OF COMPOSITION. 
 
 17.> 
 
 wards which havo been proved, the assignee shall annex to the deed or con- 
 sent to a discharge, or to the deed or offer of composition and discharge, a 
 certificate to that effect, in which he shall state the total number and total 
 amount of claims of one hundred dollars and upwards which have been 
 proved, the niunber of creditors who have given their written assent to the 
 discharge or to the proposed composition and discharge of the insolvent, and 
 the amount of proved claims of cme Inuidred dollars and upwards which they 
 represeut. The assignee shall further annex to such certificate a copy of any 
 resolution adopted at the meetings of creditors in reference to the discharge, 
 or to the jmiposed composition and discharge, and all the objections which 
 may have been filed with him to such discharge, or coniposition and dischi rge, 
 together with a certificate as to the amount of claims of the creditors who 
 shall have agreed to or opposed such resolution, or who may have filed objec- 
 tions in writing to such discharge or pi-oposed composition and discharge, 
 indicating the amount of such claims of one hundred dollars and upwards 
 which have been proved, and whether from their nature they will be aflected 
 by the proposed discharge or composition and discharge. 
 
 The assignee shall further state in such certificate the ratio of dividend 
 actually declared iind likely to be realized out of the estate for the unsecured 
 creditors, and shall, without delay, transmit such certificate to the clerk or 
 protlionotary of the Court in the county or district wherein the proceedings 
 are carried on. 
 
 Any wilful misrepresentation in the certificate of a material 
 fact, for the purpose of deceiving the judge, is a misdemeanor 
 (see section 139). 
 
 The object in requiring the certificate to show whether the 
 claims proved will, from their nature, be affected by the discharge, 
 is to assist the judge in determining whether the proper propor- 
 tions have signed the deed, creditors not affected by the discharge 
 not being estimated. 
 
 It would seem that the certificate of the assignee is not conclu- 
 sive, and that the judge, on the application for discharge, has a 
 right to go behind it in cases of apparent fraud. The judge has 
 a duty to perform and is retjuired to see that the insolvency law 
 is not used as a mere white- washing machine. In a case under 
 the Act of 1869, the assignee's certificate stated that the insolvents, 
 petitioners for a discharge, had complied with all the requirements 
 of the law, but it appeared that from the time of the assignment 
 not one meeting had been called under the Act. The judge ex- 
 amined the parties on the application for discharge and refused 
 
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 i7G 
 
 THE IJiSOLVENT ACT. 
 
 the discharge on the ground of non-compliance with the re<niirc- 
 nients of the Act (re (}>iesnel, 2 Revue Critiijue, 478). 
 
 Prior to the passing of this Statute, it was hekl by the Court of 
 Appeals in Quebec, under the Act of LSGi), that if the majority in 
 number of the creditors signing the deed of composition repre- 
 sented in value three-fourths of "the proved debts," the composition 
 would be valid whatever might be the amount of the " admitted 
 ilthough unproved liabilities " of the insolvent as shewn by the 
 sche(hdes sworn to by himself. The insolvent is rei[uired to show 
 the auiount of his lial)ilities in his schedule of liabilities, Itut for 
 the purpose of deciding whether the insolvent has acijuired the 
 three-fourths in value necessary t<) give validity to a deed of com- 
 position and discharge we are to take three-fourths of the lialnli- 
 ties of which proi)f is furnished (re Toussaint, 1 Quebec Law Re- 
 ports, 127). 
 
 This decision was rendered in a case in which the schedule of 
 lialjilities, prepared and sworn to by the insolvent, showed $50,000, 
 and only about one-tenth of this amount was proved. 
 
 The present Act follows, so to speak, the decision of the Court 
 of Ajtpeals. It speaks expressly of the claims which have been 
 proved. It is, as we have already seen, neces.sary to the validity 
 of a deed of composition and discharge, that the creditors signing 
 it .should prove their claims; and now, under this section, the cur- 
 ious result will follow, that if the schedule of liabilities furnished 
 by the insolvent shows .S100,000 of lialjilities of which only $10,000 
 is proved, only three-fourths of the latter claims are re(|uired to 
 give tlie deed validity, and a creditor contesting the deed of com- 
 position cannot, as against the ins(jlvent, take his own statement 
 of liability as the criterion under this section. 
 
 The cases of re Lan<js (4 U. C. L. J. N. S. 283), and re Laivsoii 
 (5 U. C. L. J. N. S. 232 ; Logic Co. J.), cannot now be regarded as 
 law in so far as they go to show that the creditor need not prove, 
 in order to legally sign the deed. 
 
 We have already ex|)ressed an opinion that the judge would be 
 justified in confirming the deed if signed by the pi'oper proportion 
 of claims proved at the close of the meeting called for the approval 
 of the deed. The deed however cannot be actually confirmed for 
 
DEEDS OF COMPOSITION. 
 
 177 
 
 a month after the close of this meeting, and claims i.iay be proved 
 in the meantime. 
 
 If a secured creditor elects to accept his security and not prove, 
 and the otHcial assignee, on behalf of the creditors, assents to his 
 )rtaining thr security on these terms, he ceases to be a creditor 
 \sh(j can prove, and his tlebt cannot be taken into consideration 
 m estimating the amount of indebtedness of which there nuistbe 
 the three-fourths value to render the deed of composition effectual 
 (re Lav'son, 5 U. C. L. J, N. S. 232 ; Logic. Co. J, ; liocney v. 
 Ltjon, Q. B. U. C, 1870, not yet reported ; .see 40 Vict. s. 21 ; 
 also notes to section 49) The Act of 180!), in the i)4th sec- 
 tion, contained the words "subject to he computed in a.scer- 
 tainiiig such proportion." These words were used to prevent those 
 claims which came under the lOOth suction, and which could only 
 lie barred by the express consent of the creditor from being 
 reckoned against him in determining whether he was to be dis- 
 chari;ed from his ordinary liability or not. Under the 100th .sec- 
 tion, the discharge did not apply, without the express consent 
 (jf the creditor, to any debt due as damages for a.s,sault or wilful 
 injury to the person, seduction, or libel, slander, malicious arrest, 
 \'c., and the meaning of the words " subject to be computed in 
 ascertaining such proportion," was that the insolvent had a right 
 to have tlu.'se latter liabilities excluded from his ordinary liabili- 
 ties, in ascertaining the three-fourths in value under the 94th 
 suction (Drcdye v. Wdtson, 33 Q. B. U. C, 173 ; see .sections 2 (h), 
 ()3, 82 and notes to section 49 of this Act). It seems to the writer 
 that the words " subject to be computed in ascertaining such 
 proportion," were wholly unnecessary in the Act of 1809 (see 
 section 100 of that Act), and they are properly left out of the 
 present Act, for sections 03 and 82 provide for the computation 
 leijuired. Debts to which a discharge under the Act does not 
 apply, nor any privilegetl debts, nor the creditors thereof, are not 
 to be computed in ascertaining whether a suthcient })roportion of 
 the creditors of the insolvent have voted upon, done, or consented 
 to any act, matter or thing, under the Act, nor are secured debts 
 to l)e estimated, except for the balance after deducting the value 
 
 of the security. 
 L 
 
 ,p 1 1 
 
 i t 
 
178 
 
 THE INSOLVKNT ACT. 
 
 53. .An inadlvuut wlio his procured a consontto his discharf^'o, or tho oxo- 
 cuti(»ii of a <k'i'<l of coinpnsitioii and discliargo, and the ci'rtiticatu of tho mh- 
 signou, within tiio nieanin;,' of tliia Act, may tilo in tiio otlico of tho Court tirj 
 consent (tr deed of composition and dischargo, with such ccrtificato auni-xud, 
 and may tiiuii yivo notiei; (Form J) of tlio samo huinif so tilui'., and of liis in- 
 tention to apjily by petition, to the Court in thcs I'l-ovinces of (i)uebi'c and 
 Nova Scotia, or in tliu I'rovinuo of Ontario, New lirunswicli. Prince Edward 
 Islam), lii itisli Cohuuliia, and jMaiutcjba (and in Nova Scotia, when county 
 jmlgi's are ap[ioiiited there) to the jud^e, on a ihiy named in sucli notice 
 (which, however, .shall not be befcn'e the day on wliich a dividend may bo 
 declared under this Act), for a confirmation of tho discharge effected there- 
 by ; and .'<uch notice shall be given by one ailvortisement in the Otticial 
 (jia/.otte, and also by letter or card jio.stpaid, aihb'essed to each of the credi- 
 tors by n)ail at least one month before presenting the petition to the Court 
 or judge; and upon such ajjplication, any creditor of the insolvent, or tho 
 assii,'nee under tho authority of the creditors, mny appear and f.pposo such 
 contirmatit n. 
 
 It would seem tliat notice of the filinrr and of the insolvent's in- 
 tention to a])i)ly for a coiifiimation of his discharge may he o-ivt-n 
 at ouce luider this secticjn, although tho month allowed by section 
 31 (form I) for creditors to tile their claims has not expired (see 
 re Tacker 7 C. L. J. N. S. .S2(i). 
 
 But the day on which the application is made must not be before 
 the expiration of such month (seesectionTf)). The object,in retjuiring 
 the application for c(jnlirmation to be after the day when a 
 dividend may be declared, seems to be to enable all the creditors 
 to come in, and prove their claims. The creditors may file their 
 claims at the first meeting, the deed of composition may be filed 
 then, the meeting for approval may be fifteen days thereafter. 
 A month's notice must be given of the application for confirma- 
 tion, and, as this notice cannot be given until approval or dis- 
 approval of the deed at the meeting, the writer does not see the 
 necessity of the pro vision, that the application for confirmation shall 
 not be before the day on which a dividend maybe declared. It can- 
 not be before this day, as a dividend may be declared in one 
 month from the first meeting (see section 79). Although the 
 judge would be justified in confirming the deed on the claims 
 proved at the close of the meeting, under section 52 ; yet it is 
 conceived that, if a considerable number of claims were after- 
 
 I 
 
CONFIUMATIOX ()V DISCIIAIUJK. 
 
 171) 
 
 wai'ils proved, he iiii<flit poHtpnnc the ajiplicatinn for confinna- 
 tioM tliat tlio iusol' I'lit iiii^'lit olitaiii the sii^tiatiircs of tln.'so cro 
 ditfirs, ami very pnjhaldy tin! jii(l,i;'u would eoi"si<ler it advisablo, 
 in tlir exercise of his discretion, to do so. 
 
 lender this section, any creditor of the insolvent may api)ear 
 anil nppose the contirniation. The linht to appear is not limited 
 to the creditors named in th(! statement of ass(,'ts and liahilities 
 (re Strrcitsov, I IK". L.J.N. S.')2; Lo^'ie, ( 'o. ,J.). But this can only 
 bo understood of a creditor who has proved a claim to the amount 
 of one hundred dollars (see s(!ction 2 (h). Tiie ll-tth section pro- 
 vides that, in the cimtestation of an applicati(jn for di.scharge, or 
 for contii-ming or annullinjjf a discharge, the facts upon which t'.ie 
 contesting party I'olies shall V)e set forth in detail, with parti- 
 culars of time, place, an<l circumstance, and no evidence shall he 
 received on any fact not si't forth. Th<.' writer has had some 
 doubt whether this section, taken in connecticm with the .'ilnt 
 .section of tfie Act, does not lender it necessary for the creditor 
 intending to contest the application, to file his objections in writing 
 witli the assignee (see also section 54). 
 
 An in.solvent obtained a deed of composition and discharge, 
 and, before he applied for a coniirmation thereof, the assignee 
 delivered him a bill of costs and chaig-es as assignee. The in- 
 solvent did not, however, l)efore making the application for 
 the confirmation, ask for the taxation of the assignee's bill, nor 
 did he tender nor psiy to the assignee the whole or any part 
 thereof. The assignee, therefoie, contested the insolvent's dis- 
 charge, in his own name and on his own behalf, without authoriza- 
 tion from the creditors ; and it was held that the assignee had the 
 right to contest the confirmation under these circumstances (re 
 Arsenault, 2 Quebec Law Reports, 89). The insolvent having 
 paid the assignee's Vjill after contestation lodged, the contestation 
 was dismissed except as to the costs thereof, which the insolvent 
 was ordered to pay (ib.). 
 
 Prior to the passing of the Act of 18(59, it was held by Sherwood, 
 Co. J., that it was sufficient to publish notice of the application for 
 discharge in the Canada Gazette, and that such notice need not 
 
IfsO 
 
 THE INSOLVKNT ACT. 
 
 nuci'ssarily lio i»ul)lisln.'d in tlio Untario Giizetle (iv Iluji'iiuni, 5 (J. 
 
 C.L.J. N.S. 71). 
 
 Thore can l»e little (loul)t that the ncjfrcu niu.st now In- pulilisliod 
 
 in the Gazette for each Province, a.s in Ontario in the Oiifurln 
 
 Gazette, anil in Quehec the Qtiehec Gazette. Thi.s section re(juires 
 
 that the notice he ]>ul)li,she(l in the Oflieial (Jn/ette, ami the iiiter- 
 
 })retation clause oi the Act, section 2 (/>), declares that the UUicial 
 
 (Jazette shall mean the Gazette puMished under the authority ol' 
 
 the Government of the Province, where tho pi-oceedinj^s in Itank- 
 
 ruptcy or in.solvency are carried on, or u.sed as the otlicial means 
 
 of comnuinication l)etween the Lieutenant-Clovernor and the 
 
 people (.see in Ontario, .SI Vict. c. 0, s. ,S). 
 
 It was held under the lOlst .section of the Act of l<S(i!>, that the 
 notice of an applicati(jn for the confirmation of a<li.scharp' could 
 not be given by advertisement in the U'eeldy edition of a daily 
 newspaper, hecau.se l)usines.s men do not see tho.se editions {Hope 
 v. Frank, IM L. C. J. 2.S). 
 
 The })re,sent Act does not re([uii'e insertions in a weekly or other 
 newspapers, unless no Gazette is published in the County, District 
 or Province where the advertisement is required to bt; made, in 
 which case a new.spaper is to be desiynated l>y the Court oi- judye 
 for insertion of the advertisement (see section 2 [6J). 
 
 In fixing the day for the confirmation of the discharge, the 
 insolvent must be careful that it is a juriilical day ; for it has 
 always been held impo.s.sible for a private person, like a petitioner 
 for discharge, to tix a thing to lie done on a non-juiidical day. 
 Where, therefore, in the Province of Quebec, an insolvent gave 
 notice of application for contirmation of discharge ftjr the 2.')th of 
 March (Annunciation Day), and the petition was conseipiently 
 only presented on the 2Gth, it was rejected on this gi-ound alone 
 (ex parte Desece, 2 Revue Criti((ue, 485;4 Revue Legale, G.")(!). 
 
 This section affords no means of determining the creditois to 
 whom the letter or card must be sent, whether they are only the 
 creilitors who have proved or whether those under one hundred 
 dollars must receive notice. 
 
 54. If it appears that all the notices and formalities reciuired by law, have 
 buen given and observed, and that no objections have been made to the pro- 
 
CONFIRMATION OF DISCIIAUCJE. 
 
 LSI 
 
 |)n8o(l (liHclmrgo, or compngition and discharge, tho Coiirt or judge may, 
 with'Kit fiirtlior iiotico, and on tlio putitioii of thu ins ilvoiit, confirm his din- 
 charge or tho proi)08od composition and discharge ; but in case it appears 
 tliat objoctionH have been mado to such discliar^e or composition and discharge, 
 the ajJiilicvtion of tlie insolveiit sliiU n)t be heard until at least three days' 
 U'ltico shall have bocm given of the same by tho in ^ol vent to the assignee, 
 tho inspectors, and to tlio creditors who shall have ol)joctod to the said 
 discharge, or proposed conipnsition and discharge. 
 
 Till' tliroc (lays' iiotici' to tho assignee, inspectors and creditors, 
 is not iiec(!ssary, nnlt^ss objections to tlie disehar<3fe have been tiled 
 witli the assignee. 
 
 The insolvent sliould be pre-fcnt when application is niad(^ for 
 the conHnnation of his discharge, in ordttr that he may be ex- 
 amined, if any creditor desires to do so (re Sfcvoison, 1 U. C L. 
 J. N. S. r^2 ; Logie Co. J). 
 
 Although no opposition is offered to tluulischarge, it would still 
 seem to be the (bity of the Court to see tliat the insolvent has 
 made out a ease whieli entitles him, according to the provisions 
 of the Act, to a disehargi'. in the United States, it has l)een de- 
 ci(U'il tliat it is the duty of the Court tt) examine the record be- 
 fore granting the discharge, and if it api)ears that the insolvent 
 is not entitled thereto to refuse it, even though the creditors do 
 not interi)Ose objeetions (re WilJchiHon, 8 B. R. 2H6 ; see also re 
 Qiu'i^nd, 2 Revue Critiipie, 478). 
 
 The discharge does n(jt take etfect, until it is signed bv the 
 judge (P('NO(f, V. Pasf^more, •!• Yeates, l.S!)). 
 
 Where tho deed of composition and discharge is executed by 
 attorney or agent, it is not necessary, on an ai)plication for the 
 confirmation of the discharge, that the powers of attorney under 
 which the signatures took place should be produced and proved, 
 all that is required is to satisfy the mind of the judge with a rea- 
 sonable degree of certainty that the deed was executed by a 
 proper proportion of creditors, and the same certainty is not ne- 
 cessary as on a trial batweon party and party. An atfi lavit that 
 tho attorney or agent executing had authority, and that his acts 
 have l)een duly confirmed will be sufficient (re Ldiuson, 5 U. C. L. 
 J. N. S. 232 ; Logic Co. J.). 
 
 1^1 
 I Ml 
 
 
 ;J: 
 
 't ! 
 
 < i,' 
 
 I i ' 
 
 ;"i 
 
 '( 
 
 
 
182 
 
 THE INSOLVENT ACT. 
 
 55. Tlie Court or judge shn'l not contirin tlie discharge (jr proposed com- 
 position and discharge of the insolvent, unless he shall have produced with 
 his application an affidavit, in the Form K, slKJwing that no one of the cre- 
 ditors who have signed the same, has been induced to do so by any preferen- 
 tial payment, promise of payment, or advantage whatsoever made, secured, 
 or promised to him by or on behalf of the insolvent, and a certificate from 
 the assignee that he has delivurefl a sworn statement of his liabilities and 
 assets as required Ijy this Act. 
 
 In the case of an insolvent tinn, it would lie .safer tu proiluce 
 an attidavit from each inenibei' of the firm. 
 
 In the United States it has been held that if the insolvent dies 
 before he has taken this oath, a discharge cannot be granted (re 
 O'Fiii-rell, 2 B. R. 484; re Qainike, 4 B. R. 92). It is sufficient 
 that this affidavit be produced and filed on the hearing (le Sather- 
 laml, 1 Deady, 573). 
 
 If the insolvent dies after taking the oath and the grunting of 
 the certificate, the Court has the power to order the discharge as 
 on a date when the insolvent was in life (Young v. liidenbaiujh, 
 11 B. R. o(j:3). 
 
 50. The insolvent shall not bo entitled to a confirmation of his discharge 
 or of a deed of composition and discharge if it appears to the Court or judge 
 that he has not obtained the assent of the proportion of his creditors in num- 
 ber and value required by this Act to grant such discharge or enter into such 
 deed of composition and discharge, or that lie has been guilty of any fraud 
 or fraudulent preference within the meaning of this Act, or of fraud or evil 
 practice in procuring the consent of the creditors to the discharge, or their exe- 
 cution of the deed of c(jnq)osition and discharge, as the case may be, or of 
 fraudulent retention and concealment of some portion of his estate or ett'octs, 
 or of evjision, p' jvaricatioii or false swearing upon examination as to his 
 estate and ell'ects ; or that the insolvent has not kept an account book shew- 
 ing his receipts and disbursements of cash, and such other books of account 
 as are suitable for his trade, or that if, having at any time kept sucii book or 
 books, he h;is refused to produce or deliver them to the assignee, oi is wilfully 
 in default to t)bey any i)rovision of this Act or any order of the Court or judge ; 
 but in the Provinces of Ontario and Quebec, the omission to keep such books 
 before the coming into force of the Insolvent Act of 18()4, and in the I'ro- 
 vinces of New Brunswick and Nova Scotia, such omission previous to the coming 
 into force of the Insolvent Act of 1869, and in the Provinces of British 
 Columbia, Prince Edward Island, or Manitoba, such omission previous to 
 c nning into force of this .\ct, shall not l)e a sufficient ground for refusing the 
 coutiruiatitjn (;f the discharge of an insolvent : 
 
CONFIRMATION OF DISCHARCE. 
 
 183 
 
 And provi'l"'" further that any act on the part of the insolvent, which 
 might be held to be an act of fraiid or fratidulent preference within the mean- 
 ing of the Insolvent Act of 18(54, or ot 1809, or of this Act, but which would 
 not amount to fraud if the said Acts or this Act had not been passed, shall 
 not be a ground for refusing the confirmation of the discharge of any insolv- 
 ent, if si;ch .act was done by the insolvent, in the Province of Ontario or 
 Quebec, before the coming into force of the Insolvent Act of 1864, or in the 
 Province of Nova Scotia or >'ew Brunswick, before the coming into force of 
 the Insolvent Act of 1809, or in the Province of British Columbia, Prince 
 Edward Island, or Manitoba, before the coming into forco of this Act. 
 
 It is doubtful whether gambling is a fraud within the meaning 
 of tlie Statute. If it is desired to prohibit gambling as one of the 
 frauds under the Act, it should be more specifically provided for. 
 The only section which could by any possibility apply to it at 
 ])resent is the l.SOth. However, it is clear that gambling 
 before the passing of the Act is not within its provisions (re 
 Jones, 4 U. C. P. R. 317). 
 
 In the United States, it is held that property acquired in gam- 
 ing is assets, and if the insolvent spend it in gaming he loses his 
 right to a discharge. It is impos,sible to look into the mode in 
 which such property as the Statute speaks of has been acquired. 
 If property once in the possession of the insolvent has been spent 
 in gaming, which if not so spent might be assets in insolvency, 
 the case is made out. It is too late after it is spent to say that it 
 was unlawfully accjuired, or acquired in a particular way, or that 
 creditors are no worse oft' on the whole (re Marshall, 4 B. R. 106 ; 
 s. c. Lowell, 402) ; and if on the application for di.scharge the record 
 of the insolvent's examination shows that he has, since the passing 
 of the Act, lost money at gambling, the discharge must be re- 
 fu.sed (re Wilkinson SR. R. 280). 
 
 The insolvent is bound to pay over money, though received by 
 him before the assignee is appointed (re Warminc/ton, 4 L. C. L. 
 J. 83). 
 
 The mere omission of property from the schedule is not evi- 
 dence of a wilful concealment of it (Steen v Aylesworth, 18 Conn. 
 244). An omission to place property on the schedule because the 
 insolvent concludes in good faith that it does not pass to the 
 assignee is not a wilful concealment of it, where the law by which 
 
 ' 1 
 
184 
 
 THE INSOLVENT ACT. 
 
 it may be deemed to vest in him is doubtful and uncertain (Rugely 
 V. Robinson, 19 Ala. 404). 
 
 The evidence to establish concealment must depend more or less 
 on the circumstances of each particular case {Petty v. Walker, 10 
 Ala. 379). 
 
 It is concealment to leave out of the schedules property that has 
 been conveyed by the insolvent in fraud of creditors. It is wholly 
 immaterial that the title, as l»etween vendor and vendee, vested in 
 the vendee ; as to creditors, the conveyance was void, and the title 
 remained in the vendor (re Ratlihone, 2 B. R. 200 ; re GoodfeUou', 3 
 B. R. 4.52 ; 2\>terson v. Spier, 29 Penn. 47<S). The keeping of books 
 from the assignee involves the question of intent. If the books 
 were accidentally lost before the insolvency, theie can have been 
 no such concealment. If they were not lost, but within the con- 
 trol of tlie insolvent, and not given up on demand with intent 
 to prevent the assignee from obtaining them, but their existence 
 denied, the chai'ge of concealment is sustained. It is not neces- 
 sary that they .should have been put in any unusual or out of the 
 way place (Hammond & CooUd(/e, 3 B. R. 273). 
 
 The term "concealment" implies some thing wilful and inten- 
 tional. One cannot be said to conceal property, unless he not 
 only knows that he owns it, but, uide.ss he also intentionally, not 
 inadvertently, conceals the same fi'om his assignee or creditors fre 
 Wyatt, 2 B. R. 288 ; re Wilson, Law Rep. 272) ; and an omi.ssion 
 of property l)y accident or mi.stake, will not prevent a di.seharge 
 (Loud V. I'iercc, 2.) Me. 233). 
 
 It will still be a concealment, if the assignee knows that it is 
 concealed, if he does not know where it is concealed (re Real, 2 B. 
 R. 587). The concealment under this section embraces a conceal- 
 ment of title to proi)erty, as well as the hiding from view the 
 ])ro))erty itself In fact, the most dangerous sort of concealment, 
 is when the debtor places the title to property in the hands of 
 another person, to be held for iiis benefit, ami conceals his 
 beneficial right to it. Either kind of concealment Avill preclude 
 the granting of a discharge (re Hiissnian, 2 B. R. 437 ; Edwards 
 V. Gibhs, 39Mi,ss. lG(i). 
 
 The neglect to keep proper boi>ks of account, is a most serious 
 
 i^ 
 
NEGLECT TO KEEP BOOKS OF ACCOUNT. 
 
 \H'r> 
 
 breach of duty, and should be punished in a severe and exemplary 
 manner (re Lavih, 4 U. C. P. R. 21 ; 3 U. C. L. J. N. S. 18). 
 
 But such neglect may nt)t, under all circumstances, be an ans- 
 wer to an application for discharge. It is entirely within the dis- 
 cretion of the judge in insolvency, to determine what the penalty 
 for neglect shall be in each particular case. Where the insolvent 
 made an assignment in September, 18G4, three months after the 
 ])iissing of the Act of that year, the Court considered the short 
 ])eriod intervening between the passing of the Act and the ap[)li- 
 cation for discharge, and the inconsideraltle nature of the business 
 in which the insolvent was enfjaffed, and held that the neolect to 
 keep proper books of accoimt, would be adequately punished, by 
 the suspension of the dischnrge for a limited time, rather than by 
 the absolute denial of the discharge altogether (re Parr, 17 <.'. 
 P. U. C. (>21). 
 
 If a firui has not kept proper books of account, a partner cannot 
 obtain a discharge, although he was a junior member and not a 
 keeper of the books (re Pic>'o>>/<., 10 B. R. 107). The creditor must 
 take the burden of proof, and shew that the insolvent did ncjt 
 keep proper books of account (re BuiiIm, 1 N. Y. Leg. Obs. 274). 
 The intent of the non-keeping of books is of no importance. 
 The mere omission is the thing plainly interdicted. Such 
 omission prevents a discharge, whether the intent was fraudulent 
 or not (i-e Solomon, 2 B. R. 285 ; re Schumpcvt, 8 B. R. 41o). 
 Whether the books of account are pn^perly kept, is a questi<jn 
 which must be deci'ledin each case upon tin facts as they appeal-, 
 and not ujion any strict rule that such and such books and such 
 and such entries are essential in all cases (re Pcrr'j, 20 Pitts. L. J. 
 184). It is not ni'cessary that the books be kept according to 
 the forms taught in schools, or in ledgers, or in day books, l>ound 
 in leather. In businesses (jf souie kinds, any contemporaneous 
 wiitten memorials, formal or informal, of a trader's transactions, 
 wliether in l)oun(l volume or in detached sheets, may answer the 
 definition of proper books of account, if they have l)een pre- 
 served and so arranged as to ])resent an intelligible and substanti- 
 ally complete exposition of his affairs. The (piestion of what are 
 })roper books must, in each case, be a question of evidence. What 
 
 
 t*. A 
 
 
 J 
 
 
18G 
 
 THK INSOLVENT ACT. 
 
 Avoixld lie proper and sufficient books in one case would be im- 
 proper and insufficient in another (re Solomon, 2 B. R. 285 ; re 
 Batch'lder, 3 B. R. 150). 
 
 It is not sufficient that the insolvent employed a book-keepei', 
 whom he considered competent, and left the whole charge of the 
 books to him. The law does not require traders to keep a book- 
 keeper, but to keep books, and they are responsible to see that 
 this is done (re Hdminond, 3 B. R. 273). Entries upon numerous 
 slips of paper, each entry being on a separate slip, is not a keeping 
 of books, under the law (ilj). A retailer who keeps the usual books 
 and all his invoices, keeps proper books of account, although he 
 kept no invoice book (i-e Reed, 12 B. R. 390). 
 
 Theix* is no positive rule of law requiring the entries to be 
 made daily, although they ought to be at or near the time of the 
 transactions, or the balances to be made at any of the fixed 
 periods, or the books to be kept in any particular way (re 
 Geortje, Lowell, 409). When the day book and the ledger, taken 
 together, shew all the transactions of the insolvent, a discharge 
 may be granted, although there are some meaningless nmtilations 
 in each (re Pierson, 10 B. R. 107). 
 
 A cash account is necessary to an understanding of a trader's 
 business, and when one has not been kept, a discharge will be 
 refused (re Gay, 2 B. R. 358 ; re BeUs, 3 B. R. 496). The cash 
 book should shew, in an intelligible and proper manner, the nature 
 and character of the receipts and dis}>ur,sements of cash made by 
 the insolvent (re Mackay, 4 B. R. 07). The omission of an entire 
 book or set of entries neces.sary to -the understanding of the 
 business prevents a discharge (re White, 2 B. R. 590). Careless 
 omissions or mistakes, without fraud in books, themselves proper, 
 may be overlooked (ib.). 
 
 An insolvent was largely indebted to several creditors and, on 
 the ai)plication of one of them two months before his assignment, 
 the insolvent transferred a large portion of his stock, consisting 
 of the whole of his dry goods to such creditor. He kept no 
 account of the goods so transferred, relying upon the creditor's 
 promise to send liim an account. He kept no books of account 
 from the 1st of September, 18G4, until his failure in the .-^^ring 
 
FRAUDULENT PBEFEllExNCE. 
 
 187 
 
 
 3ks 
 he 
 
 of liSO-'), Jones, Co. J., expressed an opinion that the transfer of 
 the stock in January, l8Go, was a fraudulent preference, and such 
 as would ati'ord grounds, under the Act, for opposing the insol- 
 vent's discharge also that the neglect to keep books of account 
 would have the same effect, and it appearing that during the same 
 period some g(K)ils sent to another party were I'eceived by the in- 
 solvent and concealed, an order vva;i made refusing the discharge 
 absolutely (re Beare 3 U, C. L. J. N. S. 294 ; Jones, Co. J.). 
 
 The iliscliai'ge of a debtor was refused, where it was proved that 
 he had made fraudulent jireferences and had traded extensively 
 Without cajjital, though it did not api)ear that the debtor had any 
 intention of connnitting fraud (ex parte Watt, 2 L. C. L. J. 284). 
 A., an insolvent, within a few months previous to the time he 
 stopjied pay.. lent, made large purchases from several parties, and 
 at the same time he was borrowing money outside of the banks, 
 at from a half to one per cent, a week and was undoubtedly in- 
 solvent. He had made no balance sheet for two years previous to 
 the susj)ension. It was held that the confirmation of the dis- 
 charge could not be withheld on these grounds, in the absence of 
 proof that he made the jiurchases knowing that he was insolvent 
 and in contemplation of insolvency (re Tloxrher, 2 L. C. L. J. 129). 
 The insolvents, on the day previous to the issue of the writ of 
 attachment, handed over to a clerk in their employ (wlio was their 
 cre<:litor for a lai'ge sum, and who was fully aware of their insol- 
 vent state for a year beftire,) a large quantity of negotiable paper, 
 to be held as collateral security lor an antecedent debt, with the 
 intention of giving a jii'eference over the other creditors; this was 
 held such a fraudulent prefei'cnce as to disentitle the insolvent to 
 his discharge (ex parte Temped, 11 L. C. J. oj). 
 
 The decisions on the subjects of fraud, and fraudident prefer- 
 ence, are collected under the sections of the Act from 130 to 133, 
 particularly under the latter section. Pressure is material in de- 
 termining whether there is a fraudulent preference, as it removes 
 the voluntaiy character of the ti-ansaction. In Ontario, the deci- 
 sion in JJiu'lcisun v. Hofis (24 Grant, 22) has not altered the law as 
 to fraudulent preference (see notes to .section 133.) 
 
 It was held in re Owens (12 Grant, 5G0) that fraud incontract- 
 
 ' (. 
 
 
.,, 
 
 188 
 
 THE INSOLVENT ACT, 
 
 ing debts, before the passing of the Act of 1804, might be a ground 
 for refusing a discliaro-e under that Act. 
 
 By the latter part of this section, such a fraud would not now 
 be a bar to an insolvent's discharge. 
 
 As we have seen the insolvent must have tlie majority in mun- 
 ber, and three-fourths in value, of the proved claims. The neces- 
 sity for this is clearly shewn Ijy the se.-tion now under considera- 
 tion. The amount of the claims cannot be increased 1»y affidavit, 
 filed on the ai)j)lication for confirmation of the discharge. But, if 
 after the a.ssignment, payments are admitted to have been made, 
 these payments must be applied in reduction of the proved del)ts, 
 and if they reduce the total debts below the three-fourths in value, 
 the confirmation of the discharge must be refused (roLtui;/.^, 4 U. 
 C. L. J. N. S. 283 ; Wilson, Co. J^). 
 
 In this ca.se, the learned judge held, that on thea])plication for 
 the confirmation of the discharge, he could not adjudicate upon the 
 claims of the creditors, for the purpose of determining their amount, 
 and that his jurisdiction was merely of an appellate nature (I'c 
 Ckghorn, 1 U.C. L. J. N. S. 138 ; re S'('ven>^on, 1 U. C. L. J. N. S. 
 52). The payments which reduced the amount of the debts in 
 the schedule were admitted, and it is difficult to see why the re- 
 duction of the debts by the amounts paid, is not as much an adju- 
 dication as to their amounts, as their increase by affidavit Avould 
 l)e ; and under the O.ith section of the Act the judge has now 
 original jurisdiction in tlie contestation of claims, and the abovi^ 
 cited cases do not apply. 
 
 Under the 87th section^ of the Act, the assignee has ]iower to 
 require, from any creditor, a supplementary oath, .shewing the 
 t,icula)'s of any payment received after proof of his claim. 
 
 i ■ re Nohle (2 Revue Critirpie, 03), decided in Halifax on the 
 1 >. . of September. 1870, it was held that an insolvent could not 
 
 •". discharge from the Court when no estate, debts, or effects 
 have passed by tho asuganamt (seo, h'nvjver, ro T/iomis, lo 
 Grant, 11)6, ante p. 81-2). 
 
 57. Tlie Conrt or jnlgo, as the ca^o may bj, upon hearin^' the application 
 for confirm ition of such discliargo, the objections tharotf", anl any evidence 
 
SUSI'EXISIOX OF DISCHARfJE. 
 
 180 
 
 adiliiced, shall have power to make an order either confiruiiii^ the clischargu 
 or annulling tlio same ace ding t(j the uH'ect of the evidence so adduced. But 
 if Hucli evidence should be insuflicient to sustain any of tlie grounds herein- 
 buforo detailed as fcmaing valid grounds for contesting such cnnfirinatioii, but 
 slmuld nevertheless establish that the insolvent has been guilty of miscontluct 
 in the management of his business l)y extravagance in his expenses, reckless- 
 ness in endorsing or becoming surety for others, continuing his trade unduly 
 after he believed himself to be insolvent, iucui'ring debts without a reasonable 
 expectation af paying them (of which reasonable expectation the proof shall 
 lie on him, if such debt was contracted within thirty days of the demand 
 made of ".n assignmant or for the issue of a writ of attachment), or negligence 
 in keeping his books and accounts ; or if such facts be alleged by any con- 
 testation praying for the suspension of the discharge of the insolvent, or for 
 its classification as second class, the Court or judge may thereupon order the 
 suspension of the operation of the discharge of the insolvent for a period not 
 exceeding five years, or may dechu-e the discharge to be (jf the second clasp, 
 or both, according to the discretion of the Court or judge. 
 
 It was lield inidersiibsection 1 2 of section 1) of the Act of 1804, that 
 the judge, in granting the discharge of the insolvents, could not im- 
 pose a condition which it was impossible for the insolvents to 
 perform, and where, after an assignment'and the vesting of the 
 entire estate of the insolvents in the assignep, the judge made an 
 order, directing the insolvents to pay nine hundred and fifty -nine 
 dollars to the assigiiee, the order was set aside (re Wallis, 29 
 Q. B. IJ. C. 313). 
 
 Where it appeared, on an application l)y an insolvent for his dis- 
 charge under the Act of 1804-, that he had, within three months 
 hefore his assignment, paid one of his creditors in full, under 
 such circumstances as was considered to amount to a fraudulent 
 preference, and had neglected to keei> proper ca.sh books, or books 
 of account suital)le to his trade, and the judge in insolvency 
 granted a discharge suspensively, to take effect four months after 
 the onler made ; upon an api)eal from this order by a creditor, 
 the judge in chambers thought that the judge below had acted 
 with extreme leniency ; but acting on the principle that his deci- 
 sion should not be annulled except on a clear case, and to prevent 
 an undoubted injustice, he refused to interfere with the order made 
 (re Lamb, 4 U. C. P. R Ki). 
 
 The 08^1 secti(jn of the Act was repealed by the 40 Vict. s. 14. 
 
 '?! 
 
100 
 
 TlfK liVSOr.VKNT ACT. 
 
 59. A deod of coiniiositidu and discliarge may be made under this Act, 
 t'itlier in consideration of a composition payable in cash, or on terms of credit, 
 or partially for cash and partially on credit ; and tlio payment oi such com- 
 position may be secnrud or not accordiui^ to the pleaswris oi the creditors 
 signing it ; and the discharge therein contained may bo absolute, or may ho 
 conditional upon the condition of the comi)osition being satisfied ; but if such 
 discharge be conditional upon the composition being paid, and the deed of 
 composition and discharge therein contained should cease to have etfect, tlie 
 assignee shall innnodi:itely resume possession of the estate and effects of the 
 insolvent, in the state and condition in which they shall then lie, provided 
 always that the title of any Ihihk ^//i/c purchaser of any of the assets f)f the 
 estate shall »:)t be imi)aired or affected l)y this section : but the creditors 
 holding claims which were provable before the execution of such deed, shall 
 not rank, vote, or be computed as creditors concurrently with those who have 
 acquired claims subsequent to the execution thereof, for any greater sum than 
 the balance of composition remaining unpaid ; but after such subse(iuent 
 creditors have received dividemls to the amount of their claims, then such 
 original creditors shall have the right to rank for the entire Ijalance of their 
 original claims then remaining unpaid, and shall be held for all purposes fi>r 
 which the proportion of creditors in value retpiire to be ascertained, to be 
 creditors for the full amount of such last mentioned balance. 
 
 An insolvent ccaiipoundtMl witli his cfeditors, and had his goods 
 festoiud to him. He, thereupon, resumed liis business with the 
 knowledge of his assignee and creditors, and contracted new 
 debts. It was subsetjuently discovered that he had been guilty 
 of a fraud which avoided his discharge, whereupon he absconded, 
 and an attachment was sued out against him by his subsequent 
 creditors. It was held that they were entitled to be paid out of 
 his assets in pi'iority to the former creditors. In such case, the 
 a.ssignee, as representing the former creditors, was ordere<l to pay 
 the costs of a suit brought by the subsequent creditors to enforce 
 their rights (BucJuinaa v. Smith, 17 Grant, 208; aHirmed on 
 rehearing, 18 Grant, 41). It will be observed that this case is 
 merely an affirmance of the principle enforced by the above 
 section. 
 
 It is an inqiortant question whether, after the acceptance of a 
 particular composition, the creditors have power, where the cir- 
 cumstances of the debtor cliange aftiirwards, to reduce or modify 
 the composition so as to bind dissentient creditors. By the Eng- 
 lish Act of 18G9, s. 20, the creditors may add to or vary the terms 
 
RECONVEYANCE TO INSOLVENT. 
 
 191 
 
 of any composition previously accepted by them under this Act. 
 Creditors Imve powei', by an extraordinary resolution, to reduce 
 the amount of a composition jueviously accepted by them wlien 
 the circumstances reciiiire it, and it will be for the benefit of the 
 debtor and the creditors generally. A dissentient creditor is as 
 iiuich bound by such extraordinary resolution as he was by the 
 lesolntion accepting the original composition (ex parte LUjuida- 
 for's li. I. (Jo. ; re (Jlorer, 2!) L. T. N. S. 0!)4 L. R. 17 K(|. 1-21). 
 
 (iO. Sd soon as a doud of composition and diacliargo shall have been exe- 
 cuted as aforesaid, it shall bo the duty of the assignee to re-convey the es- 
 tate to the insolvent ; and the re-cunveyance by the assignee to the insolvent 
 or to any per-son for hina, or whom he may appoint, of any part of his estate 
 nv effects, whether real (jr personal, if made in conformity with the terms of 
 a valid deed of composition and discharge, shall have the same effect (except 
 as the same may be otherwise agreed by the conditions of such deed or re- 
 conveyance) as if such property had been sold by the assignee in the ordinary 
 course, and after all the preliminary proceedings, notices and formalities 
 herein retpiired for such sale ; and if such deed of composition and discharge 
 be contested, and pending such ccmtestation, the jndge may suspend any pay- 
 ment or instalment of the composition falling duo under the terms of such 
 deed ; and the deed of re-conveyance need not contain any further or more 
 special description of the effects and property re-conveyed, than is required 
 to be inserted in the <leed of assignment, and may be enregistered in like 
 manner and with like effect ; and such deed may be executed before witnesses 
 or before notaries, according to the exigency of the law of the place where 
 such deed of composition and discharge is to be executed. 
 
 What is meant by being " executed as aforesaid " in this section? 
 
 Moss, J. A. in McLaren and Ckalmevs, 1 Appeal Reports, Ont. 
 p. 71, expressed an opinion that after the execution of the deed 
 and its deposit with the assignee, it was the duty of the latter to 
 await its confirmation before re-conveying to the insolvents. This 
 was pi'obably meant to refer ti) its approval by the creditors under 
 .section 51 of the Act. 
 
 In this case the re-conveyance was made by the assignee, im- 
 mediately after the deposit of the deed with him, and without 
 calling a meeting for its consideration. This is, therefore, a de- 
 cision that the deed is not executed within the meaning of this 
 section when deposited with the assignee, and before the calling 
 
 1 ! i<} 
 
102 
 
 THE INSOIA'KNT A('T. 
 
 I? 
 
 of the mootini,'. The doecl was .signod l»y tlie iiuccHsary nuniher 
 of the joint croditovs ; hut it is to he olwerved that there were 
 separate creditors idso, and the (h-ed woidd Ite void in notpi'ovid- 
 iny; for them. In Enj^laml, aftei- acct'ptance of a composition l»y 
 tlie creditors, the (U'l)tor lias a ri<j;ht to deal with the assets as hv 
 pleases. The creditors of a debtor resolve(l to accept a composi- 
 ti(m payable in three in.-stalments, the; third instalment bein<,' guar- 
 anteed })y a surety. Before the resolutidU was passed the debtor 
 had agreed with the surety to indemnify him against any liabil- 
 ity which he migiit incur undei' his guarnntee by de})ositing 
 goods with him. This agreement was not made known to the 
 cieditors. After the resolutions were registei'ed, the surety ac- 
 cepted bills of exchange for the amount of the third instalment 
 of the composition, and certain goods were de}>osited with him 
 by the debtor. The debtor paid the tiv.st instalment, but failecl to 
 pay the .second, and thei'eupon he tiled a licpiidation petition. 
 Afterwards the surety paid the third instalment. It was held 
 that the agreement with the surety was valid, and that he was 
 entitled to retain the goods as against the trustee under the liqui- 
 dation (e.\ parte Barrell, L. R. 1 Ch. 1). .-)37). 
 
 It seems that, under this .section, no action can be maintained 
 for any part of the composition pending the contestation (;f the 
 ih.'cd of composition and discharge — at all events if the pay- 
 ment thereof is suspended by order of the judge. The ninety- 
 sixth section of the Act of 1809 u.sed language .somewhat diffe- 
 rent from the present Act. It provided that " if such deed of 
 Composition and discharge be contested, and pending such contes- 
 tation any payment or instalment of the comi)osition falls due 
 under the terms of such deed, the payment thereof shaM he pot^f- 
 pnned till after the expiration of ten days after final judgment 
 upon such contestation." In a case undei' the Act of 180!), it ap- 
 peared that the insolvent applied for the confirmation of his deed 
 of composition and discharge, and the application was contested 
 ly- one of the creditors. The contestation was dismis,sed Vty the 
 Superior Court, but the creditor took out a writ of appeal from 
 such dismissal. The dismissal was al)out three ivreks after the 
 plaintiff commenced an action on one of the composition notes he 
 
CONFIUMATION OF DISCHAROE. 
 
 193 
 
 hafl received, and Jit tlio time of the judgment of the Couii the 
 appeal was still pending. On tlie Statute being pleaded to the 
 plaintiH"s action, it was rlisniissed (Valle v. Manro, 20 L. C. J. 
 25). 
 
 It is probable, however, that under tlic present Act the insol- 
 vent would be reciuii'ed, on contestation being made, to obtain an 
 order from the judge su,spen<ling pa^nnent of the composition, and 
 it would seem that no action could be brought after tlie making 
 of such ordei'. 
 
 01. Tho coiifirinatiou of tho clischargo of a debtor in the manner heroin pro- 
 vided shall absolutely free and discharge him, after an assignment, or after 
 his estate lias been put in compulsory li(]uidation, by the issue of a writ of 
 attachment, from all liabilities whatsoever (except such as are hereinafter 
 specially excepted) existing against hiiu and provable against his estate, 
 whether the same be secured in part or ia whole by any mortgage, hypothec, 
 lien or collateral ^security of .any kind or not, which are mentioned or set 
 forth in the statement of his affairs exhibited at the first meeting of his credi- 
 tors, or which are shown by any supplementary list of creditors funiished by 
 the insolvent, previous to such discharge and in time to admit of the creditors 
 therein mentioned obtaining the same dividend as other creditors upon his 
 estate, or which appear by any claim subsequently furnished to the assignee ; 
 whether such debts be exigible or not at the time of his insolvency, or be 
 contested in whole or in part, or be dependent on certain conditions or future 
 contingency, and whether the liability for them be direct or indirect ; and if 
 the holder of any negotiable paper is unknown to the insolvent, the inser- 
 tion of the particulars of s\ich paper in such statement of affairs or supple- 
 mentary list, with the declaration that the holder thereof is unknown to him, 
 shall bring the debt represented by such paper, and the holder thereof, with- 
 in the operation of this section. 
 
 It will be observed that, under this section, it is the confirma- 
 tion of the debtor's discharge that relieves him from liability (see 
 also section 6C)). 
 
 To effect a discharge, whether in the case of an assignment, or 
 the issue of a writ of attachment, it is necessary that the creditor's 
 claim sliould be in some way inserted in a schedule or supplemen- 
 tary list of creditors furnished to the assignee. 
 
 In the case of an attachment, it is immaterial that the means 
 of making out a schedule are taken from the insolvent by seizure 
 M 
 
 ir 
 
i 
 
 194 
 
 THE INSOLVKNT ACT. 
 
 of his books and pajjors. There vvouhl he a list of creditors pre- 
 pared hy the assi^Tiee, and on the examination of tlie insolvent, or 
 at any otlier time up to the application for discharge, there would 
 certainly be, in some shape oi- othei', a list or schedule of creditors. 
 Tlu! insolvent might, perhaps, adopt the schedule prepared hy the 
 assignee for the pui'pose of a dividen<i as his own, or fiame his 
 application for discharge, so that it refeis to that as his schedule 
 (Palmer v. Baker, 22 C. P. U. C. 50). 
 
 This was a case of a writ of attachment. The same doctrine has 
 l)een held applicable to an assignment. 
 
 Thus in Kin(/ v. Snilfk (1!) C. P. U. C. 31!)), the Couit declaied 
 that, in order that tlie insolvent may be discharged from a par- 
 ticular d ji t, th(! creditor's name and the amount of his claim 
 must be mnitionetl in the statement exhibited at the first meet- 
 ing of creditors, or in some supplementary schedule of creditors; 
 and, to a plea of discharge in the case of an assignment, it is a 
 good replication that the plaintiff's name as a creditor, and the 
 claim mentioned in the declaration were not mentioned in the 
 ■statement exiiibited at the first meeting of creditors, nor in any 
 .supplementary schedule, as reipiired by law, and the debt was 
 never proved against tlie estate {Khvj v. Smith, 19 C. P. U. C 
 319 ; followed in Palmer v. Baker, 22 C. P. U. 0. 59). 
 
 But the mere omission of the creditor's name from the schedule 
 or statement will not prevent the insolvent from being dischai'ged, 
 in respect of the claim, if the claim is sufficiently identified in the 
 .schedule, and the creditor has notice of tlie assignment, and is re- 
 quired to prove his debt. Thus, where to an action of covenant 
 on a mortgage to })ay money, the defendant pleaded that, becoming 
 insolvent after the execution of the mortgage, he made an assign- 
 ment, that the plaintiff's claim was known as the " Wood Estate," 
 and was so described in the schedule, submitted to the assignee and 
 creditors, that plaintiff' resided abroad, and was represented in 
 Canada by M., who had notice of the appointment of said assignee, 
 and that, after the la])se of a year, the defendant obtained his dis- 
 charge ; this was held a good answer to the action .(Farrell v. 
 l/Xeil, 22 C. P. U. C. 31). 
 This case is distinguishable from King v. Smith, supra. In tlie 
 
EFFECT OF DISCHAIIQE. 
 
 195 
 
 latter, neither the debt nor the creditor's name, nor anytliing to 
 iii'lic'iite the liability, was entered in the HcluMlule. In Fdrrdl v. 
 O'Nril, the claim ot the creditor was entered, but the name of the 
 crLMJitor holding' th(! claim was not <,Mven; but the C(jurt held 
 the claim sutHciently identified without the creditor's name. 
 
 The plaintiffs knowledj^e of the insolvency i)roceedin;4S seems to 
 liL' iunnateiial in cases of this 'kind (see Paliiiar \. Baker, 22 C. 
 P. U. C. 59). 
 
 The Statute will l)e substantially complied with if the debt is set 
 out in such a mannei- as cannot mislead, provided thei-e can be no 
 rcasonalJe doubt as to the debt referred to, and the amount thereof 
 can be ascertained by the creditors. Where the creditor's name and 
 ivsidence, with a statement of the indebte(hiess of the insolvent (not 
 sj^'cifying the amount), are inserted in the schedule it is not in all 
 casos nee s,sary that the precise amount .should be .shewn. Tims 
 wliere tlu; creditor was a solicitor, and the amount was stated " as 
 and for a balance of costs in suits of A. against B., and B. against 
 A." etc., it was held .sufficient {Cameron v. Holland, 29 Q. B. U. 
 C. 500). 
 
 If the name of the creditor and the amount of his claim are 
 iiiis-sLited in the .schedule or statement of the insolvent's liabilities, 
 the creditor's claim will not be barred. Thus, wliere the creditor's 
 name was John James Robinson, and his address was Newcastle, 
 and the amount of his claim 3552.25, it was held that his claim 
 was not barred, by an entry in the schedule " John Robinson, 
 Bond Head, judgment in 'suit, ^l-tS," it appearing that he never 
 received any notice of tlie insolvency i)roceedings (liobson v. 
 Warren, G U. C. L. J. N. S. 14). 
 
 In a case of an attachment where no assignment has been exe- 
 cuted, and the insolvent, not having obtained the consent of his 
 creditors, applies for his discharge a year after the attachment, he 
 ought to sujjply a list or schedule of creditors under the words in 
 this section " which are .shewn oy any supplementary list of credi- 
 tors furnished by the insolvent previous to such discharge" (King 
 v. Smith, 19 C. P. U. C. 324?). Where it appears that the creditor's 
 name was put in the supplementary list of creditors, in time to 
 permit of his receiving the ,same dividend as the other creditors, 
 
 j'l 
 
 t;flf^ 
 
 
 4 , 
 
 1 * 
 
 
 iM'i 
 
 Hi 
 Hi 
 
 Hi 
 
 Hi 
 
 ''\ 
 
 i i 
 
 :Ua 
 
 .! i 
 
19C 
 
 THE INSOLVKNT ACT. 
 
 J'" 
 
 his claim will be Ijarred by the discharjfe (Preston v. Hunton, 37 
 Q. B. U. C. 177). 
 
 M. brought an action on a broach of warranty of a reaping 
 machine, but .suspended proceeding.s on hearing of the insolvency 
 of the defendant. 
 
 After the defendant had procured the confirmation of a deed of 
 com[)Osition executed by the majority in nundjer and value of the 
 creditors, M. pi'oceeilod with the action, and obtained a verdict, 
 upon which judgment was entered and execution issued. After 
 the recoveiy of the judgment, the inscjlveiits hied a supplementary 
 list of creditors, and gave notice thereor to the plaintiii", and ten- 
 dered the compositions provided by the deed of composition and 
 discharge, which M. refused to accept. 
 
 The Court held, reversing the decision of the judge in insol- 
 vency, that the judgment was not affected by the deed of compo- 
 sition and discharge, and the order resti'aining the execution was 
 therefore vacated (re McMillan, 13 C. L. J. N. S. 105). 
 
 When judgment is obtained against an insolvent after the 
 date of the .assignment, Itut it is contested by the insolvent, 
 and costs are incurred on the contestation, which is not con- 
 cluded until long after a deed of composition is signed, the in- 
 solvent will not be discharged from these costs, though he has 
 obtained a deed of composition and discharge, signed by the 
 re([uired niunber of ci'editors, didy confirmed by the (Jourt 
 {Tai. .". CharlehoiH 14 L. C. J. 21.5). In thi.s case the amount 
 of the costs was not inserted in the schedule of lia1)ilities, nor 
 were they ascertained until after the deed was confirmed. 
 
 The discharge, under this section, will not bar debts contract- 
 ed after the assignment, or the issue of the writ of attach- 
 ment, but if the debt is due then it will be bari'ed, though not 
 actually payable. As a general rule, the liability to a dis- 
 charge is co-extensive with the power to prove (see .sec. hO). 
 
 Tlie certificate of discharge is a bar only to debts and de- 
 mands which were or might have been proved, but not as 
 against personal covenants and engagements which were not 
 provable. If a demand la not provable, it is not barred by the 
 certificate {Murray v. De Rottenham, (i Johns, Ch. 52). If the 
 
EFFECT OF DISCHARGE. 
 
 197 
 
 debt is provable, th(i action is barred, although it was not actually 
 proved {Hardy v. C<irter, 8 Humph. 153). 
 
 Where, prior to the assignment, the insolvent had as grantor in 
 a deed of conveyance to the plaintiff of a lot of land, entered into 
 covenants for quiet enjoyment and for right to convey, and it ap- 
 peared that, before the conveyance to the plaintiff was executed, 
 the insolvent had mortgaged the land to another party, in whom 
 the legal estate was vested, the Court held that the insolvent's 
 covenants in the deed of conveyance were covenants in gross, as 
 the legal estate did not pass to the plaintiff, that the damages 
 in respect of the breach of these covenants must be assessed by 
 a jury, and the claim for such damages was not provable un- 
 der the Act, consequently the insolvent was not discharged there- 
 from. It was also held that the claim did not come within the 
 81st section as being " upon a contract dependent upon a condi- 
 tion or contingency," for the covenant was broken as soon as 
 made, and before the assignment, therefore the condition was ab- 
 solute before the in.solvency (Burrowes v. De Blaqiokre, 34 Q. B. 
 U. C. 498). 
 
 In the United States, the Bankrupt Act expressly provides 
 that a creditor proving his claim shall not be allowed to maintain 
 any suit at law therefor against the bankrupt, but the suit may 
 proceed if a discharge is refused. Under our Statute it would 
 seem that the mere proof of a claim could not be pleaded in bar, 
 or to the further maintenance of an action, and the Act would 
 seem to atford no actual relief imtil a discharge is obtained. 
 
 In Allan v. Garratt (30 Q. B. U. C. l6o) it was held that, where 
 a deed of composition was ineffectual to bind non-assenting cre- 
 ditors, the mere fact of such a creditor proving his claim before 
 till! assignee did not prevent him from suing for the amount 
 thereof. 
 
 It will be observed this section declares the claims will be 
 barred whether secured in part or in whole, by any mortgage, 
 hypothec, lien, or collateral security of any kind or not. If, there- 
 fore, a secured creditor does not come in and prove his claim 
 against the estate, he must thereafter look to his security alone. 
 If he allows the time for proof to go by, and the assets to be 
 
 I'M 
 
198 
 
 TFS INSOLVENT ACT. 
 
 distributed, he cannot, on his security proving insufficient, com- 
 mence proceedings against the insolvent, assuming, of course, that 
 the particulars of the secured claim are duly inserted in the 
 schedule. 
 
 The l04th section of the Act of 18G9 provided that the con- 
 firmation of the dischaj-ge, if not reversed in appeal, should ren- 
 der the discharge final and conclusive, but it was held that 
 the confirmation of the deed, under this section, eould not give 
 it any gi-eater effect than was provided for in the deed itself, or 
 in the clause of the Act proscribing its effect. If the deed, 
 for instance, was defective in ncjt providing eciually for all tlie 
 creditors, or in ignoring the claim of any creditor, the confirma- 
 tion by the judge will not remedy the defect (Shdiv v. Mnmc, 21 
 C.P. U. C. 2GG). 
 
 It will be observed that this section authorises the insertion in 
 the schedule of the particulars of negotiable paper, the holders of 
 which are urdcnown. 
 
 If the debtor omits to insert the particulars recjuired ly the 
 latter part of this section, the holder of a bill whicii has been 
 negotiated, and who does not become aware of tlie debtor's in- 
 solvency until after the composition is accepted, will not. iie 
 bound by it (ex parte Mafthcirs, L. R. 10 Ch. Apj). 304 ; 32 L. T. 
 N. S. 081). 
 
 It is important to consider whether the order of discharge .\h- 
 solutely releases and extinguishes the debt, so that a subse([uent, 
 promise to pay it wouM be of no avail. Under the English Act 
 the order "releases" the bankrupt from all debts provable under 
 the bankruptcy, and if the word "release" be used in its tech- 
 nical sense, its effect would of course be not merely to bar the 
 remedy but to extinguish the debt. In Ihompson v. C'uhcn (L. 
 R. 7 Q. B. 527, 532) Blackburn, J., says : " The word used is ' n;- 
 leased ' the debt is thereby gone." On the other hand, in some 
 cases at least, an oi'der of discharge is not eipiivalent to a release. 
 For instance, it docs not free a surety of the bankrupt from his 
 liability (AV/;,s v. Wilmof, L. R. 10, Ex. 10). 
 
 In our Statute the words used are " shall absolutely free ami 
 discharge, 6zc." and it has l)een held that an action might bo 
 
 [ I 
 
m 
 
 EFFECT OF DISCHARGE. 
 
 199 
 
 maintained on a note given for a debt barred by the discharge ; 
 that the debt was still a continuing debt in conscience, and a suf- 
 ficient consideration for a new promise (Austin v. Gordon, 32 Q. 
 B. U. C. C21). 
 
 This case would probably not be regarded as an authority at 
 present. It professed to follow the English cases, and since it was 
 decidetl, the current of English authority has changed. Though 
 the Act of 18G9 in England does not contain any provision dis- 
 charging the <lefendant from such a pronuse or note as the a])Ove, 
 vet it is held that such a promise or note Avill not bind the bank- 
 rupt (Heather v. Webb, L. R. 2 C. P. D. 1 ; Jones v. Phelps, 20 W. 
 R. 92; see also Marshall v. Kiwj, 31 L. T. N. S. 511 ; Rimini 
 V. Van Prayh, L. R. 8 Q. B. 1). 
 
 In the United States the law is settled in accordance with the 
 ik'oision in Av^'^tin v. Gordon, supra (see the cases quoted in 
 Bump's Bankruptcy, 9th Ed. 748). 
 
 02. A clischarico under this Act, wliether consented to by any creditor or 
 not, shall not operate any change in the liability of any person secondarily 
 liable tu such creditor for the debts of the insolvent, either as drawer or 
 endorser of negotiable paper, or as guarantor, surety or otherwise, nor of any 
 partner f>r otiier person liable jointly or severally with the insolvent to such 
 creditor for any debt ; nor shall it affect any mortgage, hypothec, lien or col- 
 laterial security held by any creditor as security for any debt thereby dis- 
 charged, without the con.sent of such creditor. 
 
 Under the English Bankru})tcy Act a discharge releases only 
 the debtor to whom it is granted, and leaves a co-debtor liable to 
 be separately sued by a joint creditor (Meijrath v. Gray, 30 L. T. 
 N. S. Ki ; L. R. 9 C. P. 210) ; and, under this section, partners or 
 other perscms liable jointly or severally with the insolvent are not 
 discharged, and a plaintiff accepting a composition from one of 
 three joint, and several makers of a note, will not release the 
 others though aware, when taking the note, that the other makers 
 were sureties only (Foidor v. Perrin, 1(5 C. P. U. C. 258 ; see also 
 Marfea v. Brvmell, 4 P. R. U. C. 229 ; 4 U. C. L. J. N. S. 137). 
 
 Whei'e the acceptor of a bill of exchange presents a petition for 
 liipiidation or coni[)osition under the English Act of 18G9, andthe 
 creditors pass a lesolution therefor, the acceptor must be consid- 
 
 • ; 
 
200 
 
 THE INSOLVENT ACT. 
 
 ered as discharged by operation of law and the drawer is not 
 thereby discharged from his liability. In such a case it makes no 
 ditierence whether the bill-holder is present at the meeting or not, 
 or whether he votes in favour of the resolution or against it (ex 
 parte Jacobs, L. K. 10 Ch. App. 211 ; following Megrath v. 
 Gray, L. R. 9 C. P. 216, and disapproving of Wilson v. Lloyd, L. 
 R. 16 Eq. 60, which may be considered as over ruled so far as it 
 relates to the I'elease of a surety (see also Gle<j;/ v. G'llheij, L. R. 2 
 Q. B. D. 209. 
 
 And, where a surety on paying the debt may prove on the in- 
 solvent's estate in the place of the creditor, the surety is not re- 
 leased l)y the creditor consenting to the debtor's discharge (Brow)ie 
 v. Carr, 7 Bing. 50cS). 
 
 And the same rule applies in the case of liquidation by arrange- 
 ment under section 125 of the Act of 18()9. In .such case, the 
 surety still remains lial)le although the resolution granting the 
 discharge contains no reservation of rights against sureties (Ellis 
 v. Wilmot, L. R. 10 Ex. 10 ; see further on this section, Bafeman 
 v. Gosling, L. R. 7 C. P. 9 ; Hooper v. Marshall, L. R. 5 C. P. 4 ; 
 Cragoe v. Jones, L. R. 8 Ex. 81). 
 
 After an assignment in insolvency, in 187o, a deed of composi- 
 tion and discharge was executed, by which the insolvent cove- 
 nanted to pay thirty cents in the dollar, and give each creditor en- 
 dorsed notes tlierefor, and the creditors, in consideration thereof, 
 released hiui from all their respective claims, " saving and reserv- 
 ing the rights, which any of them may have against any other 
 per.son, or in respectof any security held by them, orany of them." 
 A. ct Co., who were creditors executing the deed, had a claim 
 amounting to 82,758, for i?800 of which they held collatei-al se- 
 curity in resi)ect of promissory notes, on which the insolvent was 
 secondarily liable, all overdue, except one for $52. It was held 
 that A. & Co. were entitled to the composition on their claim, 
 and to retain their securities, and were not bound to value theii- 
 securities, the notes being overdue and unpai<l (re Stem, 37 Q. B. 
 U. C. 296). 
 
 This section only applies to the discharge in insolvency, and 
 does not refer to, or have in view, any act of the parties etlecting 
 
EFFECT OF DlSCHAltGE. 
 
 201 
 
 a release of lial)ility at law, or in equity (re McDonald, 14 B. R. 
 477). The creditor may still sue any one else liable upon the 
 same debt in the capacities specified, and proceedings pending 
 against others thereon, and unsatisfied judgments already ob- 
 tained against others thereon, are not afi'ected, discharged, or 
 surrendered, by proving the debt (re Levy, 1 B. R. 327; Payne v. 
 Able, 4 B. R. 220). When a firm, which has been dissolved by 
 the death of one of the partners, is put into insolvency, by pro- 
 ceedings against the surviving partner, the discharge of the 
 surviving partner wiW not operate to discharge the estate of the 
 deceased partner from liability (re Stev.ns, o B. R. 112). The 
 sureties upon an auctioneer's bond are not relieved, by the dis- 
 charge of the principal, from liability foi' the proceeds of goods 
 placed in his hands for sale {JoiieH v. Russell, 11 B. R. 478). 
 
 This section expressly provides, that the discharge shall not 
 art'ect any mortgage, hypothec, lien, or collateral security, hold by 
 the creditor as security for any debt thei'eby discharged. This is 
 merely a reservation to the secured creditor, of his rights in re- 
 spect of the security, and does not, as we have seen under the 
 jtreceding section, enable the secured creditor to attach the general 
 a.ssets of the insolvent, if he elects to look only to his security. 
 
 (y'.i, A discharge under this Act shall not apply without the express consent 
 of the creditor, to any debt for enforcing the payment of which the imprison- 
 ment of the debtor is permitted by this Act, nor to any debt due as damages 
 for assault or wilful injury to the person, seduction, libel, slander, or mali- 
 cious iirrest, nor for the maintenance of a parent, wife, or child, or as a 
 penalty for any offence of which the insolvent has been convicted ; nor shall 
 any such discharge apply without such consent to any debt dwe as a balance of 
 account due by the insolvent as assignee, tutor, curator, trustee, executor, or 
 administrator under a will, or under any order of court, or as a public officer : 
 nor shall debts to which a discharge under this Act does not apply, nor any 
 privileged debts, nor the creditors thereof, be computed in ascertaining 
 whether a sufficient proportion of the creditors of the insolvent have voted 
 upon, done, or consented to any act, matter, or thing under this Act, but 
 the creditor of any such debt may claim and accept a dividend thereon 
 from the estate without being, by reason thereof, in any respect affected by 
 any discharge obtained by the insolvent. 
 
 This section provides that the discharge will not bar the debts 
 mentioned therein without tlic express consent of the creditor. 
 
 Miv 
 
 IV I 
 
202 
 
 THE INSOLVENT ACT. 
 
 How would this consent be shown ? Clearly not by proof of the 
 claim, if that were possible ; for the section itself provides that 
 the dividend may be accepted without prejuflice to the claim. Tn 
 view of the Act providinjf for the acceptance of a dividend by 
 those holding the claims I'eferred to in this section, is the assignee 
 required to reserve dividends to meet these claims (see section 
 94) ? In refi -ence to claims that are cleai'ly privileged, the assignee 
 shouM m 'inge on them in the declaration of a dividend. 
 
 But few , e .dms mentioned in this section are susceptible of 
 proof, antt as to these the ])rovision for acceptance of a dividend 
 seems t: '><.'■ useless, as the assignee, it is apprehended, woidd not 
 be justified in ^ayiii^ a dividend except on a claim duly and 
 and })roperly proved (see notes to section 104.) To meet thi- claims 
 mentioned in this section, other than tliose which are clearly privi- 
 leged, it is presumed the assignee is not retpiired to reserve divi- 
 dends out of the as.sets which come into his hands. 
 
 A discharge under this Act will not prevent a party from Iteing 
 committed upon a judgment summons under the provisions of the 
 Division Court Act, where it is not shown specifically that the ile- 
 fendant is discharged from the debt under the Insolvent Act. 
 On an application for discharge from arrest on the ground of a dis- 
 charge from a debt under this Act, it vshoidd be clearly shewn that 
 the creditor's debt appears in the schedide, and merely swearing 
 to a copy of the schedule Avithouo stating the fact that the plain- 
 tifi:"s name ap])ears will not be .sufiicient (re Machiy v. Gooilfton, 
 27 Q. B. U. C. 26:3 ; confirming s. c. in chambers, 2 U. C. L.J. N. S. 
 210 ; see also Abbey \. D<de, II C. B. 378 ; Geonje v. Somers, 1(5 C. 
 B. o3{)). 
 
 The Act imposes certain duties cm the insolvent from which he 
 is not released by the discharge. The discharge only relieves 
 him from debts provable in insolvency and not from the obliga- 
 tion to perform the duties prescribed by the Statute during the 
 insolvency, and, therefore, even after his discharge, he may be 
 committed for contempt of Court if he wilfully fail to perform 
 the duties imposed »i[)on him by the Statute, or if he fail to de- 
 liver up any part of his property which is divisible amongst his 
 creditors (re Waters, L. R. IS Eq. 701; 30 L. T. N. S. 70(>). 
 
EFFECT OF DISCHARGE. 
 
 20S 
 
 Debts due for the maintenance of a parent, wife or child are 
 not barred. 
 
 Where a decree directs the payment of a certain sum every 
 month as alimony, the monthly payments which fall due, after the 
 commencement of the proceedings in insolvency, are due by 
 natural obligation, and not by contract, and are not affected liy a 
 (Uschiirge (re Gdvrctt, 11 B R. 493), so a decree for maintenance of 
 a l)astard child is not released by the discharge (Comm v. Eris- 
 man, 21 Pitts. L. J. CO). 
 
 It has been held in the United States that the discharge bars a 
 foreign as well as a domestic creditor {Murray v. De Roftenham, 6 
 Johns, Ch. 52). 
 
 The 49th section of the English Bankruptcy Act declares that 
 the discharge shall not relieve the bankrupt from any debt or 
 liability, incurred by means of an) fraud or breach of trust. It 
 has been held, where an attcjrney brought an action in another's 
 name, without any retainer oi- authority from him, and was, in 
 conse([uence, ordered by the court to pay the defendant's costs of 
 the action, his liability to pay these costs was a liability incurred 
 by means of fraud within this section (Jcid'his v. Fcreiay, 27 
 L. T. N. S. 37 ; L. R. 7 ('. P. 358). The Statute in force in the 
 United States speaks of debts contracted by a person " while 
 acting in any fiduciary character," and it is there held that a 
 claim against a person for withholding the proceeds arising from 
 the sale of goods consigned to him, to be sold on commission, is 
 a debt contracted by him in a fiduciary capacity (re Seyrtiovr, 
 1 B. R. 29 ; re Klmhall, 2 B. R. 204). if the insolvent receives 
 money as agent, to be used in a particular way, or for a .specific 
 purpose for the use of the principal, then the money is held l)y 
 him in a fiduciary capacity (Xfatfltemn v. KdUujg, 15 111. 547). 
 A general deposit, with authority to the bailee to mix the money 
 with his own, and use it until applied for by the depositor, does 
 n(jt create a fiduciary debt {Hcrvey v. Dcvertmx, 72 N. C. 463). 
 A debt which arises from a consignment of goods to the debtor 
 to sell under an agreement, that he shall have, as commissions, all 
 that can be realiwd above a certain sum, is a fiduciary debt 
 (T)-e(i(ltvell V. Holloivay, 12 B. R. 61). An auctioneer acts in a 
 
n 
 
 v^ 
 
 -204 
 
 THE INSOLVENT ACT. 
 
 fiduciary capacity or character, and his discliarge Mall not relieve 
 him from liability for the proceeds of goods placed in his hands 
 for sale {Jone^ v. Riit^Hell, 11 B. R. 478). A discharge does not 
 relieve a guardian from his fiduciary obligations as such {Carlln 
 v. Ckvdin, 8 Bush. 41 ; Halllhiirton v. Carter, 10 B. R. 359). An 
 agreement by an executor guaranteeing the payment of a de- 
 mand against the estate is not a debt created by him while acting 
 in a fiduciary capacity. In making the promise, he acts outside of 
 his character as executor, and he is not acting in a fiduciary 
 character as respects the party to whom it is made (AmoskcAiA/ M. 
 Co. v. Bdrneti, 49 N. H. 312). In reference to the debts mentioned 
 in this section, it is to l)e obsei'ved that a judgment obtained 
 before the insolvency changes the character of the debt, so that 
 it will be barred by the discharge, whether the cause of action is 
 for tort or a fiduciary debt (Manniiuj v. Keye>^, 9 R. I. 224 ; 
 Wolcot V. Ho(((/e, 81 Mass. 547). The judgment, however, would 
 require to be before the assignment or the issue of the attach- 
 ment (.see notes to section 80). 
 
 64. If, after the expiration of one year from the dale of an assignment 
 made under this Act, or from the date of the issue of a writ of attachment 
 thereunder, as the case may be, the insolvent has not f)bt<ained from the re- 
 quired proportion of his creditors a consent to his discharge, or the execu- 
 tion of a deed of compositi(m and discliarge, he may apply by petition to the 
 Court or judge, to grant him his discharge, fii'st giving notice of such appli- 
 cation, (Form L) for one month in the OHicijil Gazette, and also by letter or 
 card postpaid, addressed, ten days before such ajjplication, by mail to each of 
 his creditors whose claims amoimt to one hundred dollars or more, and may 
 be aflected by a discharge under this Act. 
 
 It will be observed, that under this section, the notice is only to 
 be sent to those creditors whose claims amount to one hundred 
 dollars or more. The oord section is silent on this point ; but, 
 in reference to both sections, the consideration is im})ortant, 
 whether the creditors referred to are those who have proved. 
 
 This section provides, that the insolvent may apply by petition 
 after the expiration of one year. If the a]»])lication here in- 
 tended is the presentation of the petition, then there is some 
 doubt whether the notice could be iiiven a month before the 
 
DISCHARGE WITHOUT COMPOSITION. 
 
 205 
 
 expimtion of tho year. But proliably the insolvent must wait the 
 oxpii-ation of tlie year before giving notice in the Gazette, form 
 L, iind must then fix the day for the presentation of tho petition 
 one month later. 
 
 It has been held, in the Province of Quebec, under the Act of 
 l!S()!), that where the insolvent applied for his dischai'ge after the 
 lai)se of a year, it was incumbent on him to show that he had ad- 
 dressed and mailed notices to his creditors, iinder the ll7th sec- 
 tion of the Act, setting forth his intention to apply for a discharge 
 (re I'Jsinhurt, o Revue Legale 430 ; ex parte Poidin, ib. 254). 
 
 This case would not now be an authority ; the words, " and all 
 other notices reipiired to be given by advertisement without 
 special designation of the nature of such notices," in the 117th 
 section of the Act of LSG!), having been omitted in the present 
 Act (see section 101). The contrary was held in Ontario (see 
 re WcukleU, 2 U. C. L. J. N. S. 242 ; in re Starling, 2 U. C. L. J. 
 N. S. 303 ; see also re Sta7-h, 18 L. C. J. 73 ; s. c. 18 L. C. J. 288). 
 Now this section itself contains all the provisions in reference 
 to the giving of notice ; the 101st section of the Act applying only 
 to a meeting of creditors. 
 
 0.5. Upon such application, any creditor of tho insolvent, or the assignee 
 by authority of the creditors or of the inspectors, may appear and oppos- 
 the granting of sucli discharge upon any ground upon which the confirma- 
 tif)n of a discharge may be opposed under this Act, or may claim the suspen- 
 sion or classification of the discharge or both ; and whether such applica- 
 tion be contested or not, it shall be incumbent upon tho insolvent to prove 
 that lie has in all resijccts conformed himself to the provisions of this Act ; 
 and he shall submit himself to any order which the Court or judge may 
 make, upon or without an application to that effect, to the end that he be 
 examined touching liis estate and etfects, and his conduct and management 
 of his affairs and business generally, and toucliing each and every detail and 
 particular thereof :, and the Court or judge may .also require from the as- 
 signee a repori in writing upon the conduct of the insolvent and the state of 
 his books and affairs before and at the date of his insolvency ; and there- 
 upon the Court or judge, as the case may be, after hearing the insolvent and 
 the (jppoaant, if any, and any evidence that u'ay be adduced, may make an 
 an order either granting tho discharge of the insolvent or refusing it ; or in 
 like manner a-idiinder the like circumstances to those in and upon which the 
 discharge could be suspended or classified as hereinbefore provided, upon an 
 
Ill 
 
 iui 
 
 I ; 
 
 200 
 
 THE INSOLVENT ACT. 
 
 application to confirm it, an order may bo made suspending it for a like 
 period, or declaring it to bo of the second class, or both. 
 
 Provided always that the judge shall not grant any discharge under 
 this section in any case unless some one of the following conditions bo osta- 
 l)lished by proof, that is to say : 
 
 (1.) Tliat a dividend of not loss than fifty cents in the dollar on the unse- 
 cured claims has been or will be paid out of the insolvent's property ; or. 
 
 (2.) That such a dividend might have been paid but for the nogligonco or 
 fraud of the assignee or inspectors, or, 
 
 (3.) That the insolvent had, on some imo day prior to the institution of 
 the proceedings in ins )lvency, mailed, prejiaid and registered, to the address 
 of each of his creditors so far as known to him, a declaration acknowledging 
 his insolvency ; and that no proceedings in insolvency had been instituted 
 against the insolvent for more than one month after the mailing of such 
 notices ; and that such a dividend woidd have been paid but for circ\im- 
 stances for which the insolvent cannot justly be held responsible, arising 
 more than one month after the mailing of such declaration (40 Vict, s, 15). 
 
 It may be observed, in reference to tlie provi.so introduced by 
 the late Act, that it does not apply to the case of a consent to a 
 discharge or deed of composition. The majority in number and 
 three-fourths in value of the creditors have still the right to 
 accept, either by consent or deed of comj)osition, any rate on the 
 dollar wliich they think advisable, and the consent or deed will 
 be contirmed by the judge. The object of this section is to 
 meet cases where the insolvent is suspected of dishonesty, to 
 give the creditors the power by refusing to sign a consent or 
 deed of composition, to prevent altogether the discharge of the 
 insolvent, where his estate does not pay fifty cents in the dollar. 
 Sub-sections 1 and 2 of this section are borrowed from the 
 forty-eighth section of the English Act of 18(59. Sub-section 
 3 seems to have originated with our own Legislature. Voluntary 
 assignments having been abolished, the power to acquaint the 
 creditors with the state of the insolvent's atlairs is necessary in 
 the interests of justice. The Act says nothing as to the form of 
 the declaration acknowledging insolvency, but probably any dis- 
 tinct written acknowledgment would be sufHcient (see notes to 
 .section 3 (a). 
 
 Although this section enables any creditor to o]>pose the dis- 
 charge, it would seem that this must be taken to mean any credi- 
 
DISCHARGE WITllOl'T t'oMl'OSITION. 
 
 207 
 
 tor who has proved a claim to the amount of one hunch'ed dollars 
 at K'ast (see section 2, h). 
 
 Nej^'lect of duty by the assij^moe is no reason for depriving a 
 • k'htor of his discharge. Thus, though the assignee was recpiired 
 by section 10, s. s. l,of the Act of 1804, to call a meeting, by ad- 
 vertisement, of the creditors for the public examination of the 
 insolvent, yet if the other provisions of the Act were complied with 
 Itv the insolvent, it washeld that the judge could not refuse his dis- 
 cliarge on the ground that the assignee had failed to call a meet- 
 iu"-, lis recjuired by the section (re T1>onia», 15 Grant, 106). 
 
 The report, in writing, which the Court or judge is empowered 
 to call for from the assignee is entirely difi'erent from the cer- 
 tificate which the assignee is required to furnish under the 
 5'2nd secti(m. The report would, it is conceived, show conform- 
 ity, on the part of the insolvent, to the provisions of the Act, and 
 the state of his books and affairs before and at the date of the 
 insolvency. 
 
 An insolvent was ordered by a county judge to j)roduce certain 
 books and papers. These were at the time at Bruce Mines, and 
 the insolvent did not feel called upon to go there for them, and 
 an order was made ex parte for his committal for disobedience of 
 the order. The insolvent had, however, in the meantime, taken 
 the books to Mimtreal, and given them to one H. to hand to 
 tlio assignee. He was then arrested, and subsequently applied 
 for his discharge, which was refused. The books were after- 
 wards handed over to the proper person, though in a mutilated 
 condition, which mutilation, the insolvent said, must have been 
 done at Montreal. He again applied for his discharge, on the 
 ground that he had comi)lied with the order, and that the im- 
 prisonment was for compulsory purposes only. The county judge, 
 however, made an order refusing the application, and the insol- 
 vent then appealed from the last order to a judge in Chambers 
 at Toronto. 
 
 It was urged that the warrant of arrest was insufficient on its 
 face, that no demand was made of the books or refusal to give 
 them shown, and, therefore, no contempt, and that the power of 
 imprisonment was only to force compliance with the order, and 
 
 
208 
 
 TIIK INSdlA'KNT A(T. 
 
 hot in pienam. The Court held, tlmt the ju<l,t(t' at Toronto liml 
 ng ri^'ht toc'n([uiro into tlic lc;,'alitv oi' inopricty of th*^ wununt 
 for arrost, or as to tlic naturo or oliji-ct of thu iinprisonnifiitad- 
 thori/AM'. l»y tlic Statute, or whetlu^r thc^ Avarrant was an onler, 
 and so an .ipiieahible matter under tlie Aets ; that the hist oidcr of 
 the county judge was not improperly made, and the aiUM'al was 
 merely an apjieal from that order {Mclmics v. Davidson, 4i F.R. U. 
 C. 183; 4U. C. L. J. N. S. 42). 
 
 66. Every dischargu or confiriuivtiun of any dischargo obtainod by fraud or 
 fraiidvilont pruforoncc, or by means of the couseut of any creditor procured 
 by the payuient or [irmuiHo of payment to such creditor of any vahiable 
 consideration for uucli cunsent, or by any fraudulent contrivance or practice 
 whatever, tending to defeat tl»e true intent and meaning of tho provisions of 
 this Act in that behalf, shall bo null and void ; and in no case shall a ilis- 
 chiirge have any etl'ect unless and until it is coulirmed by the Court or judge. 
 
 The 39 Vict. chap. 30, s. U, added the words " or judge " to tlie 
 end of this .section. As to fraudulent preferences, see the notes 
 to sections 130 \: 133 inclusive. 
 
 If the execution of a deed of composition and discharj^'e has 
 l)een obtained hy fratnl, or fraudulent prrfcronce, or the conceal- 
 ment by the insolvent of a large portion of his assets, tho deed 
 may be .set aside, and the creditors may sue for the full amount of 
 their claims (Girard v. Hall, 1 L. (1 L. J. .58), even though they 
 have signed the deed of composition. And this may be done after 
 confirmation, if the creditors seeking to set it aside had no know- 
 ledge of the fraud until after the time elapses for appealing from 
 the order confirming the di.schaigc!. Thu.s where the insolvent, 
 before the first meeting of his creditors, called under the Act of 
 1864, concealed a portion of his estate and effects with a view to 
 defraud his creditors, it was held that the discharge was thereby 
 avoided ; and that it wns not the less a fraud because the in.sol- 
 vent at the meeting had valued his as.sets at a sum sufficient 
 to cover the goods so concealed (McLean v. McLellan. 29 Q. B. 
 U. C. 548). 
 
 The 104th section of the Act of 1869 provided tliat the dis- 
 charge, if not reversed in appeal, should be final and conclusive. 
 
 1 !! 
 
DISCHAHOE WITHOUT COMPOSITION. 
 
 209 
 
 It lias Ik'cii Ih'M ill Nova Scotia that tlio more fact of a eivditor 
 ii(»t iippcalin*'' from tlic order. conHrmiiij,' tlie (liscliar;,'(! did uot 
 |iivvi'iit him from afterwards setting' uj) that the discliar«,'i' was 
 olitaiued by fraud, in any action bi'ou^^lit by him against the in- 
 solvent, vvdiere the latter pleaded the dischar^Lfe {Uodkhi v. licech, 
 1 Russell iV Chesley Rei)s. N. S. :i(il). This seems to be the 
 law where the fraud was unknown to the creditor when the 
 oriler t)f eontirmation was obtained (jnni Thorn i mo n v. Rutlierford, 
 27 <,). 11 l^ C. 205 ; McLean v. McLellnn, 21) Q. 13. U. C. rAH). 
 
 In an action on a prondssory note, with a plea of disdiarge 
 under the Act, and replication that tlie dischar-e was obtained by 
 fiaud, inasnuich as the defendant had concealed from the as- 
 signee certain )>romi.ssory notes, it api>eared from his own evi- 
 druce that defeiulant, .several months Ixd'ore his assij^nment, 
 which was voluntaiy, desiring to raise money on Ids farm, one-fifth 
 of which bclongiid to his wife, the value of hei' interest not being 
 stated, gave his wife at least S300 of notes, she otherwise refusing 
 to consent to a mortgage of the farm. It fuither appeared that 
 defendant had attemi)ted to collect the notes, as he alleged, for his 
 wife, and tliat the mortgage had been nearly, paid off, but by what 
 means was not shown. The Court held that tlie plaintiff was ou 
 this evidence entitled to recover {Golloijhy v. Graham, 22 C.P.U. C. 
 22(5). 
 
 in order to render a deeil of comjiosition binding upon non- 
 assenting creditors, the deed should be free from all taint of fraud, 
 and .should be entered into bona Jlde, witli a view to the benefit 
 of all the creditois. If the requisite number lias been procured 
 by some of the debtor's friends buying up claims on the estate 
 at an exorbitant price, the deed will be void. 
 
 At the first meeting of creditors, a resolution in favour of a 
 ci)m]iosition was lost. Sub.sequently the debtor's brother-in-law 
 b, light up one of the largest debts for 10s. in the pound. Under 
 an order made on the debtor's application, a second first meeting 
 of creditors was summoned, at which a proxy appointed by the 
 creditor who had sold his debt, voted in favour of a composition of 
 2.^. 6d. in the pound, and a resolution to that effect was carried. 
 The Court held that the resolution was void, having been fraudu- 
 
 N 
 
 .1! 
 
 , 
 
210 
 
 THE INSOLVENT ACT. 
 
 lently procured for the benefit of the debtor, and not with a view 
 to the benefit of all the creditors (ex parte Cobh, 29 L. T. N. S. 
 123 ; L. R. 8 Ch. App. 727). It will be ob.served that thi.s section 
 invalidates a discharge or confirmation of discharge merely, and 
 says nothing as to the validity or invalidity of any security or 
 covenant made or given by the insolvent, to secure the consent of 
 the creditor to the discharge, or as an inducement to the creditor 
 to withdraw opposition to the .same. Securities of this nature 
 are void, on grounds of public policy, independently of the 
 Statute. Thus a promise by the insolvent to pay a note, in con- 
 sideration that the holder would withdraw his opposition to the 
 maker's discharge as an insolvent, is illegal and void (Austin v. 
 Markkam, 10 13. 11. 54<S), and such a nijte lias been held void even 
 in the hands of a bona Jide holder {Noble v. Scofield, 44- Vt. 281). 
 
 It was held under the Act of 18G'J, that where the insolvent, 
 in order to procure the consent of certain creditors to the deed of 
 composition, gave them his promissory note for a sum in excess 
 of what the deed .secured to the other creditors, without the 
 knowledge of and in fraud of the latter, the discharge was not 
 effectual though confirmed by the judge, under the 104th .sec- 
 tion ; it not appearing that this fraud was known at the time of 
 the application for confirmation {Thomimm v. Rutherford , 27 
 Q. B: U. C. 20.5). The 104th .section of the Act of 18G9 provided 
 that the confirmation of the discharge, if not reversed in appeal, 
 would render the discharge thereby confirmed final and conclusive. 
 
 If tlie insolvent gives a credit(jr a note of a third person, in 
 order to procurti the consent of the creditor to his discharge, the 
 note will be null and void Such a note, made l)y the insolvent 
 himself, would be null and void. In the case referred io, the note 
 was made by the insolvent's mother, and the creditor never had 
 any connnunication with her in regard to it (Prevost v. P'lehh', 
 14 L. C. J. 220). 
 
 A note given l>y an insolvent to one of his creditors, for the 
 purpose of obtaining his signature to a deed of comjjosition, cannot 
 serve as a ground of action against such insolvent, and the giving 
 of such a note w^ill be considered a fraud upon the other credi- 
 tors. Parol evidence will not be admitted to prove that such a 
 
DISCHARGE OBTAINED IJY FRAUD. 
 
 211 
 
 note was given after the signing of the deed of composition, nor 
 to establish anything relating thereto, inconsistent with the terms 
 of such deed of composition (Sinclair v. Henderson, 9 L. C. J. 306; 
 1 L. C. L. J. 54). 
 
 An agreement between a creditor and a third person, not the 
 insolvent, to give the creditor an advantage over the other credi- 
 tors, in the event of his not opposing the discharge, is invalid, 
 and contrary to the policy of the insolvent law, the same being 
 made without the knowledge and consent of the creditors of the 
 insolvent, and for the purpose of giving the creditor a preference 
 over the others (McKeivan v. Sanderson, 27 L. T. N.S. 157). 
 
 If the insolvent induces the creditors to accept a much smaller 
 composition than he is able to })ay, V)y fraudulently concealing 
 some portion of his estate, that would be a ground to avoid the 
 discharge, Itut, in the al)sence of such fraud, there is nothing to 
 prevent creditors agreeing to accept a smaller composition than 
 the debtoi', if hard pressed, might be aljle to pay [Shavj v. Massie, 
 21 O.P. U. C. 276.) 
 
 There must be good faith, and no secret bargain, for the benefit 
 of any pai-ticidar creditoi-, with the debtor or his friends, in order 
 to induce the creditors to vote for a composition (ex parte Gobh, 
 L. II. 8 Ch. A-pp. 727.) The fact, however, that the creditors were 
 partly influeneed in voting for the composition, by good will 
 towards tht^ debtor, will not invali<late the deed (exparte Linsley, 
 L. H.DCh. App. 290), unless there is nvda fides on the part of the 
 creditors, as where they resolved to accept a composition greatly 
 less than the assets would pay (e.K parte Pa'je, L.R. 2 Ch. D. 323; 
 see ex parte Elivorthy, L. R. 20 Eq. 742). 
 
 Misi-epresentation or concealment by the debtor of a material 
 fact, will also invali<late the proceedings (ex parte Barrel!, L. R. 
 1 Ch. 1). 537). 
 
 Where G. & M., creditors, on the application of the insolvent, 
 refused to execute a deed of ctnnposition and discharge, but sub- 
 sequently consented to do so upon being called upon by the assig- 
 nee, who, as an inducement, gave his own note to cover costs 
 which they had incurred in endeavouring to recover the claim. 
 The Court held, afHrming the decision of the judge in insolvency, 
 
 J:>.JL^>^ ' 
 

 
 1 
 
 
 
 
 
 r 
 
 1 
 
 :i 
 
 J 
 
 
 
 i : 
 
 J 
 
 1 
 
 ' .= 
 
 *^ 
 
 212 
 
 THE INSOLVENT ACT. 
 
 that the deed was void, oven although the action of the assignee 
 was unautliovized by the insolvent (re MvCrae, 13 C. L. J. N. S. 
 105). 
 
 Undei- the Act of ISOO, tlie composition and discharge might 
 be acted upon by tlie assignee lief ore tliere liad been any continu- 
 ation of the discharge by the judge, and it was not obligatory 
 upon the insolvent to apjjly for a confirmation of the deed of 
 com])Ositi(m and di.scharge, unless he chose to do so, or unless a 
 creditor forced him to do so under the l()2nd section, or unless 
 opposition were made to the deed under the 07th section, and 
 Avere not withdrawn. The effect of not having a confirmation 
 was simply to throw upon the debtor, under the 10-ith section, 
 the burden of proof of the discharge being completely effected un- 
 der the provisions of the Act (Nicholson v. Gunn, 35 Q. B. U. C 
 11 ; per Wilson, J.). 
 
 It is apprehended that this section makes obligatory the con- 
 firmation of the discharge. 
 
 SALE OF UEBT.S. 
 
 ()7. After having acted with iluo diligence in the collection of the debts, if 
 the assignee tinds there remain debts due, the attempt tu collect which wotdd 
 be more onerous than beneticial to the estate, he shall report the same to the 
 creditors or inspectors, and^ with their sanction, he nni}' sell the same by 
 public auction, after such advertisement thereof as they m:iy order ; and 
 pending such advertisement, tlie assignee shail keep a list of tlie debts to be 
 sold, ojien to inspecticjn at his office, and shall also give free access to all docu- 
 ments and vouchers explanatory of such debts ; but all debts amounting to 
 more than one hundred dolb.'.rw shall be sold separately, except as heroin 
 otherwise provided. 
 
 It seems duubtfid wlu'ther tlie assignee can legally sell debts, 
 under this section, without having first made reasonable and bona 
 fid*' efforts to colli'Ct the same. 
 
 This section corresponds to the i-ith section of the Act of bSO!) 
 It seenis to differ from it only in this that, under the Act of IfStJ!), 
 the assignee could not sell the debts withotit first obtaining an 
 order from the judge allowing the sale. Under this section, the 
 sanction of the creditors or insjteetnrs is all that is required. Un- 
 der the Act of LSGS>, it was held that an assignee who sold out- 
 
fp 
 
 SALE OF DEBTS. 
 
 213 
 
 
 standing debts due to the insolvent, siccording to a schedule exhi- 
 biting the original amounts of such debts, vrithout deduction of 
 payments received by the assignee on account, was bound to 
 account ft)r and pay over to the purchaser of such debts the full 
 amount of such payments so made to the assignee, notwithstand- 
 ing that the conditions of sale declared " that the sale is made 
 witliout any guarantee whatever, or any warranty of any kind 
 or description whatever, so much so that no warranty is given that 
 the debts have even existence ;" and notwithstanding also, that 
 the audience were informed by the auctioneer that dividends had 
 been paid, and that the amounts in the schedule were the original 
 amounts without deduction of payments ; and notwitlistanding 
 also, tluit tlie total amount paid for such deVits was only a few 
 dollars, and the payments in ([uesticm amounted to more than six 
 hundred dollars (Lafond v. Rankin, 18 L. C. J. (32 ; 1 Revue 
 Critique, 474). 
 
 (i8. If at any tiniu any creditor of the insolvent desires to cause any pro- 
 ceeding to be taken which, in his opinion, would be for the benefit of the 
 estate, and the assignee, under the authority of the creditors or of the in- 
 spectors, refuses or neglects to take such proceeding after being duly recjuired 
 so to do, such cretlitor shall have the right to obtain an order of the judge, 
 authorizing hiui to take such proceeding in the name of the assignee, but at 
 his own t'xpense and risk, upon such terms and conditions as to indemnity to 
 the assignee as the judge may prescribe ; and thereupon anj benefit derivcnl 
 from such proceeding sliall belong exclusively to the creditor instituting the 
 same, for liis benefit and that of any other creditor who may have joined him 
 in causing the institution of such proceeding. But if, before such order is 
 granted, the assignee shall signify to the judge his readiness to institute such 
 proceeding for the benefit of the creditors, the order shall be made prescrib- 
 ing the time within which lie shall do so, and in that case the advantage de- 
 rived from such proceeding shall appertain to the estate. 
 
 It is |)resunied the only indemnity the creditor would be re- 
 quired to give, would be as to costs of the proceeding. 
 
 The .S7th secti(m, introduced into the Act of l87o for the first 
 time, follows the .same principle as this. 
 
 00. The person who purchases a debt from the assignee, may sue for it in 
 his own name, as eU'ectually as the insolvent might have done, and as the 
 assiL'neu is hereby authorized to do ; and a bill of sale (Form M), signed and 
 
 ■It 
 ^ III 
 t 
 
 \ 
 
 I I 
 
 ^i. >i\'^'^' 
 
li 
 
 li 
 
 
 
 i 
 
 1 
 
 
 214 
 
 THE INSOLVENT ACT. 
 
 delivered to him by the assignee, shall be prima facie evidence of such pur- 
 chase, without proof of the handwriting of the assignee, and the debt sold 
 shall, in the Province of Quebec, vest in the puicliaser without signification to 
 the debtor ; and no warranty, except as to the good faitii of the assignee, 
 shall be created by such sale and conveyance, not even that the debt is due. 
 
 The insolvent himself may be the purchaser {Kitson v. Hard- 
 xoick, L. R. 7 C. P. 473 ; ex parte T taker, L. R. 9 Ch. App. 7lG) ; 
 and if the assignee assigns to the insolvent, debts owing to hiui, he 
 will be entitled to sue for them in his own name {Me<jarth v. Gray, 
 L. R. 9 C. P. 216) ; so also the assignee may sell the insolvent's 
 share of the i)artnership assets to the insolvent's co-})artners, if sol- 
 vent, or any other person (re Motion, L. R. 9 Ch. App. 192). 
 
 LEASE.S. 
 
 70. If the insolvent holds under a lease, property having a value above and 
 beyond the amount of any rent payable under such lease, the assignee shall 
 make a report thereon to the judge, containing his estimate of the value to 
 the estate of the leased property in excess of the rent ; and there>ipon the 
 judge may order the rights of the insolvent in such leased premises to be sold 
 separately, or to be included in the sale of the whole or part of the estate of 
 the insolvent, after such notice of such sale as he shall see fit to order ; and 
 at the time and place appointed such lease shall be sold upon such conditions, 
 as to the giving of security to the lessor, as the judge nuiy order ; and such 
 sale shall be so made subject to the payment of the rent, to all the covenjints 
 and conditions contained in the lease, and to all legal obligations resulting 
 from the lease ; and all such covenants, conditions and obligations shall be 
 binding upon the lessor and upon the purcha.ser, as if he had been himself 
 lessee, and a party with the lessor to the lease. 
 
 Where there is a proviso in the lease for its forfeiture on insol- 
 vency, the term does not i)ass to the assignee in insolvency of the 
 lessee. 
 
 It was provided l)y a lease that, in case the term should at any 
 time be seized or taken in execution, or in attachment, by any 
 creditor of the lessee, or if the lessee, becoming bankruj)t or insol- 
 vent, should take the benefit of any Act that might be in force for 
 bankrupt or insolvent debtors, the term should immediately be- 
 come forfeited and void. Proceedings having been taken in com- 
 pulsory licjuidation, under the Insolvent Act of 1809, and an at- 
 tachment placed in the .hands of an assignee under the Act, who 
 
Avm 
 
 LEASES. 
 
 215 
 
 
 entL'ied in the usual way, and brought an action to recover posses- 
 sion of the demised premises, it was lield that the lease was for- 
 feited, and that the clause was not limitiid to an attachment under 
 the absconding <lebtors' act (Kerr v. Hastingii, 25 C. P. U. C. 
 42!)). 
 
 But, in the Province of Quebec, it was held that, the prohibitory 
 clause contained in a lease, not to sublet nor transfer any portion 
 of his lease without the written consent of the proprietor, did not 
 apply to a sale in insolvency, under section 77 of the Act of 18G9, 
 which corresponded with this secti(m (re Wright, 2 Revue 
 Criticpie, 482). 
 
 Where a lease contains a covenant in tlie statutory form not to 
 assign without leave, if the lessee make a voluntary assignment 
 in insolvency liis interest in the lease will pass to the assignee. 
 Jt seems that the assignee has no right to decline the lea.se, and 
 that no acceptance of the lease on his part, or election to take it, 
 would be necessary. If any election were required on the part of 
 the a.ssignee, it would be sutftcient if he entered on the premises 
 and let a part of them to a third person {Magee v. Rankin, 29 
 Q. B. U. C. 257, Doe. i\.,.Palmer v. Andrews, 4 Bing, 348). 
 
 A covenant, on the pai t of a lessee, not to assign without leave, 
 will be broken by a voluntary assignment in insolvency, and the 
 lessor may maintain ejectment. In this respect it seems to differ 
 fjom involuntary l)ankruptcy, where the interest passes by opera- 
 tion of law (see Magee v. Rankin, supra). In the latter case it 
 would seem that the as.signee would not be liable under a lease to 
 the bankrupt until he accepts the term {Copeland v. Stephens, 1 
 B. ic Aid. 593; Mackley v. Pattenden, 1 B. &. S. 178). 
 
 Until the assignee elects to accept a lease as assignee, he 
 does not become liable for rent accruing after the assignment 
 (re Teneyck, 7 B.R. 26 ; I'e Washburn, 11 B. R. 60), and occu})ation 
 of the premises, independently of the lease, is not evidence of an 
 election to accept it (ib.). Merely allowing the insolvent's goods 
 to remain on the premises, does not alone prove an acceptance of 
 the lease ; especially when the key is sent back to the lessor, 
 wliich is an unequivocal act of renunciation (re Yeaton, Lowell, 
 420). A landlord has no lien on the goods on the premises for 
 
 !sU 
 
 
J 
 
 21G 
 
 THE INSOLVENT ACT. 
 
 the rent tliat accrues after tlie commencement of the proceedings 
 in insolvency, for the debt is not provable {Bdilcu v. Loch, 11 
 B. R. 271). 
 
 71. If the insolvent holds under a lease extending beyond the year current 
 under its terms at the time of his insolvency, jtroperty which is not subject 
 to the provisions of the last precedint; section, or respecting which the jvidge 
 does not make .an order of sale, as tlierein provided, or which is not sold 
 under such order, the creditors or inspectors shall decide at any meeting 
 whicii may be held more than throe months before the termination of the 
 yearly term of the lease, cnrient at tlie time of such meeting, wliether the 
 property so leased should be retained for the use of the estate, only up to 
 the end of the then current yearly term , or, if the conditions of the lease 
 permit of further extension, also up to the eiul of the next following yearly 
 term thereof ; and their decision shall be final. But if the first meeting of 
 creditors is not held until within such period of three months, then the power 
 of terminating the lease may be exercised by the creditors at such meetinu, 
 or by the inspectors, within one week thereafter, but not later (40 Vic. s. Iti). 
 
 The 40 Vict. s. 10, amended tliis section by adding after the 
 word " creditors " in the sixtli line, the words " or inspectors," 
 and by adding to the ,s(!ction the proviso given above. 
 
 If tlie assignee elects not to accept the leasi; tlie landlord can- 
 not prove for the damages suffered by him in reletting the pre- 
 mises. Future rent is not a ccmtingent debt or liability. TlnM-e 
 i.s no right of action at the time of the insolvency, except for the 
 arrears (ex parte llonyhfun, Lowell 5.54, see sections 72-3). 
 
 72. From and after the time fixed for the retention of the leased property 
 for the use of the estate, the lease shall be cancelled and shall from thence- 
 forth bo inoperative and null ; and so soon as the resolniion of the cru<litors 
 or inspectors as to such retention has been ptissed, such resolution shall be 
 notified to the lessor, and if he contends that he will sustain any damage by 
 the termination of the lease under such decision, he may make a claim for 
 such damage, specifying the amount thereof under oath, in the same manner 
 as in ordinary claims upon the estate ; and such claim may be contested in 
 the same manner, sw.^ after similar inve8tigati)n and with the same right of 
 appeal, as is herein provided for in case of claims or dividends objected to. 
 
 The 40 Vict. s. 17, amended this section by adding after the 
 word "creditors" in the fourth line the words "or inspectors." 
 
 73. In making such claim, and in any adjudication thereupon, the measure 
 
flinffs 
 
 LIEN FOR RENT. 
 
 217 
 
 of damages shall be the difference between the value of the premises leased 
 when the lease terminates under the resobition of the creditors, or inspectors, 
 and the I'ent which the insolvent had agreed by the lease to pay during its 
 continuance: and the chance of leasing or not Jeasing the premises again, 
 for a like rent, shall not enter into tliu coi.iputation of such damages ; and 
 if the claim is not contested, or if, being contested, the damages are finally 
 awarded to the lessor, ho sliall rank for the amount upon the estate as an or- 
 dinary creditor (40 Vict. s. 18). 
 
 74. The prefe':e?itial lien of the landlord for rent in the Provinces of On- 
 tario, New Brunswick, Nova Scotia, British Columbia, Prince Edward Island, 
 or ATanitoba, is restricted to the arrears of rent due during the period of six 
 months last provi'ius to the execution of a doed of assignment, or the issue of 
 a writ of attachment under this Act, as the case may be, and from thence so 
 long as the assignee shall retain the premises leased. In the Province of 
 Quebec the preferential lien or privilege of the lessor shall be governed Viy 
 the provisions of tlie Civil Code. 
 
 The 4fO Vict. s. 19, ainen<le<l this .section by striking out the 
 words " one year " in the fourth line and inserting in lieu thereof 
 "six months." 
 
 The Statute of the Province of Ontario (37 Vict. chap. 10) pro- 
 vides that all rents, annuities, dividends and other periodical pay- 
 ments in the nature of income sliall, like interest on money lent, be 
 considered as accruing from day to day, and shall be apportional)le 
 in respect of time accordingly ; and the apportioned part shall l)e 
 payaV)le when the entire portion of which such apportioned part 
 shall form part shall become due and payable and not before, and 
 all persons shnll have such or the same remedies at law and in 
 equity for recovering such apportioned parts as aforesaid when 
 payable, as they would have had for recovering such entire por- 
 tions as aforesaid if entitled thereto respectively. 
 
 It will be observed that, under this 74«th section, the landlord's 
 preferential lien continues so long as the assignee retains posses- 
 sion of the prenjises leaseil. The preferential lien of the landlord 
 can only l»e olitained or realized by its operation as a lien on goods, 
 and if there are no goods on the |iremi,ses which can be distrained, 
 the landlord has no advantage over other creditors ; for. in ca.ses of 
 insolvency, the landlord has no privilege or preference for rent over 
 any other claim, his only protection lies in his right to a preferen- 
 
 
218 
 
 THE INSOLVENT ACT. 
 
 I 1 
 
 tial lien on property on the demised ])reniises. The assignee can- 
 not be ordered to pay the rent as a privileged claim without proof 
 that he obtained goods which might have been distrained suf- 
 ficient to pay the rent (re Kennedy, 30 Q. B. U. C. 471). 
 
 It would seem that a landlord cannot distrain upon the 
 demised premises after the assignment, but must proceed under 
 the 125th section of the Act. One M., in May, 1873, mortgaged land 
 to deftjndants to secure payment of ixion«y by instalments and it 
 was provided that, in case of default, the defendants might dis- 
 train. M. made an assignment under the Insolvent Act of 18()9, 
 and the plaintiff" as his assignee entered on the land which was in 
 M.'s possession and took possession of certain goods there belong- 
 ing to him ; afterwards an instalment on the niortgage being over- 
 due, the defendants distrained therefor on these goods which were 
 still upon the mortgaged premises. It was held that the defend- 
 ant's only remedy was by application under the oOth section of 
 the Act and that they had no right to distrain {Manro v. Com. 
 Bhiij. cC- S. Society, 3(i Q. B. U. C 464). 
 
 Prior to the decision in Mvnro v. Com. Bldy. & 8. Society it was 
 held that the landlord might distrain after the assignment, but if 
 he did so he w^as restricted to one year's arrears of rent accrued 
 due prior to the insolvency {Griffith v. Brovm, 21 C. P. U. C. 12). 
 
 It did not improve the position of a landlord to distrain after 
 the assignment, for whether he distrained or not his i)referential 
 lien for arrears of rent was required to be paid. If the landlord 
 distrains before the assignment, and there is more than six 
 months' arrears of rent then due, he is only, under this section, en- 
 titled to the six months' arrears. In other words, this section 
 applies whether the distress is before or after the assignment 
 {Mason v. Hamilton, 22 C. P. U. C. 411 ; reversing s. c. ib. 190). 
 
 In England, a landlord has always been entitled to distrain, not 
 only after bankruptcy, but even after the messenger has taken 
 possession (ex parte Plummer, 1 .Atk. 103 ; Briggs v. Sowry, 8 
 M. & W. 729) ; but not after fiie removal of the goods (ex parte 
 Descharmes, 1 Atk. 103) ; and it has been held, under the present 
 Act in force in England, that he may distrain after the receiver 
 has taken possession (re Mayhew, L. R. 16 ^(\. 97). But the English 
 
 i ■. i 
 

 LIEN FOR RENT. 
 
 219 
 
 Act expressly enables the landlord to distrain "either before or after 
 tlie commencement of the bankrujitcy." But the landlord cannot 
 distrain and prove for the same rent (ex parte Grove, 1 Atk. 104). 
 
 It has been held in the Province of New Brimswick, that a 
 landlord may distrain on tho ^'oods of his tenant, although they 
 are in tlu; possession of a guardian in insolvency, under a writ in 
 compulsory liquidation, and that there is nothing in the Insolvent 
 Act taking away the conmion law remedy by distress in such a 
 case {Me Lead v. McGuirk, 2 Pugsley, 248). But this is contrary 
 to the recent decision in Ontario already referred to. 
 
 A com])any which has statutory powers to recover money due 
 to them " ))y the same moans as a landlord, may recover rent in 
 anear " is a landlord within the meaning of the English Act (re 
 li. cC- ,S'. Gas Co., L. R. 11 Ec;. 015). 
 
 Where the Statute of 8 Anne, chap. 14, or similar statutory pro- 
 vision })revails,the landlord, by making a demand upon the assignee 
 before the removal of the goods for an amount not exceeding a 
 year's rent, is entitled to priority of payment, whether the right of 
 distraining exists or not (re Appold, 1 B. R. 021 ; Longsteth v' 
 Pen nock, 20 Wall, .57o ; 12 B. R. 9.5). 
 
 If an execution is issued before the connnencement of the pro- 
 ceedings in insolvency, the landlord is entitled to j)riority for the 
 rent in arrear, although the levy was not made, nor notice of 
 the rent given to the slieriff until after that time {Barnes ap- 
 peal, 13 B. R. 543). Where a lease stipulates that all unpaid 
 rent shall be a mortgage lien upon the property on the premises, 
 it creates an equitable lien that is valid against the assignee 
 (McLean, v. Klein, 3 Dillon, 113). All right to priority under 
 such a lease, which gives the landlord power to take possession 
 of the property on the premises, is gone if the assignee takes 
 possession before the landlord does (re Dyke, 9 B. R. 430). 
 
 No action lies against an assignee under the Insolvent Act to 
 resiliate a lease made to the insolvent prior to liis insolvency, 
 on the ground that the premises are not garnished with suffi- 
 cient movables to secure the rent {Anderson v. Wurtele, 2 
 Revue Criticjue 111). 
 
 f^ 
 
 liM 
 
 id! 
 
 ■ 1 
 
 "^ 
 
 '1 ' -f 
 
 ■■■■ 
 
 . 
 
 ■■ '- 
 
 
 
 
I 
 
 1 1 
 
 220 
 
 THE INSOLVENT ACT. 
 
 75. The assignee may sell the real estate of the insolvent, but in any Pit- 
 vine other than Quebec no sale shall bo couiploted (iiiloss (<() the proposed 
 sale has been sanctioned by (he creditors at their tirst nieuting, or at any 
 subseijueat meeting called for tlie puri)oMe, or by the ins[n!ctorH or (/i) the 
 assignee hasadvertizeil an auction sale or sale by tender, in accordaiipe with 
 the directions in that behalf given by the creditors at thei." tirst meeting or at 
 any subsequent mooting called for the purpose, or by the inspectors, and the 
 inspectors sanction, in writing, the acceptance of a price not greater than the 
 ainotuit bi<l, or tendered. In the Province of Quiibec no sale of real estate 
 shall be made unless after advertisement thereof, for a period of two mouths, 
 and in the same manner as is reipiirod for the actual advertist'uient of sales 
 of real estate by the sheriff in the district or place whore such real estate is 
 situate, and to such further extent as the assignee deems expedient ; provided 
 tliat the period of advertisement may be shortened to not less tliau one 
 month by the creditors with the approbation of the judge, l)ut in the Pro- 
 vince of Quebec such abridgment siiall not take place without the cmisL'Mt 
 of the hy|(otliecary creilitors upon such real estate, if any there bu ; and if 
 the price offered for any real estate at any imblic sale duly advertised as 
 aforesaid is more than ton per cent, loss than the value set upon it by a reso- 
 lution of the ci'editors, or by the inspectors and the assignee, the sale may be 
 adjourned for a period not exceeding one month, when, after such notice as 
 the inspectors and the assignee may deem proper to give, the sale shall he 
 contiinied, connnoncing at ihe last bid iifl'ered on the previous day when the 
 property was put up at auction, and if no higher bid be then offered, the 
 property shall be adjudged to the person who made such last bid : Provided 
 that with the consent of the hypothecary and privileged creditors, or where 
 there are no hypothecary or privileged creditors, with the approbation of the 
 creditors or of the inspectors, the assignee may postpone the sale to such 
 time as may bo deemed most advantageous for the estate, and whenever the 
 sale shall liavebeen so posipnnud beyond one month, tlie last bidder shall be 
 dischcarged from aTiy f)bligation under the bid he may have made on the pre- 
 vious day when the property was otlered for sale by auction (40 Vict. s. 20). 
 
 The 40 Vict. s. 20 has made a material difierence in the tiKxle 
 of sale of real estate in all the Provinces exce])t Quebec. Adver- 
 tising^ the sale, as re([uired l)y the former law, is dispensed with ; 
 the sanction of the creditors being sufficient, if given at the tirst 
 meeting, or at any subsequent meeting, called for the purpose, or 
 the sale may be completed, if an auction sale or sale by tender, 
 has been advertised in accordance with the direction of the credi- 
 tors, and the price ottered is equal to that whicli the inspectors 
 sanction in writing. This section has eti'ected a nuich needed re- 
 
SALK OF RKAL KSTATK. 
 
 221 
 
 iv„. 
 
 fiiiy 
 i the 
 with 
 (>ni( 
 
 the 
 
 tilt! 
 
 state 
 tlis, 
 iilcs 
 
 to is 
 ilud 
 ('lie 
 
 foi'iii in till) Provinco of Ontario, as lieavy expenses liave Iutc- 
 tofoie been incin'red in advcitisinij; the sale of real estate undei' 
 the former law. Advertisenients by a.ssi<rnees in insolvency, for 
 the sale of ]iroperty of the insolvent, should describe the property, 
 and state the title with the distinctness re(juired in eipiity, in the 
 case of advertisement by trustees, and other officials (O'Jicilli/ v. 
 Hour, IN Grant, ti:i; McDoiid/d v. (Jamcron, Hi Grant, 84 ; Mc- 
 Donald v. Gordon, I Ch. Cham. 12"); MftAlpine v. Yoiiit(j,'2 ib. 177). 
 
 In Quebec, the sale of real estate by the sherirt', on execution, 
 must be advertised in the Ojficial Gazette, and in addition an- 
 nounced at the church door of the ])ari,sh where the land lies (see 
 Code, Civ. Pro. Art. t)4iS). In Ontario, it is not now necessary to 
 advertise the sah) of real estate of the insolvent, in the samt( man- 
 nei' as re([uired for the advertisement of the .sale of the same on 
 execution by the sheriti". 
 
 When the assignee varies the conditions of .sale ot real estate, 
 and improperly refuses a bid, according to the conditions of .sale, 
 and adjudges the property to a previous bidder, the judge will set 
 aside the adjudication, and ordei' the property to be ti'an.sferred to 
 the i)arty whose bid is rejected (Parimett and Stetcai't, 17 L. C. 
 J.H4). 
 
 It is the duty of the Court, from the moment that the property 
 is submitted to its custody, to take due order for its preservation, 
 anil to turn it to the l)est account for the creditors (re Vila, 5 
 Law Rep. 17).. If a sale is made before the appointment of an as- 
 signee, it is necessary that the creditors should have due notice 
 of the application before the sale takes place, so that they ma ,' ap- 
 pear in Court, and shew cause against any sale, or for a postpone- 
 ment thereof. The best mode of giving notice to the creditors is 
 by advertisement in some public newspaper, a sufficient time be- 
 fore the sale, to enab e them to act if they see fit (il)). 
 
 The solicitor of the assignee carmot purchase at a sale made 
 by the assignee, for he is not the personal counsel of the a,ssignee, 
 but of the assignee as the representative of the creditors {Citizen 8 
 Bank v. Ober, 13 B. R. 328). 
 
 The insolvent may purchase proi)erty at an assignee's sale, (Ar- 
 nold V. Leonard, 20 Miss. 258). If the right to property, and the 
 
 ^il 
 
! •'?•■ 
 
 S22 
 
 THK INSOLVENT ACT. 
 
 ovidence to ostabllsh it, aiv' conceal"^! from tlu! asHigneu ami tlio 
 creditors, ko that the assets are sold for a m)minal amount to the 
 insolvent himself, then the purchase is fraudulent, and may be set 
 timle (Clark y. Clark' 17 How, 3ir)-.S22). 
 
 The purchaser at an assijjfnee's sale is entitled to the rents from 
 the day of sale (Ha/lv. ,Sr,»<II, 10 K. R. •2!).')). 
 
 But, he takes no higher ri<rht to the pi'operty tha?i the insol- 
 vent himself had {AndorAon v. Milh'v, lo Miss. 5(S()). The sale 
 fjdves to the purchaser no other title than a sale by the insolvent 
 himself before his insolvency would (Confer. If the insolvent could 
 not give a legal title l)y his sale, the assignee cannot (Gamack v. 
 Binqnay, 18 Ala. 28()). 
 
 76. All .sfiloa of real ostate sd mado bytho aasi^'uoc shall vest in the pur- 
 chasers all the legal and o((uitablo estate of tlio insolvent therein, and the 
 conveyance may be in the Form N ; hnt in the Province of Qnehec, snch sale 
 shall in all respects have the same ett'ect as to mort).;ages, hypothecs, or i)rivi- 
 leges then existing thereon, as if the same liad iieen made hy a sheriff nndor 
 a writ of execntion issnod in the ordinary conrso, bnt shall have no other, 
 greater, or less effect than snch sheritr's sale : and in the Province of Qnobec 
 the title convoyed by such sale shall have ecpial validity with a title created 
 by a sheriff's sale ; and the deed (»f sncli sale which the assignee executes 
 (Form N,) shall, in the Province of Quebec, have the same eflect as a sherilf's 
 deed ; but the assignee may grant snch terms of credit as he may deem ex- 
 pedient, and as may be approved of by the creditors, or by the inspectors, 
 for any pjirt of the j)nrchase uKjney ; except that no credit shall be givc'u in 
 the Province of Quebec for any part of the purchase money coming t.. 
 hypothecary or privileged creditor, without the consent of such credit 
 
 the .assignee shall be entitled to reserve a special hj'pothec or niortgagt ,iie 
 deed of sale as .security for the payment of such part of the purchase n. imy 
 as shall be unpaid ; and such deed :iay l)e executed before witnesses or be- 
 fore notaries, according to the exigency of the law of the place where the real 
 estate sold is situate. 
 
 Although tliis section declares, that the sale will vest in the 
 purchaser, all the legal and e([uitable estate of the insolvent in 
 the property sold, yet this must be understood to mean only such 
 estate as passes to the assignee under the assignment, or the issue 
 of the writ of attachment (see section 16 and notes thereon). 
 
 77. In the Province of Quebec, such sale may be made subject to all such 
 charges and hypf)thecs as are permitted by the law of the said Province to 
 
. ■ hi! 
 
 SALE OF REAL ESTATE. 
 
 223 
 
 remain char^oaWe therudii wlion sold by tho slioriff, and also subject to such 
 (•tliLT cliiirguH iind hpimthecs thoroon, as are not duo at tho tinio of salo — 
 tho tinio of piiyiuent wliorcof shiill not, however, l)o extended by tho condi- 
 tions of such Halo ; and also H\ibj('ct to such oflior chiirL,'eH and hypothoca im 
 may be consented to in writing by the holders or ereditors thereof, —And an 
 order of re-sale for false bidding may bo obtained from the judge by the n»- 
 siynee ni)on summary petition; and such rti-sale may ho proceeded with, 
 after the same notices and advertisomonts, and with the same oH'ect and con- 
 Rciiuences as to tho false liiddor and all others, and by means of similar pro- 
 ceedings as are provided in ordinary cusus for such re-sales in all essontial 
 particulars, and as nearly as may be without being inconsistent with this 
 Act. And as s)on as immovables are sold l)y the assignee, ho shall procure 
 from the registrar of the registration division in which each innnovablo is 
 situate, a certificate of the hypothecs charged uiion such innnovablo, and re- 
 gistered up to the day of the issue of iho writ of attachment, or of tho exe- 
 cution of tho deed of assignment, by which the estate of tho insolvent was 
 brotiglit within the purview of this Act, as the case may bo : And such 
 ccrtitiuate shall contain all tho facts ami circtimstancos ro(|uire(l in the regis- 
 trar's certificate obtained liy tho sherifl' subsoiiuent to the adjudication of 
 an immovable in conformity with the provisiims of the Code of Civil Proce- 
 dure, ami sliall be made and charged for by tho registrar in liko manner : 
 Ami the provisions c)f the said Code as to tho collocation of hypothecary and 
 privileged creditors, tho necessity for and the filing of oppositions for pay- 
 ment, and the costs thereon, shall apply thereto under this Act as nearly aa 
 the nature of the case will admit : And tho collocation and distribution of 
 tho moneys arising from such sale shall be made in the dividend sheet anumg 
 the creditors having privileged or hyiiothocary claims thereon, after tho O(dlo- 
 cation of such costs and expenses (including tho assignee's conunission on the 
 anioinit of the salo), as were necessary to ofl'ect stich salo or are incident 
 thereto, in the same maimer as to all the essential parts thereof, as the 
 collocation and distribution of monejs arising from the sale of immovables 
 are made in the appropriate Com-t in ordinary cases, except in so far as the 
 same may be inconsistent with any provisions of this Act ; but no portion of 
 tho general expenses incurred in the winding up of the estate shall be 
 char 'able to or payable out of the said UKJiieys, except on such balance 
 as may remain after the payment of all privileged and hypothecary claims. 
 The assignee's commission on such sale shall be the same as the poundage 
 to which the sheriU'is entitled I'U sales made by him. Any balance remain- 
 ing after the collocation of tho stiid necessary costs and expenses, and of the 
 pri leged and hyi)othecary claiuis, shall be added to and form part of the 
 general assets of the estate. * 
 
 Tlie registrar's certiticate must contain all hypothecs registered 
 against the property, as soon as hypothecs shall be thus registered, 
 
!:'; 
 
 224 
 
 THE INSOLVKNT ACT. 
 
 wlion tlio plan and book of reference shall be in force in the 
 rei^ist ration division, all hypothecs re<4istered against the parties, 
 who, during, the ten years previous to the sale, wei'e owners of 
 the inniioval)le and all such anterior hypothecs as wei-e registered 
 anew during that period. It inu.st also contain the <late of the act 
 r( gisteied as cieating or evidencing such hypothec, the date of its 
 registration, the names, occupation, and residence of the creditor, 
 and the i.anie of the notary oi' notaries ])efore whom the act was 
 passed. If it is notarial, it must specify, when several immov- 
 aliles are seized, which of tliem is affected 1 y each hypothec, men- 
 tioning, as regards each hypothec, every partial payment registered 
 and the amount in principal and preserved interest which api»ears 
 to he due, and if the registi'ation of a hypothec has been lenewed, 
 the certificate must mention both the registration and the renewal. 
 J-Jut the registrar nui.st not include hypothecs which a})pear Ity his 
 1 looks t(j have been extinguished or wholly discharged, and in 
 searching foi' the hypothecs, the registrar must not go beyond the 
 date of a sheriff's title, a sale in bankruptcy, or Ity forced licita- 
 tion, or of any other sale having the effect of a sheriff s sale or of 
 a judgment of conhrmaticjn of title, with regard to tliL inmiovalde 
 ill (piestion, and which has been registered, except as to hypothecs, 
 which are not by such means di.schaiged or extingui.sheil. If there 
 is no hypothec registered, or if all the hypothecs registered appear 
 to have bei'U extingui.slud or discliaiged, he nnist state so in his 
 ceititicate. Art. 70() of the Code of (,'ivil Pi'ocedure. 
 
 Creditors, wliose rights are thus registered, need not file their 
 clainis to .secin-e payment from the prcjceeds of the sale (Art. 
 7lI)J. But if such proceeds be wholly or partially insufficient to 
 ])ay a claim, he can rank on the estate generally with the 
 uiisecureil creditors, for the whole or any unpaid Italance. Under 
 the Code, opjwsitions for payment on claim.s, not iegi.stered, must 
 be made within six days after the leturn of the sheriff to the 
 Court, .stating the amount in his hands frou) the sjvle, avaihd)lo for 
 distribution (Art. 720). Under this it may, therefore, be presumed 
 tiny .should be filed within six days fiom the deposit of the pur- 
 chase money Avith the a.ssignee. 
 
 The opposition shoidd state distinctly the nature of the claim. 
 
 hk.^ 
 
SALE OF RE^L ESTATE. 
 
 225 
 
 with the dates and place and documents on titles in support of its 
 pretentions. 
 
 By the code, the prothonotary must prepare a scheme of dis- 
 ti'iliution between the sixth and twelfth day after the sheriff's 
 leturn (Art. 724). Under this Act, it may be assumed it should 
 bo ma<]e l)y the assignee within twelve days from the payment 
 hy the jmrchaser. 
 
 In this sheet the name of each claimant must be inserted in 
 numerical ordei', and the nature and amount of each claim, and 
 whethei' it affects the whole or a part of the property (ib. ; Art. 
 
 720). 
 
 The moneys must be divided and paid in the following order : 
 
 I. The law costs in selling the property, &c. (art. 788). 
 
 IT. The mortgajjes, according to the date of registration. 
 
 III. Non-registered claims j^ro rata, according to the pro- 
 visions of this Act. 
 
 A separate dividend must be prepared of the proceeds of each 
 piece of property (Larivierc v. Whyte, 11 L. C. J. 2Go ; Wother- 
 s])0()n's Ins. Act, 134-135). 
 
 78. In the Province of Quebec any privileged or hypothecary creditor, 
 whose claim is actually due and payable, shall have th j right to obtain from 
 the judge an order on the assignee to proceed without delay to the sale in 
 the mode above prescribed, of any property real or personal which is sub- 
 ject to his privileged or hypothecary clauu, .and such creditor may also one 
 month after the sale has taken place or one month after the assignee has re- 
 ceived the price thereof, if not paid at the time of the sale, obtain an order 
 from the judge to compel the assi'^nee to make a dividend of the proceeds of 
 such sale. 
 
 DIVIDENDS. 
 
 70. Upon the expirjition of the period of one month from tlie first meet- 
 ing of the creditors, or as soon as may be after the expiration of such period, 
 and afterwards from time to time at intervals of not more then three months, 
 the assignee shall prepare and keep constantly accessible to the creditors, ac- 
 counts and statements of his doings as such assignee, and of the position 
 of the estate ; and he shall prepare dividends of the estate of the insolvent 
 whenever the amount of money in his hands will justify a division thereof, 
 and also whenever he is required by the inspectors, or ordered by the judge 
 to do so. 
 
 
 
 o 
 
22() 
 
 THE INSOLVENT ACT. 
 
 We have seen, under tlie fifty-third section, that the confirma- 
 tion of discharge cannot Ite applied for V)efore the day on which 
 a dividend may he declared under the Act. 
 
 The wording of the Act of LSG9 Avas slightly dift'erent from 
 this section. The period was the expiration of one month from the 
 first insertion of the advertisement, giving notice? of the a])point- 
 ment of an assignee. The assignee was not retpnred to ])repare 
 dividend sheets when the funds would justify it or when required 
 by the inspector or ordered l»y the judge. Under the Act of 18(ii), 
 the assignee might declare a dividend at any time within one 
 month after his appointment and thei'eafter at intervals of not 
 more than three numths (re TvA-cr, 7 C. L. J. N. S. 32G). 
 
 In vicAV of the provisions of the !>4th section it would .seem 
 that the assignee should not prepare the dividend sheet with 
 reference only to the claims then proved against the estate. 
 
 If the assignee employs an attorney who rendei"s legal services 
 for him, the hill of the attorney therefor should he presented hy 
 assignee as part of his account. The intention is that the dis- 
 bursements of the assignee in administering, whc*^her only in- 
 curred and not yet paid or whether incurred and paid, shall hr 
 .submitted to the creditors (re Ilubbdl, J) B. R. 5:^3). 
 
 80. All ilohts (hio and payiiblo by the insolvent at the time of the execn- 
 tion of a deed of as.siifnnient, or at the time of the issue of tlie writ of 
 attachment under this Act, and all debts due but not then actually payable, 
 subject to rebate of interest, shall have tiie right to rank upon the estate of 
 the insolvent ; and any person then bein;,', as surety or otherwi.se, liable for 
 any debt of the insolvent, and who subsetpiently pays such debt, shall there- 
 after 8tan<l in the place of the original creditor, if such creditor has proved 
 his claim on such debt ; or if ho has not proved, such person shall be entitled 
 to prove against and rank upon the estate for such debt to the same extent 
 and with the same effect as the creditor might have doi.e. 
 
 A creditor cannot rank against the estate of an in.solvent firm 
 of which he is himself amendier, but if not actually in j)artner- 
 shop with the insolvent he may rank. 
 
 Randolph \' Brother wei'e lumber merchants, and carried on 
 a grocery store and blacksmith's .shop, for the convenience of the 
 men engage(l in thrir mill, I'eckham & Hoag receiveil consign- 
 
 IJidiM 
 
PROOF OF DEBTS. 
 
 227 
 
 iiicnts of lumber from Randolph & Brother, and accepted their 
 drafts (IraAvn against such consignments. P. & H. were pail one- 
 half of the net profits of the business, by way of commission. 
 No provision was made in case of a loss, but 1>y a special agree- 
 ment, P. & H. shared half a loss which occurred in one year. P. 
 i^- II. had access to the Randolph's books, and the ^ early balanc- 
 ing was done under their supervision. One purchase of timber 
 was made in the joint names of the Randolphs and a member of 
 the firm of P. & II., the cash having been advanced by the 
 Kiindolphs alone. Subsequently the Randolphs dissolved. The 
 liusiness was carried on by Randolph, the insolvent, and it was 
 agree<l between him a,vd P. & H., tiiat they should receive half 
 the prcjfits of the V)usiness, instead of a commission, as formerly, 
 and the amount due P. & II. at the time, was carried to the debit 
 of R. 
 
 P. ik H. claimed as creditoi's of the insolvent's estate, for 
 a balance due them. Their claim was resiste<l by the in.spectors, 
 on the ground that a partnership existed between them and the 
 insolvent. The Court held, affirming the judgment of the County 
 Coui-t, that P. .i: H. were not partners of the insolvent and might 
 therefore rank on the estate (re Eandolph, 13 C. L. J. N. S. 83). 
 
 When a creditor seeks to ])rove a debt against the estate of a 
 hankrupt, he stands in the positiim of a plaintiff in a suit at law 
 sicking to enforce such claim (re Prcscott, 9 B. R. 385) ; and the 
 assignee may set up any defence to the claim which the debtor 
 himself could set up (ib.). 
 
 The word debts used in this section must mean debts 'which the 
 insolvent owes, as indorser, guarantor or surety as well as princi- 
 pal debtor. Though this section does not expressly provide this, 
 yet section 2 (h) declares that the v.'ord " creditor " shall mean 
 eveiy person to whom the insolvent is liable, whether primarily 
 (jr .secondarily, and whether as princii)al or surety, and if a credi- 
 tor may be such in respect of a secondary liability it necessarily 
 follows that there may be an in.solvent in respect of a secondary 
 liability. But independently of this section it seems that section 
 81 would apply to the case, where the insolvent is a surety the 
 
228 
 
 THE INSOLVENT ACT. 
 
 'l\ 
 
 happening of the contingency would be non-payment by the 
 principal. 
 
 ]n the Uniterl States it is held that a claim against an insolvent 
 as drawer, iiidorser, surety, bail or guarantor cannot be proved 
 before the liability has become fixed; until that time it is not re- 
 garded as a <lebt due and payable or even as a debt existing, Init 
 not payable until a future day so as to be provable (re Loder 4 B. 
 R. IJH)). But when an indorser's liability lias become fixed, such 
 liability constitutes a debt due and payable from him and may 
 be proved against his estate (re JSHckodcm ux, 3 B. R. 230). 
 
 As between co-sureties, no claim exists until payment has V)oen 
 made upon the debt l)y one of them. There is no existing liability 
 from one surety to the other until that event. If the payment 
 is not made until after the final dividend, there is no claim con- 
 tingent or otherwise which can be pi'oved (Sioaiyi v. Barber 29 
 Vt. 2!)2). 
 
 The latter part of this section applies to insolvency proceedings, 
 a principle enforced by the Statutes of (.'anada 26 Vict. chap. 
 45, as to the Piovince of Ontario an<l the 23 Vict. chap. 31 as to 
 New Brunswick. Under these Statutes any pe rson who, being 
 surety for the del)t or duty of another, or being liable with 
 another for any debt or duty shall ])iiy s jch debt or perform such 
 duty shall be entitled to stand in the place of the creditor and to 
 use all the remedies and, if need be, and on proper indemnity, to 
 use the name of the creditor in any action or other proceeding at 
 law or in e([uity in order to obtain fi'om the ])rincipal debtor or 
 any co-.surety or co-contractor indemnification for the advances 
 made and loss sustained by the pei'son who has paid such debt 
 or performed such duty. 
 
 Under the latter pai't of this section, any person who is surety 
 for the insolvent's debt at the time of the assignment may pay 
 the debt after the assignment and be permitted to rank {Hardy 
 V. Carter, 8 Humph. lo3). Actual payment by the surety seems to 
 be necessary to enable him to rank. 
 
 If the creditor has proved the claim, the surety may apply to 
 the Court for an order that the proof .shall stand for his benefit 
 
 ,l^>---» 
 
PROOF OF DEBTS. 
 
 229 
 
 to the extent of the payment made by him thereon (Downing v 
 Traders Ban J- 11 B. R. 371). 
 
 The debt nnist be satisfied by the payment of it. An arrange- 
 ment dispensing with the actual payment, as ])y the substitution 
 of a new security in wliicli the surety joins and which in fact 
 amounts to tlie <'reation of anew suretyship, will not do (ex parte 
 Serijcant, 1 CJ. & J. l(S3). But where the surety in a bond gave, 
 with(jut the knowledge of the debtor, his promissory note to the 
 creditor, and the latter gave the bond to the surety who i»aid the 
 promissory note, the right of the surety t(j prove under the liank- 
 luptcy of the delator was lield to be unaffected (ex parte Allen, 3 
 De. G. & J. 447). 
 
 A surety who pays the |)rincipal creditor is only entitled to the 
 same amount of proof as the latter would have been entitled to. 
 If therefore tlie surety pays the debt with interest, subsecpient to 
 the 1 laidvruptcy, he cannot prove such subsequent interest because, 
 according to the rule in bankruptcy, intei-est for the purpose of 
 proof stops at the bankru[)tcy (ex parte Wilson, 1 Rose, 137 ; 
 Rolison, 3rd Ed. "200 etse([.). 
 
 Theie is no provision similar to the latter part of this section 
 in the Bankruptcy Act at present in force in England. But the 
 Bankruptcy Act of 1841) (section 173) contained a provision so 
 closely analogous to this that it is ctjnceived the decisions there- 
 under will apply to our Statute. Tiiat Statute provided that any 
 person wlio, at the time of tiling the petition, should be surety, 
 or liable for any debt of tlie bankrupt, if he should have paid 
 the ilebt, or any part thereof, in discharge of the whole del)t (al- 
 though he mi ,dit have paid the same after the tiling of the peti- 
 tion), if the creditor shouhl have proved his del>t under the 
 bankruptcy, shoidd be entitled to staml in the place of the cre- 
 ditoi' as to ilividends, or if the creditor should not have proved 
 that the surety should bo entitled to prove his demand in respect 
 of such payment as a debt under the bankruptcy. Under this 
 Statute it was held that any perscjn who had made himself 
 legally or e(piital)ly liable to pay the debt of another, although 
 not strictly a surety, was a person liable within the Statute (ex 
 parte Barrett, 34 L. J. Bank. 111). Therefore, a person who ac- 
 
 ■ I 
 
i I 
 
 1 
 
 j^30 
 
 THE INSOLVENT ACT. 
 
 
 • ' 
 
 ceptod, drew, or indorsed a bill of exchange for the accommoda- 
 tion of another, was held to be a person liable within this section 
 (ex parte Yoimrj, 2 Rose, 40). So, also, was a partner who re- 
 tired under an agreement that the continuing partners should 
 pay and indenmify him fi-om the partnership debts (Wood v. 
 DodgKov, 2 M. ^ S, 195). A surety in a bond to the Crown was 
 also held to be a per.son liable within the section {Wei^fcoff v, 
 Hodges, o B. ifc Aid. 12). But it was held that in order to bring 
 a person within it he nmst be under a peisonal obligation to pay, 
 and, therefore, when the goods of a sub-lessee were distrained 
 by the superior landlord for rent payable by the mesne lessee, 
 and from which the latter had agreed to indenmify the sub- 
 lessee, the latter not being under a personal obligation to pay the 
 rent, was l^dd not to be a per.son liable within the section (llodrc 
 V. White, 3 Jur. N. S. 445). 
 
 It w?vS held, also, that the surety must be liable for a debt ac- 
 tually owing by the bankrupt at the time of tiling the jietition 
 for adjudication, and thatliabilility for a debt accruing afterwards 
 or a mere contingent liability, was not sutHcient (ex parte Han- 
 sen, 1 Rose, 157 ; ex parte Houston, 2 G. ^ J. .SO). 
 
 The whole of the debt must be discharged either by payment in 
 full, oi- of part, in satisfaction of the whole, before the surety can 
 claim to stand in the creditor's place, or to prove (ex parte *SV/'- 
 gcanf, 2 G. &. J. 23). But the surety himself need not pay the 
 entire del>t, or part, in satisfaction of the whole, ,provided the 
 whole is paid or .satisfied. If the siu'ety pays all which the in- 
 .solvent debtor f)r his estate has not paid, it will be a payment 
 in respect of which the siirety's right of proof will arise (ex 
 parte Johnson, 4 D. M. k G. 218). Therefore, if the surety pays 
 the whole debt he will be entitled to prove for the whole, oi- to 
 the full benefit of the creditor's proof (ex parte Brook, 2 Rose, 
 334) ; and if the surety pays all that remains due he will lie en- 
 titled to stand in the creditors' place as to future dividends on 
 the full amount of the cieditor's proof until he is fully repaid 
 (ex parte Johnson, supra). 
 
 Where the creditor's demand exceeds the amount guaranteed 
 by the surety, the creditor cannot, after the paymeJit to him by 
 
 I -.-TrPWifia-afc. 
 
PROOF OF DEBTS. 
 
 231 
 
 the surety of the amount guaranteed, apply the whole dividend 
 on his own proof in reduction of that part of the debt which was 
 not covered by the guarantee, but the dividend must be appor- 
 tioned for the benefit of the surety, and the portion of the divi- 
 dend payable in respect of the sum paid by the surety nuist be 
 paid over to him by the surety (ex parte Rushfortk, 10 Ves. 409; 
 Uubmn v. Buhh, L. R. G Ch. App. 792). The right of the surety, 
 however, to share the dividend with the creditor may be ex- 
 cluded by special contract (ex parte Hope, 3 M. D. & D. 720 ; Mkl- 
 hi-ml Ji. Co. v. Ckamhn'8, L. R. 7 Eq. 179). 
 
 Altliough a creditor of an insolvent indorser or drawer of a 
 bill of exchange may prove against him in respect of his secon- 
 dary liability, }et, if the insolvent would have been entitled to 
 notice of dislionour of the bill or note, if he had not become in- 
 solvent, the creditor cannot pro\-e if he has not given the insol- 
 vent a sutticient n(jtice of dishonour. In the case of a foreign 
 bill it would be sufficient to give notice that it had been presented 
 foi' [layment and dishonoured without stating that it had been 
 |»rotested by a notary (ex parte Loiventhal, L. R. 9 Ch. Ai)p. 
 .')91 ; 30 L. T. N. S. 0(58). The same rules as to the time and 
 mode of giving notice of dishonour and as to what constitutes 
 due diligence, and under what circumstances absence of notice is 
 excused would seem to apply in the the case of insolvency as 
 when no insolvency has occurred {Gladwdl v. Tamer, L. R. 5 
 Ex. .-)9 ; Byles on Bills, 9th Ed. 263). 
 
 [n proving on a cheipie, it is not necessary to present it or give 
 notice of dishonour where tlie drawer can sustain no injury by 
 the omission to dt) .so, anil the holder of unpaid cheques drawn by 
 the insolvent may rank on the insolvent estate, although he has 
 not presented the cheques or given notice of dishontmr, provided 
 there was no funds of the drawer in the banker's hands from the 
 time the (cheques were drawn to the tiling of the claim. A 
 {)arty contesting a claim on the ground of the non-presentment 
 oi the checjues must show that the drawer sustained some loss 
 or injury thereby (I'e (Jultoti, 2 Pugsley, 333). 
 
 To cluirge the insolvent as indorser upon a note payable on 
 denumd, the note must be presented for payment within a rea- 
 
 4 ^ 1% 
 
 
 ^i} 
 
 ^ 
 
232 
 
 THE INSOLVENT ACT. 
 
 sonable tiniu, A demand after tlie lapse of more than four years 
 is not sufficient (re Cratvj'urcl, o B. F. .'JOl). 
 
 The liolder of a bill of exchange or note will also forfeit his 
 rig'ht to prove against the drawer or indorser if without his con- 
 sent, or, if he is insolvent, the consent of his assignee, he gives 
 time to the acceptor or maker, except in the case of a mere 
 acconiinodation hill or note, as between the insolvent and the per- 
 son to wliom time is given (Oriental F. (J. v. Overend, L. R. 7 Ch. 
 App. 142 ; Lufhd.m v. Chartered Bank of India, L. R. 17 Ecj. 
 205). 
 
 Under the (.■ighty-fourlh section, as we shall hereafter see, a 
 creditor holding a bill or note on which some person, othev than 
 the insolvt'iit, is primarily liable, is considered a secured creditor 
 within that section, and nnist, in proving against the insolvent 
 indorser, i)ui a value on the security of the party primarily 
 liable thereon 
 
 As the law is interpreted in the United States, no inteivst 
 runs after the adjudicati(jn. If the debt exists at that time, Vtut 
 is not payable till afterwards, and is not a debt running with in- 
 terest, there must be a rebate from its amount of the inteiest on 
 that amount from the time of adjudication till the time when it 
 would be payable. If it exists, l)ut is payable before that time, 
 and bears interest, the Statute intends that the debt shall be 
 proved for the amount of the principal, and of the interest there- 
 on, to the tiiue of the adjudication (re Oi'uc, 1 ^. R. .57 ; re 
 Pod llavun D. I). Co., 14 B. R. 2.j:}; re JSayhee, !J B. R. 258). 
 The Statute there speaks of all debts then existing, but not pay- 
 able until a future day, a reljate of interest being made when 
 no interest is payable by the terms of the contract. In Englantl 
 it has been very recently held that a secured creditor cannot 
 claim interest after adjudication (re lUf/'jt^, G'2 Law Times, y3(i, 
 following re Savin, L. R. 7 Ch. App. 700). And in calculating 
 the rebate of interest, under this section, the time of the execu- 
 tion of the assignment or the i.ssue of the writ of attachnient is 
 to govern. 
 
 Wliere the estate of the insolvent is suHicient to pay in full, 
 and a surplus remains, interest must be allowed on all debts 
 
 el 
 
 pp 
 
 sill 
 
 th 
 
^Wl 
 
 PUOCJF OF DEBTS. 
 
 283 
 
 j)r()vt'(l ill tlio insolvency procuedings wliorc tlie debt by express 
 cDntract or by Statute bears interest, or wliero a contract to pay 
 it is implied, but on no other debts will interest be allowed (re 
 lAin;/s((iff', 2 Grant, lU')). 
 
 A wife may prove against her hus])an<l's estate for money lent 
 by lier to him })rior to the insolvency. The mere fact that the 
 claimant is the wife of the insolvent .should not debai' her from 
 proving against the ins;)lvent's estate, if the circumstances are 
 sueli that a thiril party might make proof (re Dawjer field, 13 C. 
 L. J. X. S. 42; McDonald, J. J.). 
 
 So in the United States it is held that money loaned by the 
 wife of the in.solvent to him out of her separate estate is a claim 
 that may be proved. W^hile the law regards chiims of thi char- 
 acter with great distrust, e((uity will protect the lights of the 
 wife, even against the creditors of the husband. The Court being 
 .satisfied that the money was the .separate property of the wife, 
 and was placed in the husband's hands as a loan or trust for the 
 benefit and use of the wife, and not as a gift, will adjudge him to 
 be her debtor to that amount, and will awanl payment to her a,s 
 to any other creditor (re lii(jcloa\ 2 B. 11. '>')(j ; re Joiten, U B. K. 
 
 A married woman transferred certain shares which formed part 
 of her .separate estate, to her iiusbaiul, upon a promi.se of rejjay- 
 lucut by him of their value. It was lield in in.solvency proceed- 
 ings against the husband, that she was entitled to rank on his 
 estate as a creditor, but that such claim should be .submitted to 
 tlir most rigid iina'stigation, and must be .supported by the most 
 clear and convincing evidence when being proved before the 
 assiLjiiee {Miller v. Hewitt, in the Court of Aj)peal, Ontario, 13 C 
 L.J. N. S. 85). 
 
 B., a trader, in 18.')7, went through the ceremony of marriage 
 with M., a sister of his deceased wife, and thenceforth lived with her 
 as Ids wife. In l!S5S a siuii of £2,000, whicli came to her under 
 the will of her father, was by her direction paid to B, to be em- 
 pl(jyed by him in his business, it being at the same time agreed 
 that B. should be trustee of the £2,000 for M., and that a settle- 
 ment should be executed to carry out the agreement. In 187G, B. 
 
 
 n 
 
234 
 
 THE INSOLVENT ACT. 
 
 {|i 
 
 tiled a li([ui(lati<m petition — no settlement of the £2,000 liail lieen 
 executed. It was held that M. was not entitled to prove in the 
 li( [nidation for the £2,000 in competition with the creditors of the 
 business, and that no proof could be adnutted in respect of a trust 
 inconsistent with the application of the money which the lender 
 pointed out (re Beale, L. \i. 4 Oh. D. 240). 
 
 In the Province of Quebec, the wife of the insolvent may claim 
 for her dower, though only payable at the death of her husband, 
 subject of course to a rebate on the valuation (jVoyr/.so/;. v. 
 nomas, 1.) L. (;. J. IGO). 
 
 The right of proof under a bankruptcy in England does not 
 depend up(m the law of the place where the contract was made, 
 but on the law of England. Thus wheie, by reason of want of 
 I'egistvation, a marriage settlement whereby the husband secureil 
 a provision to the wife, was void as against the husband's credi- 
 tors by the lex loci coati'dctas, it was held that the husband, 
 having become bankrupt in P^ngland, the wife might prove i»i r'l 
 pnHHii with the other creditors under his bankruptcy, the want of 
 registration not atlecting the validity of the contract (ex parte 
 Mdhourn, L. R. (J (.'h. A])p. 04). 
 
 Where a foreign creditor has obtained a judgment, and levied an 
 execution upon the personal propei'ty of the bankrupt in such 
 foreign country, after the commencement of such proceedings in 
 l)ankruptcy, if he seeks to prove his claim he must first refund 
 what he has so ac(|uired, and come in e(pially with the rest of the 
 creditors or not at all (re litn/hec, 9 B. R. 2')iS). 
 
 A .savings bank, which is prohibited from making loans on per- 
 .sonal security, cannot prove a claim for money .so loaned (re Ja;j 
 Cox, 13 B. R. 122). 
 
 Debts contracted by an infant cannot, on his becoming insolvent 
 after attaining his majority, l)e proved, except debts for necessaries 
 and li([uidated damages for torts; but a debt contracted by an in- 
 fant who fraudukiutly represents himself to be of age, woidd seem 
 to be provable (ex ])arte Unity Bank, 3 Ue Gex. & J. 03). 
 
 In an action of detinue where the plaintiff had obtained a ver- 
 dict for damages, in default of the defendant returning the goods 
 to him, and, before he had is.sued execution, the defendant became 
 
PROOF OF DEBTS. 
 
 235 
 
 1 till" 
 
 .f tlu' 
 
 trust 
 ■nder 
 
 h.ankrupt, it was liold tliau the tnistco in bankruptcy being ready 
 to y:ive up the jjfoods, the plaintitt' could not prove as a creditor 
 for the amount <fiven by the verdict, since until execution should 
 be issued the property in the goods remained in him (re inearth, 
 L. K. 10 Ch. 234). 
 
 The provisions in regard to what debts .nay V»e proved are arbi- 
 tray, but do not art'cct the existence or validity of such del>ts as 
 ai.e not provable, nor does a discharge release them. If a debt is 
 piovable, it comes in for a <livi<lend, and can, unless it is an 
 excei»ted debt, be discharged. If it is not provaljle it does not 
 come in for a dividend, and will not be discharged (re M((y, 9 B. 
 R. ■H9). 
 
 Hnnvwrx v. De Jibiqun'rc (34 Q. B. U. C. 41)8), establishes 
 the proposition that debts not provable against the estate are not 
 barred by the discharge ; and a claim foi' unli(jui(lated damages 
 on a covenant in gross is iKjt provable, the damages not being 
 assessed by a jury (ib.). 
 
 The claiuLs which may l)e proved arc such as can be .satisfied 
 in mcmey of an asccrtainctl or easily ascertainable amount (John- 
 sun V. Skiiffe, L. R. 4 Q. B. 700; ex parte Wilmut, L. R. 2 Ch. 
 App. 795). 
 
 In other words, a creditor can only prove for a debt against the 
 estate, and not for unli(|uidated <lamage.s. The in.solvent, a miller, 
 agreed to grind wheat foi" the claimants, and to deliver to them a 
 liarrcl of Hour of a specified ([uality for so many bushels of wheat. 
 The claimants accordingly purchased wheat, and sent it to be 
 ground under the agreement, and the insolvent bought wheat at 
 the mill, and sent the claimants a statement of the amount bought 
 in each case, and the claimants paid for it. Wheat was thus sup- 
 plied to such an amount, that under the agreement, the insolvent 
 became liable to deliver to the claimants 955 barrels of Hour as 
 the e(iuivalent for the wheat received by him. It was held that, 
 under this agreement, the wheat remained the property of the 
 claimants, and the miller was only a ])ailee thereof, that such 
 l»ailment was determined Ijy the conversion of the wheat, so that 
 the claimants might maintain trover for it either as wheat or as 
 Hour, if it was grouml ; that they might waive the right to bring 
 
 III 
 
 ( ':!•;; 
 
 ^1 
 
23G 
 
 THE INSOLVENT ACT. 
 
 an action for the conversion, and sue for the vahie of the wheat 
 according; to the market price when delivered, or if the wheat had 
 been converted into Hour they niij^ht sue for its value at tlie nmrkct 
 price, and as tlie price of the wheat in the one case or of the tlour 
 in the other could he easily ascertained witli certainty, the 
 claimants were entitled to prove for it (re WiUuuiis, .*U t^. B. IJ. C. 
 
 14:}). 
 
 The Court further held that a claim for compensation as to a 
 Certain number of barrels which turned out not to he of the 
 • [uality aj^reed for was clearly a claim for unli(niidated danicayes 
 and could not l»e proved. In such a case as the al)ove the claim- 
 ant would l)e allowed to amend his claim ,so as to com|»rise the 
 wheat or tlour according to the tacts. 
 
 A claim for damages for a purely personal injury is not i)rov- 
 ahle unless liipiidated and transiiuited into a legal deltt by a 
 judgment obtained before the adjudication of bankruptcy (re 
 Heii,uo<'kshiu'ijli,7 H.li.'.i7). A mere verdict in an action foi a 
 personal tort is ni>t a ])roval)le debt (lihick v. McCldlund, 12 
 B. R. 4Ml). A judgment entered after the commencement of the 
 pi'oceedings in Itankiuptey upon a verdict rendei'ed before that 
 time in an action for a personal tort is not a provaVde ilebt (ib.). 
 A judgment for a tine imposed by law foi- the commi.ssion of a 
 crime is not proval)le (vii Stifheiiund, 'i B. R. 314). A judgment 
 obtained for a breach of a promi.se to marry is provable (re 
 Slieelinu,H B. R. ,*U.5). 
 
 Demands founded on tort will be piovable if, before the nuik- 
 ingof the a.ssignment or the i.ssuo of tlie writ of attachment, the 
 amount has been a.scertained by a verdict and tinal judgment (ex 
 parte Hill, 11 Ves. ()4(>) ; or by a reference and award (ex parte 
 Hardlv;/, 5 ]). M. & G. 3(J8) ; or by agreement (ex parte Mum- 
 ford, 15 Ve.s. 289); and the ereditor lias not, befoi-e the verdict, 
 judgment or award, notice of an act of bankruptcy available for 
 adjudication against the debtor (Rohi)Mon v. Vide, 2 B. & C, 7G2). 
 But on a verdict for damages in an action of tort, judgment must 
 be signed before a<ljudication in order to make it provable under 
 section 31 of the English Act. If judgment is not signed till 
 after adjudication, even thouirh the verdict is ol)tained before the 
 
 IjLjiaat 
 
PROOF OK DKBTS. 
 
 287 
 
 insolvent is not discharged from the lial)ility (ro Keivmaii, L. R. 
 3 Ch. D. 4!)4). 
 
 Under the English Act demands in the nature of unli(|uidated 
 ilaiiiages, arising othisrwise tlian by reason of a ccmtract or pro- 
 iiiist', are not ])roval)h!, hut, save as aforesaid, all debts and lia- 
 liilities present oi' future, certain or contingent, shall rank on the 
 L'statf. There it is lieM that a claim for costs is a proval)le debt 
 although the costs have not been taxed at the date of the adjudi- 
 cation (re Daffiehl, L. R. 8 (.'h. (182). 
 
 A creditor, who has obtained a verdict with costs in an action 
 at law, but had been restrained by injunction from taking any 
 further proceedings in the action, claimed to vote in resj)ect of 
 tlie aggregate ainount of the damages recovered, and tlu; esti- 
 mated costs which had not been taxed, but it was lield that this 
 last was an unlitpiidated debt within the Act, and that, in order 
 t(- vote, he ought either to have applied for leave to sign judg- 
 ment and tax his costs, or else to liave sworn to a sum to which 
 the costs when taxed would at least amount (re Diunmeloiv, L.R. 
 8 Ch. {)f>7). 
 
 A breach of trust, although it would afford a good ground for 
 an action in tort for unli(|uidated damages, has always been lield 
 to create a debt in equity, and, as such, is provable (ex parte 
 Green, 2 D. & C. 113 ; re White, L. R. 9 Ch. G2G). 
 
 Where thei'e is one estate, there can in no case be two proofs 
 on one del)t, and this, even tliough there be separate contracts 
 in re.spect of the same debt (re Oriental Com. Bank, L. R. 7 (Jh. 
 99). 
 
 It must also be remembered that when a creditor proves under 
 an Englisli bankruptcy he cannot take the benefit of the English 
 law without bringing into the common fund any part of the 
 banki-upt estate, which he may have already received abroad 
 (Selkrigy v. Davis, 2 Rose, 97 ; re Douglas, L. R. 7 Ch. 490). 
 
 In proceedings before the count}' court judge, a claim was put 
 in by the mother of the insolvent, which the creditors opposed the 
 allowance of, on the ground that the mother was indebted to the 
 son in a gi'eater amount than her claim, sucli claim being dis- 
 tinctly proved by the claimant, her husband and the insolvent. 
 
 ■ M 
 
238 
 
 THE INSOLVENT ACT. 
 
 Tlic jiKlffe allowed the claim, from which allowance the insjX'Ctors 
 of the estate appealed, ami then sought to impeach the claim of 
 the mother alto^u'ether, as ]>v\w^ frauduK'Ut — the only thin<;' that 
 coidd he siirrgested in o))position to tho evidence stated, ln'ing the 
 fact that the money said to have been deposited in the hank hy 
 the claimant was in gold, English sovei^igns, which the (,'ouvt 
 was asked to assume was so impi'obahle i nd incredilile, as to lie 
 evidence of fraud. This, however, the C)(urt refused to <lo ; and 
 on the ground that the judge, who saw the jtaities give their evi- 
 dence, having thought the ))roof of the bonn jidi's of the deht suf- 
 ficiently estalilished, had allowed the claim. 
 
 Proudfoot, V. ('., agreed in the conclusion at which the iud<:e 
 had ariivi'(l, and dismissed tlie ai)peal with costs (re Weeks, 12 C. 
 L, J. N. S. 147). 
 
 By an agreement lietwecn a delator and one of his creditors, 
 the latter agreed to accej)t. by way of com])osition. certain notes 
 of the debtor, payable at specitieil dates, and it was jirovided that 
 thi' debtor .should also give his note for the whole debt, and that, 
 if he were guilty of any default in paying the composition notes, 
 the creditor should rank on his estate foi' the wdiole delit. The 
 U'ltes were given accordingly, the debtor made delault, and aftei- 
 wards was proceeded against undei' the Act. It was held that 
 the stipulation as to the whole debt was not illegal, and that 
 there having been default before in.solvency the cieditor was en- 
 titled to prove for the whole debt (re M liae, 15 Grant, 4')S). 
 
 The holder of a bill of exchange, or promis.sory note for valu- 
 al lie consideration, may prove for the amount against all the par- 
 tii's liable upon it, and he may prove against tlie estate of the 
 insolvent di'awer, or indoi'scr, before the bill is dishonoured 
 (Shxreif V, Barns,7 Kiist, i'ib ; Alsii(/er v. Carrie, 12 M. & \V. Tol). 
 The holder may also receive a divich'ud upon the amount of the 
 bill or note from each of the estates against which he proves, un- 
 til he receives one hundred cents on the dollar, and, if after proof 
 1ie receives a divid(!nd from other parties to the bill or note, that 
 will not be deducted from the amount of his proof, and he will be 
 entitled to receive a dividend on the full amount of the bill or 
 noti', until the debt is satisfied (ex })aite ('ama, L. R. 9 Ch. App. 
 
^ 
 
 r 
 
 PROOF OF DEBTS. 
 
 239 
 
 (i,S(i : I'X parte W'ddman, 1 Atk. 109). If, however, at the time of 
 provinif, tlie creditor has received part of the del)t, either in pay- 
 iiiiiit or as a dividend, on the hill or note from the estate of oni' 
 of tlif other parties lia1)le upon it, oi" even if such a dividend has 
 Imtu declared, though not actually paid (ex parte Todd, 2 Rost-, 
 202) ; he will he allowed to prove for the residue only, after de- 
 ducting the amount so paid or declared (ex parte Leers, Ves. 
 (il'4) ; so also if hills are taken in payment for goods, and negoti- 
 ated liy the vendor, and the hoMer proves under the insolvency 
 of till' purcliaser, the vendor will not l)e allowed to j)rove against 
 the same estate, as t lis would he a douhk' pioof for the same deht 
 (ex parte Ah'oit, 21 W. 11. 32cS ; Rohson, 3rd Ed. 217-8). 
 
 It hills art' di.scounted in the market, which are drawn hy one 
 Hnn upon another firm, and then hoth these firms hecome bank- 
 rupt, the hill holdei' is entitled to prove against l)oth estates, antl 
 to receive all the dividends he can get from hoth estates, until he 
 lias ri'ceived one hundred cents on the dollar, and whether it may 
 turn out tliat the drawer is surety for the acceptor, or the accep- 
 tor is surety for the drawer, yet the surety has no right to receive 
 anything until the hill holder has received payment of his debt 
 infiJl (ex parte Tiirquand, L. R. 3 Ch. 1). 445. Bill-holders, 
 ])ro\'ing against both estates, must deduct from proof the amount 
 ot any dividend previously received from the other (ib.). 
 
 Where the indorser of a note becomes insolvent and com- 
 pounds with his creditors including the holder of the note, who, 
 however, reserves liis recourse against the other parties to the 
 note, and the maker afterwards becomes insolvent, the indorser 
 cannot rank on the note against the estate of the maker so long 
 as the holder has not been paid in full. 
 
 When a claimant in insolvency has received, as holder of a note, 
 a conr,)osition on the amount of his claim from the indor.ser, in 
 consideration of which he has released the indorser, reserving his 
 recourse against the other party to the note, whatever the claim- 
 ant has received from tlie indoi'ser must be deducted from the 
 amount of the claim which he can prove against tlie maker's 
 estate (re Bcssctfe, 15 L. C. J. 12(>) ; although the dividend on 
 lioth estates will not amount to twenty shillings in the pound. 
 
 ,1 
 
 
11 
 
 Mil 
 
 2#> 
 
 THE INSOLVENT ACT. 
 
 In this case tlio clniiiiant had received a part only of his divi- 
 dend on the one estate, and there was aconsidi-iable sum still due, 
 hut the elainiant was alloweil to prove for the full amount of his 
 claim, K'ss the sum actually I'eceived. 
 
 A creditor who, in acci'])tin(i' a composition whereby the insol- 
 vent ai^rees to pay ten shillings in the ])()und^ reserves his recourse 
 against indorsers of notes, which he hohls, and upon other securi- 
 ties, is not hound to deduct the sums obtained from such indorsers 
 from his dividend merely, but fi'om the total amount of his 
 claim (Joseph V. Lrni.ini.i', 17 L. C. R. 170). 
 
 Wholesale traders supplied goods to a retail dealer on the tei'ms 
 that he was to be allowed a discount of twenty per cent, from the 
 the invoice pi'ices on })ayment in cash within a month. The 
 debtor accepted bills of exchange for the amount due, aftei" de- 
 ducting the twenty per cent, di.scount, but he did not pay the bills 
 oi- make cash payments according to the agreement, and it Avas 
 held that proof luust be atlmitied in the bankruptcy of the re- 
 tail dealer for the full amount of the invoice price of the goods 
 without deduction of the discount (re Camhc viand, h. R. 3 Ch. D. 
 808). 
 
 On the insolvency of a shareliolder in a joint stock company 
 before calls made in respect of his shaivs the company cannot 
 l>rove in respeet of the subscripticm. Shares in an English com- 
 pany were taken by a resident at Bombay who became insolvent. 
 Afterwards the conn i . . ^ . r^-. 
 
 M' 
 
 up. 
 
 debtor ,subse(|uently obtained an order of discharge under an 
 Indian Act, and it was held that the liability of the insolvent 
 in respect of the sliares was not a debt provable in the insolvency 
 
 P' 
 
 oceedini's, and that, therefore, it was not liarred bv the order of 
 
 discharge (le Kxst India Cotiov Ajjcncy, L. R. 3 Ch. I). 204). 
 
 bv 
 
 81. If iiny creditor of the insolvent claims upon a contract dependent upon 
 a condition or contingency which does not h.appen previous to the declaration 
 of the first dividend, a dividend shall bo reserved upon the amount of such 
 conditional or contingent claim luitil the condition or contingency is deter- 
 mined ; biit if it be made to ajipear to the judge that the estate may there- 
 by he kept open for an undue length of time, he may, unless an estimate 
 of the value of such claim be agreed to between the claimant and the in- 
 
m 
 
 PROOF OF CONTINGENT CLAIMS. 
 
 241 
 
 spectors, order that the value of such contingent or conditional claim be es- 
 tablished by such person or persons as the claimant and the inspectors may 
 apiioint, and incase they do not agree, then by such person or persons as the 
 jndije shall name ; and the persons S(j niimed shall make their award — which 
 award the judge, after hearing the claimant and inspectors, may reject or 
 confirm. In case the award be rejected, other persons shall be app(nnted as 
 herein provided, to establish the value of such claim, subject to the control 
 of the judge, and if the said award be confirmed, the amount therein men- 
 tioned shall be that for which the clainiiint shall rank upon the estate as 
 (, debt payable absolutely. 
 
 This .section contains a new provision in reference to arbitra- 
 tion as to the value ol tlie claim — any person may be selected as 
 arbitrator innler this section, though the .^Tth section of 
 the Act of l(S(Jl) r<'([uire<l the assignee to act. And the section 
 provides for a second reference to arbitrators if the first award 
 hv rejected. 
 
 Tliis .section will not apply where the condition or contingency 
 happens before the a.ssignment is made or the writ of attachment 
 is issued {Burnnvcs v. /V lUnqa'wi'c, 34 Q. B. U. CJ. 4-()»). 
 
 It would seem that this .section only applies to debts payable 
 an a contingency, and not to mere contingent liabilities which 
 may never l)ecome debts (H'nifon v. Acraman, 2 C. B. 409 ; ex 
 paite Marshall, 3 Dea. »!c C. 120). 
 
 The liability of an underwriter before a loss takes place 
 is a mere contingent liability, and, therefore, not provable 
 under the Act. Defendant wrote, in favour of the plaintiff, a 
 policy of insurance on a ship of which plaintiff was part owner, 
 loss, if any, to be paid in sixty days after proof of loss, and ad- 
 justment and proof of interest, no partial loss or particular ave- 
 rage to be made good, unless it should amount to five per cent, on 
 tlu' valuation. And the ship was beached in a gale on the 18tli 
 of October, 1872. Efforts were made between thi's date and the 
 3(H.h to get her off, and she was finally hove off and towed to an 
 anchorage on the 31st of Octobt^r, where she remained until the 
 9th of November. On the 14th she was hauled into a dry dock, 
 and on the 16th examined by surveyors, who reported what 
 damage was done, and recommended repairs. On December the 
 3rd .she was hauled out of dock, and on December the 12th the 
 
242 
 
 THE IN.SOLVE>T ACT. 
 
 ■ i 
 < i 
 
 
 surveyors reported that all damage had been made good, and on 
 the 18th of January, liST.S, the adjustment of loss with pi-oof 
 were furnished to the broker for the underwriters. On the 28tli 
 of October, 1872, defendant made a vohnitary assignment under 
 the Insolvent Act of 18GU, and obtained his dischargi' undt-r sec- 
 tion 105 on the 19th of January, 1874. The schedule prepared 
 at first meeting of creditors did not include the plaintiff's name, 
 nor was his claim included in any supplementary .schedule fui- 
 ni.shed the assignee until about the lOth of March, 1874, when 
 plaintiff's name was furnished to the a.ssignee in time to entitle 
 plaintiff to obtain the same dividend as tho.se in the original list. 
 Plaintiff was notified to file his claim, but declined to do so, and 
 sued defendant for the full amount. ft was ht^ld tb.at at the 
 time of the defendant's assignment the liability to the plaintiil 
 was not a debt payable upon a contingency, but a mere contin- 
 gent liability which was not capable of being proved, and, theit - 
 fore, that the discharge was no bar to the plaintiff's action {Boi'Miii 
 V. Harrho7i, 2 Pugsley, 508; 11 G. L. J. N. S. 252). 
 
 In this case, the plaintiff's name was not fumi.shed to tin- 
 assignee until after the plaintiff had issued his writ, and until 
 after the defendant's discharge, and the assignee then had on hand 
 funds sufficient to pay theplaintitt'the .same dividend as theothfi 
 creditors, if authorized to do so, after having declared an<l paiil 
 one dividend. Surely the case cannot be an authority to establish 
 that a claim cannot, in any case, be proved on a policy of insurance 
 against an insolvent insurer, unless the loss has occurred pi-ior to 
 or at the time of the assignment. True, the liability is contingent 
 until a loss occurs, but when a loss takes place, and is pi-o]H'ilv 
 prf)ved, and in .sufficient time, and before the insolvent obtains 
 his discharge, it is submitted the claim is one which may be allowed 
 in the Insolvent Court. This has been held in the United States, 
 although the loss did not occur till after the connnencement of the 
 proceedings in bankruptcy ^re Am. Glasi^ Ins. Co. 12 B. R. o6). 
 
 The Statute in force in the United States speaks of " contingent 
 debts, and contingent liaV>ilities contracted by the bankrupt, " and 
 allows proof thereof. There it is held, that the phrase " contingent 
 debts " means not demand.s, whose existence dept^nds on a contin- 
 
 '.::pJiS£u-:i.ii.'~.u^ .i 
 
 ^■G jm 
 
2Sth 
 
 ^ont 
 
 PROOF OF CONTINGENT CLAIMS. 
 
 243 
 
 gency, hni existing clcniands on wliicli the cause of action depends 
 on a contingency {French v. Morse, 68 Mass. 111). 
 
 The case of Rowan v. Harrisov was decided on the Act of 
 IHiii). The thiid section of that Act reciuired the schedule to 
 sliow " any contingent lialiilities, (U'sciil)ing the same." The claim 
 atrainst the underwriter was held not to come within the o6th 
 section of that Act (corresponding to this section of the present 
 Act). The Coiut sei'uied to rust its judgment on the ground, that, 
 at the tinu' of the assignment, no loss had happenevl, and it was 
 thcref(jre uncertain whether any claim would arise. 
 
 It is necessary to distinguish between a contingent demand and 
 a contingency, whether there ever will be a demand (Wooddrd v 
 Herbert, 24 Me. 358). The contingent demands provided for by 
 thf Statute, are those contingent demands which are in existence 
 as such, and in such a condition that their value can be estimated 
 
 (il'O. 
 
 Kvery joint debtor has a demand against his co-del)tor, contin- 
 gent uj)on liis been compelled to pay jnore than his share of the 
 debt, and such demand ib provable (Dean v. Speakman, 7 Blackf, 
 317 ; Clarle v. Porter, 25 Penn. 141). 
 
 As long as it remains wholly uncertain whether a contract or 
 engagement will evei' give rise to an actual duty or liability, and 
 there is no means of removing the uncertainty by calculation, 
 such contract or engagement is not provable. A covenant for an 
 indefeasible title in fee, cannot be proved, when the claim consists 
 merely of a contingent right of dower in the wife of one of the 
 former owners of the property (Rlgtjin v. Magiulre, 8 B. R. 484). 
 This i)rovision has no application to a claim for storage which 
 arose after the commencement of proceedings in insolvency, under 
 a contract which was terminable at pleasure. There must be a 
 debtor liability, either as ])rincipal or surety, which, if the on- 
 tingency has happened, or the term of credit has expired, will be 
 ascertainable {Robinson v. Pesant, 8 B. R. 42G), 
 
 Where the payment of a debt cannot be enforced un^il the hap- 
 pening of some contingency, such debt being readily estimated 
 may be proved, or if the extent of a liability depends ui)on th»> 
 happening of a contingency, and such contingency is reasonably 
 
 *!i 
 
 
 
 
 
 
 
 
 
 if 
 
 S: ;,■ 
 

 il 
 
 i I ! 
 
 r 
 
 244 
 
 THE INSOLVENT ACT. 
 
 certain to happen before final dividend, the Court may, by some 
 method, determine the value to be placed by the claimant on such 
 debt, and admit him to prove it {U. S. v. Thrutkmorton, 8 B. R. 
 30!)). 
 
 Where there is a stipidation in an ante-nuptial settlement that 
 the wife surviving is to receive in lieu of dower the interest 
 on 11,000, during the term of her life, should she survive her 
 husband, the principal to go to the children after her death, tl is 
 is a " contract dependent upon a condition or contingency," il- 
 though the wife would have no vested interest until after hei' 
 husband's ileath (re Morison, 15 L. ('. J. KiG). 
 
 The English Bankrujitcy Act of 184!», s. 17<S, provided that 
 if a tradei- had contracted a liability to pay money on a con- 
 tingency which should not have ha]ipene(i, an<l the demand in 
 respect thereof should not have lieen asceitained before the 
 filing of the jx'tition. in such a case the creditor should lie ad- 
 mitted to prove for such sum as the Court should think fit. 
 The cases under this section may assist us in construing the 
 section of our own Act now under consideration. It was iield, 
 under the English Act, that the liability must be to pay a sum 
 of money of a certain amount, or at all events a sum the amount 
 of which coidd be asceitainecl by some settletl data, and that the 
 contingency on which the lialdlity depended must not be too re- 
 mote, but that there nuist lie a single contingency reducible to 
 a n\atter of calculation and capable of valuation (White v.Curhett, 
 1 E. & E. 692 ; Boyd v. Rohins, 5 C. B. N. S. .)!)7 ; Kent v. Thomas, 
 L. R. (i Exch. 312). Upon these jtrinci[)les it was determined that 
 this section did not apply to a covenant to pay premitimson a life 
 policy which were not <lue at the date of the bankruptcy ( WaH>niy 
 V. Tucker, 5. E. ^r B, 3M4); nor to the lial>ility of a surety for tho 
 payment of an annuity where tliere was a solvent grantor (Artiott 
 V. Holdev, 18 Q. B. .5i>3) ; nor to the possible demand for contribu- 
 tion which one surety has against his co-surety {AdMna\.Farrin<j- 
 (io7i,5H.(!cN.58()); nor to a covenant by a husband for the payment 
 of such yearly sums as would be sufficient with other contingent 
 payments to make up an annuity to his wife, determiiiable on a 
 return to cohabitation {Parker v. Ince, 4 H. &, N. 54); nor to a 
 
'■f'm 
 
 PROOF OF CONTINGENT CLAIMS. 
 
 245 
 
 covenant to pay an annuity (letorraiuable on future cohabitation 
 {Mwdge v. Rowitn, L. R. 3 Ex. 85); nor to a guarantee for the 
 price of goods to be supplied from time to time to third parties 
 and which were supplied after the bankruptcy of the guarantor 
 {Boyd V. Robins, supra); nor to a covenant to indemnify against 
 tlie covenants in a lease (Hoare v. White, 3 Jur. N. S. 44-5); nor 
 to covenant to indemnify against calls on shares in a Joint Stock 
 Company (Bettley v. Stainaby, L. R. 2 C. P. 568; ex parte Wise- 
 man, L. R. 7 Ch. App. 35); nor to the liability of a shareholder 
 to pay calls made after obtaining his discharge in bankruptcy upon 
 shares rejected by his assignees (Martin v. Martiit, L. R. 3 Q. B. 
 30G; Nasties case, L. R. 7 Eq. 3; ib. -i Ch. App. 27 1; Robson, 
 3rd Ed. 237-8). 
 
 TT. V 
 
 82. In the propanitioii of tho dividend sheet, due regard shall be had to 
 tlierank and privilege of every creditor — which rank and privilege, upon 
 whatever they may legally ba founded, shall not be disturbed by the pro- 
 visions of this Act, except in tho Province of Quebec, where tho privilege of 
 the unpaid vend(jr shall cease from the delivery of tho goods sold ; but no 
 dividend shall be allotted or paid to any creditor holding security from the 
 estate of the insolvent for his claim, until the amount for which he shall 
 rank a.-^ a creditor upon the estate as to dividends therefrom, shall be es- 
 tablished as hereinafter provided ; and such amount shall be the amount 
 which he shall be held to represent in voting at meetings of creditors, and in 
 computing the proportion of creditors, whenever under this Act such pro- 
 porticm is retpiired to be ascertained. 
 
 The 58th section of the Act of 1869 did not contain the words 
 "oxcept in the Province of Quebec where the privilege of the un- 
 paid vendor shall cease from the delivery of the goods sold." 
 
 In the Province of Quebec, under the new Act, the privilege of 
 the unpaid vendor ceases on the delivery of the goods .sold. The 
 privilege theri-fon ceases as soon as the right to stop in trtiii'^ita 
 is gone. This right is determined when once the goods have 
 actually reached their destination and btien actually received by 
 the vendee as his own (Bolton v. Lancashire & Y. R. W. Co. L. R. 
 1 C. P. 481, 8 ; re Whit worth, L. R. 1 Ch. D. 101 ; see as to stopp- 
 age in transitu, Lewis v. Mason, 3(i Q. B. IT. C. 590). 
 
 This section does not, however, affect the right of stoppage in 
 
Il:f 
 
 f 
 
 I 
 
 246 
 
 THE INSOLVENT ACT. 
 
 transitu (seo on the Act of 1804, in Quebec, //a?<'^wwo/'</<. v. Elliott, 
 10 L. C. J. 197). 
 
 83. No lien or privilogo upon either the personal or real estate of the in- 
 solvent shall be ereated for the amount of any judgment debt, or of the in- 
 terest thereon, by the issue or delivery to the Hheriil'of any \frit of execution, 
 or by levying upon or seizing under such writ the effects or estate of the in- 
 solvent, if before the payment over to the plaintiff of the moneys actually 
 levied under such writ, the estate of the debtor has been assigned U> an 
 assignee, or if proceedings to place the same in li(iuidation inidor this Act, 
 have l)oen adopted and are still pending. Hut this provision .shall not alt'oct 
 any lien or privilege for costs which tho plaintiff possesses under the law of 
 the Province in which such writ shall have been issued. 
 
 What is meant by " proceeding-s " in tliis section? Would tlie 
 scivice of a demand un<lt'r section four be deemed " pioceedintf.s 
 to place the same in licpiidation under tliis Act ? " 
 
 The 59tli section of tlie Act of 18(i!) diflered materially from 
 this section ; under the former tlie execution ereditoi- was en- 
 titled t>the fruits of his execution if the same were realized be- 
 fore the estate was actually })laccd in insolvemy. 
 
 Under the Act of 1805 (29 Vict. chap. 18, s. 12), goods actually 
 under seizure, passed to the assignee, if they wore not actually 
 .sold by the sherifi' undei- the writ of execution, but when^ the 
 sale by the sheriff" took place before the assignment, the execu- 
 tion creditor was entitled to the j^rocecds, in preference to the 
 assignee (Brand v. BicW, 4 U. C. P. R. 101 ; 4 IJ. ('. L. J. N. S- 
 95). 
 
 Undei- the 13th section of the Act of 1805, whore the sheriH' 
 seized on nji.fa. and made the money before an assignment, the 
 execution crciditor was hold entitled to it, though it was not 
 paid over to him at the time of the assignment (Sinclair v. 
 McJJouijall, 29 Q. B. U. C. 388). 
 
 In Quebec it was held, under the Act of 18()4, that the assign- 
 ment transferred to the assignee, elfects already seized in ihe 
 suit, and that an opposition, tiled Ity the assignee, claiming the 
 effects seized, to be divided amongst the creditoi's, under ^he Act, 
 would be maintained (Bacon v. Doufjhix, 15 L. C R. 450). 
 
 Under section 13 of the Act of 1805, the priority of right 
 
RIGHTS OK KXKCUTION CUKDITOI?, 
 
 247 
 
 iiiij^lit liave botm doHtroyod by a sale under execution. Thus, 
 iiinler this Act, wliore a writ of execution was phiced in tlie 
 shi'rifr.s liands on the loth March, I80(j, and on the 20th of the 
 saiiif month, a sale of tlie j^oods thereunder conunenced at 10 
 (till., and was completed at 11 a.m. At the latter hour, on the 
 (lay (if the sale, a writ of attachment, in compulsory liquidation 
 against the ins(dvent, was |»]aced in the sheritl''s hands ; it was 
 held that the attachment could ncjt prtsvail over the execution, 
 and tliat the sheritt' was not liable to the assi(jrnee in insolvency 
 for till' proceeds of the «j;oods sold (Wliijte v. Treadwell, 17 (-. 1*. 
 r. (' -tiSH). The (fround of the decision in this case, was that, by 
 the >alt! undei' execution, the property was entirely gone, and 
 i'oimed no part of the estate of the dditoi' at the time when tlic 
 altacliment issued. If it had formed i)art of such estate, it would 
 have belonged to the aissignee foi' the l)eneHt of the creditors, as 
 all propeity of the insolvent, except only such as is exempt IVoni 
 s(,'izMr(' and sale under execution, ])asses to the assignee on an 
 assignment, or the issue of a writ of attachment. 
 
 In Cniivcm'. V. MU'hic (1(5 V,. P. U. (1 Ui7j, the goods were still 
 the propei'ty of the insolvent, at the time when the two writs 
 were delivei'ed to the .sheriff by the execution and the attaching 
 creditors. The latter case was decided under .section 13 of the 
 liHtli Vict. chap. IS. On the 18th September, 1865, a judgnumt 
 was recovered against tlie cUibtoi', and an execution wa.s i.ssued on 
 the same day, and placed in the hands of the sheriff about half- 
 past 10 a.m., UTider which the sherifl' made a levy a])out 11 a.m. ; a 
 writ of attachment in insolvency was sued out on the .same day 
 against the debtor, and placed in the .sheriff's hands about 11.30 
 a.m. The Act 21) Vict. chap. IS, s. 13, cjime into force on the 
 same day, the Royal assent having b('(}n given at 3 o'chjck in the 
 afternoon. On the i)rinciple that judicial })r(jceedings and Acts of 
 the Legislature take effect in law from the earliest period of the 
 day upon which thisy are respectively originated, and come in force, 
 the ( 'ourt held that the writ of attachment in insolvency, which 
 derived its effect from the Act, pnsvailed over the execution, for the 
 latter only bound fiom the actual nnnute of delivery to the 
 sheriff, the delivery not being judicial act, but the Statute was 
 
 ■^v 
 
 ,„..l..!.'i^' 
 
iii 
 
 248 
 
 THE INSOLVENT ACT. 
 
 
 liHI: 
 
 i"' 
 
 in force from tlu; first inimitc of the saiiie day (Converse v. M'ukUi, 
 supra ; hoo also Ddrlhu/ v. Wilson, 16 Grant, 255). 
 
 It would seuni that tlie ])r()visionH of this section only apply to 
 writs of execution, properly so calle<l ; and where the ott'ects of 
 tlie insolvent were seized by the plaintiff, undttr a writ of attach- 
 ment, issued a|j;ainst him as fin ahscondinjSf debtor, and the proceeds 
 of the sale thereof remained in the sheriff's hands at the time his 
 estate was jdaced in compulsory li(|uidation under the Insolvent 
 Act, it was held that the plaintiff, the attaching creditor, was 
 entitled to the proceeds, as against the assignee in insolvency 
 (Aeid V. Smith, 9 C. L. J. N. S. 74-5 ; but see Pattersov v. 
 McCarthy, 35 Q. B. IT. C. 14 post 24J»-5()). 
 
 When an assignment is made, the intention of the Act is that 
 the estate and efiects of the insolvent should be wholly adminis- 
 tered by the Court in the insolvency proceedings, and if a slu ritf 
 has, before the assignment, seized goods of the insolvent under a 
 writ of execution, it is his duty, on the assignment being made, 
 to surrender the goods to the assignee!, leaving the execution 
 cieditor to assert his })rivilege for costs, if he has any, in the 
 proceedings in insolvency (BIdkeley v. Jlall, 21 C. P. U. C. 138). 
 
 In Ontario, whei'e judgment in default of appearance is ob- 
 tained on a specially indorsed writ, no execution can issue tnitil 
 the expiration of eight days from the last day for appearance. 
 Where judgment was entered and execution issued before the ex- 
 piry of that period, and an assignment in in.solvency was made 
 by the defendant five days after the issue of the execution, 
 the execution was .set aside at the instance of the insolvent and 
 a.ssignee {Randall v. Bo^vman, 1 IT. C L. J. N. S. 158). 
 
 Where final judgment, in default of appearance to a specially 
 indorsed writ, was entered on the 23rd of January, and execu- 
 tion issued on the 30th of tlie sarie month, and a writ of at- 
 tachment, under the Insolvent \ct, issued on the 3rd of Feltru- 
 ary, an application on the 28ch of March, at the instance of the 
 official assignee, to set a.side the judgment as irregular, for a de- 
 iect in the affidavit of service was held too late (Dunn v. Dtcnn, 
 1 U. C. L. J. N. S. 239). 
 
 The attachment issued before the sale of the goods, and leave 
 to the assignee to come in and defend the suit was lefu.sed, as 
 
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 pri 
 
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 RKIHTS OF EXECUTION CRED.TOIl. 
 
 24!) 
 
 the plaintiff", tlio oxocuticMi creditor, would therel)y lose his 
 priority in rcspc t of the execution, but the assignee was al- 
 |{»\v(!d to move to set aside tlie judgment on the ground of 
 frjuid. This case was decided under the Act of 18G4, and it is 
 (joiilitful whether it would now he followed in regard to allow- 
 ing the assignee to defend the suit. As the attachuuint issued 
 hefore the sale of the goods, no privilege could he obtained by 
 tlir execution ci'editor as against the assignee. Under this sec- 
 tion of the present Act t\w attachment would have priority, 
 lUiU'ss the money made l)y the sheriff' was actually paid over 
 to the execution cniditoi'. And it would seem now to be im- 
 material to tlu^ assignee whether he were allowed to set aside 
 the judgment (jr not. 
 
 The ))olicy of the insolvent law is that, after the assignment, 
 the whole of thi! insolvent's estate shall l)e administered in the 
 fn.solvent Court,and, even l)efore the enactment of tliis section, it 
 was held tliat a prior execution in the sheriff's hands would not 
 pievent tln^ entire propei'ty from passing to tlie assignee. Thus, 
 where a writ of attachment, luider the Ab.sconding Delators' Act, 
 was n^ceived by a .sheriff", and acted upon by attaching the <le- 
 feiidant's goods, and aftei'wards writs of Ji. fd. were placeil in 
 the sheriff's hands againt the defendant, it was, nevertheless, 
 held tliat the dt^fendaut's property passed to the assignee under 
 a writ of attachment in insolvency subsecpiently received by the 
 slieriff (Henry v. DowjlaH, 1 U. C. L. J. N. S. 108). 
 
 The aim and policy of tlie insolvent law, as expounded in this 
 section, are to j)revent all judgment debts, without exception, be- 
 coming a lien, if the money recovered is not paid over before the 
 insolvency. The word " sheriff" only is used in the Statute, 
 l>ut it is used to illustiate the intention of the framers of the 
 provision, namely, the delivery to the j)roper ofticer who has 
 the execution of tlie writ, not to indicate the nature of the 
 judgment del)ts, or the court out of which the execution i.ssued, 
 and accordingly it has been held that this section a})plies to 
 juilgment debts recovered in Division Courts, in which ex- 
 ecution has ])een issued, and the money levied thereunder by 
 a bailiff of such (Jourts, although tlie section speaks only of 
 
 
 
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 THE INSOLVENT ACT. 
 
 executions delivered to the slierift' (Patterson v. McCarthy, 3o 
 Q. B. U. C. 14). In this case, it was objected that the defend- 
 ant received the money only as clerk of the Court ; but, as it ap- 
 peared that the sale had takjn place after the assignment, the 
 Court held that the goods sold had previously passed to the 
 assignee, and he was entitled to their proceeds, no matter in who.se 
 hands they might be. 
 
 Where an execution against the insolvent's effects is place<l in 
 the sherifi^s hands, and the execution debtor makes an assign- 
 ment within thirty days thereafter, the execution creditors are 
 nevertheless entitled to their costs of suit, to be proved as a privi- 
 leged claim before the assignee (re Fair, 2 U. C. L. J. N. S. 21(J ; 
 Logie Co. J. ; see also section 3 Ik]). 
 
 The word privilege is frequently used in Quebec, as referring 
 to certain preferential or secured riglits or claims, and in all ]»ro- 
 bability this word was used in reference to that Province ; and 
 the word lien a^ a])plicable to Ontario. The expre.ssion lien is 
 generally used to designate a right which a party has to retain 
 that which is in his posse.s,sion or power, until certain demands 
 are satisfied, and a particular lien niay arise by mere operation of 
 law. In the Province of Ontario, before the passing of the Act, 
 an execution creditor, when he placed his writ in the sheriff's 
 hands, had a particular lien on his debtor's property, to the extent 
 of his debt and costs. This section deprives him of that lien, foi' 
 the judgment debt, under the circumstances stated ; but it does 
 not affect his lien for the costs of recovering that judgment, and a 
 judgment creditor who has an execution in the sheriff's hands at 
 the time the assignment is made, is entitled to rank for his costs 
 of the judgment as a })rivileged creditor, against the insolvent (re 
 Hetjihn, 29 Q. B. U. C. 2G2 ; overruling re Rons, 3 P. R. U. C. 31)4 ; 
 see also Canada L. C. Co. v. McAllister, 21 Grant, 5U3). 
 
 Where proceedings for compulsory liqui<lation are taken under 
 the Act, and an attachment is issued, money which has l)een 
 levied by the sheriff under an execution against the debtor, but 
 which has not been paid over to the judgment creditor, passes to 
 the assignee, under this section (Ballen v. Hardiny, Mich. T. 1871 ; 
 Stephen's Digest, N. B. Reports, 227, 228). 
 
SECURED CREDITORS. 
 
 251 
 
 %, 35 
 efend- 
 it ap- 
 nt, the 
 to the 
 whose 
 
 84. If a creditor hold.s security from the insolvent or from his estate, or if 
 there be more than one insolvent liable as partners, and the creditor hold 
 security from, or the liability of one of them as security for a debt of the 
 firm, he shall specify the nature and amount of such security or liability in 
 his claim, and shall therein on his oath put a specified value thereon ; and 
 the assignee, under the authority of the creditors, may either consent to the 
 right to rank for such liability, or to the retention of the property or effects 
 constituting such security or on which it attaches by the creditor, at such 
 specified value, or he may require from such creditor an assignment of such 
 liability, or an assignment and delivery of such security, property or effects, 
 at an advance of ten per centum upon such specified value, to be paid by 
 him out of the estate so soon as he has realized such security, in which he 
 shall be bound to the exercise of ordinary diligence ; and in either of such 
 cases the difference between the value at which the liability or security is re- 
 tained or assumed and the amount of the claim of such creditor, shall be the 
 amount for which lie shall rank and vote as aforesaid ; and if a creditor holds 
 a claim based upon negotiable instruments upon which the insolvent is only 
 indirectly or secondarily liable, and which is not mature or exigible, such 
 creditor shall be considered to hold security within the meaning of this sec- 
 tion, and shall put a value on the liability of the party primarily liable 
 thereon as being his security for the payment thereof; but if such claim is 
 mature or exigible at the date ()f the assignment, or the issue of the writ of 
 attacliment or becomes so, and remains unpaid thereafter, whether before (jr 
 after proof, such creditor sliall be entitled for ranking, to treat the claim as 
 unsecured, but for voting or consenting to a discharge or a deed of composi- 
 tion and discharge or for any other purpose, save ranking, he shall be still 
 Cdiisidered to hold security within the meaning of this section, and shall for 
 all s\ich purposes p\it a value on the liability of the party primarily liable 
 thereon as being his security for the payment thereof," (40 Vict. s. 21). 
 
 The 39th Vict. chap. 30, s. 15, wliich amended thi.s section has 
 since been repealed, 40 Vict. s. 32. 
 
 This section of the Act must be complied with before divi- 
 dends are paid (see section 82). It will be observed that when a 
 soeured claim is filed, the assignee has no power to act, except 
 under the authority of the creditors (see also section 86). 
 
 The general purpose and policy of the Act is to produce 
 equality among the creditors of insolvent debtors, with the 
 exceptions provided for in the Act. and to attain that end, its pro- 
 visions should, in ca.se of extreme doubt, be construed beneficially 
 for the general unsecured creditors (re Jaycox, 8 B. R. 241). 
 
 Every line of this section points mo.st distinctly and directly to 
 
 ..ijtli'*"- 
 
252 
 
 THE INSOLVENT ACT. 
 
 property of the insolvent, and only to property of the insolvent 
 which the Insolvent Court can deal with, and does not contem- 
 plate the sale of property of third parties, held by the claimant 
 as security for his demand (re Cram, 1 B. R. 504 ; re Bahcock, 3 
 Story, 393). 
 
 This section only refers to security which the creditor may hold 
 from the insolvent himself, or from his estate, or from one partner 
 on account of the firm. If the creditor's security is from the 
 estate of a third person, the rule does not apply. In such case 
 the creditor may prove his whole debt against the insolvent's 
 estate, and apply himself to his security for the deficiency, not 
 receiving, however in the whole, more than one hundred cents in 
 the dollar (ex parte English, L. K. 4 Ch. App. 49). If the creditor 
 reali.'ies his security before proving against the insolvent estate, 
 he can only prove for the balance remaining unpaid (ex parte 
 Todd, 2 Rose, 202). 
 
 In England, as well as in this country, the amount of the 
 security which a creditor holds from the estate of a bankrupt, 
 must be deducted from the amount for which he proves on the 
 estate. But before the creditor is compelled to do this, tlie 
 security must be from the bankrupt's estate. R. & Co., merchants 
 at Madras, consigned goods to H., their agent in London, for sale 
 on their account, and in respect of these goods drew bills of 
 exchange upon H. The bills were discounted by R. & Co., and 
 indorsed to the Madras branch of a London bank, to whom the 
 bills of lading of the goods were delivered with the bills of 
 exchange. They were sent to London and tendered to H. for 
 acceptance, and he accepted them " payable on delivery of the 
 bills of lading." H. became bankrupt before the acceptances 
 matured, and it was held that the acceptance was a coiiditional 
 one, and that the bank held security for their debt, upon what 
 was in effect part of the estate of H., inasmuch as he was not 
 bound to pay the acceptances unless the bills of lading were at 
 the same time given up to him (ex parte Brett, L. R. 6 Ch. 838; 
 25 L. T. N. S. 252 ; see also ex parte Ashworth, L. R. 18 Eq. 725). 
 
 When the creditor's security is from the insolvent firm he can 
 
SECURED CREDITORS. 
 
 253 
 
 only prove for the balance, after deducting the value of the secu- 
 rity (re GoUie, L. R. 3 Ch. D. 481). 
 
 A creditor who holds security upon the property of a third per- 
 son lias a provable debt for the full amount against the estate of 
 his debtor. If the debtor is a surety, and pays the debt, he may 
 be entitled to the benefit of the collateral .security. But, in insol- 
 vency, it seems more just and equitable that the creditor should 
 have the benefit of all his remedies, so that he may obtain his whole 
 del it if possible. If he is obliged to realize his security, and prove 
 only for the balance, he will be losing the advantage for which he 
 has stipulated, of the full credit of the promise of the surety (re 
 Ak.cander, 4 B. R. 178 ; Fox v. Eckstein, 4 B. R. 373). 
 
 If the creditor holds a mortgage upon the real estate of the insol- 
 vent, the creditors' consent to the retention of the property em- 
 biaeed in the mortgage might perhaps be held to authorise the as- 
 signee to release the insolvent's right of redemption to the ae- 
 curi'd creditor, subject to the provisions of the 85th section. In the 
 United States it is held that the act of the assignee in allowing a 
 creditor to retain an alleged security after deducting the value of 
 the same from the amount of the claim, does not preclude other cre- 
 ditors claiming the same security, if they have not proved their 
 claims {Second N. B. v. State N. B., 11 B. R. 49 ; 10 Bush, 367). 
 
 It would seem that, when the assignee abandons his claim to 
 the secured cre.^Hor, the latter has the same rights and remedies 
 to enforce his security as if the insolvency proceedings had never 
 been instituted (ib.). 
 
 The Statute in force in the United States speaks of the cre- 
 ditor having a " lien " on the property of the insolvent, and there 
 it is held that mechanics' liens come within this provision, and 
 that such lien may be filed after the commencement of the pro- 
 ceedings in insolvency. But the provisions of the Statute neces- 
 sary to keep the lien alive must be observed {Clifton v. Foster, 3 
 B. R. 656; re Sahin, 12 B. R. 142; re Brunquest, 14 B. F,. 205). 
 The lien-holder cannot, however, claim for work done after the 
 commencement of the proceedings in insolvency (re Cork, 3 Biss. 
 122). 
 
 If the security consists of a policy of insurance, the value of 
 
 ' 1* (I 
 
 maOiaWkM 
 
254 
 
 THE INSOLVENT ACT. 
 
 which is assessed by the creditor, on his proving against the es- 
 tate, and the policy falls in before the assignee expresses his elec- 
 tion, it would seem that the assignee and not the creditor is en- 
 titled to the sum insured, less the amount at which the value 
 was, on proof assessed by the creditor ((!X parte King, L. R. 20 
 Eq. 273). 
 
 The secured creditor is not bound by the debtor's estimate 
 of the value of the security (re Bestwick, L. R, 2 Ch. D. 485;. 
 
 The acceptance of a composition on a joint debt is no satisfac- 
 tion of the separate liability in respect of a joint and separate 
 tlebt itbimpson v. Hennmg, L. R. 10 Q. B. 406). 
 
 A joint ci'editor, holding separate security, may vote for and 
 receive i comjiosition in respect of his whole del)t without giving 
 lip the separate security (re Littler, L. R. 18 Eq. 249). 
 
 The rule in England is that if a creditor of the firm has a 
 security upon the separate estate of one partner, he will })e en- 
 titled to prove again.st the joint estate without giving up his 
 security {Bank of Australasia v. Flower, L. R. 1 P. C. 27), and 
 this was also the decision in re Gkaffey (30 Q. B. U. C. G4), in the 
 Province of Ontario, decided on the Act of 1SG4. 
 
 In this case the appellants in the matter of C & Co. insob'ents, 
 had a claim upon a note made by C & Co., payable to C. or jf the 
 firm and by him endorsed to the appellants. They proved against 
 the firm on the 3rd July 18G9, but afterwards withdrew it and 
 proved on the 11th January 1870, under .section GO of the Act of 
 18G9, .specifying and putting a value on the separate liability of 
 C. The Court held, affirming the decision of the county judge, that 
 the appellants, under the Act of 18G4, could not rank both upon 
 the separate estate of C, and on the estate of the firm, but must 
 elect ; but that they might prove again.st the joint estate for their 
 whole claim, without deducting from it the value of C.'s separate 
 liability. It was held also, that the appellants could treat the 
 [)ayee and endorser as having incuri-ed a separate liability by 
 his indorsement distinct from his joint liability as a maker. It 
 was held also, that the Act of 18G9 could not apply, for the case 
 was pending before it, and the question in dispute as to the right 
 
SECURED CREDITORS. 
 
 255 
 
 to prove was not a matter of procedure, only exempted froni the 
 exceptions in the repealing clause (re Ghafey, 30 Q. B. U. C. 04 
 
 This case cannot be regarded as an authority that, under the 
 Act of 1 809 or the ])resent Act, a creditor, who holds the note of 
 a firm endorsed by an individual partner, would not be bound to 
 specify the n, ■ ture and amount of such separate indorsement as a 
 security under this section. The Act of 1804, on which the de- 
 cision was based did not contain the words, " or if there be more 
 than one insolvent liable as partners and the creditor holds secur- 
 ity from or the liability of one of them as security for a debt of 
 tlic film," &c. Therefore, if a creditor holds a note made by a 
 firm in partnership, endorsed by one of the partners individually, 
 lie must under this section, when proving against the estate of 
 the firm, put a value on the separate indorsement. In fact this 
 was (U-cided in re Jiaker, (3 Ch. Oiam. 499 ; 8 C. L. J. N. S. 136) ; 
 and tliis rule will apply only when b^th the estates are being ad- 
 ministered in insolvency. As has ueen already pointed out in 
 this work the different sections of the Act apply only to those 
 who have made assignments or against whom writs of attachment 
 have issued. A creditor, therefore, holding the note of an insol- 
 ent firm, endorsed by one of the partners can prove in an admin- 
 istration suit in respect of the indorsement, though he has proved 
 in the insolvency proceedings against the firm, this section not 
 applying in such case (x'e Baker, supra). 
 
 ( )n the insolvency of a firm, promissory notes drawn by the firm 
 in favour of, and indorsed by, one of its members do not entitle 
 the holders who are cognizant of the connection of the parties to 
 pi'ove against both estates, but they may elect against which 
 estate to prove, and this election may be made before dividend 
 paid (re Dodge 8 C. L. J. N. S. 51). 
 
 If an insolvent has carried on business in this and some other 
 country, and has assets in each country connected with each busi- 
 ness, and a particular creditor is able to lay hold of the personal 
 assets of the insolvent in the foreign country, and afterwards 
 comes to this country to share with the other creditors, he must 
 bring into the estate here, that which the law of the foreign 
 country has given him in preference to the other creditors. Thus 
 
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 250 
 
 THE INSOLVENT ACT. 
 
 it liKS been held in England under the 152nd section of the Act 
 of 18G1, where a debtor carried on business in England and Brazil, 
 and on his becoming bankrupt a creditor received part of his 
 claim out of the assets in Brazil, and aftei'wards claimed to re- 
 ceive dividends on the entire amount of his claim out of the 
 assets being administered in England, that this section did not 
 apply, consequently the creditor was not entitled to receive any 
 dividend out of the assets in England until the other creditois 
 had received a dividend equal to that received by him in Brazil 
 (ex parte Wilson, 26 L. T. N. S. 489 ; L. R. 7 Ch. 490). 
 
 A secured creditor, who, in his proof, claims a lien upon the en- 
 tire estate of the insolvent, when he only has a lien upon a cer- 
 tain portion thereof, df)es not therel)y lose the real lien to which 
 he is entitled, nor is his proof thereby vitiated (McKinscy v. 
 Harding, 4 B. R. 39). 
 
 It is held in the United States that a secured creditor who proves 
 his claim without reference to his lien or security, and without 
 api)rising the Insolvent Coui't of its existence, thereby waives his 
 lieu and relin(iuishes it to the assignee (re Htamell, B. 11. bs:}; 
 re Qramjer H B. R. 30). 
 
 A secured creditor may give up his security and prove vn res- 
 pect of the whole debt under this section. If he proves for the 
 whole debt, he will be considered to have elected to give up his 
 security, and this, it would seem, even though at the time of so 
 voting, he was unaware that he was a secured creditor (re Hoare, 
 L. R. 18 Eq. 705. 
 
 It has been held in England, that if the creditor give up his 
 security, and the bankruptcy is subsecjuently annulled, the creditor 
 is entitled to have the security returned to him, although the debtor 
 be adjudicated a bankrupt on some other petition (ex parte Morrin, 
 14 L. T. N. S. 606). 
 
 The creditor holding security, may either elect to retain it and 
 decline to rank on the estate, or he may, if he considers the se- 
 curity insufficient, put a value on it under this section, and rank 
 for the difference. If a creditor deliberately elects to look only 
 to his security, he cannot afterwards be permitted to rank on the 
 estate. What will amount to such election depends on the circum- 
 
SECURED f'REDTTORS. 
 
 257 
 
 stances of each case. If tlie general creditors are not in any way 
 prejudiced Ly the act done, and can V)e placed in the same position 
 as they were Ijefore, the creditor will not he held to have made 
 liis election. Thus it has been held that a creditor holding 
 security, is not, by the mere fact of selling or disposing of such 
 security after the assignment, precluded from ranking on the 
 estate. If the creditor selling has dealt fairly with the securi- 
 ties, and the estate has lost nothing by the sale, or if it has been 
 or can be fully recompensed for any supposed damage suffered, 
 then, after making good such damage, the creditor selling and 
 complying with the provisions of this H^th section will be 
 allowed to rank for his debt (re Hurst, 31 Q. B. U. C. IIG). 
 
 If a creditor, holding security, wishes also to rank on the estate , 
 lie ought to put a value on his security, and comply with the 
 provisions of this section. A secured creditor, who after the 
 assignment, recei ves payment of \YAvi of his claim, as for instance 
 by exercising the jwwer of sale under a mortgage, may be 
 allowed to prove on his bi-inging in the money received for the 
 lienefit of the other creditors. 
 
 Re Hurst (31 Q. B. U. C. 116) decided that a secured creditor 
 might realize his security after the insolvency of the debtor, and 
 if he did so fairly and the estate had not lost anything thereby, 
 he did not waive Lis right to come in undei' this section and prove 
 for the d eficiency. Therefore a creditor who holds a note on 
 which the insolvent is secondarily liable may proceed against the 
 party primarily liable theieon after insolvency, may put a value 
 on the amount realized, and i)rove for the deficiency under this 
 section. 
 
 This case seems to go far in the direction of introducing the 
 English rule in the case of .secured creditors. There such credi- 
 tors may eithpr retain their securities and compel the trustee to 
 redeem them, or they may realize their securities or apply to have 
 them realized under the direction of the Court, and prove for any 
 deficiency (B. Act, GO, s. 12, Rule 78; see White v. Simmons, L. 
 R. (5 Ch."^i^pp. 555). 
 
 The power to realize, and then prove for the deficiency, is an 
 
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 111 
 
 I'll 
 
 258 
 
 THE INSOLVENT ACT. 
 
 important power to the secured creditor, as it enables liiia to de- 
 termine exactly the value of his securities. 
 
 The English Act of 18(jU uses the Wv^rds " any creditor liolding 
 a security," and it defines a creditor liolding a security to mean 
 " any creditor holding any mortgage, charge, or lien on the bank- 
 rupt's estate, or any part thereof, for a debt due to him. It was 
 held that a creditor who has levied execution under a ji. fa. by 
 seizure of the debtor's goods {SUitcr v. P'nuler, L. R. Kxch. 
 228 ; ib. 7 Exch. 95), or has obtained and served a garnishee 
 order under the Common Law Proceduie Act, 18.54 {hJrtiiyxuuui 
 V. Bridger, L. R. 9 Q. B. 286), is a secureil creditor within the 
 Act. And it is inniiaterial, in the case of a garnisliee ordei-, that 
 it has not been made absolute {Loive v. Blakeniore, 28 W. R. 8.')), 
 which may, in this respect, be considered to have overruled ex 
 parte Greeiiivaij, (L. R. 10 Eq. 019). 
 
 85. But if the security cunsiats of a mortgage upon real estate, or up(jn ships 
 or shipping, tlie property uxortgaged shall only be assigned and delivered to 
 the creditor, suhject to all [irevious mortgages, hypothecs and liens thereon, 
 holding rank and priority before his claim, and upon his assuming and bind- 
 ing himself to pay all such previous mortgages, liypothecs and liens, and upon 
 his securing such previous charges upon the property mortgaged, in the same 
 manner and to the same extent as the same were previously secured thereon; 
 and thereafter the holders of such previous nuirtgages, hypijthecs and liens, 
 shall have no further recourse or claim upon the estate of the Insolvent ; and 
 if there be mortgages, hypothecs or liens thereon, subse(iuent to those of 
 such creditor, he shall only obtain the property by consent of the 8ubse(iuently 
 secured creditors ; or upon their tiling their claims specifying their security 
 thereon as of no value, or upon his pay'ug them the value by them placed 
 thereon ; or upon his giving security to the Assignee that the estate shall n(jt 
 be troubled by reason thereof. 
 
 If a mortgage is given when the debtor is notoriously insol- 
 vent to the knowledge of the creditor and for the purpose of ob- 
 taining a fraudulent preference over other creditors, collocation 
 in respect of it will not be allowed {Whitney & SImiv, 4 Revue 
 Legale, 488). 
 
 If an assignee sells projierty of the insolvent on which there 
 are mortgages first and second — and receives the i)urchase money 
 sufficient to pay the first nearly off and part of the second, the 
 
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 SECURED CREDITORS. 
 
 250 
 
 Hrst inortfjagoo musfc be paid in full out of the pvocood.s and tho 
 halancc only can go to the second mortgagee. In one case tlie as- 
 signee, after selling tlu; pi'0])erty, paid over part of the money to 
 the second mortgagee, and then absconded with the rest of tho 
 money. It was lield that the conversion of the mortgaged pro- 
 perty into cash in the assignee's hands did not, under these cir- 
 cumstances, alter the rights of the mortgagees as Ijetween them- 
 selves ; that the first mortgagee was entitle<l to bo jtaid out of 
 the proceeds of the property mortgaged, tho loss of a portion of 
 it did not affect him so long as enough remained to satisfy liis 
 claim, and that he should lie paid in full liefore anything was 
 paid to the second mortgagee (Il<i rfcaii v. Boijci; 2 Revue Criti([ue, 
 47!)). 
 
 8<i. Upr)!! a secured claim being filed, with a vidiiation of the security, it 
 shiill be the duty of tho assignee to procure the authority of the inspectors, 
 or of the creditors at their first meeting thereafter to consent to the reten- 
 tion of the seciu'ity by the creditor, or to require from him an assignment 
 and delivery thereof ; and if any meeting of inspectors or ot creditors takes 
 place without deciding upon the course to be adopted in respect of stich 
 security the assignee shall act in the premises accoi'ding to his discretion 
 and without delay. 
 
 It will be ol)served that if any meeting of the inspectors or 
 creditors is held after the filing of the secured claim, and no direc- 
 tions are then given to the assignee as to the ti'oatment of the 
 claims under section 84, he is empowered to exercise his own dis- 
 cri'tion in the matter. 
 
 W7. The amount due to a creditor upon each separate item of his claim at 
 the time of the execution of a died of assignment, or of the issue of a writ 
 of attachment, as the case may be, and which shall remain due at the time 
 of proving such claim, shall form p.art of the amount for which he shall rank 
 up<inthe estate of the insolvent, until such item of claim be paid in fidl, ex- 
 cept in cases of deduction of the proceeds, or of the value of his security, as 
 hereinbefore provided ; but no claim or part of a claim shall be permitted to 
 )>e ranked upon more than once, whether the claim so to rank be made by 
 the same person or by ditlerent persons ; and the assignee may, at any time, 
 re<piire from any creditf)r a supplementary oath, declaring what amount, if 
 any, such creditor has received in payment of any item of the debt upon 
 which his claim is fi unded, subsecpient to the making of such claim, together 
 
 Uiitiist^ ' 
 
260 
 
 THE INSOLVENT ACT. 
 
 fii^i 
 
 with the particuhirs 'of such payiuont ; and if any creditor refuses to pro- 
 cluce or make sucli oatli before tlio assi^ieo witliin a reasonable time after lie 
 has been reciuirod so to do, he shall not be collocated in the dividend 
 sheet. 
 
 Under this section a creditor can oidy rank for the amount due 
 at the time of proof, ^'iving credit foi' all j)ayinent8 since th^' as- 
 signment or tlie issue of the writ of attachment. 
 
 88. Tf the insolvent owes debts both individually and as a nioniber of a 
 co-partnership, or as a member of two ditt'ercnt co-partnerships, the claim.s 
 a<,'ainst him shall rank tirst upon the estate, by which the debts they re- 
 present were contracted, and shall only rank upon the (jther after all the 
 cretlitors of that other have been paid in full. 
 
 An indivichial partnei- may he insolvent, altliough the partner- 
 ship to which he belongs is (luite solvent. The ctiect of his in- 
 solvency, by the express language of the 4()th section of tlio Act, 
 is to dissolve the ])artnership. The claims against him indivi- 
 dually are provable as well as those against him as a member of 
 the j)artnership. Those against him j)ersonally rank on his indi- 
 vidual estate first, and tlK)se against him in resi)ect of the part- 
 nership rank on the jiartnershi]) estate first. After the partner- 
 ship claims have been satisfied out f)f the partnersliip funds, the 
 individual debts may lank on the partnership estate ; and so, 
 after the individual debts are satisfied out of the estate which is 
 applicable to their payment, the partnershij) claims may rank on 
 this estate (re McKenztc, 81 Q. B. U. C. 7). 
 
 If a partner fraudulently takes money out of the partnership 
 assets for his own piivate purjiDses, a proof can be nu\de f(jr it on 
 behalf of the fiiin against his pi-ivate estate in competition with 
 his private creditors {Lmwy v. Hill, L. R. 4 Ch. D. 537; following 
 ex parte Harris, 2 V. ic B. 210). 
 
 The rule in equity, as well as in bankru])tcy, is that the sepa- 
 rate estate of a partner is to ])e applied first in discharge of his 
 separate debts, and, in applying this rule, money paid by co-part- 
 ners on a liability created by the fraud of a partner towards 
 them is treated as a separate d«bt, })rovable and payable jx^'f"*' 
 jjassu with the other separate creditors of such partner. In case 
 
PROOF AOAIXST PAUTNERS. 
 
 261 
 
 l>rfi. 
 er lie 
 itluml 
 
 flue 
 
 " as- 
 
 of a 
 aiiiis 
 lu- 
 ll the 
 
 of his death insolvent, the niiTc lial)ility so fraudulently created 
 cannot he proved aj^'ainst the separate estate; as a debt until the 
 Hiiliility is paid, or until sonietliing eiiuivah'iit to payment taken 
 place. When the fraud was in the use of the partnership's name 
 on Itills, the other partners bocominj,' insolvent, the holders of the 
 ])ills proved them against the partnership estate. The as.signeo, 
 in a suit for administering the separate estate of the guilty part' 
 ner, claimed to prove the amount against the separate estate. 
 But the master restricted the proof to the expected div^'l nd 
 from the partnership estiite and the sepai'ate estate of the sur- 
 viving partners, and the Court held that the assignee was not en- 
 titled to prove ior a laiger sinn (Baker v. Dawharn, 19 Grant, 
 113). 
 
 On the insolvency of a firm, the holders of })romissory notes, 
 drawn by the firm in favour of, and endorsed by one of, its mem- 
 bers, in his individual character, cannot prove agaiast both estates 
 wlien they are cognizant of the relation between the parties. 
 They may, however, elect against which estate to prove, and if 
 they have proved against one, they may, before any dividend is re- 
 ceived or declared, abandon it, and prove against the other (re 
 Dodge, 8 C. L. J. N. S. 51 ; Supreme Court, Nova Scotia). A 
 similar decision was rendered in re Chajfey (30 Q. B. U. C. 64) ; 
 where it was held that the holder of a note made by a firm, and 
 endorsed by one of the partners individually, must elect, whether 
 he will prove against the firm or against the individual partner. 
 
 But the doctrine against double proof aj)plies only where both 
 estates are being administered in insolvency, and a creditor who 
 has proved in insolvency upon a promissory note made by an in- 
 solvent firm, can prove as a creditor in an administration suit 
 against one of the parties deceased, who has separately endorsed 
 the note (re Baker, 3 Ch. Cham. 499 ; 8 C. L. J. N. S. 136). 
 
 The doctrine in ex pai-te Waring (19 Ves. 345) does not apply 
 unless there has been not only a double insolvency, but also a right 
 of proof against both the insolvent estates, in respect of the same 
 matter. The drawer of certain bills of exchange sent remittan- 
 ces to the drawee to meet his liability upon the bills. The drawer 
 became bankrupt, and the diawee refused to accept the bills 
 
202 
 
 THE INSOLVENT ACT. 
 
 illi 
 
 Iff 
 
 of exchange, and shortly afterwards also became bankrupt. 
 The Court held that there was no right of proof against the 
 drawee's estate, and that a bill by the holder of the bills of 
 exchange, praying for a declaration, that the remittances were 
 specifically appropriated to meet the bills held by him, and ought 
 to be applied in satisfaction thereof, without prejudice to his 
 right to prove for the unpaid balance, must be dismissed with costs 
 (Vaughan v. Halliday, SOL. T. N.S. 741 ; 9 Ch. App. oGl ; ex parte 
 Greener, 32 L. T. N. S. 205). There must also be the concurrent 
 administration of both insolvent estates by competent tribunals (re 
 Yijlesias, L. R. 10 Ch. App. 035 ; ex parte Gomez, L. R. 10 Ch. 
 App. 039). 
 
 The principle of ex parte Waring (19 Ves. 344;) will not be ap- 
 plied to the prejudice of the joint creditors of two firms engaged 
 in a common adventure, so as to deprive such creditors of the 
 right to be paid out of goods constituting joint assets of the firms, 
 but which as between them were appropriated to bills drawn by 
 one firm, and accepted by the other (ex parte Dewhurst, L. R. 8 
 Ch. App. 905 ; 29 L. T. N. S. 125). 
 
 Two firms carried on jointly a trading adventure in cotton, 
 the one drawing bills of exchange, the other accepting the bills, 
 and it being agreed that the bills should be paid out of the pro- 
 ceeds of the cotton. The two firms became bankrupt, and it 
 was held that the right of the bill-holders to have the pro- 
 ceeds of the cotton applied in payment of the bills upon the 
 principle of ex parte Waring (19 Ves. 345) was subject to the 
 right of the joint creditors (if any) of the aggregate of the two 
 firms to have the proceeds of the cotton applied as part of the 
 joint estate (ex parte Deivhurst, supra). 
 
 So also the principle does not apply as between vendor and 
 purchaser or agent and principal where all property in the goods 
 consigned, and in respect of which the bills were drawn and ac- 
 cepted, has been parted with by the consignor to the consignee, un- 
 less the consignor specially directs the j)roceeds of the goods to be 
 applied in a particular way. A direction relating only to the 
 invoice price of the goods, that is the debt due from the consignee 
 
nipt, 
 the 
 lis of 
 Were 
 
 o his 
 costs 
 ^arte 
 irrent 
 s (re 
 )Ch. 
 
 PROOF AGAINST PARTNERS. 
 
 2G3 
 
 for the goods, will be insufficient for the purpose (ex parte Banner, 
 L. R. 2 Ch. D. 278). 
 
 A., \\'ho was partner in a bankin</ firm, on being appointed 
 treasurer to a board of guardians, entered into a bond for the due 
 discharge of his duties, his sureties being B., one of his partners, 
 and C, who was not a partner in the firm. The bank stopped 
 payment, and A. died tliree days afterwards, and a suit was insti- 
 tuted in Chancery to administer his estate. The other partners 
 in the firm were adjudicated bankrupts. A.'s joint and separate 
 estates were both insolvent ; but B.'s separate estate was solvent. 
 When the bank sto})ped payment, over £.5,000 was standing to 
 the credit of the guardians. C. paid tl is amount in full, and was 
 rei)aid a moiety of it out of B.'s separate estate, having previously 
 been admitted to prove in the Chancery suit for the whole £5,000. 
 He also proved against the joint estate of the firm for the second 
 moiety of the £5,000. 
 
 On an application by the trustee in bankruptcy of B.'s separate 
 estate, for leave to prove against A.'s separate estate for the 
 moiety of the £5,000 repaid to C. out of B.'s separate estate, it 
 was held, that the application could not be allowed, inasmuch as 
 its effect would be to make the separate creditors of A.'s insolvent 
 estate contribute towards the payment of the joint debts of the 
 firm, in aid of B.'s solvent separate estate (Lacey v. Hill, 28 L. T. 
 N. S. 86 ; 27 L. T. N. S. 504). 
 
 This section assumes that there is both a joint and separate 
 estate, and that there are creditors of both estates, and if thtre is 
 no joint estate, the creditors of the firm will be entitled to rank 
 as private creditors of the several estates of the respective part- 
 ners (ex parte Bradshaw, 1 G. & J. 90). So also the joint credi- 
 tors will be entitled to prove against the separate estate of one 
 partner in competition with his separate creditors where part of 
 the joint estate has been fraudulently applied by one partner for 
 his private use (ex parte Harris, 2 V. & B. 210 ; Lacey^ v. Hill, 
 L. R. 4 Ch. D. 537, ante 260). If there are no separate creditors 
 of an insolvent partner, the joint creditors will, of course, be en- 
 titled to prove at once, for the pui"pose of receiving dividends 
 from his separate estate (ex parte Chandler, 9 Ves. 35). 
 
 'jt'if^Hf 
 
264 
 
 THE INSOLVENT ACT. 
 
 In the ordinary case of there being joint and separate creditors, 
 and also joint and separate estates, the separate estate of each part- 
 ner is to be first applied, in paying the debts of his separate credi- 
 tors, until they are paid in full (ex parte Elton, 3 Ves. 238 ; ex 
 parte Taitt, 16 Ves. 193). 
 
 If in a case of mutual accommodation paper between two firms 
 or individuals, the account between the parties consists partly of 
 outstanding or dishonoured bills, and partly of a cash account, 
 proof can only be made in respect of the latter, and the bills must 
 be struck out on both sides (ex parte Walker, 4 Ves. 373). The 
 proof is for that sum for which an action could have been maintained 
 by the one party against the other, the bills remaining in the 
 situation in which they are actually found, if there had been no 
 insolvency. Where A. had advanced cash, and given acceptances 
 to B, and the latter had given to A. acceptances for part of the 
 cash advances and acceptances of A., and A. discounted B.'s ac- 
 ceptances, and the holder thereof proved against B. on his becom- 
 ing bankrupt ; it was held that the trustee of A. could not, on his 
 bankruptcy, prove against B.'s estate for more than the balance 
 due, after deducting the acceptances given by B. to A. (ex parte 
 Macredie, L. R. 8 Ch. App. 535 ; ex parte Cama, L. R. 9 Ch .App. 
 68G). 
 
 It is a settled rule in bankruptcy that a partner cannot prove 
 under a joint conmiission against his firm, in competition with 
 the creditors of his firm. And this rule applies in a case where 
 the partner had died before the bankruptcy, his share had been 
 taken by the other partners, under the provisions of the partnei'- 
 ship deed, and the money due in respect of it had not been paid 
 to his executors at the time of the bankruptcy {Manaen v. Gor- 
 don, L. R. 1 P. C. D. 195). 
 
 But the exception to this rule, which is allowed where the 
 debt is in respect of a distinct trade carried on by one or more of 
 the bankrupt [jartners, is confined to the case where the debt 
 in question arises in respect of goods supplied, and cannot be 
 sustained when the debt arises in respect of cash advances {NoA'- 
 raway v. Beattle, 26 L. T. N. S. 310 ; affirmed on appeal, ib. 
 
 492). 
 
PROOF AGAINST PARTNERS. 
 
 265 
 
 Where the partnership articles provided that, on the death of a 
 partner, the surviving partners should take his share at its value, 
 to be ascertained by the last stock-taking before his death. The 
 executor of a deceased partner, whose share was so taken by the 
 continuing partners, was not allowed to prove against them for 
 tlie purchase money, there being joint debts of the original firm 
 remaining unpaid (ex parte Gordon, L. R. 10 Ch. App. 169 ; 31 
 L. J. N. S. 528). 
 
 It is competent for solvent partners to make any arrangement 
 tlu'V think proper with respect either to the joint property of 
 the firm, or the separate property of the persons constituting it> 
 and to alter the character of the property, so as to convert joint 
 into separate property and vice versa, and every such agreement, 
 if made honajide, will bind their creditors, and in the event of 
 bankruptcy the property will be distributable as joint or separate 
 estate, according to the character which it then bears as between 
 the partners themselves (ex parte Williams, 11 Ves. 6 ; ex parte 
 Nanson, 22 W. R. 875 ; 30 L. T. N. S. 40). Upon this principle, 
 where the partnership deed between four persons provided that, 
 on the death of a partner, the partnership should not be dissolve*! 
 but that the survivor should carry on the business, and that the 
 deceased partner's share should remain in the hands of the sur- 
 vivors for a limited time, and the amount should be ascertained 
 and paid by instalments, and in the meantime be secured by the 
 pronussory notes of the survivors, it was held that the credi- 
 tors of the four partners had no priority of payment out of the 
 assets which could be proved to have belonged to the partnership 
 of the four (re Simpson, L.R. 9 Ch. App. 572 ; 30 L. T. N. S. 448 ; 
 see also ex parte Dear, L. R. 1 Ch. D. 514). 
 
 Bona fides, however, in cases of this sort, is the very essence of 
 the transaction, and if the latter be tainted with fraud it will not 
 bind the creditors, and where both partners, individually as well 
 as the firm, were at the time of the assignment hopelessly insol- 
 vent, and this was known to the partners, the transaction was 
 held to be fraudulent and void, as against the joint creditors (ex 
 parte Mayou, 11 Jur. N. S. 433 ; see also re Kemptner, L. R. SEq- 
 287). 
 
 '^m 
 
 
 P ; 
 
 ■1 
 
 m 
 
 i< 
 
2G6 
 
 THE INSOLVENT ACT. 
 
 A trader, who carried on business in Brighton, married a widow 
 who was entitled under a partnership deed to three-fourths of tlie 
 profits of a business carried on in London. With the sanction of 
 the Court of Chancery, the trader })urchased the other fourth of 
 the London business and executed a settlement by which lie 
 covenanted that his wife's three-fourths should be for her sole 
 and separate use, free from his debts, and he afterwards filed a 
 l)etition for liquidation, being considerably indebted in respect of 
 his Brighton business, which he had continued to carry on quite 
 unconnected with the London business. It was held, that the 
 creditors of the London business were entitled to have their debts 
 paid out of the assets of that business to the exclusion of the credi- 
 tors of the Brighton business, and that his wife was entitled to 
 three-fourths of any surplus which might remain after satisfying 
 the debts of the London business, unaflfected by the claims of 
 her husband's separate creditors, who, however, would be entitled 
 to be paid out of his one-fourth of the surjilus, if any (ex parte 
 New, 30 L. T. N. S. 447 ; L. R. 9 Ch. App. 508. 
 
 The rule that a partner cannot prove against the estate of his 
 co-partner, till all the partnership debts have been paid in full, 
 does not apply to a claim in respect of a devastavit, committed l)y 
 an executor against the estate of his deceased partner, and, there- 
 fore, when an executor who has been in partnership with the 
 testator wastes the assets, and afterwards becomes insolvent, the 
 representatives of the testator's estate may prove in the insolvency 
 proceedings, although the partnership creditors are not paid in 
 full (ex parte Westcott, 30 L. T. N S. 7?9 ; L. R. 9 Ch. App. 020), 
 
 In England, by section 103 of the Act of 1809, when one mem- 
 ber of a firm becomes insolvent, the joint creditors of the firm 
 have a right to prove and vote, but not to receive any dividends 
 out of the separate estate until the separate creditors have been 
 paid in full. Where, therefore, one member of a firm becomes in- 
 solvent, and obtains his discharge, he cannot afterwards be forced 
 into insolvency as a member of the firm, but the insolvency pro- 
 ceedings must be against the continuing partners and the part- 
 nership assets (ex pai'te Hammond, 29 L. T. N. S. 72). 
 
 Where a creditor sells goods to a party who, after the sale, 
 
^■w 
 
 PROOF AGAINST PARTNERS. 
 
 267 
 
 forms a partnership with another person, and brings the goods 
 into the firm, on the partnership afterwards becoming insolvent 
 the creditor cannot claim to rank upon the partnership estate for 
 the price of the goods sold, though the partnership got the bene- 
 fit of the purchase (re Simmons, W L. C. J. 29G). 
 
 This decision seems to have been given on the ground that 
 the credit was originally given to the individual partner, and he 
 alone was the debtor. But the creditor could surely, under the 
 S8th section, ])rove against the partnersliip estate after payment 
 of the creditors of the firm. 
 
 Two partners, before the passing of the Insolvent Act, assigned 
 their joint estate and separate estates together for the benefit of 
 their joint and separate creditors rateably and in proportion 
 without preference or prioi'ity. An assignee, under the Act, 
 having been afterwards appointed, filed a bill to set aside the 
 previous assignment on the ground that to entitle the separate 
 creditors of each partner to share rateably and in proportion 
 with the joiijt creditors, not merely the separate property of their 
 debtors, but the joint property also, and the separate property of 
 the other assignor was a fraud on the joint creditors. But it 
 appearing, by the evidence, that the joint estate alone was insol- 
 vent, and that the separate property of each was more than suf- 
 ficient to pay the separate debts, the bill was dismissed with costs 
 {McDonald v. McCallum, 11 Grant, 4G9). 
 
 89. The creditors, or the same proportion of them that may grant a dis- 
 charge to the debtor nnder tliis Act, may allot to the insolvent, by way of 
 allowance, any simi of money, or any property they may think proper ; and 
 ihe allowance so made shall be inserted in the dividend sheet, and shall be 
 subject to contestation like any other item of collocation therein, but only on 
 tlie ground of fraud or deceit in procuring it, or of the absence of consent by 
 a sufficient proportion of the creditors. 
 
 The proportion of creditors who can grant a discharge to a 
 debtor is a majority in number of those who have proved claims 
 to the amount of one hundred dollars, and who reju'esent, also, 
 three-fourths in value of all the claims, whethei" above or below 
 one hundred dollars, which have been proved (see sections 2, /i,. 
 and 52). 
 
 Mi 
 
 I" 
 
268 
 
 THE INSOLVENT ACT. 
 
 90. No coats incurred in suits againsi the insolvent after duo notice has 
 been given, according to the provisions of this Act, of an assignment, or of 
 the issue of a writ of attachment in liciuidation, shall rank upon the estate 
 of the insolvent ; but all the taxable costs incurred in proceedings against 
 him up to that time shall be added to the demand for the recovery of 
 which such proceedings were instituted ; and shall rank upon the estate 
 as if they formed part of the original debt, except as herein otherwise 
 provided. 
 
 In case of an attachment, the notice I'eferred to in this section 
 would probably be the publication of the advertisement, form D, 
 under section 11. 
 
 In case of an assignment the notice, form G, under section 20, 
 would be the first notice given. 
 
 It would seem that this section renders necessary the taxation 
 of the costs before proof is made. The costs must be taxable, 
 and taxation is the best evidence of what costs are taxable. 
 
 91. Clerks and other persons in the employ of the insolvent in and about 
 his business or trade shall be collocated in the dividend sheet by special pri- 
 vilege for any arrears of salary or wages due and unpaid to them at the time 
 of the execution of a deed of assignment, or of the issue of a writ of attach- 
 ment under this Act, not exceeding two months of such arrears, and also for 
 such salary or wages for a period not exceeding one month of the imexpired 
 portion of the then current year of service, — during which period they shall 
 be bound to perform, under the direction of the assignee, any work or duty 
 connected with the affairs of the insolvent, and which the insolvent himself 
 might have directed them to perform under their respective engagements ; 
 and for any other claim they shall rank as ordinary creditors ; and no assignee, 
 payable by commission, shall be entitled tcj charge for any disbursement for 
 procuring to be performed, any service which he might properly have caused 
 to be performed by any such clerk or other person, and for which he might 
 otherwise charge under this Act, and no assignee whose remuneration is not 
 fixed by this Act shall be entitled to remuneration for any service or for any 
 disbursement in respect of any service which he might properly have caused 
 to be performed by such clerk or other person. 
 
 The 40 Vict. s. 22 amended this section by striking out of the 
 sixth line the word " three," and substituting in lieu thereof the 
 word " two," and^by striking out of the eighth line the words "two 
 months," and substituting in lieu thereof the words " one month," 
 and by making the addition to the section, which is given above. 
 
 
PRIVILEGE FOR WAGES. 
 
 2Ga 
 
 
 The servant must be in the employ of the insolvent at the time 
 of the assignment in order to be entitled to wages for two months, 
 by privilege under this section, and where a servant had left his 
 master's employ three months before the assignment, it was held, 
 under the 67th section of the Act of 1 8G9, that he was not en- 
 titled to the wages as a privileged claim, even though he was 
 obliged to leave the employ because he could not get his pay (ex 
 parte Napier, 3 Pugsley, 134). 
 
 This special privilege of clerks and other persons, for their 
 arrears of wages, may be lost, or waived Ijy their own conduct. 
 Thus, where the clerk voluntarily left the insolvent's eraploy,some 
 time before the insolvency, and took a note for the arrears of 
 wages, it was held that he must come in with the general credi- 
 tors, and had no special privilege under the 07th section of the 
 Act of 1869 (t'x parte Napier, 2 Pugsley, 300). 
 
 In this case, the insolvent's business was building vessels, and 
 the clerk was employed working at vessels. He was hired by the 
 day, and objection was taken that the Statute did not apply to 
 clerks employed by the day, but the Court did not express an 
 opinion on that point. Weekly or daily labourers, oi workmen 
 were held not to be within the Statute in force in England. 
 Neither were workmen paid by the job without being hired for 
 any specific time (ex parte Grellier, Mont. 264). 
 
 The language of this section seems to point to a yearly hiring, 
 ir speaks of the " then current year of service," and seems to 
 iiiier in this respect from the English Act. The clerk is to be 
 tiiowed for two months' wages, immediately prior to the assign- 
 raent or the issue of the writ of attachment, if the wages for 
 these two months are unjjaid, and though the insolvency does 
 not of itself operate as a dissolution of the contract of hiring 
 {Thomas v. Williams, 1 Ad. & E. 685 ; Hopkins v. Thomas, 7 C. B. 
 N. S. 711) ; yet, under this section, the clerk's privilege against the 
 estate for wages, accruing after the assignment, is restricted to one 
 month of the unexpired portion of the then current year of 
 service. In other words, if the clerk's year of service has not 
 expired at the time of the insolvency, he is entitled to claim one 
 
 t '. 
 
270 
 
 THE INSOLVENT ACT. 
 
 month's wages aftei' the insolvency, but must during such period 
 pen-form any work required of him for the benefit of the estate; 
 and it will be seen that the late aet enforces the employment of 
 the clerk (^r servant during such period, by depriving the assignee 
 of any remuneration for any service which may be performed liy 
 sucii clerk or sei'vant. It would seem that those claimincr the 
 jjrivilege nuist ho employed in or about the business or trade of 
 the insolvent. Domestic servants would seem not entitled to 
 this privilege. 
 
 The (juestion has arisen in the United States whether a 
 privileged claim can be assigned so as to entitle the a.ssignee to 
 the privilege ; and it was held thai, a party who had taken an 
 assignment of the claim as secui'ity for money advanced by him 
 to the claimant, was entitled to the privilege to the extent of his 
 advance, and the l)alance remaining, aftei- payment of the ad- 
 vances, was paid to the original holder of the claim (re Brown, 3 
 B. II. 720). 
 
 The assignee is not bound to pay a jn-ivileged claim for wages 
 before it is put on the dividend sheet (re Clcghorn, 2 U. 0. L. J, 
 N. S. 133). 
 
 The effect of an order directing a trustee to set apart a certain 
 sum for the payment of preferential claims, is to sever that 
 amount fi'om the debtor's estate, and the trustee cannot delay the 
 payment thereof, merely upon the ground that the l)alance in his 
 hands will be insufficient to meet prospective costs (ex parte 
 Poivis, L. R. 17 Eq. 130 ; 20 L. T. N. S. 054). 
 
 92. So soon as a dividend sheet is prepared, notice thereof (Fornn O) shall 
 be given by advertisement, and by letter posted to each creditor, inclosing a 
 copy of the dividend sheet, noting the claims objected to, and after the expiry 
 of eight days from the day of the last publication of such advertisement, all 
 dividei'ds which have not been objected to within that period shall be paid. 
 
 The posting of a letter to each creditor, inclosing a copy of the 
 dividend sheet, and noting the claims objected to, was not re- 
 (piired by the Act of 18G9. 
 
 It seems that a dividend sheet will be a nullity, unless notice 
 
NOTICE OF DIVIDKXD. 
 
 271 
 
 thc'ioof is given by arlvertisenient, pursuant to the provisions of 
 tliis st'ction. 
 
 It would seem also tliat the decision of the Court, as to divi- 
 dends, is final under section 05, unless appealed from in the man- 
 ner prescribed l)y tl^e Act (re Lariviere and Wkyie, 1 1 L. C. J. 205). 
 
 It lias been held by MacDonald, Co. J., that an as.signee cannot, 
 under our Statute, dispute a claim or dividend collocated by him- 
 •selt' in a dividend .sheet, advertised and unobjected to by a credi- 
 tor ; and it has been also held that an action will lie against an 
 assignee for a dividend in respect of a privileged claim for wages 
 so collocated, advertised and unobjuctod to {Simpmnw. Xeivtov, 
 4 U. C. L. J. N. S. 4G : MacDonald, Co. J.). 
 
 There must be some method of enforcing the payment of a 
 dividend. This section declares that dividends not objected to shall 
 be paid, and the assignee is the only party to pay him. It is 
 clearly the duty of the assignee to pay the dividends, and, in all 
 probability, the payment could l)e enforced by summary ap})lica- 
 tion under the 125th section, whether it does not exclude all other 
 i-emedies. 
 
 There is no warrant in the Statute for paying dividends to 
 creditors who have not proved their claims. On the contrary, all 
 tlie sections on the subject, expressly or by necessary intendment, 
 refer to creditors who liave verified their debts in the mode re- 
 ([uired by law (re Hoyf, 3 B. R. 55). The declaration of a divi- 
 dend fixes the rights of the creditors in respect to that particular 
 dividend. Creditoi's who have not proved then, and who are 
 not known to the assignee as creditors (see section 94) cannot par- 
 ticipate in the dividend, although they prove previous to the pay- 
 ment of the money (nit of the hands of the assignee (re Miller, 
 1 N. Y. Leg. Obs. 180). 
 
 If the assets are more tlian sufiicient to pay all the claims in 
 full that have been })roved against the estate, interest may be 
 allowed up to the day of the payment of the claims respectively 
 (re Hoyan, 10 B. R. 383 ; see re Langstafe, 2 Grant, 165). 
 
 93. It shall be the duty of the inspectors to examine with the assignee 
 the claims made against the estate, and also each dividend sheet before the 
 expiration of the delay within which the same may be objected to, and to in- 
 
 "m 
 
 ■m'tiiAifei 
 
 .■ui^Li. 
 
272 
 
 THE INSOLVENT ACT. 
 
 struct the as8ij;nee as to which claims or collocations should be contested by 
 and on behalf of the estate, whereupon contestation shall be entered and made 
 in the name of the assignee or of the inspectors or of some individual credi- 
 tors consenting thereto, and shall be tried and determined by the Court or 
 judge ; and the costs of such contestation, unless recovered from the adverse 
 party, shall be paid out of the funds belonging to the estate. 
 
 The fact that a creditor has obtained a judgment is not conchi- 
 sive evid(;nce of deljt, and it will not preclude the assignee and 
 inspectors from en(|uiring whether a debt is really due (ex parte 
 Kibble, L R. 10 Ch. App. 373 ; 32 L. T. N. S. 138). 
 
 The propert}^ of goods recovered in an action of detinue re- 
 mains in the ci-editor until execution is issued on the judgment, 
 and he cannot prove for the value of the goods when insolvency 
 takes place before execution i.ssued (ex parte Scarth, L. R. 1 Ch. 
 App. 234). 
 
 It has been held in England, that, when a judgment is recovered 
 by default against a person who afterwards becomes bankrupt, 
 proof for the amount of the judgment may be disputed. Thus, 
 where a judgment had been recovei-ed by default against the 
 acceptor of certain liills of exchange, the^ trustee was allowed to 
 dispute the claim on the judgment on the ground that the judg- 
 ment creditor was not a holder for value of the bills (ex parte 
 Chatteris, 2G L. T. N. S. 174). 
 
 94. If it appears to the assignee on his examination of the books of the in- 
 solvent, or otherwise, that the insolvent has creditors who have not taken the 
 proceedings requisite to entitle them to be collocated, it shall be his duty to 
 reserve dividends for .such creditors accordhig to the nature of their claims, 
 and to notify them of such reserve, wliich notification maybe by letter through 
 the post, addressed to such creditors' residences as nearly as the same can be 
 ascertained by tlie .Tssignee ; and if such creditors do not file their claims and 
 apply for such divid.'uds previous to the declaration of the last dividend of 
 the estate, the dividends reserved for them shall form part of such last divi- 
 dend. 
 
 It is not necessary for the creditor to demand the dividend a.s 
 well as file his claim, but the tiling of the claim should be taken 
 as an application under this section (Abbott Ins. Act. 44). 
 
CONTESTATION OF CLAIMS. 
 
 273 
 
 •t,"). If any claim be objoctod to at any time, or if any dividend be objected 
 to within tlio said period of eiglit days, or if any dispute ari-^es between the 
 crt'dit(jr8 of the insolvent, or betwoun him and any creditor, as t.'the amount 
 of the claim of any creditor, or as to the ranking or jjrivilego of +ie claim of 
 any creditor upon such dividend sheet, the objection shall bo fi' jd in writing 
 by "1' hcfore the assignee who shall make a record thereof ; and the grounds 
 of objections shall be distinctly stated in such writing, and the party object- 
 ing shall also tile at the same time the evidence of previous sei'vice of a copy 
 thoruof on the claimant ; and the claimant shall have throe days thereafter to 
 auawor the same, which timo '.Jiay, however, be enlarged by the judge, with a 
 like delay to the contestant to reply; and upcm the completion of an issue 
 upon such objection, the assignee shall transmit to the clerk of the Court the 
 dividend shoot or a copy thereof with all the papers and documents relating 
 to such objection or contestation ; and any party to it may tix a day, of which 
 two days' notice shall be given to the adverse party, for proceeding to take 
 ovidonco thereon before the judge, and shall thereafter proceed thereon from 
 day to day until the evidence shall have been closed, the case heard, and the 
 judgment rendered, — which judgment shall be final, unless aitpoaled from in 
 the manner hereinafter i)rovided : the proceedings on the said objection or 
 contestation shall form jiavt of the records of the court, and the judgment 
 shall be made executory as to any condemnation for costs, in the same nuui- 
 ner as an ordinary judgment of the Court. 
 
 k:.' 
 
 Thu facts on which the contesting party relies must be clearly 
 set forth in his written objections, with particulars of time, place, 
 and circumstance, and no evidence can be received on any fact 
 nut so set forth (section 114). 
 
 It was held under the 70th section of the Act of 18G9, that the 
 judge in insolvency had no power to adjudicate upon a claim until 
 it had been decided upon by the assignee. It might, however, be 
 brought before the judge on an appeal from the decision of the 
 assignee, but not for the judge's decision in the lirst instance (re 
 Chyhoni, 2 U. C. L. J. N. S. 133). 
 
 'Phis section makes a material alteration in the procedure, in 
 contesting claims. The .judge, in the first instance, is to decide on 
 their validity. 
 
 The 71st section of the Act of 1869 required the assignee to fix 
 
 a day for proceeding to take evidence on the issue. It did not 
 
 state that the a[)pointment by the assignee of the day should be 
 
 in writing; but this was, nevertheless, held necessary. In a con- 
 
 B 
 
 airiirt 
 
274 
 
 THF TNSOLVKNT ACT. 
 
 testation of a rlaiin licforo tlic assifi^ncc, tlic latter verltally Hxed 
 on a convenient day for hearinj; and takin;,' evidence ; tlie contes- 
 tant inscrilied the matter with due notice, and ail the parties in- 
 terested, indmlin^f the assi^'iiee, a))|)enred on the day fixed, and 
 sh(>weil tlieii ac([uiesconoe in the rennljuity of the pidceedin^'s, 
 l»V allowing the assiifnet; to j;ive an awiird without olijection ; the 
 proeeedin<.;s were held iri'ei^'ulai', not\vithstundin;^f the atteJidance, 
 and assent of the parties (w JJtivlf<, 15 L. ('. .1. l.'U). 
 
 \H>. Tho creditors, and in thoir defiuilt tho insjioctorH, luiiy l)y rcBolutiuii 
 authori/.e and direct tlic costs of the contestation of any claim or of any di\ i- 
 dond, to 1)0 paid out of the estate, and may make such order either before, 
 ponding, or after any such contestation ; thoy may also, with the sanction of 
 the judge, authorize the payment out of tho estate of any costs incurred for 
 the general interest of the estate, whether such costs were incurred by tho 
 assignee, the inspectors, or any individual creditor. 
 
 97. If at the time of the issue of a writ of attachment, i>r the execution of 
 a deed of assignment, any immovable property or real estate of the insol- 
 vent be xinder seizure, or in process <jf sale, under any writ of execution or 
 other order of any competent court, such side shall be jjroceeded with by the 
 oflicer charged with the same, unless stayed by order of the judge upon appli- 
 cation by the assignee, upon special cause shewn, and after notice to the 
 plaintiff, reserving to the party ]iro8ecuting the sale his privileged claini on 
 the proceeds of any subseipient sale, for such costs as ho would have been 
 entitled to out of the proceeds of the sale of such property, if made luider 
 such writ or order ; but if such sale be proceeded with, the moneys levied 
 therefrom shall bo returned into the court on whose order the sale has been 
 made, to be distributed and paid over to the creditors who shall have any 
 privilege, mortgage, or hypothecary claims thereon, according to the rank 
 and priority of such claims ; and the balance f)f sTich moneys after the payment 
 of such claims shall be ordered to be paid to the assignee to be distributed 
 with the other assets of the estate. 
 
 Under this section, the sheriff must make his i-ctui-n to the 
 Court, instead of paying the proceeds of the sale to tiie assignee 
 for distribution, as required by the 74th section of the Act of 1809. 
 
 M., under a, /i. /a. at his own suit against D., which was the 
 first in the sheriffs hands, purchased certain lands in September, 
 1867. D. had, in April previous, made a voluntary assignment 
 under the Insolvent Act of 1864, to an official assignee who 
 claimed the proceeds of the sale under a section of the amending 
 
UNCLAIMKI) DIVlDKiVDS. 
 
 275 
 
 Act, Miniilar to tliis. M. claiinod a convcyaticr from tlui Hlicritf, 
 cretlititi;if the purcliaHc iiioiicy on his j\i<lgiiK'iit, The Ooiiit, under 
 tlu'sc! eircuni.stancoH, discharged with costs an application by M,, for 
 a iikiikIhiiiim to coni|)cl tlic shciiti' to convey, to which tho 
 assi{fnc!c was no party (re Moifall, 27 (i- 11 U. ('. ')2). 
 
 98. All (lividondH romiiiiiiiij,' iinuliiiiiiod at tho tiiuo of tlio discharge of the 
 ausigiifi' hIihU V)o left in the liaiik wlniv tluiy iirn doimsitud, fur three years, 
 fiud if still uiichiiint'd, shall then ho paid over by such bank with intorest 
 aucriu'd thereon, to the (Jovornineiitof (Canada, and if afterwards duly claimed 
 shall he paid over to the jiersous entitled thereto, with interest at the rate of 
 four [per centum per annum from tho time of tho reception thereof by the 
 (iovernment. 
 
 !>lt. If any balance remains of tlio estate of tho insolvent, or of tho proceeds 
 thereof, after the payment in full of all debts due by tho insolvent, such 
 balance shall be paid over to tlii'. insolvent upon his petition to that effect, 
 Jidy notified to tho creditors by advertisement ami granted by tho judge. 
 
 I'ROC'EUUKK (JKNEKALLY. 
 
 100. Whenever a meeting of creditors cannot be held, or an application 
 iiiado until the expiration of a delay allowed by this Act, notice of such meet- 
 ing or application may bo given pending such delay. 
 
 101. Notices of meetings of creditors shall bo given by publication thereof 
 for at least two weeks in tho Utlicial Ciazetto of tho Province in which they 
 aro to take place, and by such other notice as the judge or inspectors may 
 direct : — and in every case of a meeting of creditors the assignee shall address 
 notices thereof to the creditors and to all the representatives within tho 
 Dominion of foreign creditors, and shall mail the same at least ten days be- 
 fore tho day on which the meeting is to take place, the postage being prepaid 
 by such assignee : in other cases not provided for, tho assignee shall advertise 
 as directed by the inspectors or tho judge. 
 
 It seems that this section wouhl not apply to the notice of the 
 tirst meeting of the creditors under section 20, the time and man- 
 ner of givinj^ such notice being specially fixed by sections 20 and 
 21 of tho Act. 
 
 It would seem that, under this section, the notice is not confined 
 to creditors who have proved their debts. The notice must be 
 sent to all known creditors (re Mills, 11 B. R. 117). The 21st sec- 
 
 i"i 
 
 .^ii^iMJ" 
 
i 
 
 276 
 
 THE INSOLVENT ACT. 
 
 !!!''» 
 
 tion requires that the notice be forwarded to every creditor men- 
 tioned in the original or any corrected or supplementary list or 
 statement furnished by the insolvent, or who may be known to be 
 a creditor. 
 
 The 117th section of the Act of 18G9 was somewhat different 
 from this section (see ex parte Foulin, 5 Revue Legale, 254, ante 
 p. 205). 
 
 102. All (luestions discussed at meetings of creditors shall be decided by 
 the majority, in number and in value, of the creditors having a right to 
 vote under section two, present or represented at such meeting, unless herein 
 otherwise specially provided ; but if the majority in number do not agree 
 with the majority in value, the views of each section of the creditors shall 
 be embodied in resolutions, and such resoluti ^us, with a statement of the 
 vote taken thereon, shall be referred to the judge who shall decide between 
 them : Provided, however, that no costs of or incidental to any such refe- 
 rence shall be paid out of the estate, and the decision of the jndge on any re- 
 ference under this section in which the resolutions referred involve the ap- 
 pointment of an assignee, or inspector to the estate, shall bo final (40 V^ict. 
 B. 23). 
 
 The 40 Vict, (.section 23) amended this .section by striking out 
 after the word " meeting " in thu fourth line the words " and re- 
 presenting, also, the majority in value of such creditors," and by 
 adding after the last word in the section the })roviso given 
 above. 
 
 The Legislature, by this section, did not intend to jiut it in the 
 power of an insolvent to give a preference to a majority in num- 
 ber and value of his creditors, to the prejudice or exclusion of 
 the minority, or 'o deprive tlie latter of all remedy if the insol- 
 vent .should attempt such a pivfercnce. The judge in insolvency 
 ha.s a general jurisdiction in all matters coming under the Act, 
 and this jurisdiction may l)e invoked in such a case as ti>e above, 
 and the judge may sanction a suit in the name of the assignee foi' 
 the benefit of the estate if he deems it expedient to do so (re 
 Lamhe, 13 Grant, 391). 
 
 Under the Act of 1804, on tlie first disagreement between the 
 majority in number and value, the meeting had to be adjourned 
 for fifteen days, and it was only on disagreement at the adjourned 
 meeting that the matter came before the judge. 
 
litor men- 
 ary list or 
 lown to be 
 
 different 
 254, ante 
 
 3 decided by 
 : a right to 
 nless lierein 
 o not agree 
 aditors shall 
 nont of the 
 ide between 
 f aucli refe- 
 je on any re- 
 olve the ap- 
 lal (40 Vict. 
 
 riking out 
 s " and re- 
 's," anfl by 
 vino given 
 
 it it in the 
 jy in nuin- 
 :clusi()n of 
 the insol- 
 insolvency 
 r the vVct, 
 iv.G above, 
 ssignee for 
 do so (re 
 
 tween tlie 
 adjourned 
 adjourned 
 
 FIRST MEETING OF CREDITORS. 
 
 277 
 
 In a case under the Act of 1864, where there was a disagree- 
 ment between the majority in number and the majority in value, 
 and tlie motion to adjourn was opposed by the majority in value, 
 it was held that neither party could legally oppose the adjourn- 
 inent if insisted on by the other, because by doing so either 
 ])aity would have the power to prevent an adjudication between 
 them by the judge, who is the referee on divisions arising (re 
 Z;a»i6r','l7C.P. U. C. 173). 
 
 103. If the first meeting of creditors, which takes place after the expiry of 
 the period of ten days from the first advertisement calling such meeting, 
 be called for the ordering of the affairs of tlie estate generally, and it be so 
 stated in the notices calling such meeting, all the matters and things respect- 
 ing which the creditors may vote, resolve or order, or which they may regu- 
 late under this Act, (except when otherwise specially j^rovided) may be voted, 
 rcbjlved or ordered upon and may be regulated at such meeting, without 
 having been specially mentioned in the notices calling such meeting, — due 
 regard being had, however, to the pnjjjortions of creditors reqviired by this 
 Act for any such vote, resolution, order or regulation (40 Vict. s. 24). 
 
 The matters which usually may be decided upon on that oc- 
 casion, are the following : — 
 
 1. The appointment of the assignee. 
 
 2. The .security to be given by the p'^'gnee (sections 28 and 29). 
 
 3. The enactment of rules for the guidance of the assignee 
 (.section 38). 
 
 4. The appointment of inspectors and their remuneration (sec- 
 tion 3.")). 
 
 5. The reception of the report of the official assignee of the 
 estate. 
 
 (5. Upon any ofler of composition which may be made by the 
 insolvent (section 35). 
 
 7. The continuance or cessation of the lease of premises occupied 
 by the Insolvent (section 71). 
 
 8. The place where sul)sequent meetings are to be held (sec- 
 tion 34). 
 
 {). The disposal of the estate of the insolvent (section 3G). 
 10. The examination of the insolvent (section 23). 
 
 (Wotherspoon's Ins. Act, 152-3.) 
 
 iU 
 
 ►j;u*«i'i*-'- 
 
278 
 
 THE INSOLVENT ACT. 
 
 104. The claims of creditors furnished to the Assignee in the Form P, 
 attested under oath and accompanied by tlie vouchers on wliich they are 
 based, or when voiicliers cannot be produced, accompanied l)y sucli affidavit 
 or other evidence as in tlie opinion of the Assignee shall justify the absence 
 of such vouchers, shall be considered as proved unless contested, — in which 
 case the claims shall be established by legal evidence on the points raised. 
 
 An assignee of a debt may prove in his own name (ex parte 
 Cooper, L.R. 20 Eq. 7S2). 
 
 The only method of i)roving debts is l)y an affidavit filed l)efore 
 the assignee as required by this section (re Stevenson, 1 U. C. L. 
 J. N. S. 52). 
 
 The production of vouchers was not required by the Act of 
 1869 — under thi.s section it will, probably, be sufficient to attach 
 a copy of the voucher to the affidavit, and to produce and exhibit 
 the original to the assignee, so that the latter could cei-tify to the 
 existence of the original and the correctness of the copy. 
 
 In England, the practice is established that it is necessary for 
 a creditor holding a bill of exchange or other security, to produce 
 it when he seeks to prove his debt, and he muse also produce it 
 when he comes to receive a dividend. lu case by unavoidable 
 accident or otherwise, the creditor is unable to produce the 
 security, it seems the Coin't would disptaise with its production 
 (ex parte Jacoks, 30 L. T. N. S. 138 ; L. R. 17 Eq. 575.) 
 
 But in re Hoare (L. R. 18 Eq. 705) it was held sufficient for 
 the validity of a vote for the creditor to ])roduce the bill before 
 the registration of the resolutions upon which he voted. 
 
 In the United States, the rule as to the i)roduction of vouchers 
 prevails, and where the claim consists of a proniissory note, the 
 creditor must produce the note or a co])y thereof (re Northern 
 Iron Comjiany, 14 B. R. 356). When a note is merged in a judg- 
 ment, it need not be produced (re Jaycox, 7 B. R. 303). 
 
 If the affidavit refers to an annexed account, which merely 
 gives date and amount, without stating the subject matter of the 
 account, that is not sufficient (re Port Huron D. D. Co. 14 B. R. 
 253). 
 
 The statement of the debt in tlie schedule is not proof of 
 it. It may be stated in fraud and may not exist. The insol- 
 
 . 
 
i 
 
 PROOF OF CLAIMS. 
 
 279 
 
 'orm P, 
 Iiey are 
 ifR davit 
 absence 
 1 which 
 ised. 
 
 ; parte 
 
 vdiit may have made payments or may have counter-claims and 
 .sffc-orts. The debt must be proved by tlie oath of the creditor. 
 This applies to a secured as well as an unsecured creditor (re Bittcl, 
 2 B. R. lVd'2). 
 
 Tlie proof of a debt against a firm should state that the firm 
 dcsc'iibing it by its firm name, and the individuals who comi)Osed 
 it, were indebted to the creditor, and how and for what amount. It 
 should not be uncertain whether the demand is a firm debt or a 
 joint claim against the individuals who compose the firm (re Wal- 
 ton, 1 Deady, 51 0). And it is also held that pi'oof of a debt against 
 a firm should not be included wuth proof against the individual 
 members of that firm (ib.). 
 
 The proof should contain at least one full Christian name of the 
 creditor as well as his surname (re Valentine, 12 B. R. 339). 
 
 In the proof of debts l)y a firm composed of several members, 
 tlie firm is to be treated as one creditor, and any one member 
 may act for all in proving the debt (re Barrett, 2 B. R. 533). A 
 party to whom a debt has been assigned aftei" the commencement 
 of the proceedings can prove it, and this will include assignees by 
 operation of law. Thus, where the creditor dies after the assign- 
 ment and before pro{>f, his executor or administrator may prove the 
 debt. 
 
 Although a creditor, upon whose affidavit a writ of attachment 
 issues, swears to his claim in order to support the order for the writ, 
 yet it would seem such creditor must aftei'wards prove his claim 
 under this section in the same manner as other creditors in order 
 to be entitled to participate in the estate (re Cornwall, G B. R. 
 305). 
 
 Every affidavit in proof of a claim is understood to refer to the 
 anumnt of the claim over and above any set-ofF or counter-claim of 
 the debtor against such creditor (section 2, It). 
 
 Particij)ating in the election of an assignee will not preclude a 
 creditor from amending his proof from unsecured to secured when 
 there is no evidence that he gained any advantage thereby, or that 
 the other creditors have been in any wayprejudiced in consequence 
 of it, or that he was infiuenced by any fraudulent intent. In the 
 absence of evidence, the presumption is that none existed (re Mc- 
 
 rtlti. 
 
 Wa 
 
 ,,j;i, :,..ii- 
 
280 
 
 THE INSOLVENT ACT. 
 
 '^d 
 
 ConwU, 9 B. R 387 ; re Carles, 10 B. R 82). Where proof has 
 been made under a mistake of fact, or even of law, it may he cor- 
 rected almost as a matter of course, if neither the insolvent nor the 
 other creditors who have proved will he injured. Even where the 
 rights of others will be affected, if the only effect is to restore all 
 parties to the position they were in before the debt was proved, it 
 would be proper to allow the withdrawal, if there has been a mis- 
 take and no want of diligence (re Hvbhard, 1 B. R.G79). 
 
 Although the general rule is that a party who proves his claim 
 as unsecured will not be allowed to withdraw such proof, and set 
 up security ; yet, if a party under a mistake, and in ignorance of 
 the facts proves a claim as unsecured he may withdraw it whore 
 the affidavit in proof, though produced at the first meeting of 
 creditors, is not marked by the assignee as received and tiliMl 
 (Buoncy v. Lyov, 3!) Q. B. U. C. not yet reported). When the 
 claim is so withdrawn the amount thereof cannot be considei'e(i 
 as forming jiart of the proportion of claims required to give validity 
 to a deed of composition or consent to a discharge (ib.). 
 
 The power of the Court to allow a creditor to withdraw a ]>r()of 
 that has l)een filed inadveitently is wholly discretionary (re 
 Wiever, 14 B. R. 218). 
 
 105. Any affidavit required in proceedings in insolvency may he madt- hy 
 the party interested, his agent or otlier party having a personal knowledge of 
 the matters therein stated, and may be sworn in Canada before the assiuneo 
 or before any official assignee, judge, notary public, commissioner for tak- 
 ing affidavits, or Justice of the Peace, and out of Canadii before any Jiidgc 
 of a Court of Record, any commissioner for taking affidavits appointed by 
 any Ciinadian Court, any notary public, the chief municipal officer for any 
 town or city, or any British Consul or Vice Consul, or before any person 
 authorized by any St<atute of the Dominion or of any Province thereof, to 
 take affidavits to be \ised in any court of justice in any part of the Dominion. 
 
 As we have seen, commissionei- foi- taking atfidavits does not 
 exclude the attorney of the deponent or the clerk or ])artner of 
 such attorney (ante p. 60). 
 
 100. A creditor holding a mortgage, hypothec, lien, privilege, or collateial 
 security on the estate of a debtor, or on the estate of a third party for whom 
 such debtor is only secondarily liable, may release or deliver up such security 
 
SET OFF. 
 
 281 
 
 1 
 
 to the assignee, or he shall by his affidavit for the issue of a writ of attach- 
 ment, or by an affidavit filed with the assignee at any time before the declara- 
 tion of a final dividend , set a value upon such security ; and from the time 
 ho shall have so released or delivered up such seciu'ity, or shall have fur- 
 nished stich affidavit, the debt to which such security applied shall be con- 
 sidered as an unsecured debt of the estate or as being secured only to the ex- 
 tent of the value set upon such security ; and the creditor may rank as iind 
 exercise tall the rights of an ordinary creditor, for the amount of his claim, 
 or to the extent only of any balance thereof above and beyond the value set 
 upon such security, as the case may be. 
 
 • 
 
 This section enables a secured creditor to change the nature of 
 liis claim from secured to unsecured, and ir the latter case gives 
 him the rights of an ordinary creditor. 
 
 107. The law of sct-oflf, as administei'ed by the courts whether of law or 
 equity, shall apply to all claims in insolvency and also to all suits instituted 
 by an Assignee for the recovery of debts due to the insolvent, in the same 
 manner and to the same extent, as if the insolvent were plaintiff or defen- 
 dant, as the case may be, except in so far as any claim for set-off shall be 
 allected by the provisions of this Act respecting frauds or fraudulent pre- 
 ferences. 
 
 If the circumstances are such, that a set-ofi' would have been 
 allowed, had no assignment taken place, the assignment will not 
 art'i'ct the right to set-otf ; for, after the assignment, the assignee 
 stands in the same position as the insolvent. Thus where apart 
 tVom the insolvency of the defendant, the plaintiff had a right to 
 set-off certain cost^: due from the defendant against a debt due 
 from the plaintiff, it Avas held, that he possessed the .same right 
 of .set-off against the assignee (Brigham v. Smith, 17 Grant, o 12). 
 
 Under the i;^.')th section of the Act, a transfer of a debt due 
 by tiio insolvent for the purpose of enabling the debtor to set up, 
 l»y way of set-off, the debt so transferred is, under certain circum- 
 stances, null cind void. 
 
 In England, the 8!)th .section of the Act of 1869 provides that 
 where there are mutual credits or mutual debts or other mutiial 
 dealings, the balance only siiall be claimed or paid on each side 
 respectively. Where there have bcfu nmtual credits between a 
 bankrupt and a person claiming to prove a debt under his bank- 
 ru])tcy, and at the commencement of the bankruptcy there is a 
 
 „i.i.i*^- 
 
282 
 
 THE INSOLVENT ACT, 
 
 balance due by eacli party to the other, the fact tliat the bank- 
 rupt lias a lien or security for the balance due to him does not 
 interfere with the other party's right of set-off under the Statute 
 (ex parte Barnett, L. R. 9 Ch. App. 293 ; 29 L. T. N. S. S5S). 
 In order, however, to establish a right of set off, on the basis of 
 mutual credits between the parties, there must be an aotuiil 
 bankruptcy, and the assignment by the several partneis of a firm 
 is not sufficient to establish the right of set-oft against tlirir 
 trustees, or to bind .the joint estate (London B. and M. B. v. 
 Narraway, L. R. 15 Eq. 93). 
 
 The right of set-off in insolvency depends on the i)arty claim- 
 ing to exercise the right liaving the beneficial interest. Where it 
 apjjeared that the plaintiff claimed a right to set-off certain bills 
 against the proceeds of a ])romissory note which were claimed to 
 be retained by the defendants, and it appeared that they were 
 not the ho^ia fide holders of the bills, but had got possession of 
 them for the jnirpose of establishing the set-off, and were under 
 -an engagement to re-deliver to the real holders, in case the claim 
 to set-off failed, the bill was dismissed with costs (ib.). 
 
 It has been held in England that a claim for unliquidated 
 damages arising out of contract, is a proper subject for set-off, 
 under section 39 of the Act, before i-eferred to, which sjieaks of 
 other mutual dealings {Booth v. Hatchmson, L. R. 15 Eq. 30 ; 27 
 L. T. N. S. 600). 
 
 As a general rule, for the purposes of set-off, each of the parties 
 must be debtor and creditor in the same right (Freeman v. 
 Lomas, 9 Hare, 109, 114; see as to set off in equity, Middleton 
 V. Pollock, L. R. 20 Eq. 29) ; but there are exceptions to this rule, 
 r;;;^!* ''-o case of a factor selling goods as his own without dis- 
 c:-;-.!'.^ ^i.s principal (Oconje v. Clagett, 7 T. R. 359). So, also, 
 liil T,y : .;e[)arate rights may be set off by special agreement 
 * • • ' '^hadley, 1 C cV. P. 174). But a debt due to a testator 
 caniioi i e oct-otf against a debt owing by his executor (Stammers 
 V. Elliott, L. R. 3 Ch. App. 195 ; see, also, Armstrong v. Arm- 
 strong, L. R. 12 Eq. 614). Where a person as executor and 
 residuary legatee had a balance in the liands of bankers, he was 
 allowed to set off in an action by the trustee of the bankers, for 
 
l>ank- 
 
 oe.s not 
 Statute 
 
 «r)S), 
 
 lasis of 
 actual 
 a film 
 
 >t tlu'ir 
 
 n. v. 
 
 SET OFF. 
 
 283 
 
 a (Ifl)t due from him to them, the halance due to him as executor 
 and i-esiduary leg-atee, it ap, .oaring that he had in Ins liands more 
 than sufficient assets to ]>ay all the testator's debts and legacies 
 remaining unpaid (Bailey v. Finch, L. R. 7 Q. B. 34). 
 
 It would seem that the claims to which the law of .set-oft' ap- 
 plies nnist he provable claims (see MatfoH v. S<mnders, L. K. 7 Ch. 
 App. /i70 ; Ivrvcr v. Thomas L. H. G C. P. 010), and claims which 
 are not provable cannot he set-ofl"(yl?>6o<^ v. Hicks, 5 Bing N. C. 
 .57!S). 
 
 Where the trustee of A., a bankrupt, paid money belonging to 
 his estate iito a bank which failed, and after .such failure the bank- 
 ruptcy of A. was annulled, it was lield in an action by the trustee 
 under the bankruptcy of the bank against A. for a debt owing by 
 him to the bank, that he was entitled to set-off the money paid 
 into the bank by his ti'ustee, tlie right to such money having be- 
 came revested in him up n the ainiulment of the bankruptcy 
 {Bailey V. Juhvson, L. R. 6 Ex. Ch. 271) ; ib. 7 Ex. Ch. 263). Where 
 ])ills or other chattels are deposited with the creditor upon trust 
 oi' for a specific purpose, he cannot claim to set-off a debt owing to 
 him from the insolvent against the assignee, claiming .such bills or 
 goo<ls (Xaoroji v. Bank of India, L. R. 3 C. P. 444). 
 
 A claim for a loss on a policy of insurance may be set-off against 
 an indebtedness from the holder to the com]iany for money de- 
 posited with him as a banker (.see Scammon v. Kimball, 13 B. R. 
 44")). Losses upon policies of insurance may be set-off against 
 money borrowed from the insurance company (Drake v. Hollo, 4 
 B. R. 689). A joint indebtedness may be proved and set-off against 
 the estate of either of the joint del)tors who may become insol- 
 vent, and the fact that it may be subject to be marshalled makes 
 no difference. The joint debtors ai-e .severally liable in solido for 
 the whole debt (Gray v. Rollo 9 B. R. 337 ; Tucker v. Oxley 5 
 Cranch, 34). A debt payable in futuro can be set-off against a 
 debt])ayable in pntisenli. Though there are not debts mutually 
 payable between the parties, there are mutual credits and the case 
 is within the equity of the Statute (re City Bank, 6 B. R. 71), a 
 bank may set-off the amount due on a protested draft against 
 
 I !• 
 
 k:iii*i' 
 
 ;iilk 
 
284 
 
 THE INSOLVENT ACT. 
 
 a deposit made l)y the insolvent, and need not pay such dojxisit 
 to the assi^mee (re Petrie, 7 B. R. 882). 
 
 A creditor, who, at the time of the insolvency, has in his hands 
 goods or chattels of the insolvent, with a power of .sale, or chases 
 in action Avith a power of collection, may sell the goods or collect 
 tlie claims, and set them olf against the debt the insolvent owes 
 him (re D(nv, 14 B. B. 807). 
 
 If a banker, in the regular coin*se of business, receives drafts for 
 collection, he may retain the amount so collected to pay an in- 
 debtedness (h ,■ to him, although the money was collected after 
 the commencement of the proceedings in insolvency (re F<in)S- 
 vjorfh, 14 B. R. 148). A stockholder cannot set-ott'a claim held l)y 
 him upon the corporation, against a demand for an unpaid sub- 
 scription for stock. The delfts are not uuitual. The debt due on 
 the subscription is a trust fund, devoted to the {)ayment of all the 
 creditors of the company As soon as the company l)ecomes insol- 
 vent, and the fact becomes known to the stockholders, the right 
 of .set-off for an ordinary debt to its full amount (:eases (SaiO)jt'r v. 
 Hoag, 9 B. R. 145 ; Jenkins v. Armour, 14 B. R. 27(5). 
 
 Proving the entire debt in the proceedings in insolvency with- 
 out offei'ing to abate the claim by any set-off which the ci'editor 
 may have, is a waiver of the right to do so, and an election to 
 proceed on such claim alone in the insolvency proceedings, and 
 the subsequent assertion of part of tlu' same del>t by a [dea of set- 
 off in an action against the creditor, is ecpiivalent to the prosecu- 
 tion of an original suit upon the claim, against the prohibition of 
 the in.solvent law (Brown v. Farnwrx' Bank, Bush. 11)8; Russell 
 V. Oiuen, ()1 Mo. 185). 
 
 108. Except when otherwise provided by thia Act, one clear juridical day's 
 notice of any petition, jnotion, order or rule, shall be sufiicient if the party 
 notified resides within fifteen miles of the place where the proceeding is to be 
 taken, and one extra day shall be suHicient allowance for each additional 
 fifteen miles f)f distance between the place of service and the place of proceed- 
 ing ; find service of such notice shall be made in such manner as is now pre- 
 scribed for similar services in the Province within which the service is made. 
 
 One clear day's notice, under this section, excludes the day of 
 service and the day of hearing, so that a service on the 23rd for 
 
COMPELLING ATTENDANCE OF WITNESSES. 
 
 285 
 
 for lioaring on the 24th, would be in.sufiicient. The service should 
 be on the 23rd for a hearing on the 2oth. But where a notice 
 was served on the 23rd for hearing on the 24th, the Court, on the 
 authority of re Owens (12 Grant, 440), and in favour of the liberty 
 of the subject, allowed the notice to be amended (re Davidson, 4 
 U. C. P. R. 153 ; 3 U. C. L. J. N. S. 318). 
 
 The service is to be in the manner prescribed for similar services 
 in the Province, within which the service is made. But there is 
 notiiing in the Act requiring a petition or motion to be served at 
 any particular hour, and whore a petition was served on Saturday, 
 returnable on the following Tuesday, and it did not aj)pearat what 
 hour of the day it was served, it was nevertheless held sutticient 
 to give the party one cleai' day's notice, as required by this sec- 
 tion (Ilillhorn v. Mills, .", U. (.'." L. J. N. S. 41 ; Hughes, Co. J ; sec 
 the l>Sth Rule of Praetiee in Quebec). 
 
 100. The judge shall have the same power and authority in respect of the 
 i.ssuing and dealing with connni.ssions for the examination of witnesses, as 
 are possessed by the ordinary courts of record in the Province in which the 
 proceedings are being cfirried on. 
 
 '{'he issue of commissions in Ontario is regulated by the Con. 
 Stats. II. C. chap. 32. 
 
 110. bi any proceeding or contestation in insolvency, the Court or judge, 
 may order a writ of stthpa'ua ad testljiauulinn or of snhpanui duces tecum to 
 issue, commanding the attendance as a witness of iiny perscm within the lin.- 
 its of Canada. 
 
 111. All rules, writs of subpcena, orders .and warrants issued by any coiirt 
 or judge in any matter or proceeiling under this Act, may be validly served 
 in any part of Canada upon the party affected or to be att'ected thereby ; and 
 the service of them, or anj^ of them, may be validly made in such manner as 
 is now prescribed for similar services in the Province within which the service 
 is made ; and the person charged with such service shall make his return 
 tLjreof under oath, or, if a .shorilf or bailitt' in the Pi'ovince of Quebec, may 
 make such return luider his oath of office. 
 
 112. In case any person so served with a writ of snhpcena or with an order 
 to appear for examinatiim, does not appear .according to the exigency of such 
 writ or process, the Court or the judge on whose order or within the limits of 
 whose territorial jurisdiction the same is issued, may, upon proof made of 
 tho service thereof, and of such default, if the person served therewith has his 
 
 liiy 
 
 I 
 
 ijjiiti^iiiu- 
 
Wi 
 
 i< 
 
 1 
 
 
 Ullii 
 
 28G 
 
 THE INSOLVENT ACT. 
 
 domicile within the limits of the Province within which such writ or proci-ns 
 issued, cousti'iiin such person to iippoiir iind testify, luul punish him for non-ap- 
 pearance or for not testifying in the same manner as if such person had been 
 summoned as a witness liefore such Court or judge in an ordinary suit ; and if 
 the person so served and nuiking default, has his domicile beyond the limits of 
 the Province within which such writ or process issued, such Court or judge iiuiy 
 transmit a certificate of such default to any of Her Majesty's superior Coiu'ts 
 of law or equity in that part of Canada in which the person so served re- 
 sides, and the Court to which such certilicate is sent, sliall thereupon pr.jcei'(l 
 against and punish such person so having made default, in like manner as it 
 might have done if such person had neglected or refused to appear to a writ 
 of Miibpu'iM or other similar ju'ocess issued (jut of such last mentioned Court ; 
 and such certificate of default attested by the Coiu't, judge or assignee be- 
 fore whom default was made, and copies of such writ or process and of the 
 return of service thereof certified by the clerk of the Court in which the order 
 for transmission is made, shall be iirimd facli: proof of such writ or process, 
 service, return, and of such default. 
 
 Theso sections it will be observed, provide the ineans by whicli 
 the attendance of a witness may be compelled if he is served in any 
 Province of the Dominion. 
 
 113. No such certificate of default shall be so transmitted nor shall any per- 
 son be punished for neglect or refu.sal to attend for examination in obedi- 
 ence to any iinbp<t:nH or other similar process, unless it be made to appear to 
 the Court or judge transmitting, and also to the Court receiving such certi- 
 ficate, that a reasouivble and sufficient sum of money, according to the rate 
 per diem and per mile, allowed to witnesses by the law and practice of the 
 superior courts of law within the jurisdiction of which such person was foiuid, 
 to defray the expenses of coming and attending to give evidence, and of re- 
 turning from giving evidence, had been tendered to sucli person at the time 
 when the writ of suhiHena, or other similar process, was served upon him. 
 
 114. The forms appended to this Act, or other forms in equivalent terms, 
 shall be \ised in the proceedings for which such forms are provided ; and in 
 every contestation of a claim, collocation <jr dividend, or of an application for 
 a discharge, or for confirming or annulling a discharge, the facts upon which 
 the contesting party relies shall be set forth in detail, with particulars of 
 time, place and circumstance ; and no evidence shall be received upon any 
 fact, not so set forth : but in every petition, application, motion, contestation 
 or other pleading under this Act, the parties may state the facts upon which 
 they rely, in plain and concise language, to the interpretation of which the 
 rules of construction applicable to such language in the ordinary transactions 
 of life shall apply. 
 
 . 
 
';.'!' 
 
 FORKION DISCITAROKS. 
 
 287 
 
 All fissi^Muiiciit not according to the provisions o? tlic Insol- 
 vent Act is void under tliis section {Caloln v. Trdiicheinoiitayne, 
 14 L. C^ J. 210). 
 
 (Tiidcr tlio " Intcrpri'tation Act" (81 Vict, chaji. 1, s. 7), 
 " Tliirty-firstly: Where forms are prescribed, sli<,dit deviations 
 tlierefrom, not aff't^cting the suljstance or calculated to nnslead, 
 shall not vitiate them. 
 
 See, as to manner of cntitlinii^ affidavits for attachment, 
 Hharp V. MattheAVH (5 P. R. U. C. 10). 
 
 115. No plua or exception alleging or setting up any discharge or certifi- 
 cate of discharge, granted under the bankropt or insolvent law of any coun- 
 try whatsoever beyond the limits of the Uoniinion, shall be a valid defence 
 or bar to any action instituted in any Court (jf competent jurisdiction in the 
 Uoiiiinion, for the recovery of any debt or obligation contracted within such 
 limits. 
 
 A foreign law authorizing the discharge of an insolvent debtor 
 must he directly proved, and the Court will not listen to an ap- 
 plication tor the discharge of such person after he has allowed 
 judgment to go by default and is in execution {Brown v. Hud- 
 son, Taylor, 34G ; MacMahon's Ins. Act, 172). 
 
 Though the holder of a note has proved foi' the amount there- 
 of, luider a sequestration issued again.st his debtor, the maker, in 
 Glasgow, under the " Scottish Bankrupt Act of 18.50," he may, 
 nevertheless, maintain an action in this country against the 
 maker of the note, if he carries on business here and in Scot- 
 land, and the proof will be no bar to an action commenced during 
 the pendency of the bankruptcy proceedings, and before final dis- 
 charge (Robinson v. McKeand, 23 Q. B. U. C. 359; see also Foster 
 v. Taijlor, 31 Q. B. U. C. 24). 
 
 In a case reported in Peter's Reports (Prince Edward Island), 
 p. 27, it is laid down that there is no doubt of the power of the 
 Imperial Parliament to bind the Colonies where an act shows a 
 clear intention to do so, and the Court thought it clear that a cer- 
 tificate of bankruptcy obtained in England would be a bar in the 
 colonial Court to a debt contracted tliere. In the case in (|ues- 
 tion, however, it was held that the Imperial Act (5 & 6 Vict. 
 
 
28H 
 
 THE INSOLVKNT ALT. 
 
 chap. 122, s. 28) did not extend tu the Colony. A similar decision 
 was rendered in Gilbert v. McLenn (2 Hannay, 2Ki), where de- 
 fendant was ari'ested for a debt due on a itond, and it appeared 
 that aftei' the debt was contiacted he had Iteconie a bankrupt, 
 and received his discharge uncU'r the; " Bankiupti;y (Scotland) Act, 
 1850," and the Court ordered his discharge on entering a coninioii 
 a])pearance. 
 
 A debt or liability arising in any country may be discliarged 
 V)y tlie laws of'tl,.i,t ctnintry, and such a <lischarge, if it extinguishes 
 the <lebt or liability, and does not merely interfere with the 
 remedies or course of procedure to enforce it, will be an eH'ectual 
 answer to the claim, not only in the Courts of that country, but 
 in every other country. But tlie diseliarge of a debt or liability 
 by the law of a country other than that in which the dcfbt arises, 
 does not relieve the debtor in any other country. Where the dis- 
 charge is created by the Legislature or laws of a country which 
 has a paramount jurisdiction ov»'r another country in which the 
 debt or liability arose, or by the Legislature or laws which govern 
 the tribunal in which the questiim is to l)e decided, such a ilis- 
 charge may be effectual in both countries in tlie oni^ case, or on 
 proceedings lu^fore the tribunal in the other case. Wheiv, there- 
 fore, a contract was made, and was to Ite performed in Cainula, a 
 di.scharge obtained in England, after breach of the contract, was 
 held a yood answer to an action in the En<dish Courts, and the 
 Court also expressed an opinion that the discharge would bar an 
 action in (Jana<hi, on the ground that it derives its force from a 
 paramount jurisdiction, the Imperial Parliament (J'JIIls v. Mi- 
 Hcnrij, L. R. C. P. 22H ; 2.S L. T. N. S. «(il ; see also Mclhmahl 
 v. Geonjlan Bay L.Co. 24 (Jrant, ;}5() ; Sni'des v. Belford, 23 Grant, 
 o!)0). 
 
 110. The rules of procedure as to aiueiKlmeiits of pleadings, which may be 
 in force at any place where any proceedings under this Act are being carried 
 on, shall apply to all proceedings under this Act ; and any Court or judge, 
 or assignee, before whom any such proceedings are being carried on, shall 
 have full power cand authority to apply the appropriate rules as to amend- 
 ments, to the proceedings so pending before him ; and no pleading or pro- 
 ceeding shall be void by reason of any irregularity or default which can or 
 mayjbe amended under the rules and practice of the Court. 
 
EXECUTORS AND ADMINIHTllA I'ORS. 
 
 289 
 
 117. Th" (loiith of tho iiiHolvunt, pondin;,' pr()C(!0(Un^H in li(]iii(lation, shall 
 not iitlbot such pmcooilinj^B, or iiii[>('(li' tho wimiing up of his ofltate ; and his 
 hoirs or othor lo|,'al reproHoiitativi:! may cuntiniio tho procoodingB on his be- 
 liiilf to the i)ro(Mirinj,' of a diHchar^'i!, or of tho contirination thereof, or of 
 hfith ; and tho proviHions of this Act shall apply to tho hoirs, adininistrators, 
 I ir other legal roprosontativos of any docoasod porson who, if living, would 
 lu> Hiihjoct to its i)rovi8ioiiH, but only in tlioir cai)acity as such heirs, lulminis- 
 trators, or roprosoiitatives, without their Ix'ing lii'ld to bo liable for tho debts 
 ipf till' dcccasod to any greater extent than they would have boon if this Act 
 had not boon passed. 
 
 I'riiiinry pi(K'(H'(liiio;s in insolvency cannot bo taken a<,fain.st 
 I'xecutors as sncli. Tlie ol>joct of this Act was merely to autlio- 
 rize procee(lino;s to lie carried on against tlie reju'escntatives of 
 a deceased insolvent, and its provisions all relate to the case of 
 the deatli of an insolvent i)endinf,' proceeding's in insolvency. Tho 
 oliject of the s"ction is that, notwithstai»din<j; the death, proceed- 
 iii;fs may he carried on l)y the assij^nee or hy the ropresentatives 
 of the insolvent, if either deem it advisable to proceed. But tho 
 |i(is(inal representatives cannot be made insolvent in their cha- 
 racter as such, though they are guilty of delay in paying debts 
 line by the; deceased, or oven of negligence in collecting the 
 debts, and vliore a writ of attachment issued against an executor, 
 as such it was set aside, though the circumstances were such that 
 if thi! executor were a trader within the Act, he would have 
 clearly committed an act of bankruptcy under section 3[k], by not 
 satisfying an execution (re Sharpc, 20 C. P. U. C. 82). 
 
 This section only signifies that the ileath of the insolvent shall 
 not affect the proceedings if a])ers()nal representative is appointed, 
 and it expressly requires that any persons who wish, on behalf 
 of the insolvent, to interfere in the proceedings in insolvency on 
 liehalf of the estate of the debtor, must be clothed with authority 
 io act as his legal representative. When, therefore, an insolvent 
 appealed from the decision of a county judge refusing to set 
 aside an attachment against him, a id died during the pendency 
 (jf the appeal, and no personal representative was appointed, the 
 appeal was held to fail (Lawrie v. McMahon, 6 P. R. U. C. 9). 
 
 118. The coats of the proceedings in insolvency up to and inclusive of the 
 notice of the appointment of the assignee, shall be paid by privilege as a first 
 
 S 
 
 I III 
 
 'feS 
 
 1 iii tli I ' *' 
 
290 
 
 THE INSOLVENT ACT. 
 
 ;! ! 
 
 charge upon the assets of the insolvent ; the disbursements necessary for 
 winding up the estate shall be the next charge on the property chargeable 
 with any mortgage, hypothec, or lien, and upon the unincumbered assets of 
 the estate respectively, in buch proportions as may be justified by the nature 
 of such disbursements, and their relation to the property as being incum- 
 bered or not, as the case may be ; and the remuneration of the assignee and 
 the costs of the discharge of the assignee being first taxed by the proper 
 taxing officer at the tariff rate, or if there be no tariff, at the same rate as is 
 usual for uncontested proceedings of a similar cliaracter, after notice to the 
 inspectors, or to at least three creditors, ej^;i11 also be paid therefrom as the 
 last priviltjged charge thereon. But no poi'tion of the assets or property 
 chargeable with any mortgage, hypothec or lien for any claim not proval)lo 
 on the estate shall be liable for any other but their proportion of costs neces- 
 sarily incurred in realizing such assets and property, except w!iat may re- 
 main after payment of such mortgage or lien. 
 
 !i 
 
 The 40 Vict. (s. 24) amended this section by striking out 
 
 , the words " and the costs of the judgment of confirmation of 
 
 the discharge of the insolvent, except when such confirmation is 
 
 upon a deed of composition or of the discharge, if obtained 
 
 direct from the Court " (see also 40 Vict. s. 36). 
 
 Under the 49th section, the insolvent must pay the costs of 
 a deed of composition, but prior to the late Act the costs of 
 discharge, under section G4, or of confirming a consent to a dis- 
 charge, were payable out of the estate. Now the insolvent must 
 pay the costs of obtaining his discharge in all cases. 
 
 Under the ^xct of 18G4, the lien of the landlord for rent on the 
 proceeds of goods fc'^d on the demised premises had priority 
 over the privilege oi the assignee and the insolvent for the 
 costs of their res})ective discharges {Mor(jan v. Whijte, 13 L. C.J. 
 187 ; 5 U. C. L. J. N. S. 29,S). 
 
 The term " assets " in this section means assets which belong 
 to the insolvent beneficially, and which pass to the assignee for the 
 benefit of the general creditors. No privilege can be claimed 
 against property of which tlie insolvent was trustee, or was 
 wrongfully in possession, or which belonged to others. The 
 privilege has not priority over valid incumbrances on the pro- 
 perty, and in case of such incumbrances, only the equity of re- 
 demption can be assets (re Stewart, 3 Ch. Cham. 95). 
 
Tf, 
 
 f 
 
 LETTERS ADDRESSED TO INSOLVENT. 
 
 291 
 
 In the Province of Quebec the prothonotary should not allow, 
 on a contestation of the insolvent's application for discharge, a 
 fee on articulation of facts or on appearance as counsel at enquSte, 
 under the tariff in force under the Insolvent Act of 1869 (re 
 Inylis, 20 L. C. J. 184). 
 
 110. The judge shall have the power, upon special cause being shewn be- 
 fore him under oath for so doing, to order any postmaster at the place of 
 residence or at the place of business of the insolvent to deliver letters ad- 
 dressed to him at such post office to the assignee, and to authorize the 
 assignee to open such letters in the presence of the prothonotary or clerk of 
 the Court of which such judge is a member, and in the presence of the insol- 
 vent or after notice given to him by letter through the post, if he be within 
 the Province ; and if such letters be upon the business of the estate the as- 
 bignee shall retain them, giving communication of them, however, to the in- 
 solvent on request ; and if they bo not f)n the business of the estate they shall 
 be resealed, endorsed as having been opened by the assignee and given to the 
 insolvent or returned to the post office ; and a memorandum in writing of 
 the doings of the assignee in respect of such letters, shall be made and signed 
 by hira and by the prothonotary or clerk, and deposited in the Court. 
 
 ^ 20. All causes of disqualification applying to a judge in civil matters in the 
 several Provinces to which this Act applies, shall be causes of disqualification 
 aiul recusation under this Act, as regards the final hearing and determination 
 of iuiy matter subject to appeal or revision under this Act ; but such grounds 
 of disqualification shall n(jt apply to mere ministerial acts or incidental pro- 
 ceedings ; and such causes of disqualification shall be tried as provided for 
 by the laws in force in the several Provinces where the proceedings are pend- 
 ing. If a judge be disqualified or incompetent to act in any matter in insol- 
 vency under this section, the judge competent to act in matters of insolvency 
 in a county or district adjoining that in which the proceedings are pending 
 (or in the case of a Judge of the Court of Probate in Nova Scotia, the judge 
 of the said Court in an adjoining county) and who is not disqualified under 
 this section shall bo the judge who shall have jurisdiction in such matter in 
 the place of the judge so disqualified. 
 
 Although there is no provision in the Insolvent Act for the re- 
 cusation, properly so called, of an assignee who is deciding on a 
 contested claim, yet on a petition by the claimant alleging facts 
 which he claims to l)e legal grounds of recusation of the assignee, 
 and claiming to be allowed to recuse the assignee, the judge will 
 order the assignee to suspend all further proceedings, and order 
 
292 
 
 THE INSOLVENT ACT. 
 
 i ■ \i 
 
 I |B 
 
 proof of the facts alleged in the petition ( Worthinyton and BdU, 
 17 L. C. J. ino\ 
 
 In the Province of Quebec, it lias been held that, the assigiu'c 
 to an insolvent estate, is not a judge within the meaning of article 
 170 of the Code of Civil Procedure, and, tlierefore, cannot be 
 recused in the mode preserilKjd by the code for the recusation of 
 a judge. Proceedings to discjualify an assignee, under the Insol- 
 vent Act of 1809, must be taken in the mode prescribed by sec- 
 tion 137 of the Act (Mechanics' Bank v. Broivn, 19 L. C. J. •2\)r>.) 
 
 ]'21. In the absence of the judge from the chief jilace of any district in tlio 
 Province of Quebec, the prothonotary of the Court shall preside at the meet- 
 ings of creditors called to take place before the judge, and shall take niinutts 
 of the proceedings of the same, and shall in such cases as well as in all others, 
 make any order which the judge is empowered to make ; but the same shall 
 uot be delivered nor put into execution if any o))jection to it is filed with the 
 prothonotary, the same day or the next after, and then the whole matter and 
 all the papers and proceedings, produced and had at such meeting shall bo 
 referred to the judge, who shall adjudicate up(jn the same, confirming tlic 
 order made by the prothonotary, or making such other as ho may tliiiik best 
 in the case. 
 
 122. In the Province of Quebec, rules of [)ractice for regulating the due con- 
 duct of proceedings luider this Act, before the court or judge, and tarifls of 
 fees for the officers of the court and for the advocates and attorneys practising 
 in relation to such proceedings, or for any service performed or work done 
 for which costs are allowed by this Act (but the amount whereof is not here- 
 by fixed), shall be made forthwith after the passing of this Act, and when 
 necessary repealed or amended, and shall be promulgated under or by the 
 same authority and in the same manner as the rules of practice and tariff" of 
 fees of the Superior ('ourt, and s'lall ajjply in the same manner, and have the 
 same effect in respect of proceedings under this Act as tlie rules of practict' 
 and tariff of fees of the Superior Ctmrt ajiply to and atfect proceedings before 
 that Court ; and bills of costs upon proceedings under this Act may be taxed 
 and proceeded upon in like manner as bills (jf costs may now be taxed and 
 proceeded upon in the said Superior Court. 
 
 In Quebec no rules have yet been made under this section. 
 The I'ules framed under the former Acts will V)e found in the ap- 
 pendix. 
 
 123. In the Province of Ontario 
 jority of them ; in the Province 
 
 the Judges of the Coiu-t of Appeal or a ma- 
 New Brunswick, the Judges of the Supremo 
 
RULES OF PRACTICE. 
 
 293 
 
 'I 
 
 Court of New Brunswick, or the majority of them ; in the Province of Nova 
 Scotia, the Judyos of the Supreme Court of Nova Scotia, or the majority of 
 them ; in the Province of British Cohimbia, the Judges of the Supreme 
 Court, or the majority of them ; in the Province of Prince Edward Island, 
 the Judges of the Supreme Court, or the majority of them ; and in the Pro- 
 vince of Manitoba, the Judges of the Court of Queen's Bench, or a majority 
 of them ; shall forthwith make and frame and settle the forms, rules and re- 
 gulations to he folhjwed and observed in the said Provinces respectively, in 
 proceedings in insolvency under this Act, and shall fix and settle the costs, fees 
 and charges which shall or may bo had, taken or paid in all such cases by or to 
 attorneys, solicitors, counsel, and officei's of courts, whether for the officer or 
 for the Crown as a fee for the fee fund or otherwise, and by or to sheritl's, 
 iis.si;,'nees or other persons whom it may be necessary to provide for, or for 
 any service performed or work dcjue for which costs are allowed by this Act, 
 l)ur the amount whereof is not hereby fixed. 
 
 Tlio 40 Vict. s. 20 aincndod this section as to Ontario by mak- 
 iiiir it the duty of tli(! Judges of tlio Court of Appeal or a inajority 
 of thrill to frame and si'ttle the rules, f(n'i us and regulations under 
 the Act. 
 
 No I'ules liave yet been promulgated under this section in any 
 of the Provinces. 
 
 1-4. Until such rules of practice and tarill of fees have been made, as re- 
 iliiired by the two preceding sections, tlio rules of practice and tarifi'of fees 
 (>i insnlvency, now in force in the said Provinces respectively, shall continue 
 .111(1 remain in full force and otloct. 
 
 I'Jo. Every assignee shall be subject to the summary jurisdiction of the 
 Ciiiirt oi- judge in the same manner and to the same extent as the ordinary 
 olficurs of the court are sul)ject to its jurisdiction ; and the performance of 
 his duties may be compelled, and all remedies sought or demanded for 
 enforcing any claim for a debt, privilege, mortgage, hypothec, lien or right 
 of property upon, in or toiuiy efiects or property in the h.ands, possession or 
 cimto<ly of an assignee, may bo obtained by an order of the judge on sum- 
 mary petition in vacation, or of the court on a rule in term, and not by any 
 suit, attachment, opposition, soi.nu'o or other proceeding of any kind what- 
 ever ; and obedience by the assignee to such order may be enforced by such 
 Court or judge under the penalty of imprisonment, as for contempt of court 
 or disobedience thereto, or ho may bo removed in the discretion of the Court 
 or judge from the assigneeship of the estate. 
 
 The 40 Vict. h. 27 amended this section by striking out the 
 
! :M 
 
 294 
 
 THE INSOLVENT ACT. 
 
 ■ ■:( 
 
 ' ! :i 
 
 
 I > i 
 
 words " if not an official assignee " and adding , at the end of the 
 section the words " from the assigneeship of the estate." 
 
 The British North America Act must be presumed to have 
 been passed as Acts of Parliament always are presumed to have 
 been passed, with a knowledge by the Legislature of the then ex- 
 isting law, and of the decisions of the Courts upon the matter 
 which is the subject of legislation, and as an enactment somewhat 
 similar to this section was in force when the British North 
 America Act Avas passed, this section of the Act is not beyond 
 the power of the Dominion Parliament as being an interference 
 with property and civil rights (Crombie v. Jackson, 34 Q. B. U. C. 
 375). 
 
 The object of this section is to establisli a special tribunal in 
 the first instance, for the dispo.sal of such matters, for the benefit 
 of the debtor and the creditors, to prevent litigation being carried 
 on by any one prejudicial to the estate ; to prevent the assets 
 bein^ .lissipated by law suits, and to have all such matters de- 
 cided upon promjjtly h>y a summary petition, presentable at any 
 time to the Insolvent Court or to a judge of it, and specific relief 
 afforded at once, if the applicant is entitled to it, under pressure 
 of very severe punishment. Where a party who had mortgaged 
 his goods to the plaintiff, made an assignment in insolvency, and 
 at the time of making the assignment the insolvent was in pos- 
 se.ssion of the goods assigned, and the possession was transferred 
 to the assignee, who took possession of, but did not in any way 
 interfere with the goods, except in his capacity as assignee : it 
 was held that the plaintiff, the mortgagee of the goods could not 
 maintain trover against the assignee, for he was not a wrong 
 doer by simply taking possession of the goods assigned, and the 
 plaintiffs remedy, if any, was held to be by summary application 
 under this section {Gronibie v. Jackson, 34 Q. B. U. C. 575). 
 
 The decision in this case rested on the ground that the a.ssignee 
 merely held for the benefit of the creditors the po.ssession which 
 he obtained rightfully, under the assignment. Where goods 
 mortgaged remain in the actual possession of the mortgagor, 
 after default in payment, and are by the latter or by the sheriff, 
 assigned to an assignee in insolvency, the mortgagee cannot en- 
 
 . 
 
^m 
 
 SUMMARY REMEDY AGAINST ASSIGNEE. 
 
 295 
 
 force any claim for a right of property to the goods in the pos- 
 session of the assignee by a suit at law. In such case the 
 mortgagee will be bound to proceed against the assignee, under 
 this section of the Act {DurrMe v. WJiite, 82 Q. B. U. C. 601). 
 
 This section seems to apply to proceedings between creditors, 
 parties to the insolvency proceedings, or who have it in their 
 power to become parties thereto. It does not prevent a person 
 who is not a creditor at all, and whose property, lands, goods, 
 money, and other effects, have been wrongfully taken, as the pro- 
 perty of the debtor, from pressing his redress in the ordinary 
 courts of law. And, a mortgagee of goods who is entitled to 
 the immediate possession of them, may bring an action of trespass 
 against the assignee for a wrongful taking of them, and is not 
 oldiged to apply to the judge on summary petition, as pointed out 
 in this section. But creditors who have proved, or wlio can prove, 
 on the estate, although they have not made themselves parties to 
 the insolvency, are bound by the section, and can only seek re- 
 dress against the assignee as therein provided {A rchihald v. Hal- 
 dan, 30 Q. B. U. C. 30) where the assignee has not been guilty 
 of any illegal or wrongful act, and it seems the assignee would 
 not be protected by this section if he wrongfully converts or dis- 
 poses of the property of a ci'editor. 
 
 The assignee is not a public officer under the Con. Stats. U. C. 
 cha]). 120, and is therefore not entitled to notice of action (ib.). 
 
 In New Brunswick, it has been held, that i2 property claimed 
 by a third person has been attached as the property of an insol- 
 vent, under a warrant issued under the 20th section of the Act 
 of 1869, such person has no right to apply, under section 50, to set 
 aside the attachment, or to have the property restored to him by 
 the assignee, he must resort to his Common Law remedy (Clement- 
 xon V. Hammiond, East. T. 1871 ; Stephen's Digest, N. B. Reports, 
 2:^7). 
 
 But this section does not apply as against a person who is 
 not a creditor of the insolvent, and where the goods of A. were 
 seized by the sheriff under an execution against B., and were 
 afterwards delivered by the sheriff to the official assignee of B., it 
 was held that A. was not driven to an application under this sec- 
 
 
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290 
 
 THE INSOLVENT ACT, 
 
 V. 
 
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 tion, but might maintain replevin against the official assignee foi' 
 the goods (Burke v. McWhirter, 3o Q. B. U. C. 1). 
 
 This case is an express decision on two points, namely, that 
 this section does not apply to a person who is not a creditor of 
 the insolvent, and has nothing to do with the distribution of his 
 estate, and secondly, that goods may be replevied out of tho 
 custody of an assigr^'o in -solvency. On the hitter point it fol- 
 lows Jamk'son v. lu- L. J. N. S. 241 ; P. R. U. C. :3) ; 
 in which it was held t) „• i-,0' \i' ai'e repleviable out of the hands 
 of a guardian in insolvency, notwithstanding the Replevin Act in 
 Ontario provides, that aoth''"'fiC th"' 'n contained shall authorize 
 the replevying of, or taking out (if t.1> ) cstody of any sheriff or 
 other officer, any personal pro[H'rty sti/ed l)y him under any pro- 
 cess issued (mt of any Court of Record foi Ontario (Con. Stat. U. 
 C. chap. 2{), s. 2). 
 
 The foregoing case was on the Act of bSfi!), and on the latter 
 Act it has been held, in the Province of New Brunswick, that 
 I'eplevin will not lie against an assignee in insolvency to recover 
 property seized by him, on the ground that, under this section of 
 the Act, the remedy by action is taken away, and that tin; 
 proper proceeding is an application to the judge foi an ordir 
 for the delivery of the go(jds {McGalrh v. McLeod,, 2 Pugsley, -^2.'}) 
 The point as to the goods being in the custody of the law was 
 raised on the argument, but the coi.li gave no opinion theieon. 
 
 Sections 9, 12 and 2(S of the present Act change the position of 
 the official assignee from what it was under the former Act. In 
 reference to the pro|)erty of the insolvent seized under a writ 
 of attachment, the official a.ssignee stands in the .same position as 
 a sheriff .seizing goods on execution from a (*ourt of Record, In 
 Ontario, where this Statute alrea<ly citcsd is in force, it has been 
 held that an official a,s.signee appointed under the Act, is an officer 
 within the meaning of the .said Statute, and that ^oods in his 
 possession as such assignee seized under a writ of attachment 
 cannot ])e replevied {Barclay v. Saltoii, 7 P. R. U. C 14). In 
 this case the goods were seized by the a.ssignee under a writ of 
 attachment, and where the goods vest in the a.ssignee under an 
 
RIGHTS OF MORTGAGKE. 
 
 297 
 
 assignment made by the debtor after demand, it is doubtful 
 wliether the same rule will apply. 
 
 Although this section will, as we have seen, protect an assignee 
 when acting strictly in the discharge of his duty as assignee, yet 
 when the proceeding is in rem against property, and not against 
 the assignee for something in discharge of his duty, the section 
 does not apply. 
 
 A mortgagee seeking to enforce his mortgage by bill of fore- 
 closure after default in payment, does not come, as a creditor, 
 asking payment out of the assets of the estate, but he asks that, 
 within a speciHed time, the mortgagor shall redeem his moitgage, 
 otherwise thecMjuity of redemption will be barred. The Insolvent 
 Court has no machim vy for calling in claimants for service out of 
 tlie jurisdicti(m, and for working out all the details of a foreclosure 
 suit. Therefore, it has l)een held that the jurisdiction of the 
 Court of Chanceiy to decree foreclosure upon a mortgage where 
 the mortgagor has made an assignment in insolvency, after the 
 date of the mortgage, is not taken away Ity this section, and the 
 mortgagee must still [)roceed in Chancery to obtain such relief 
 against the assignee of the mortgagor (Ilcndernon v. Kerr, 22 
 (bant, !)1. 
 
 The interest of a moi'tgagee of real property does not i)ass to 
 till' assiguee of the mortgagor, for it is not, in fact, the property 
 (if the insolvent, the mortgagee being the legal owner ; therefore, 
 if a mortgagor become insolvent, the mortgagee is not obliged to 
 tile a claim mider the Act, but may proceed to sell the property 
 under the power of sale in his mortgage (Gordon v. Ruku, I TT. C. 
 L, J. N. 8. 10(i ; 11 tJrant, 124); or, it is presumed, exercise any 
 other remedy to which he would be entitled, had no insolvency 
 intervened, for the insolvency of the mortgagor does not al)ridge 
 or destroy the powers and privileges of the mortgagee (see also 
 Coulthirrst v. Smith, 29 L. T. N. S. 243 ; ib. 714). So, a court of 
 equity has power to order a sale of the mortgaged property, the 
 Insolvent Court not being competent to give adeijuate relief. 
 
 A creditor having taken security by mortgage on real estate, 
 the mortgagor afterwards became insolvent, and the creditor filed 
 a claim, placing a certain value on the mortgage security, and 
 
 
298 
 
 THE INSOLVENT ACT. 
 
 
 seeking to rank on tho estate for the balance of the debt. It was 
 afterwards discovered that certain property intended to be in- 
 cluded in the mortgage security had, by mutual mistake, been 
 omitted therefrom. Whereupon, the creditors, the mortgagee, 
 filed a bill in Chancery to have the mortgage rectified and the 
 security realized. It was held that the mortgagee having so pro- 
 ceeded in insolvency, formed no objection to the relief asked, and 
 the Court ordered a rectification of the instrument as prayed. 
 It was further held that the Insolvent Court had not exclusive 
 jurisdiction under this section, as the relief asked was deJhors 
 the administration of the assets in that Court and the latter 
 Court could not give adequate relief in respect of the same 
 {Ganieron v. Kerr, 23 Grant, 374 ; see also Stone v. Thomas, L. 
 R. .5 Ch. Ap}>. 219.) The foi'egoing cases at common law were all 
 cited in the judgment in Henderson v. Kerr (22 Grant, 91). The 
 court also declared that the decision in the case would not inter- 
 fere with the right of the assignee to proceed and sell an eijuity 
 of redemption which had passed to him as assignee. 
 
 In England, tho Court of Bankrujjtcy will restrain the mort- 
 gagee from proceeding in the Court of Chancery, if it appear 
 more convenient that the sale should take place under the direc- 
 tion of the Court of Bankrnptcy {Wldte v. Simmons, L. R. (i Ch. 
 Goo). 
 
 A writ of attachment issued, under which the assignee in insol- 
 vency seized goods, which were claimed by a person to whom it 
 was alleged the debtor had transferred them. The assignee there- 
 upon filed a bill of interpleader against the claimant, and the 
 creditoi-s who had sued out the writ. The Court held that the 
 assignee was not compelled to apply to the judge in insolvency 
 under this section, and relief was attbrded to the assignee, and the 
 claimant failing to appear was ordered to be debarred of all inter- 
 est in the goods in question, and to pay the costs of suit, and the 
 assignee was given a lien on the goods in his hands for his costs 
 (Wells V. Heivs, 13 C. L. J. N. S. 21 ; 24 Grant, 131). 
 
 The Insolvent Court is the proper Court to apply to in order to 
 compel the assignee to perform his duties properly, and under 
 this section the jurisdiction of the other Courts of law is excluded, 
 
t was 
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 gagee, 
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 and 
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 usive 
 (.'hors 
 atter 
 same 
 
 'Cts, L. 
 
 ere all 
 The 
 
 inter- 
 
 iuity 
 
 SUMMARY REMEDY AGAINST ASSIGNEE. 
 
 29» 
 
 and recourse must be had to the judge in insolvency as pointed 
 out in this section. If, for instance, a sale by an assignee, in in- 
 solvency is open to objection on the part of creditors, the remedy 
 of the latter is by an application to the Insolvent Court, and not 
 by a suit in Chancery or an action in the Superior or other Courts 
 of law (O'Rielly v. Rose, 18 Grant, 33). 
 
 A judge of the Insolvent Court has power, under this section of 
 the Act, to make an order that the defendant, the assignee of the 
 estate of H. L. pay to the plaintiff, the assignee of the estate of 
 A. L. the proceeds of the sale of a lease whicli belonged to the 
 estate of A. L., but which the defendant improperly sold as be- 
 longing to the estate of H. L. In this case there was an alleged 
 assignment of the lease from A. L. to H. L., and it was contended 
 that the judge had no power on a summary application under this 
 section to set aside the assignment, as such pi'oceedings could only 
 be in a Court of E(iuity. It was agreed, however, between both 
 parties that the defendant should sell the unexpired term in the 
 lease, and hold the proceeds subject to such order as the judge 
 should make, and under these circumstances it was held that the 
 judge had power to make the order under this section (Skinnier 
 V. McLeod, 2 Pugsley, 131). 
 
 Had the lease not been sold, the plaintiff' as the assignee of A. L. 
 would have had the right, under the 39th section of the Act, to 
 take proceedings to set aside the alleged assignment and obtain 
 possession of the property. Had it been sold and converted into 
 money, he probably might have maintained nn action for money 
 had and received against H. L. if he had sold the property (ib. 
 135, per Ritchie, C. J. ; nee Marks v. Feldman, L. R. o Q. B. 275). 
 
 The power given to the judge by this section to control the 
 assignee, is in the nature of giving him personal directions as to 
 his duties enforceable by inprisonment on default, but the judge 
 has no power to enforce his orders by execution against the goods 
 of the assignee, though the judge may possibly compel the as- 
 signee to pay the costs incurred by his disobedience, by making 
 it a condition that they shall be paid before the contem])t is 
 purged (re Gleghorn, 2 U. C. L. J. N. S. 133). 
 
 On a summary application on petition under this section of the 
 
 I' 
 
 :itiP^ 
 
 i.ivtJti''-*'"" 
 
300 
 
 THE INSOLVENT ACT. 
 
 
 m 
 
 i M 
 
 Act, for the delivery to the real owner of property, seized under 
 an attachment in insolvency, it is not necessary that the petition 
 or artidavit should be entitled in the cause. Such an application 
 may be made while the property is in the hands of the guardian, 
 and before its deliver}^ to the real owner) re Pyke, 9 C. L. J. N, 
 S. 314). 
 
 If a debtor has no assets, and wishes to assign, merely to defeat 
 the claim of a creditor who is suin^ him, an assit>n(;e would be 
 guilty of fraud in accepting such assignment, and in taking mo- 
 ney in advance from the det)tor, or security to recompense him 
 for his .services. In .such case, the assignee would be subject to 
 the summary jurisdiction of the Court, who would punish such 
 conduct, l)esides enforcing restitution of the money unlawfully 
 taken from the insolvt'iit's assets (Thouuin v [fal/. (! 1'. R. V. C. 
 172). 
 
 12(). In the Proviuco of Quoboc ovory tnulor having a marriago contract 
 with hi.s wife, by wliich ho givos or pi'oniiscH to L;ive or pay or caiwo to W 
 paid, any right, thing, or .sum of nionoy, shall onrogistor thu sanio, if it be 
 not already onrogisterod, within three months from the oxecntion thereof ; 
 and every person not a trader, but hereafter becoming a trader, and having 
 such a ccmtract of marriage with his wife, shall cause such contract to be 
 enregistered aa aforesaid (if it be not previously thereto ouregistored), within 
 thirty days from becoming such trader ; ami in (Uifault of such registration 
 the wife shall not bo permitted to avail herself of its provisions in any claim 
 upon the estate of such insolvent for any advantage conferred upon or pro- 
 mised to her by its terms ; nor shall she be deprived by reason of its provisions 
 of any advantage or right >ipon the est.ito of her iiusband, to which, in the 
 absence of any such contract, she woidd have been entitled by law ; but this 
 section shall be held to be only a continuance of rhe second sub-section of 
 section twelve of the " Insolvent Act of 1804," and of soctiim one hundred 
 and forty of the " Insolvent Act of 18(5!)," and .shall not relieve any person 
 from the consequence of any negligence in the observance of the provisions 
 of the said sub-section or section. 
 
 IMPKISONMENT FOK DEBT. 
 
 127. Any debtor confined in gaol or on the limits in any civil suit, who 
 may have made the assignment provided for in this Act, or against whom 
 process for liquidation under this Act may have been issued may, at any 
 time after the meeting of creditors provided for in this Act, make applica- 
 tion to the judge of the county or district in wliich his domicile may be or 
 
 
II 
 
 
 IMPRISONMENT FOR DE15T. 
 
 301 
 
 in which the gaol nmy ho in which he is contiiiod, for hiH dischiirgo from im- 
 prisoiiiuont or coiifinoiuunt in Hiicli auit ; iind thoruupon such juilge may 
 grant an order in writing directing the Bherifl'or gaoler to bring the debtor 
 t)ofore liini for examination at snch time and place in such county or district 
 as may be thought fit ; and the said sheriff or gaoler shall duly obey such 
 order, and shall not be liable to any action for escape in consecjuence thereof, 
 or to any action for the escape of the said debtor from his custody, unless the 
 same sliall have happened through his default or negligence ; or if the debtor 
 is confined in the county or district in which the judge d(jes not reside, tlie 
 judge instead of ordering the debtor to be brought before him for examina- 
 tion may, if he sees tit, make an order authorizing and directing the otticial 
 assignee for the county or district in which the debtor is confined, to take 
 such examination, and it shall be the duty of the official Jissignee bo take 
 down or cause to be taken down such exaniinfition fully in writing and trans- 
 mit tlie same under his hand forthwith to the judge ; and the otticial assignee 
 sliali be entitled to ten cents for each folio of one hundred words of such 
 examination. 
 
 (1.) In pursuance of such oi'derthe said confined debtor and any witnesses 
 .subp(enaed to attend and give evidence at such examination may be exa- 
 mined on oath at the time and place specified in such order before such judge 
 or assignee ; and if on such examim.tion it appears to the satisfaction of the 
 judge that the said debt(jr has }iinta Jide made an assignment as re(|uired by 
 tliis x\ct, and has not been guilty of any fraudulent disjjosal, concealment, 
 or retention of his estate or any part thereof, or of his books and .accounts 
 or any material porticui thereof, or otherwise in any way contravened the 
 provisions of this Act, such judge shall, by his order in writing, discharge 
 the debtor from confinement or imprisonment ; and on production of the 
 order to the sheriff or gaoler, the debtor shall be forthwith discharged with- 
 out payment of any gaol fees: Provided always, that no such order shall be 
 made in any case luiless it be made to appear to the satisfaction of such 
 judge that at least seven days' notice of the time and place of the said exa- 
 mination had been previously given to the plaintiff in the suit in which the 
 debtor was imprisoned, or to his attorney and to the assignee for the time 
 l)eing : 
 
 (2 .) The minutes of the examination herein mentioned shall be filed in the 
 office of the clerk of the court out of which the process issues, and a copy thereof 
 shall be delivered to the assignee ; and if, during the examination, or before any 
 (jrder be made, the official assignee or the appointed assignee, or the creditor 
 or any one of the creditors at whose suit or suits the debtor is in custody, 
 makes affidavit that he has reason to believe that the debtor has not made 
 a full disclosure in the matters under examination, the judge may grant a 
 postponement of such examination for a period of not less than seven 
 days nor more than fourteen days, unless the parties consent to an earlier 
 day : 
 
 i 
 
302 
 
 THE INSOLVENT ACT. 
 
 (3.) Aftor such oxaiuinatiuii, in caao of any Bubsequoiit arrest in any civil 
 suit as aforesaid for causen of action arising previous to the assignment or 
 process for liijuidation, the said debtor may, ponding further procoodingg 
 against liim imder this Act, bo forthwith discharged from confinement or im- 
 prisonment in such suit, on application to any judge and on producing such 
 previous discharge : I'rf)vided that nothing, in this section contained, shall 
 interfere with the impris<mment of the said debtor, in pursuance of any of 
 tne provisions of this Act. 
 
 When a party becomes insolvent and takes proceedings under 
 the Act, he suhinits liiuiself to tliu provisions of the Act, and it' 
 he is in custody and wislies to be (lisi'liai<^rc'd, he must take the 
 remedy pointed out l»y the Act, and cannot resort to another tri- 
 bunal. This section of the Act indicates the method of proceed- 
 ing in such case, and if there is a conllict between this seetioi) 
 and the local Statutes of any Province, the latter are repealed so 
 far as inc^onsistent with the former; for the 149t]i section provides 
 that all Acts and parts of Acts now in force in any of the Pro- 
 vinces which are inconsistent with the Inscdvent Act are repealed. 
 Thus it has been held in New Brunswick, that a debtor who 
 assigns under the Insolvent Act, cannot, if in custody, obtain an 
 order for support under the Fnsolvent (Jonfined Debtors' Act, and 
 can receive his discharge only in the manner pointed out by the 
 Insolvent Act (ex parte Bejeaii, 2 Pugsley, 200 ; see also Stevenson 
 v. McOwati, 11 L. C. J. 4G ; Hegan v. Joven, 2 Pugsley, 290). 
 
 In an unreported case {Hill v. Moore) before Gait, J., in the 
 Court of Common Pleas for Ontario, it was held that the proper 
 remedy for a debtor who was arrested on a ccqnas before his as- 
 signment in insolvency, was imder the Insolvent Act, he having 
 voluntarily submitted to the provisions of the Act by making an 
 assignment (Edgar 6c Chrysler's Ins. Act, 137). 
 
 Where an insolvent apjjlied for his discharge from arrest under 
 the 145th section of the Act of 18G9, and it was argued that, as 
 the defendant possessed nothing to tussign, he having before his 
 assignment, parted with or encumbered all his estate to its full 
 value, it could not be said that he had bona fide made an assign- 
 ment under sub-section 2 of this section corresponding to sub- 
 section 1 of the present Act, but it was not shewn that there was 
 
 ti«i.;.^Mi 
 
UI8CHAUGE FROM ARREST. 
 
 303 
 
 Hiicii .V rraudulcnt parting with or eneuii»l)oring of the estate of 
 the ilohtor, as would, taken in connection witli tlio other facts of 
 thi' caHo, justify the Court in the conchision that the insolvent did 
 not, in good faith, make his assignment. The Court held the 
 assignment b(»ia Jide under this secticm, and declared that even 
 if one principal object of the insolvent was to obtain his discharge 
 from arrest by moans of the insolvency proceedings, this would 
 not be material so long as the object of the Act in so far as the 
 oirditorsare c(mcerned, was attained by procuring whatever por- 
 tion of the debtor's estate they might be; entitled to for the satis- 
 faction of their debts (Hood v. Doddti, 19 Ci-ant, G3!J). 
 
 Although a debtor may fail to show himself entitled to his dis- 
 ci)' as an insolvent, it does not follow that he is disentitled 
 to ischarge from arrest, for the conditions of discharge in the 
 
 one case are not so severe as in the other. The words " or other- 
 wise in any way contravened the provisions of this Act in sub- 
 section one of this section, cannot l)e read in so wide a sense as 
 to include all the requirements and conditions necessary to be ob- 
 served in order to procuie the general discharge of the insolvent, 
 hut must be limited to those provisions required to be performed 
 by the insolvent prior to his application, such as the preparation 
 of statements, attending the meetings of creditors, submitting to 
 examinations and such like. These may be termed the direct re- 
 (juirements or provisions of the Act, as distinguished from those 
 which are mere conditions to be fulfilled if the insolvent desires 
 to procure his certificate. If the debtor submits to an examina- 
 tion, and upon such examination it appears that the debtor has 
 made a bona Jide assignment as required by the Act, and has not 
 been guilty of any fraudulent disposal, concealment, or retention 
 of his estate, or any pait thereof, or of his books and accounts, 
 or any material portion thereof, and has not contravened the pro- 
 visions of the Act, as above explained, namely, those direct pro- 
 visions required to be performed up to the tune the discharge from 
 arrest is sought, he is entitled to his discharge from arrest (Hodd 
 v. Dodds, 19 Grant, 639). The insolvent was, therefore, discharged 
 from arrest, although the absence of books, the absence of any 
 satisfactory statement, as to how it came that a credit balance of 
 
304 
 
 THE INSOLVENT ACT. 
 
 S15,O00 a short time before the insolvency, was within a few 
 months <^urne(l into a dehit balance of nearb 330,()()(), the loanii, r 
 to his brother a sum of $1 7,000 to carry on a business in which 
 lie failed, and which was being carried on without capital ; the 
 receipt of 81,250 from the plaintifl' liy the insolvent a few months 
 iK^fore his insolvency, and no explanation of what became of it ; 
 all went to show that the di'fendant was not entitled to an order 
 of discharge. 
 
 Al'I'EAL. 
 
 128. In the Province <>f Quebec all decisions by a judge in chambers in 
 matters of insolvency shall be considered as judgments of the Superior 
 Court, and any final f)rder or judgment rendered by such judge or Court may 
 be inscribed for revision or may be appealed fnmi by the parties aggrieved in 
 the same cases and in the same manner as they might inscribe for revision or 
 ii])pefil from a final judgment of the Superior Court in ordinary cases, under 
 the laws in force when such decision shall be rendered. If any of the par- 
 ties to any c<jntestation, matter or thing np(m which a judge has made any 
 final order or judgment are dissatisfied with such onler or judgment, they 
 may, in the Province of Ontai'io, apjjcal therefrom to the Court of Error and 
 Appeal or to any judge of that Court (3!) Vict, chiip. 30, s. 16) ; in the Pro- 
 vince of New Brunswick to the Supreme Court of New Brunswick, or to 
 any one of the judges of the said Court ; in the Province of Nova Scotia to 
 the Supreme Court of Nova Scotia or to any one of the judges of the said 
 Court : in the Province of British Columbia to the Supreme Court of that 
 Province, or to any judge of the said Court ; in the Province of Prince 
 Edward Island to the Supreme Court of Judicature, or to any judge of the 
 said Court ; in the Province of Manitoba to the Court of Queen's Bench, or 
 to any judge of the said Court ; but any appeal to a single judge in the Pro- 
 vinces of Ontario, New Brunswick, Nova Scotia, British Columbia, Prince 
 Edward Island, or Manitoba, may, in his discretion, be referred, on a special 
 case to be settled, to the full Court, and on such torms in the meantime as 
 he may think necessary and just. No such appeal or proceeding in revision 
 shoU be entertained unless the appellant or party inscribing for revision shall 
 have within eight days, from the rendering of such final order or judgment, 
 adopted proceedings on the said appeal or revision, and shall within the said 
 delay have made a deposit or given sufficient sureties before a judge that he 
 will duly prosecute the said appeal or proceedings in revision, and pay such 
 damages and costs as may be awarded to the respondent* If the party appel- 
 lant does not proceed with his appeal, or in review, as the case may be, ac- 
 cording to the law or the rules of practice, the Court, on application of the 
 respondent, may order the record to be returned to the ofJicer entitled to the 
 
APPEALS. 
 
 305 
 
 custody thereof, and condemn the appellant to pay the respondent the costs 
 liy him incurred. The judgment of the Court to which under this section 
 the appeal can be had shall be final (40 Vict. s. 27). 
 
 Tlie 39 Vict. chap. 31, s. 12, enacted that the appeal provided 
 for by this section of the Act should extend to all orders, judg- 
 ments, or decisions of the judge. 
 
 Tlie 39 Vict. chap. 30, s. IG, provides that the appeal shall be 
 tt) t iie Court of Appeal in Ontario, instead of to either of the Su- 
 j)( riiir Courts of Common Law or the Court of Chancery. 
 
 Tlie 40 Vict. s. 27, amended this section by striking out the 
 w unls " or unless he " in the thirty-fifth line, and inserting in lieu 
 thereof the word " and," and by providing also that the judgment 
 of the Court ai)pealed to, should be final. 
 
 in re Lamb (4 U. C. P. R. 10), the Court enunciated the prin- 
 ci]ile, that on an appeal it is not considered wise to interfere with 
 tlu' discretion of a judge in granting or suspending a discharge, 
 till' judge having heard the examination of the insolvent, and 
 been cognizant of the various i)roceedings in the case. Clear evi- 
 dence is required to induce a Court of Appeal to set aside the 
 Judge's decision (.see also Davidson v. Ross, 24 Grant, 50). 
 
 An ap[)eal may be made from the order and decision of the 
 judge, on an application by the insolvent, for his discharge from 
 aiiest under the 127th section of the Act {Hood \. Dodds, 19 
 Cirant, 039). 
 
 A demand was made upon a debtor under section 14 of the In- 
 .sulvent Act of 1869, requiring him to make an assignment of his 
 estate and etfects, for the benefit of creditors. The demand was 
 made in the County of St. John, the debtor being a resident of 
 Wistmoreland. The debtor presented a petition under section 15, 
 to the county court judge, upon hearing which he decided that 
 the demand was inoperative, and ordered that no further proceed- 
 ings be taken, on ^he ground that the demand should be made in 
 the county where the debtor resided, or in which his chief place 
 nf liusiness was. It wm held, that under the 83rd section of the 
 Act, an appeal would lie from the judge's decision, and a certiorari 
 to remove the order was therefore refused (ex parte Thomas, 2 
 
 ilii)iiAk 
 
i i 
 
 306 
 
 THE INSOLVENT ACT. 
 
 Hannay, 16S\ A final jiulgment rendered by a judge, di.siuissinii- 
 a writ of attachment, under section 8 sub-section G of the Act of 
 1SG4, was held subject to review under 27 and 2S Vict. chap. 3!t. 
 H. 30 {Jolmsioii V. Kelly, 1 L. C. L. J. (14). 
 
 An in.solveiit liad been refused an absolute dischaige by ii 
 county judge, from whose decision he apjiealed. When the ap- 
 plication was refused the judge gave his judgment in writing 
 .saying: " I have come to the conclusion, aftei- having heard tl)i: 
 in.solvent and his objecting creditors, to refuse the discharge (if 
 the insolvent altsolutely," and at the end of this docuiuent, after 
 setting out his reasons in fidl, he .says: "I cannot consent to 
 grant the insolvent his aVtsolute discharge, but nnist refuse his 
 discharge absolutely, and mu.st deny the prayer of liis petitidii 
 above mentioned." This was held an order which could be ap- 
 pealed from, although no formal order was drawn up or signal 
 (re /07!cs, 4 IT. C. P. R. 317). 
 
 It has been held, in the Province of New Riunswick, that, when 
 theie is an .appeal from the award of Ihe assignee to the couiuy 
 judge, and the latter makes an order, on the hearing of the ap- 
 peal, such order is a final order or judgment within the 
 meaning of this .section, and an apjieal will lie therefioni to 
 the Supreme Court (Sh'mner v. McLfod, 2 Pugsley, 131). 
 
 Such a case as the above caimot now arise under tlie 9.")th .sec- 
 tion of the Act, as tlie judge has original jui'i.sdiction there- 
 under. 
 
 A party appealing from the decision of a ju<lge of tlie county 
 court, undei- section <S3 of the Insolvent Act of 18(j}), is bouml 
 to prove the service of the notice of appeai. and that all other 
 preliminary steps have been duly taken {Hd'ndUon v. Bur(j('()i'<, 
 3 Pugsley, 232). 
 
 The sureties under this section cannot be the solicitors for the 
 appellants, the rule in the other Courts is to be followed (re 
 (hvens, 12 Grant, 5G4 ; and see Pavfonv. Laherfovche, 1 Ph. 2G.') ; 
 Meyers v. HutcJmison, 2 U. C. P. R. 3S0). The pioper time to 
 take objection to the insufficiency of the sureties is before tlie 
 judge of the Insolvent Court, by analogy to proceedings in aii- 
 
APPEALS. 
 
 307 
 
 jicals from the county to the .superior courts (Con. Stats. U. C. 
 chap. l.'),.s. (i7, and re Oiuens, ubi supra). 
 
 In re Waddell (2 U. C. L. J. N. 8. 242) the security in r.ppeal 
 from the county judge was given before the county judge. 
 
 In Ilodd V. Dodds (19 Grant, 63!)) no objection was taken to 
 the form of the l)ond, but it was objected that it was not actuaUy 
 I'xccuted in the presence of or " before " tlie judge, the bond having 
 luen executed at the Town of Guelph, and transmitted to and re- 
 ceived by the judge in the Town of Berlin, where he resided. 
 The Court did not decide the point, considering on the authority 
 of IV (hvens (12 Grant, 504) that the objection should have been 
 taken ])oforc the judge of the Insolvent Court. 
 
 It is not necessary that the petition in appeal should be signed 
 hy the party or his attorney. The service of notices of setting 
 (liiwn for argument of the appeal is sufficient notice. The peti- 
 tion shoidd lie addressed to the Court, and not to the chief jus- 
 tice only. The neglect of the assignee to file the papers on or 
 licfore the day of presenting the petition is no reason for reject- 
 ing the appeal, though it may be a reason for enlarging the hear- 
 ing and proceeding against the assignee for his neglect or con- 
 tempt. Points not taken in the Court below are not open to 
 parties before the appellate Court. The proper mode of raising 
 technical objections to the proceedings in cases of this kind is to 
 move a rule to set the proceedings aside instead of urging the 
 oljections on the argument of the merits (re Parr, 17 C. P. TJ. C. 
 (i2"l). 
 
 It was held under .sections 83 and 84 of the Act of 1860, that 
 it was not sufficient for the appellant to serve notice of appeal 
 within the five days limited by the Act, and subsequently file the 
 appeal bond, but that the application in appeal should be .served 
 upon the respondent and security for costs also given within five 
 (lays fi'om the day in which the order or judgment is rendered, 
 oth'jrwise the appeal will not l)e allowed (re Thomas, 6 P. R. U. 
 C. 252). 
 
 The 84th section of the Act of 1869 expressly required the 
 security to be given within the five days, and the amendment in- 
 troduced by the 40 Vict. s. 28, requires that the security should 
 
308 
 
 THE INSOLVENT ACT. 
 
 he given, as well as the proceedings adopted within the eight 
 days ; and the case of re Thomas supi-a will apply to the present 
 Act as amended hy the 40 Vict. s. 28. In computing the eight 
 days under this section, the day on which the order or judgment 
 is made nuist be excluded. If, for instance, the order or judgment 
 was made on the 14th, the eighth or last day would be the 22n(l. 
 If the last day falls on a Sunday or non-juridical day, the a])pel- 
 lant would have the whole of the followinj; day witlp" which to 
 proceed according to the general rule ov practice in such cases 
 (see ante p. 09-70 ; Hood v. Dodds, 19 Grant, (339j. 
 
 Under the Act of 1804, the appeal had to he first allowed l)y 
 the judge, and notice had to be given of the application for al- 
 lowance, and the application had to be made within eight days, 
 from the day on M-hich the judgment of the judge was rendered. 
 In one case the order of the judge was made on the 2nd of June, 
 and notice of the application for the allowance of the a])peal was 
 served on the 7th, returnable on the 9th of June. The credi- 
 tors resided in Montreal, and the insolvent in Guelph, and it 
 was objected, that as Guel]»h is more than 15 miles from Toronto, 
 ■where the proceedings were to be taken, the notice allowing only 
 one clear day between the service and return was insufficit-Oit, 
 (.see .section 108 of this Act). The Court held, that when the 
 service of the notice was within the eight days the applica- 
 tion might be for a day .subsequent, and they allowed the notice 
 to be amended so as to give the time recpiired. It was also ob- 
 jected, that the notice was not entitled in any court and did not 
 mention on what evidence the motion was to be made. The 
 Court considered the notice irregidar in these respects, but allowed 
 it to be amended. It Avas also held, that the notice need not .set 
 forth the ground of a})peal (re Owens, 12 Grant, 440; 3 U. C. L. J. 
 N. S. 22). 
 
 The above case would ap]ily to the jn-esent Act. The ai)plica- 
 tion in ajipeal and notice .should be served Avithin eight days, but 
 the notice might be for an apjdication to the Court on some day 
 after the expiration of eight days. 
 
 It is clear from the reading of this section that the appellant 
 must have l)een a party to the contestation, kc, from wliich the 
 
fl 
 
 APPEALS. 
 
 300 
 
 appeal is brought ; and he must also have proved his claim (see 
 also re Sharpe 2 Ch. Cham. G7). 
 
 Where the affidavits on wliich the allowance of an appeal under 
 the Act of 18G4 was sought, were not entitled in any Court, they 
 were not allowed to be real. It was held also that it should be 
 distinctly shown that an order had been made, and the terms of 
 the order should also be shown (ib). 
 
 If an appeal is made to one of the judges of the Superior Court 
 from an order of the judge in insolvency and the former mnV vs an 
 order referring the matter to the full Court, but no special case 
 is settled betw .^en the parties as required by this section, the 
 want of the special case is an irregularity which may be waivedi 
 and if no objection is made on this ground until the argument of 
 the case before tlie full Court, the uljjt.'ction will be waived. The 
 ])roper mode of raising the objection is as already explained by a 
 rule to set aside the [)r()ceedin'.,'s (re Slnirpe, 20 C. P. IJ. C. 82 ; fol- 
 lowing re Parr, 17 C P. U. C. G21). In this case the petition of 
 appeal was filed by leave of the Court, and the appellant was au- 
 thorized to sei've a notice of hearing for a day named. 
 
 The 84th section of the Act of 18G9 reciuired that the application 
 in ap])eal should set forth the proceedings l)ef ore the judge. But 
 it was held that the ap[)lication nee<l not set out all the evidence, 
 documents and materials upon which the judge had matltj the 
 order or judgment ap[)ealed from. The oljject of the Legislature 
 in this section was to require a reasonable notice of the matter 
 appealed from, the grounds upon which the appeal was based, and 
 the materials whicli supported it ; and this object would be satis- 
 tied if either the petition oi- the notice accompanying it showed to 
 the opposite party the objection which was taken to the proceed- 
 ing appealed from and the materials to be used on the argument of 
 the appeal. Where a petition had been presented and served with 
 a notice of the ap[)lication and a copy of the judge's decision, and 
 the notice referred to the proceedings before the judge on which 
 the appellant relied foi' the reversal of the order, and stated that 
 these would be reail on the application, this was held sufHcient 
 (Hood v. Dodih, l!) Grant, G8f)). 
 
 When an insolvent who has appealed from the decision of a 
 
 vi i] 
 
310 
 
 THE INSOLVENT ACT. 
 
 county judge refusing to set aside an attachment against him, dies 
 during the pendency of the appeal and no personal representative 
 has heen appointed, the appeal fails (Laivrie v. McMahon, G P. R. 
 U. C. 9). 
 
 It would seem that fresh documents, the genuineness of which 
 cannot be disputed, may be allowed to be proved and received (re 
 WUlshire Irmi Co., L. R. 3 Ch. App. 443; 18 L. T. N. S. 423). 
 But as a general rule, leave ought not to be given to use evidence 
 on the appeal which was not used on the hearing before the Court 
 below, through the fault of the party desiring to use it on the ap- 
 peal (ex parte Isaac, L. R. G Ch. App. 58). A shorthand writer's 
 note of the evidence given at the hearing of the Court below, can- 
 not be admitted, except by consent. But if the judge's notes are 
 produced, and purport to contain a full record of what took place, 
 they will be admitted (ex parte Gilhhrand, 23 W. R. 194; ex 
 l)arte Hicks, 23 W. R. 852). 
 
 Under the Act of 18G4, the costs of appeal were in the discre- 
 tion of the judge of the Court a}>pealed to (see re La nib, 4 U. C. 
 P. R. 16). The present Act is silent on this point, though it i)n)- 
 vides for costs in the event of the appellant not duly prosecuting 
 his appeal. 
 
 129. Pending the contestation of any claim or of a dividend sheet, and of 
 any appeal or proceeding in revision, the assignee shall reserve a dividend 
 equal to the amount of the dividends claimed or contested. 
 
 FRAUD.S AND FRAUDULENT I'REFERKNCES. 
 
 130. All gratuitous contracts or conveyances or contracts without consider- 
 ation, or with a merely nominal consideration, respecting either real or per- 
 sonal estate, made by a debtor afterwards becoming an insolvent, with or to 
 any person whomsoever, whether such pereon be his creditor or not, within 
 three months next preceding the date of a demand of an assignment, or for 
 the issue of a writ of attachment under this Act whenever such demand 
 shall have been followed by an assignment, or by the issue of such writ of 
 attachment, or at any time afterwards, and all contracts l)y which creditors 
 are injured, obstrncted, or delayed, made by a debtor unable to meet his en- 
 gagements, and afterwards becoming an insolvent, with a person knowing 
 such inability or having probable cause for believing such inability to exisf, 
 or after such inability is public and notorious, whether such person be his 
 creditor or not, are presumed to be made with intent to defraud his cre- 
 ditors. 
 
n 
 
 in, dios 
 ntativi; 
 P. H. 
 
 FRAUDS AND FllAUDULKNT PREFEKENCES. 
 
 311 
 
 Tlie tiuKj mentioned in this section, and also in sections 131 and 
 i:j3, is next before the demand of assignment, instead of the exe- 
 cution of the deed of assignment, as in former Acts. 
 
 In NeAvton v. Ontario Bank (13 Grant, 6o2) the Court was of 
 opinion that the sections of the Act of 1864, corresponding to 
 sections 130, 131, and 132 of this Act, did not apply to the in- 
 solvent's transactions with his creditors, but only those with 
 strangers. But these sections are now framed to meet all persons 
 whether creditors or not. 
 
 This section embraces two classes of conti-acts. First, those 
 inaili- without consideration within three months prior to the pro- 
 ceedings in insolvency ; and, second, contracts by which creditors 
 artj injured or delayed by a debtor in insolvent circumstances, 
 and who afterwards becomes in.solvent, with a person who knows 
 or has probable cause for believing the insolvent condition of the 
 debtor, though there may have been a consideration for the 
 contract (Skinner v. McLeod, 2 Pugsley, 134, per Ritchie, 
 (.!. J.). ^ 
 
 In Newton v. Ontario Bank (13 Grant, 052), it was said that 
 the second branch of this section and the 132nd section of the 
 Act might be read together and that the latter section was in 
 substance a re-enactment of the Statute, 13 Elizabeth, chctp. 5. 
 (See also DavuUon v. Rosi^, 24 Grunt, 76, per Patterson, J.). 
 
 The latter part of this section must apply to acts whereby the 
 general body of creditors are injured. Two mortgages were 
 created l)y a debtor in favour of a creditor, whose claim consisted 
 of promissory notes then current. It appeared that the debtor 
 was in insolvent circumstances, and the Court considered that 
 l)oth the del)tor and creditor contemjilated the debtor going into 
 insolvency, which he did shortly afterwards. It was held 
 that the transaction might be set aside {Payne v. Hendry, 20 
 Grant, 142). 
 
 A person in insolvent circumstances made a bill of sale of his 
 property to one of his creditors, the consideration therefor being 
 a pre-existing debt, and a sum of money in addition, sufficient to 
 make up the price agreed upon, as the value of the property sold, 
 the amount of money so received by the debtor being by him 
 
 i li* 
 
 \\\ , iliiM 
 
312 
 
 THE INSOLVENT ACT. 
 
 paid over, with the knowledge of the purchaser, to another cre- 
 ditor, and three months after the sale was completed the debtor 
 made an assignment of his assets under the Insolvent Debtors' 
 Act. On a bill filed by a creditor for that purpose the sale was 
 set aside, and a re-sale of the property ordered, the proceeds to 
 be applied in payment of the plaintiff's claim, and the residue, 
 if any, to be paid over to the assignee in insolvency. The bill 
 of sale thus made, not with the object of carrying out a sale, 
 but of securing a past debt, the sale, l»eing only part of the plan, 
 was considered void in toto, as being in contravention of tlie 
 Statute (Coates v. Joslin, 12 Grant, 524). 
 
 The plaintiff who lived in Stirling, and carried on business 
 there, went to Belleville, about twenty miles distant, where he 
 saw for the first time, about midday, one G., who was in business 
 there. They discussed the purchase by the plaintiff of G's. stock 
 in trade, amounting to something over 84,000, but concluded no 
 Imrgain. The plaintiff then went home, realized all his available 
 assets, part at a sacrifice, retui'ned to Belleville between nine and 
 ten the .same night with his .son, at once commenced taking stock 
 with G., finishing next evening between five and six, and then, 
 wMthout making any enquiry as to G's. position, or taking any ad- 
 vice on the .subject, according to his own statement, purchased 
 the .stock at ninety cents on the dollar, and paid over to G. in 
 cash the purchase money, $4,279. G., who was in.solvent at the 
 time, being indebted about $17,000, with le.ss than So, 000 ot' 
 assets, absconded that night with the money. Other evidence 
 went to shew that plaintiff in fact purchased the business at 
 thirty-five per cent, discount, i. a. for $2,700 ; and there were 
 other circumstances of suspicion, it was held that the jury pro- 
 perly found the sale to be fraudulent and void under sections 8() 
 and 88 of the Act of 1869. It was also held that even if the 
 plaintiff were innocent of a wrongful intent, the .sale of his whole 
 stock in trade was in itself an act of bankruptcy (Brooks v. 
 Taylor, 26 C. P. U. C. 443). 
 
 A partnership existing between two persons was, within three 
 months of the issue of a writ of attachment in insolvency, dis- 
 solved, and one of the parties transferred his interest in the part- 
 
 Ill;! 
 
f] 
 
 FRAUDS AND FRAUDULENT PREFERENCES. 
 
 313 
 
 nership property to the other, but at the time of such transfer 
 tli(.' firm, as well as the partners individually, was insolvent, and 
 each knew, or had probable cause for believing the inability of 
 tlie other to meet his engagements. Afterwards the retiring 
 pHrtner and the firm were plo^ced in insolvency by compidsoiy 
 li( [nidation and a different assignee appointed for each. It was 
 held that, the transfer was fraudulent and void, and that nothing 
 passed under it, and that the assignee of the firm therefore, and 
 not of tlie separate pai'tner was entitled to the effects of the part- 
 nership including the property transferred by the retiring part- 
 ner. An order made by the county judge for the transfer of such 
 property from the separate to the joint assignee, WcOs therefore 
 ronfirmed. It wa.s also held that even if the partnership creditors 
 conld prove against the effects iu the hands of the sei»arate as- 
 signee, so that all that was i'e([uired was a direction to that effect 
 as the making of the order was purely a matter of discretion, tlie 
 (Jourt would not interfere (I'e Gaton and Cole, 26 C. P. U. C. 30<S). 
 
 Under this section the j)resum])tion that the contract or con- 
 veyance is made with intent to defraud creditors cannot be re- 
 lintted. The section .should be read as if it concluded that all 
 sncli contracts " art; to be deemed to be made with inttmt to de- 
 iVaud creditors," and are eonsei[ueutly void {Ciinnphell v. Barrie, 
 :n Q. B. U. C. 28<)-!)(> ; .see also Davidmn v. Roh,% 24 Grant, 22, 
 tt, 75, 70 and 77). 
 
 The phra.se " probable cause for believing" fee, the inability of 
 the debtor to meet his engagements occurs in this and in the 134th 
 section of the Act. The Act in force in the United States uses 
 the word " reasonable " instead of " probable " as in our Act. This 
 phra.se in our Act does not import any actual knowledge on the 
 part of the creditor, nor does it seem necessary that he should 
 have any actual belief on the subject ; and belief will not protect 
 a party, if he has probable cause to disbelieve (Davvlson v. 
 McIimcH, 24 Grant, 414). It only requires that he should have 
 probalile cause to believe, and he nnist be considered to have 
 probable cause to believe when such a state of facts is brought 
 to his notice in respect to the affairs and pecuniary condition 
 of the debtor as would lead prudent business men to the 
 
 m 
 
 •? 
 
» i 
 
 i 
 
 w 
 
 ijip 
 
 ih 
 
 i 
 m 
 
 1 :; 
 
 'Is 
 
 
 314 
 
 THK INSOLVENT AIT. 
 
 conclusion that tho debtor cannot nieot hi.s ohligations as thoy 
 mature in the ordinary course of Inisiness (Tuof v. Martin, (i 
 B. R. 49 ; re Clark, 10 B. R. 21). If it appears that the debtor 
 was actually insolvent, and that the means of knowledge upon 
 the subject were at hand, and tliat such facts and circumstaiyes 
 were known to the creditor as clearly put him on enquiry, hu 
 had probable cause to believe that the debtor was insolvent. Or- 
 dinary prudence is required of a purchaser in respect to the titlf 
 of the .seller, and if he fails to investir^ate, when put upon en- 
 (juiry, he is cliargeable with all the knowledge which it is rea- 
 sonable to suppo.se he could have acijuired if he had [jerforuiod 
 his duty {Scaninion v. Cole, ."> B. R. 257 ; Bucha'nan v. Smith, 7 
 B. R. 513). Knowledge of a trader's inability to i)ay his debts in 
 the ordinary course of business derived from his failure to pay 
 the debt due to the itreferred creditor himself, is at least sutHcient 
 to put a party on enipiiry as to the debtor's insolvency (re 
 Forsyth, 7 B. R. 174). Willing ignorance as where a party wil- 
 fully shuts his eyes to the means of information which he knows 
 are at hand is regarded as e(]uivalent to actual knowledge 
 (Scammonv. Cole 5 B. R. 257; Ww/er v. Hall 5 B. R. 181). 
 
 If other creditors institute eniiuiries .shoi'tly after the making 
 of the transfer, and find no tlitKculty in learning that the ilcbtor 
 owes more than the value of liis property, this sho tvs that thr 
 means of ascertaining liis condition were at hand ( Wayer v. Ila/I, 
 5 B. R. 181). 
 
 The existence of a financial crisis constitutes of itself a reason- 
 able cau.se for believing doubtful men to be insolvent (re Clark, 
 10 B. R. 21). A conveyance out of the ordinary course of business 
 is sufficient evidence, if uncontrolled, to establish a knowledge of 
 the debtor's insolvency. The purcliaser is put upon the enquiry 
 and should take steps to ascertain the condition of the debtor, or 
 at least his general reputation as to solvency {Tvitle v. Truaa', 
 1 B. R. GOl ; North v. Hoiise, G B. R. 305). 
 
 131. A contract or conveyance for consideration, respecting either real <jr 
 personal estate, by which creditors are injured or obstructed, made by a deb- 
 tor unable to meet his engagements with a person ignorant of such inability, 
 ■whether such person be his creditor or not, and bef(jre such inability has 
 
" 
 
 FHAUDS AND FRAUDULENT PUEFKHEXCIiS. 
 
 31 o 
 
 s thoy 
 rtin, (i 
 debtor 
 e upon 
 stan^'os 
 ivy, hv. 
 . Ov- 
 (3 titlf 
 >on en- 
 is rea- 
 f'uniifd 
 hnitk, 7 
 ilebts in 
 i to pay 
 utficient 
 ncy (ic 
 rty wil- 
 e knows 
 Dwledgc 
 
 bt'coiiio public and notorious, but within thirty days next boforo a domaiid 
 of an asHigninont or the issue of a writ of attachment under tliis Act, or at 
 any time afterwards, whonovor such demand sliall have boon followed by an 
 assignment, or by tho issue of such writ of attacliment, is voidal)le, and may 
 bo set aside by any court of comiietent jurisdicticjn, upon such terms as to 
 tiie protection of such person from actual loss or liability by reason of such 
 contract, as the Court may order. 
 
 A wife having an inchoate riglit of <lowei' out of an t;([uity of 
 redeinpti(jn in property worth Slj.SOO, agreed with lier liusljand, 
 and one of hi.s creditors that she should release this dower in con- 
 sideration of an absolute conveyanceof property worth^l,700. The 
 liusVtand was at this time in insolvent circumstances having made 
 an assignment sonu; time previously. It was held, that the re- 
 lease of dower under these circumstances was a fraud upon the 
 other creditors and the Court set aside the transaction with costs 
 (Black V. Fountain, 23 Grant, 174 ; see also Masaon v. McGoiuan, 
 2 L. C L. J. 37, as to fraudulent transfers). 
 
 A .sale of pnjperty by the insolvent, whcn-e the purchasei- pays 
 full value for the goods he buys, is not neces.sarily a fraudulent 
 transaction, so as to be voidable under this section, though the 
 sale takes place immediately before the assignment. If the credi- 
 tors cannot get the identical property sold, they get its value, and 
 are consequently not injured or obstructed. Thus, where on the 
 2 1st September, 1806, one S. transferred certain cheese to K., by 
 delivering him warehouse receipts therefoi'. 8. })ecame insolvent 
 on the 19th of October, and on the following day K. became aware 
 of it. On the 22nd of October, K. executed a mortgage to the 
 Bank of Montreal on this cheese. It was held that the subsecjuent 
 insolvency of S. did not affect K's right respecting this property 
 Even if a case comes within this section, the contract is voidalilc, 
 only under the order of a competent tribunal, and this order will 
 only be made on such protective terms to the person from actual 
 loss or liability, as the Court may see fit to direct (Bank of Mon- 
 treal V. McWhirter, 17 C. P. U. C. 506). 
 
 In holding void a mortgage, under section 3 (j) of the Act, 
 both as to an antecedent debt and a fre.sh advance, on the ground 
 that the fresh advance was not made bonM fide, to enable the 
 
31(5 
 
 THE INSOLVENT ACT. 
 
 V\ 
 
 1 1 
 
 debtor to carry on his buHincHs, Mosh, J. A., expre.sHcd an opinion, 
 that this section did not ap])ly, vvlion the creditor knew that tlio 
 debtor was wholly unabli^ to meet his en<,'a;,'(Mnents, and he ret'uscil 
 to uphold the niortt^agt! even as to the; fresh advance {KoJus v. 
 Ilet'<jeii, 1 Api)eal Reports, Ont., 7')). 
 
 It was stated by the Court, in Matlutrfi v. Lunch (27 Q. B. U. 
 C 244), that the transaction then\ in (luestion niij,dit possibly 
 come within this seHion. The action was detinue and trover for 
 the conversion of goods, but the Court said they had no power to 
 settle any terms for th(! proti^ction of tin; plaintiff, but that tliis 
 must be Uift to anotlier tribunal. 
 
 T]\e (piestion was raised in Skinner w. McLeod (2 Puf^sley, 134), 
 whether the (Jourt of " compet(!nt jiuisdietion," referred to in this 
 section, would not mean a (Jourt of E(|uity only. 
 
 132. All CDiitmots, ur convoyivncos lu.ido, and acts dune by a dol)t<ir, ro- 
 specting either real or persdiial estate, with intent fraudnlontly to impede, 
 oV>8truct or delay his creditors in their renuxlies against him, or with intent 
 to defrand his creditors, or any of them, and so made, done and intendud 
 with the knowledge of the person contracting or acting with the delitor, 
 whether such person be his creditor or not, and which have the elfect of im- 
 peding, ol)8trncting, or delaying the creditors of their remedies, or of injur- 
 ing them or any of them, are prohibited, and are null and void, notwith- 
 standing that such contracts, conveyances, or acts bo in consideration, or in 
 contemplation of marriage. 
 
 A contract, which falls within this .section, is absolutely luill 
 and void, afc initio, and where a promissory note is o])taiiK'd in 
 violation of this section, it will l)e void, even in the hands of a 
 third per.son, who takes it without any positive knowledge of its 
 origin, and the holder of such a note will not be allowed to rank 
 on the estate in respect of it (re Davis, 13 L. C. J. 184 ; 5 U. C. L. 
 J. N. S. 207 ; see as to the meaning of the words " null and void " 
 Pearce v. Morrice, 2 A. & E. 94 ; McCord v. Harper, 20 C. P. U. C. 
 96). 
 
 The " knowledge " referred to in this section would seem to be 
 actual knowledge, and not mere constructive notice (Leys v. Mc- 
 Pherson, 17 C. P. U. C. 206). 
 
 A person in insolvent circumstances conveyed, by way of 
 settlement to his intended wife, a lot of land, ujjon which the 
 
FRAUDS AND KUAUDUI.KNT IMIKFKHKNCEH. 
 
 317 
 
 f 
 
 settlor had coiinnoncwl to put up a house, hut wliich was not coni- 
 pk'tcd (uitil aft(!r luarria^fo. On a hill filed hy the )i.ssi<;neeH in 
 iusolviincy, the (Jourt doclarod that for ho uuich of tho huilding as 
 was C'oniiilcted after inairia<j;e, the creditors had a claim on the 
 property, hut j^avo the wife the rij^'ht to elect whether she would 
 lie paid the value of her interest without tho expenditure aftei 
 umrriage, or ])ay to the assignees tho amount of such expendi- 
 tine ; and it suhsequently apjtearing that her hushand had 
 created a mortgage pjioi' to the settlement, the wife was declared 
 entitled to have the value of the impi'ovements made aftei' 
 marriage, applied in discharge of the mortgage in priority to the 
 claims of the creditors (J(icJx»on v. Bowman, 14 Grant, 150). 
 
 A covenant, in an ante-niiptial settlement hy the hushand to 
 settle upon such trusts as the trustees slujuld require, all the real 
 and personal estate of, oi- to which he shoidd hecome possessed or 
 entitled during the covertuie, is void, as against his trustee in 
 hankruptey,as heing against puldic policy, and an attempt to with- 
 draw the whole of his property from the just claims of his credit- 
 ors (ex parte Bolland, L. R. 17 Ecj. 115 ; 29 L. T.N. S. 543). 
 
 Ui3. if any sale, deposit, plodgo or transfer be made of any property real 
 (ir personal by any person in contemplation of insolvency, by way of ."lecurity 
 for payment to any creditor; or if any property real or personal, movable or im- 
 movable, goods, eflects, or valnable security, bo given by way of payment by 
 snob 'THon, to any creditor whereby such creditor obtains or will obtain an un- 
 just prelerence over the other creditors, suclisale, deposit, pledge, transfer or 
 payment nhall be null and void, and the subject thereof may be recovered 
 back for ■ benefit of the estate by the Assignee, in any court of competent 
 inrisdictiun ; and if the same be made within thirty days next before a de- 
 mand of an assignment, or for the issue of a writ of attachment under this 
 Act, or at any time afterwards, whenever such demand shall have been fol- 
 lowed by an assignment or by the issue of such writ of attachment, it shall 
 be presumed ^jnmo / .»■ to have been so made in contemplation of in- 
 solvency. 
 
 The 40 Vict. s. 29 amended this section by adding after the 
 word " presumed " in tho last line hut one, the words "prima 
 facie," This amendment makes the presTimption rebuttable, and 
 was no doubt introduced in consequence of the opinions of two of 
 the Judges in Davidson v. Ross, 24 Grant, 22 (see post p. 32). 
 
If 
 
 
 fill 
 
 !!iP' 
 
 '^f 
 
 
 i 
 
 3]8 
 
 THE IiNSOLVENT ACT. 
 
 Tfiio section now extends to real estate as well as to personalty, 
 though in Newton v. Ontario Bavk (13 Grant, 052), the majority 
 (jf tlie Court were of opinion that the Act of 1864 only, applied 
 to personalty. I'his section does not invalidate conveyances 
 executed before the Act jtassed, and whicli were valid at the time 
 of their execution (Gordon v. Young, 12 Grant, 318). 
 
 The first branch of this section relates to transfers, etc., liy way 
 of security for ])Siym{.'nt, etc., the second branch of the section re- 
 lates to transactions liy way of 2i(f'y'>^i^nt. '• Such perso^i " in the 
 second branch of the section is an e(|uivaU'nt to " any person in 
 contemplation of insolvency " and the latter words shouli' be im- 
 plied in the secontl bianch of the section (.see observations of Wil- 
 son, J. in Camphcll v. Barrie, 31 Q. B. U. C. 285). Presumed to 
 lie made in contemplation of insolvency signifies, presumed to give 
 an unjust preference oi- to defeat efpial distribution among the 
 creditors (ib. ; see also Davidson v. Ross, 24 Grant, 75-C ; per 
 Patter.son, J. A.), the prevention of ratable distriliution which 
 the in.solvent law aims to secure being an unju.st preference. 
 
 The point as to who is a ci'e(litor of the insolvent came u)> in a 
 veiy imjtortant case in Nova Scotia. In that ca.se the defendants 
 were acconnnodation indorscjrs for the firm of W. L. Dodge \: Co., 
 who on the 29th of Nov., 1870, assigned in insolvency to the 
 [ilaintiff. On the 2{)th of July previous, defendants had endor.sed 
 a note made by W. L. Dodge cV: Co. to T. G. Budd, one of the fiiiii 
 of W. L. Dodge it Co., for S3,()()(), jtayable three months after 
 date. On the 2r,th of October, W. L. Dodgt- i; Co. .sold to David 
 McPlierson a (piantity of hnnlter foi- wliich was given two notes 
 for iS!l,333,75, one for Sl,l()7.')() and another for i?l,500. These 
 notes were tiansferred by W. L. Dodge ifc Co. to the defendant 
 who had endorsed the !?3,0()() not(! which would mature on the 
 2f)th of October. The transfer was before the S3()00 note fell due 
 and these McPherson notes were discounted by defendant and thi' 
 ii?3,0()0 note taken up therewith and the })alance credited to W. L. 
 Dodge ic Co., tlie balance of S835, which went in reduction of a 
 further liability, on a note for 83,500, of the insolvent ; and de- 
 fendants gave a renewal for the balance. The defendants weie 
 indorsers after Budd, and were consequently sureties to the hold- 
 
■p 
 
 FRAUDS AND FRAUDULENT PREFERENCES. 
 
 319 
 
 V 
 
 lts of tlie note, that it sliould be paid by the prior parties when 
 it liecanio (hie, bnt neither W. L. Dodge & Co., nor Budd the first 
 taidorser was in any way liable to the defendants, nor could they 
 he liable until the note fell due and the defendants were compelled 
 to p.ay it. The transfer of the McPherson notes was made befoi'e 
 the note endorsed by the defendants fell due, and consequently be- 
 fore there was any liability whatever on the defendants. It was 
 contended that under these circumstances the defendants nothavinsr 
 actually paid or become liabh; to ])ay the note at the time of the 
 transfer were not creditors of the insolvenfc« within the meanino' 
 (pf the (S!>th section of the Act of 18G9. Young, C. J., and Ritchie, 
 J., huJd that the defendants were ci-editors of the insolvents, and as 
 the insolvents were at the time of the transfer hopelessly insolvent 
 and tliere was no probability of there being able to tide over their 
 (litheulties the transfer was hthl to be void under this section. 
 
 McCully, J., and Wilkins, J., dissented fi'om the judgment given 
 !)y the other two judges, and held that the last indor.ser was not 
 before^ the maturity of the note a creditor of the insolvent (Harwi/ 
 V. ir;Wr,S:ip. Ct.'N. S. 1874). 
 
 In one case in this Province the question was raised whether 
 an indorser of the note of the insolvent was, before the maturitv 
 (if the note a creditor of the in.solvent, and the Court held that he 
 was (Churchcr v. Covsins, 28 Q. B. U. C. 540). 
 
 In Roe V. Smith (1/5 Grant, 344), A. was indorser of a note, 
 which had not matured. The maker of the note was insolvent 
 to the knowledge of A. Vankoughnet, Ch. expressed an opinion 
 that A. was not a creditor until he paid the note. The better 
 I >pinion, however, seems to be that the indorser is a creditoi' in 
 such a case ps the above (see section 2, h, sections 9 and 80, and 
 notes thereon ; see also Bothnm v. A'i'mstrovff, 24 Grant, 21 (J : 
 Ch archer v. Stavlcy, ib. (i?). 
 
 Since the decision in Davidson v. Rosa (24 Grant 22) in thi- 
 Court of Appeal for Ontario, pressure has ceased to be material 
 in determining whether a tran.saction is void under this section. 
 Two things only need concur to avoid the tran.saction, namely, 
 contemplation of insolvency, and the fact that the creditor 
 thereby obtains or will obtain an unjust preference over the other 
 
 Vis 
 
 .11 J 
 
 
 m 
 
320 
 
 THE INSOLVENT ACT. 
 
 
 i t 
 
 
 •JH ^' 
 
 :M i ; 
 
 creditors, and unjust preference is not synonymous with fraudu- 
 lent preference. Under this section the intent of the debtor a,s 
 fraudulent or otherwise, is not an ingredient ; the preference, as; 
 a fact, is made material, but nut the intent to prefer ; as, therefore, 
 pres.sure has been held to displace the intent to prefer by sliowing 
 that the tran.saction was not the voluntary act of the debtor, ami 
 as the intent to prefer is not macL-iial, under this section, so long 
 as there exists the other ingredients referred to, namely, contem- 
 plation of insolvency, and an actual, unjust preference ; the fact 
 that there is pressure will not prevent a transaction from beini; 
 void under this section ; but preference may still be unjust with- 
 ui the Statute if made in contemplation of in.solvency. In the 
 case referred to, two cousins, H. and R., entered into partnersliip 
 in trade, R furnishing all the capital (about 81400). After 
 eighteen months R. retired from the business, assigning as a 
 reason therefor, his having become possessed of the family Ikjuic- 
 stead, the management of which it was necessary for him to 
 superintend. On R.'s retirement, he sold his interest to S., a 
 brother of H., for about $1230, paid })artly by two promissory 
 ru)tes, one for 880, at a .short date, and the othei- for $1080, at a 
 year, indoi'sed by two other Itrothers, and the residue by $70 in 
 cash, supplied by one of the indorsers — S. having been without 
 any means of his o\vn. S. shortly aftei'wai'ds (about three or 
 four months) withdrew from the business, making way for J., 
 a brother-in-law of H. and S., who put a $1000 into the bu.siness, 
 l)ut paid nothing to S. for tlie transfer of his interest. The 
 smaller note was duly ])aid, but the larger noti; was not met at 
 maturity, and it was alleged that there was an understanding for 
 an extension of the time for payment. R. omitted to give the 
 indorsers' notice of dishonour, and some montlis afterwards claim- 
 ing that the paitneiinhip effects were, under the circumstances, and 
 a prior, verbal agreement, answerable for the note ai)plied to H. 
 and J. (the new firm) for j)ayment thereof, which, being unable 
 to meet, they assigned to R. certain accounts, and executed in his 
 favour a chattel mortgage on neaily the whole of their assets, as 
 security for its ultimate ])ayment. Within thirty days after the 
 execution of these instruments H. and J. were placed in insol- 
 
UNJUST PREFERENCE. 
 
 321 
 
 vtncy by other creditors. Draper, C J., held that defendant was 
 ni it a creditor, but did not rest his decision on that ground, 
 Patterson, J., held that defendant was a creditor, but does not ex- 
 press an opinion as to whether, as a matter of fact, there was 
 pressui-e ; and Burton, J., held that pressure was not proved, but 
 tlu' Court was unanimous in the opinion that pre.ssure could not 
 validate a transaction under this section, if there was a contem- 
 jilation of insolvency, and an actual unjust preference, and the as- 
 signment and mortgage were held void as an unjust preference 
 iDade in contemplation of insolvency. Draper, C. J., and Patter- 
 son, J., held that the presumption under this section is not re- 
 buttable, and, therefore, that any act done or security given by a 
 debtor within the thirty days mentioned in this section, whereby 
 line ci'edi tor obtains an unjust preference over the other creditors 
 i^^ void (see, however, 40 Vict. ehap. 41, s. 29). 
 
 Patterson and Burton, J. J., declai-etl tliat, in the Province of 
 Quebec, the doctrine of pressure had never been recognised as in 
 Utitario, and, in view of this fact, Patterson, J., expressed an 
 opinion that the rule that when an Act of Parliament has I'e- 
 ccived a construction either from long ])ractice or by judicial in- 
 terpretation, and is afterwards re-enacted in the same terms, the 
 Legislature is deemed to have had that construction in view in 
 the re-enactment, cannot apply to an Act of the Dominion where 
 different constructions are shown to have obtained in some of the 
 Provinces of the Dominion. 
 
 On the doctrine of pressure tliis case expressly overrules 
 ('aiaphMy. Bavrie (31 Q. B. U. C. 279) ; Archibald v. Hahian 
 (:n Q. B. U. C. 295) ; McFarlane v. McDonald (21 Grant, 319) ; 
 K('(i>/H V. Brown (22 Grant, 10). The cases overruled were all 
 decided on the 89th section of the Act of I8ij9, corresponding to 
 tliis section of the present Act. 
 
 The wi-iter entirely agrees in the correctness of the decision 
 in Davidson v. Ross, as ap[)lied to the 133rd section of the Act, 
 and it is to be observed that the Court guarded against expressing 
 an opinion that the same rule would apply to the other sections 
 of the Act in which the elemeut of fraud is contained. The de- 
 cisions prior to Davidson v. Ross treated " unjust preference " 
 U 
 
 I'd St 
 
THE INSOLVENT ACT, 
 
 ,1 
 
 as e(}uivalent to " fraudulent prefei-ence," and to constitute a 
 fraudulent jti-etVi-ence the transfer or paynientniust not only Ix' vo- 
 luntary, but made in contemplation of insolvency {Campbell v, 
 Bavrle, 31 Q. B. U. C. 279 ; Hevsee v. White, 2!) Q. B. U. C. 282; 
 Keays v. Brown, 22 Grant, 10). 
 
 The ])ropositions of the (Jourt in Davidsoi} v. lio^s, supra, 
 were that the preference was unjust within this section if it pro- 
 vented that equal distribution of the insolvent's estate which the 
 Act was designed to secvu'e, and it was nunle in contemjdation of 
 insolvency, if, at the time it was made, the debtor had in \'iew 
 proceedings under the Act. A nund)er of cases are given under 
 this section, which are merely explanatory of the subject of 
 fi'audulent preference, and do not strictly relate to this sec- 
 tion as now construed. 
 
 Prior to the decision in Ddoidxon v. Ross, the Courts had in 
 two cases declared that it was not necessary that the payment or 
 transfer should be made with a fraudulent intent, that the 
 transaction would be void if entered into by the insolvent in 
 contemplation of insolvency, and the effect was to give the cre- 
 ditor, to whom the payment or transfer was made, an unjust pre- 
 ference over the other creditors of the insolvent (see Adams v. 
 MrCad, 2.) Q. B. U.C.21!)). 
 
 In Payne v. Hendry (20 Grant, 14JS), the decision was rested 
 on section 130 of the Act, but the opinicjn of tlie Court was that 
 fri'udulent prefei'ence was not necessary under section 133. But 
 as the debtor was insolvent to the knowledge of the creditor, 
 and his becoming insolvent was contemplated l)y both parties, it 
 cannot be regarded as a decision under section 133. 
 
 In Adams v. MeCall (25 Q. B. U. C. 219), the Court held that 
 knowledge on the part of the creditor of the debtor's inability to 
 pay his debts, or of a fi'audulent intention on his part to impede 
 obstruct, or delay his creditors, was not necessary to make the 
 transaction null and void. The material consideration is 
 whether the debtor, in contemplation of insolvency, made a 
 transfer whereby the creditor obtained an unjust preference over 
 the other creditors. The policy of the Act is the distribution of 
 the insolvent's elfects ratably among all his creditors and if one 
 
im 
 
 UNJUST PU INFERENCE. 
 
 323 
 
 ;;;ii 
 
 :. V I 
 
 
 of tlieiri obtains payment in full by the means stated in this sec- 
 tion, it is an unjust })refeJonce. Where tlie transaction is not with- 
 in the thirty days, the only consecjuence is tliat the person seek- 
 ing to impeach it must give evidence that it was in contemplation 
 of insolvency. One S., on the 2/)th of November, 1864, agreed 
 to deliver certain tindter to the plaintiff, at T., in the State of New 
 Voik, in May, June, and July, ItSOo, .^l,r)00 payable down, and the 
 sjime suiri on the loth of January, 1st March, and 1st April, 1(S65, 
 and the balance on delivery and inspection at T. On the 14th of 
 i)ecend)er following he assigned the timber to L., as security for 
 certain advances in goods, which L. agreed to make, to enable 
 liiiii to get it out, and on the 27th of February, 1805, formally 
 (iflivered it to L.'s son, who, after consulting with S., wrote to the 
 plaintiff that S, desired to deliver the timber to the plaintiff, but 
 WHS in diftiiiulty, tliat soin^ of his ci'e litors refused to wait until 
 he coul<l complete his eontract, and had coinuKMiced actions, and 
 n'ci)iiiiiH'n<ling that the plaintilt' should anticipate their action 
 liy taking a dcliveiy bi'foie they could interfere. On the 11th 
 of .\hirch the ])laintirt" accordingly paid L.'s claim, and took a de- 
 livery of till' tind)er in Canada instead of in the State of New 
 York. On tlie 3rd of March, L. had served a writ on S., telling 
 liiiii it was to secure precedence, and an execution was obtained 
 ill this sint, under which the sheritt' seized, and the .seizure was 
 not abandone(l until the 1st of July. On the 14th of April S. 
 made an assignmt'ut, under the Insolvent Act of 18(J4, to the de- 
 fendants. S. admitted that he was insolvent on the 11th of 
 Mareh. and long previous, thuugli he said lie did not then know 
 it, and had not iid'ormed the plaintiff of it. It was lield that this 
 evidence showed a transaction void un ler this section, and the 
 jury, having f<mnd for the plaintiff, a new trial was gi-anted 
 Adams V. McCall, 25 Q. B. U. C. 21!)). 
 
 In the Province of Quebec, also prior to the foregoing decision, 
 it had been declared that it is immaterial that tlie payment is 
 iiiaile by the debtor under compulsion of legal process, and under 
 this section, a sum of numey paid by the debtor to obtain his dis- 
 charge under a caphi-^ al t'l'^ponilenditm, may bo recovered back 
 by the assignee of the debtor, under deed of a.s.signment made im- 
 
324 
 
 THE INSOLVENT ACT. 
 
 nit'diatt'ly after the arri'st, tlie money being ])ai(l witliin thirty 
 days before tlie execution of tlie assignment (SauvageaM v. Lciri- 
 viere, 13 L. C. J. 210). 
 
 It is evident, that where fi'aud is necessary to imiieacli t'iie trans- 
 action, pressure is still material, and wliere fi-aud is the only 
 vitiating element in the transaction, pressure may render it valid. 
 But pressure will not validate a transaction where there is another 
 element rendering it void. Thus, a mortgage on the ti-ader'.s 
 whole pi'operty for an antecedent debt will be void, though there 
 is pi'essure (re Hurst, P. R. U. C. 329), and pressiu'e will not 
 protect transactions which obstruct and delfiy creditors under the 
 130th .section of the Act (Z>((y/d.soii v. Mvlnncs, 24 (irant, 414; 
 see also McWhirier v, Eoyal Can. Bank, 17 Grant, 480). 
 
 So an assignment of part of a trader's property, to a special 
 class of creditors, on the awe of bankruptcy, and under such cir- 
 cumstances, that it is in direct and express contravention of the 
 bankrupt laws, cannot be made good by any amount of pressure 
 (ex parte S<ttf'ery, L. R. 4 Ch. D. ooo). 
 
 But pressure rebuts the fraudulent intent, and if a fraudulent 
 intent is all that is required to make a fraudulent preference, there 
 can be no fraudulent preference where there is j)ressure (see 
 Davidson v. Rosi<, 24 Grant, 22; Bills \. Smith, 11 Jur. N.S. V)7; 
 34 L. J. Q. B. GH). 
 
 Thus in Clemmoiv v. Converse (1(J Grant 547), the Court de- 
 clared that 'prima facie a payment by one in s<j hopeless a .state of 
 in.solvency, that his paj'ment was to be looked upon as made in 
 contemplation thereof, or a delivery of good.s, or other effects by a 
 debtor in that [)osition, is a fraudulent preference. But if the 
 payment is made under the influence of pre.ssui-e, the presumption 
 of fraud will be rebutted, and a preference which a debtor is in- 
 duced to give, by threats of criminal or other proceedings, is not 
 void as a fraudulent preference. But to rebut the i)resumi)tion of 
 fraud, the pressure must be real, and not a feigned contrivance be 
 tween the debtor and creditor, to wear the a])pearance of pressure, 
 while the real desire and intention is to give a preference {Clem- 
 nioiv V. Converse, 1(5 Grant, 547). 
 
 The object of the law again.st fraudulent preferences, is to pre- 
 vent a trader, on the eve of insolvency, from making a voluntary 
 
I-'RAUD'JLENT PREFERENCE. 
 
 325 
 
 m 
 
 distribution of his |)roporty among his creditors, so as to defeat 
 that e((ual distribution wliich is contemplated by the insolvent 
 laws (re JltiM, P. R. U. C. 330 ; per Harrison, C. J.). 
 
 In Dav'uhon v. Ross (24 Grant, 22) a clear distinction was drawn 
 between "unjust preference" and "fraudulent preference." It was 
 declared that a preference might be unjust without being fraudu- 
 lent, and in fact this was the gist of the decision. The 133nl sec- 
 tion of the Act was distinguished from the 13()th and 132nd which 
 latter sections show that the intent is material in the use of the 
 word fi'auduleiit — a fraudulent preference may no doubt be also 
 unjust, but preference may be unjust without being fraudulent — 
 pressure, however, does not negative the contemplation of insol- 
 vency und ir this section. 
 
 As we have seen to constitute a fraudulent preference, the 
 transfer or payment must be voluntary and nuxst also be in con- 
 templation of in.solvency. The intent to prefer is inferred, when 
 the transaction is voluntary, and pressure negatives this intent, 
 hut not the contemplation of insolvency (see authorities already 
 cited ; see al.so N lines v. Garter, L. R. 1 P. C. 348.) 
 
 In the United States it is held, that the intent must be an in- 
 tent on the part of the debtor, and unless the debtor at the time 
 knew that he was insolvent or contemplated insolvency, he could 
 have no intent to give a preference to one creditor over another 
 If a person, while paying one creditor honestly, supposes that he is 
 able to pay every cre<litor, there can be no intent to give a prefer- 
 ence (re D'tU(n', 2 B. R. 017 ; see also Xewtoii v. Oa'ariu Biiik, l> 
 Grant, 281)). The Act was designeil to secure an e([ual distribution 
 of the property among the creditors, and any transfei- made with 
 a view to secure the prijperty or any p irt of it to one, and thus to 
 prevent such ei[ual distriltutit)n is a transfer in fraud of the Act 
 [Toofv. Martin, (5 B. R. 4!) ; Wa]cem%n v. Ho;jt, 5 Law Rep. 80!)). 
 
 It is not a frc^nlulent preference if the act is done ia conse- 
 (juence of pressure or imjiortunity on the pirt of the creditor 
 though no threat is used {Crosbu v. Oroif/;h, 2 Camp. 166) ; if, in 
 fact, anything is done by the creditor to interfere with or control 
 the debtor's will, the act will not be a framlulent preference (ex 
 pu-te Trbikett, 2.'» L. T. N. S. 73) ; and if there is a bjiia Jik' ii^- 
 
I il 
 
 ^{ 
 
 U:^ 
 
 '>¥H\ 
 
 
 II h 
 I II 
 
 Il f i 
 
 326 
 
 THE INSOLVENT ACT. 
 
 plication or pressure on the part of some person having' a rio-ht to 
 apply, and the act in any detjree proceeds from such ap])lication 
 or jiressuie, it is not entirely voluntary, and is not a fraudulent 
 jirefeience, though the debtor may have heen in some degree ani- 
 mated hy a desire to favour the creditor (Iihnirds v. Glyii, 2 
 E. & E. 20 ; Bilh v. Snrifh, iJ4 L. J. Q. B. 68) ; and wliere a cre- 
 ditor had issued execution, and seized the debtor's goods, and the 
 latter sold the goods to the creditor with a view of making his 
 title indefeasible, this was held a fraudulent preference (ex parte 
 Pearson, L. K 8 Ch. A])p. 667). 
 
 To constitute a fraudulent preference it must be sliown that the 
 insolvent cted voluntarily and with the view of giving a picfcr- 
 ence (Grodn v. Watts, 4 Ex. 727 ; Bnmv v. Krviptov, 19 L. J. C, 
 P. 169). 
 
 If the act is done under pressure it will not be void. It is, 
 however, impo.ssible to declare the mininuim of language or of 
 conduct on the part of a creditor which will be strong enough to 
 remove the volition of the debtor. A lecpiest by the creditor is 
 sutficient, and it is not necessary that tlu're should have been 
 pressure by the creditor, or an apprehension by^the debtor that 
 he would be in a worse position l)y not making the j)ayment, 
 or otherwise complying with the creditor's recpiest: It is enough 
 if the moving cause were the solicitation of the applicant, and not 
 the desire of the debtor him.self to defeat the general distributi(»n 
 of his projierty {Mogcj v. Baker, 4 M. \: W. 348 ; Van Castrcl v. 
 Eoolrr, 2 Ex. 691). 
 
 In one case the creditor, who lived twenty miles from the in- 
 solvent, had a mortgage on the insolvent's hou.se for $900, of 
 which $400 was due. On the 8th February he wrote to the in- 
 solvent to call and arrange matteis the next time he was in ; and 
 on the 9th he purchased from the insolvent about !?1, 400 worth 
 of pork, on the condition tliat 8600 should go upon the mortgage 
 and he paid the balance of the purcha,se-m(mey to other credi- 
 tors. An attachment in insolvency issued on the 8i-d March, and 
 the assignee brought his suit against the creditor to avoid the 
 transaction. The creditor said he did not wish to press the 
 debtor in any way but wanted his money, The debtor owed 
 
Tf 
 
 ! .1.1 
 
 FRAUDULENT PREFERENCF. 
 
 327 
 
 about S3,000, and his property produced only 1,000. There was 
 contradictory evidence as to the defendant's knowing, or having 
 prolialile cause for believing that the debtor was unable to meet 
 his engagements, and as to whether the property mortgaged was 
 wortli morc'than the balance due upon it. It was held that the 
 insolvtrit could not, under the circumstances, be said to have 
 acted voluntarily, within the meaning attached to that word by 
 the decided ca.ses (Campbell v. BuA'rie, 31 Q. B. U. C. 279 ; 
 see as to what constitutes pressure, re Hurst, 6 P. R. U. C. 
 32!)-338). 
 
 In order to constitute pressure, it is not necessary that legal 
 proceedings should have been resorted to, for if the pressure 
 was such that it overweighed the insolvent's own inclination, and 
 inducetl him to act against his will, that is sufficient pressure 
 within the meaning of the insolvent laws (De Tdstetv. Carroll, 1 
 Stark. 8(S ; ex parte Sciidamore, 3 Ves. 65 ; Belcher v. Prittie, 10 
 Bing. 408). 
 
 A ti-ansfer of goods V)y a party knowing himself to be in in- 
 solvent circumstances, and afterwards l)ecoming insolvent, to a 
 creditor in payment of his claim, is a fraudulent preference, and 
 void if the necessary result of the transfer is to cause the deb- 
 tor to cIo.se up his business, and prevent him from paying his 
 other creditors (Mamh v. Sveeny, 12 C. L. J. N. S. 18 ; 2 Pugs- 
 ley, 454). 
 
 Traders who had been in Ijusiness for about eight months, and 
 were, at the end of that time, in insolvent circumstances, had 
 sent an order for goods to their largest creditor, whosi! account 
 against the firm had increased to doublethe amount it was origin- 
 ally agreed it should be. The goods were packed up, but not sent 
 for some days, when one of the firm waited on the creditor, 
 taking with him a list of the debts due the firm, intending by 
 arrangement with his partner, to oft'er to assign to the creditor 
 such of these accounts as the creditor should select ; the creditor 
 had given orders that the goods should not be sent until he saw 
 one of the insolvents, and on the latter calling on the creditor, 
 he demanded something in cash, and the insolvent informed him 
 that he could not wiake the payment, but ortered an assignment 
 
 ill! 
 
328 
 
 THE INSOLVKNT ACT. 
 
 of tlie accounts, wliich the crcflitor accuptod. It was held tliat 
 this was sutticieiit pressure on the part of tlie creditor to prevent 
 the assi^fnnient l)ein<f considered as a prefc^rential one within thi- 
 nieanint,' of the Act (Ke<ii/f< v. livonui, 22 (Jrant, 10). 
 
 M. was tlie owner of a warehouse, and aycnt for T. & W,, and 
 held for them a (|U<intity of j,n'ain, which he refused to give up 
 till paid $1,400 owed him by T. & W. The latter were in ins(jl- 
 vent circumstances, and W. had absconded. After several appli- 
 cations for })ayment by M. to T., the latter agreed to transfer to 
 him his interest in a vessel in satisfaction of the debt. This was 
 done by a bill of sale, made on the 28th Novend)er, 1872, which 
 being iiregular in form, another was executed on the 5th i>i 
 December. T. & W. were declared insolvent on the 12th of De- 
 cember. The gi-ain was given up by M. on the 28th November, 
 upon execution of the first l)ill of sale. The Court held that the 
 sale of T.'s interest in the vessel was not a fraudulent preference, 
 for the bill of sale was executed by T. under pressure, and on the 
 express condition that the grain .should be delivered up to him 
 {McFarlane v. McDonald, 21 Grant, 319). 
 
 A mortgage, covering the whole of the debtor's property, is not 
 under all circumstances, void on that ground. Where the mortgage 
 is given under pre.ssui'e by the creditor three months befori' tlir 
 assignment, and there is no intent to defeat or delay creditors, the 
 mortgage will be good, though the mortgagor knew, or had strong 
 reasons to believe him.self to be insolvent, when he gave the 
 mortgage {Archllxdd v. Haldan, 31 Q. B. U. C. 2!)5). 
 
 In this case, however, there was no evidence that the creditor 
 was aware of the insolvent circumstances of his debtor, i'he 
 principal arguments against the mortgage were, that it covered all 
 the debtor's property, and as it contained no proviso allowing the 
 debtor to continue in possession until default it enabled the mort- 
 gagee to put a stop to the debtor's business, by taking pos.session 
 of the property mortgaged (see McAulaij v. Allen, 20 C. P. U. C. 
 417 ; see ante p. 43). 
 
 Under the authorities, the payment or satisfaction of a debt, 
 the result of pressure on the part of the creditors, where it is made 
 in the ordinary course of business, can stand, although at the time 
 
FRAUDULENT PllKFEUENCE. 
 
 32&> 
 
 the debtor wa.s insolvont. But if the debtor is insolv^ent at tlie 
 time, to the kno\vledf,'e of both |»arties, and the transaction is a 
 transfer of tlie whole estate witliout any e(|uivalent and cut 
 of the ordinary course of business, and causing a stoppa ,c of 
 the liusiness, it is more difHcult to support it on the grcnnd 
 of pressure. Thus, a trader who was indebted to the amount of 
 .'r'S.OOO, and claimed to have assets consisting' of stock in trade, 
 book, and other debts, due to him to the amount of about $8,500, 
 a^ni'ed with one of the ci'editors to sell off liis entire stock in trade, 
 [Tocure notes therefor, and hand same over to the creditor in dis- 
 eliari,'e of his claim, which was accordingly done by the debtor, to 
 an amount of about $(J,000, leaving only the book debts, which it 
 was shown would pay not more than 25 per cent, on the claims 
 of the remaining creditoi's ; at tliis time, about one-half of the claim 
 of thr creditor so paid oft', was not due ; it was held, that under the 
 circumstances, tliis was a prefei-ential assignment within tlie 
 meaning of the Insolvent Act and as such fraudulent and voi<l, 
 against the general body of creditors, and tliat it could not be sup- 
 ported as having been procured by pressure {Dav'uhon v. Mclnnea, 
 •1-1 (iiant, 217; attirmed on appeal, 24 Orant, 414). 
 
 Mortgages, by an in.solvent, to secure an antecedent debt, if 
 given voluntarily or spontaneously, in contemplation of insolvency, 
 are wholly void. But if a morti;age is obtained by pressure with- 
 -ut any knowledge that tlie debtor is insolvent, and the mortgage 
 is in such a form that the creditor is not enabled to at once put a 
 sto}) to the de})tor's trade, the mortgage will be valid, where there 
 is still a substantial portion of the assets left for payment of the 
 creditors. A mortgage was obtained by urgent pressure from an 
 insolvent person, more than three nuniths Itefore lie executed an 
 assignment in insolvency. The mortgage was for an antecedent 
 debt, and was not enforceable for two years. It comprised the 
 mortgagor's mill property, and left untouched about one-third of 
 his assets. It was not executed by the mortgagor in contempla- 
 tion of insolvency, or with intent to give the mortgagee a ])refer~ 
 ence, and at tiie time of obtaining it, the latter was not aware of 
 the mortgagor's insolvency. In a suit by the assignee in insol- 
 
 >■ \ 
 

 i^ii 
 
 ! I.. 
 
 I 
 
 i 
 
 380 
 
 THK INSOLVKNT ACT. 
 
 vency, inipcacliing the transaction, tlio mortgage was held to he 
 valid (McWIiirfcr v. Roi/dl Can. Jiavk, 17 Grant, 4h0}. 
 
 But if the mortgage coverH the whole of the dchtor's assets, or 
 if il covers so much, or such part, as necessarily stops the mort- 
 gagor's trade, or prevents it being carried on in its usual and or- 
 dinary course, or enables the mortgagor forthwith to put a sto])to 
 the business, it will be void {Johnson v. Femmcj/cr, 2') Beav. 8iS ; 
 Llndon v. Mason, (i M. ^: Gr, 89') ; ex ])arte Baifcy, 3 De. G. M. 
 & G. 534-G; Stanijn- v. Wiltins, 1!) Beav. ()2(;). 
 
 Thus where a ci'editor, aware of the despeiate oircinustanoes 
 of liis debtoi', olttain<'d fi'om him, by pressure, a moitgage on his 
 chattels used in his business, an<l it did not appear that he had 
 any other property at the time, except some book debts ; the 
 mortgage was held void, it having the effect, under the circum- 
 stances, of stopping the debtor's business (McWhirter v. Roijal 
 C<in. B(tvk, 17 Grant, 480). 
 
 A mortgage obtained ])y pressure from an insolvent, maybe 
 good, though the debt secuied was not payable at the time of 
 making the mortgage, and, therefore, the law sancticms the doing 
 under prcssiu'e, what the creditor has not the power to compel 
 (Strachan v. Burton, 11 Ex. 047). 
 
 It was decided in Prince Edward Island in 1870, that to sustain 
 a charge of undue preference, the ])ayment or ti'ansfer must bo 
 voluntary — i.e., originating with the debtor, and made with the 
 intent to prevent the e((ual destribution of his assets among his 
 creditoi's. If it is ma(ie in conse([uence of threat or pressure by 
 the creditor it is not voluntary, nor if it originated in a bonn tiJa 
 application by the creditor (re 7^7/, Peters Reps. P. E. J. 211). 
 
 The law will not presume an intent to prefer when the debtor 
 is not aware of his insolvency, but it is incumbcnit on him to 
 show it (re Oregon Printing Company, 13 B. R. 503). No particu- 
 lar or specific evidence of an intent to prefer is necessary when a 
 payment is made by an insolvent debtor, for the Act itself is 
 sufficient evidence of the intent (il).). 
 
 If a bank merely certitie;; tne cheijue of a debtor in advance, re- 
 lying on his promise to make his accnunt good during the day, such 
 an overdi'aft in the absence of fraud creates simply the relation 
 
FRAUDULENT PRKFKRENCK. 
 
 331 
 
 of (Iclttor and creditor and ilic payment of such a debt after in- 
 snlxi'ncy occiu'H is an act of bankruptcy (Pnipv v. Sohnnoii, 14 
 15. H. I«i2). The intent of a debtor to i>refer, coupled with an at- 
 tt nipt to do it is an act of bjuilsruptcy, altliough the instrument 
 is so <lefective as to })e void (re Mwdeholni, 12 Jl II. ')33). 
 
 Frau(hih'nt assif^nments of a )>ni't of a del)t<)r'H property mostly 
 consist of fraudulent pi'efeicnces, l)ut it is sidtnutted that nn 
 nssiyument of part of a delttor's property may be fraudulent 
 ax mini lint rrrdifovK, even thou^di thei'e be no preference of a 
 creditor or creditors. It is clear that a conveyance of the whole 
 of a debtor's property in resjx'ct of a past debt is only fraudu- 
 lent in respect of tlie defeat or ilelay of th(^ creditors at lar;.,'o, 
 which necessarily must result tlierefrom, and which is therefore 
 presumed to have been intended l)y the debtor, winch shows 
 that intent to delay in itself renders fiaudulent in tlu! eye of 
 the baiiki'uptcy law a transaction, otherwise unol)jectionablo ; 
 and it would would seem to follow that any transfer even of 
 part of a debtor's property winch has for its ol)ject a fraud on 
 thy creditors is an act of bankruptcy, even though the object 
 be not to prefer a cre<litor oi- creditors, and even though the 
 transaction did not fall within the Statute of Pllizabcth, e. //.,any 
 transaction which is intended to induce creditors to hold their 
 hands !ind not pre.ss for just de})ts, such as a .scheme to avoid the 
 p\dilicity of a debtor's embarrassments which the Bills of Sale 
 Act ensures will amount to an act of bankruptcy if the jury 
 conclude that the object of the arrangement was to deprive credi- 
 tors of theii- rights under the banki'uptcy law (ex parte PeavNon, 
 L. K. S Ch. 6()7 ; ex parte (hliev, L. R. 7 Ch. 20). 
 
 But where a trader gave (me of his creditors a bill of sale of 
 all his ]>i'op(!rty to secure a then existing debt and a fresh ad- 
 vance, and it was verbally agreed that the lull of sale should not 
 be registered, but that the giantor should give a new bill of .sale 
 in substitution for the first when re(}uired to do so by the grantee : 
 more than two months before the grantee tiled a litjuidation peti- 
 tion, a new bill of sale was given and was registered, and the 
 grantee |)ut a man in possession of the property : but the 
 gii;ntor's name remained on the i)remises as the ostensible occu- 
 
 If 
 
332 
 
 THE INSOLVENT ACT. 
 
 1 i \''M ! i? ■ f 
 
 ; i: 
 
 pier of thorn : it was helil that there liaving been a sufficient 
 fresh advance when the tirst bill of sale was given, the substi- 
 tuted bill of sale was good as against the trustee in the licjuida- 
 tion (re Jackson, L. R. 4 Ch. D. G82 ; ex parte Cohen, L. R. 7 Ch. 
 20 ; and ex parte Stevens. L. R. 20 £({. 780, distinguished). 
 
 The fact that the debt to secure which the debtor ass-.igns tho 
 whole of his property, is much less in value than the ])roperty 
 assigned, so as to create a valuable resulting trust in favour of tht,' 
 assignor, does not prevent the assigiunent frcnn operating as an 
 act of bankruptcy, because the surplus beyoml the debt secuivil 
 would not l)e liable to be taken in execution, and the connnon law- 
 remedies of other debtor's against tlieir creditor's estate would be 
 thereby barred and they defeated and delayed (Smifk v, Caaium, 
 22 L. J. Q. B. 290; ex j)arte Lmkef^, L. R. 7 ('h. 302). 
 
 The fact that the present advance is, to the kiiowledge of the 
 person making the advance, intendeil to pay olf an existing 
 secured debt, and thereby to relieve the debtor'.^ estate from ;i 
 liability to a distress or any other charge, does not, it has l)eeu 
 held in many cases, ])revent such advance froin saving the a.ssign- 
 ment from being an Act of bankruptcy (see Whltnioi'e v. Claridip-, 
 "i L. J. Q. B. 14-1). But until recently, this has never been heM 
 in respect of advances intended to pay off an unsecured debt. In 
 the recent case, however, of ex parte Heed (L. R. l-t E([. 580), it 
 was held that payment of bills by the drawer at the request of 
 the acceptor, who in consideration thereof assigns to the drawei- 
 all his })r()perty to secjie the amount and also some past debts, 
 is a substantial advance and prevents the assignment from being 
 an act of bankruptcy (seti also ex parte Sw'dehenhai't, 3 M. .v, 
 De G. 071). 
 
 In April, 18G9, A. lent money to B., on an express agreement 
 that it was to be secured by mortgage on certain property, and on 
 the 3rd of July following the mortgage was given accordingly, at 
 the request of the mortgagee's agent, and in fulfilment of the pro- 
 mise made at the time of the loan. On the 2nd of August in the 
 same year, the mortgagor became ins(jlvont, the moi'tgage was, 
 nevertheless, upheld under tlu^ section «jf the Act of 1804 cor- 
 responding to this, for there was sufficient pressure by virtue of 
 
'^ 
 
 UNJUST rREFER?:NCR. 
 
 333 
 
 tlio agreement to take the ease out of the Statute {Allan v. 
 ChirlMon, 17 Gi-ant, ')70). 
 
 Strong, V. C, in giving judgment, expressed an opinion that 
 section 131 would not apply to such a case as the above, inas- 
 much as it could not be said that the mortgage injured or ob- 
 structed creditors, and if the section did apply, he would only 
 give relief by ordering that the mortgage be redeemed. 
 
 A payment made by the insolvent in good faith, in the ordinary 
 course of business, for a good consideration, and not in contem- 
 plation of insolvency, cannot be set aside though made a d ay or 
 two before an assignment. Where the clerk of the insolvents, 
 who were bankers, on the day before their assignment, and in 
 the ordinary course of business, pai<l a checj^ue for which they 
 were liable, without any knowledge of the intended assignment, 
 it was helfl that the payment was not null and void within sec- 
 tion 89 of the Act of 1809 (City Bank v. Smith, 20 C. P. U. C. 
 93), and was not a fraudulent preference. 
 
 The payment will not be void undei- this section unless some 
 other creditor of the insolvent is injured thereby. A payment, 
 therefore, of money, which would not in any event have passed 
 to the assignee, for th>> benefit of the other creditors, will not be 
 void under this section. The payment must be unjust to the 
 other creditors, and must deprive them of some advantage which 
 they would otherwise have possessed. Where the money paid is 
 beyond the reach of our laws, antl would not form any part of 
 the insolvent's estate for distribution, the payment will be good. 
 Tims, in one case an insolvent absconded to the United States, 
 taking money with him. He was followed by the agent of a 
 person in this country, who had become surety for him, and by 
 threats of criminal proceedings, induced to pay the agent of the 
 surety the amount for which he had become liable. The pay- 
 ment being made in a foreign jurisdiction, the Court held that it 
 was not void within this section, and that the assignee wjvs not 
 entitled to recover it back for the benefit of the estate (Roe v. 
 Smith, 15 Grant, 344). 
 
 Where A. was indebted to B., and the latter was indebted to C. 
 and it was arranged between the parties that C. should take A. 
 
334^ 
 
 THE INSOLVKNT ACT. 
 
 LIJ 
 
 !k. 
 
 f! 
 
 as his flolttor, and should credit B. with the amount (hiu tVoni A. 
 to B., and tlir hitter should dischar^'e A., and in puisuanee of 
 this agieeiiicnt A. gave his note payable to C. or bearer within 
 thirty days. Afterwards B. became insolvent, and his assignee 
 broujjcht an action against C. to recover tlie note. It was held 
 that he could not recover, for the note never was the insolvent's 
 projterty, and .so never pas.sed to tlie assignee, and even if the 
 transaction was voiil A. Wcis still indebted to the estate, and he 
 vras the proper person to be sued {Moixrcijor w. Hixm'-,'2f> Q. B. 
 U. C. 380). 
 
 Where there are no other dealings between the parties, and a 
 merchant sells goods to a debtor on tlie express understanding that 
 a chattel mortgage shall be given to secure the price, the niort- 
 irau'e will be vali<l, and where a chattel mortgage for >i>-,()()() was 
 oiven, and thj mortgagc^r testitied that he was not insolvt-nt, 
 having real estate and a claim against a railway company for 
 .*?10(),0()0, and available jjroperty to satisfy executions against him 
 he furtlier stated that the mortgage was given for the price of the 
 proi)erty covered by it V>eing household furniture, which he had 
 bouirht from the mortgagee, and that the terms of his puiehase 
 were cash, but being disappointed in getting the money to j»ay he 
 had otiered either to let the mortgagee t;ike back the furniture, or 
 t) give him a mortgage upon it, and the mortgagee accej)teil the 
 latter alternative : it was held that this in effect amounted to a re- 
 sale of the furniture liy the mortgagee, and the moi'tgage given 
 imder the ciicumstances was not a preference, though at the time it 
 was given there w^ere unsatisKed jiidgiuents and executions against 
 the mcjrtgagor (//t'/we v. Wluti-., 2!) Q. B. IL (J. 232). 
 
 There is a great distinction between the case wheie a pail of the 
 delators estate is made over to a creditor as jtayment oi- security for 
 an existing debt, and the case where the person advancing money 
 to the debtor, or Iniying goods from him, had no previous dealings 
 whatever. Where a person becouus a creditor only by the actual 
 advance for which he obtains security, such security will hold good, 
 and a sale of pr«)perty by the debtor where he obtains a full equi- 
 valent will be valid, though an assignment is made inunediately 
 afterwards. Even if a debtor, in contemplation of /nsolvency, and 
 
 11 i 
 
I \ 
 
 UNJUST PREFERENCK. 
 
 33.' 
 
 
 »iu A. 
 
 IfC of 
 
 Aithin 
 
 held 
 vent's 
 if the 
 
 1 he 
 
 Q B. 
 
 when unable to meet his engagements, and within the thirty days, 
 executes a chattel mortgage to a person who advances money in the 
 ordinary course of business, without knowledge of the debtor's in- 
 tentions, and <»n the distinct understanding that the mortgage shall 
 lie given I-* security, the security cannot be impeached wliere itap- 
 ] .it the mortgagee only became a creditor 1»y the actual 
 
 tridisaction mi which ho gave an ecjuivalent for the mortgage 
 [M'lthei's V. Lyurh, 27 q. B.U. C.2U). 
 
 One I., boinu '' tail dealer, and wanting goods to carry on his 
 Imsiness, asked one M. to endorse notes to enable him to purchase 
 them. To this M. consented, on conditi<m that 1. on receivinir the 
 goods should secure him against loss iiy a mortgage therecm and on 
 tlie othc g<;i; i in l.'s store, who was to sell them at his store only, 
 and out of t'l' proceeds retire the notes, and if he sliould sell other- 
 wise M. tnight sell the goods ftjr his own protection. M. accord- 
 ngly endorsed, ami 1. with the notes j)urchased goods, which he 
 moi'tgaged to M. as agreed on, with otlier goods for the bona fide 
 and sole consideration of perfecting the said agreement. T. after- 
 wards, and within thirty da\s fiom thr date of the morttrai-e, but 
 without AI.'s consent made a voluntary assignnient to an otHcial 
 assignee. This mortgage was upheld as against the assignee 
 {Mathers v. Lunch, 27 Q. B. U. C. 244). 
 
 It did no* ap[)ear whether tlie mortgage covered all the 
 debtor's property, and the mortgagee was ignorant of any con- 
 tenipiati(m of insolvency on the part of tlie debtor. 
 
 Wheie a mortgage only includes part of the debtor's property, 
 and does not include his stock in trade, or tht; property used in 
 carrying on his busines'^, it will Ije valid. A banking firm in 
 Toronto having become embarrassed by gold operations in New 
 York, applied to the plaintiffs to whom they owed $.50,000 to 
 advance them !?1'),(H)0 moie, and in order to obtain the advance, 
 they otfered (believing that otherwise the further advanc would 
 not be given), to secure Ixtth debts l»y a mortgage on the real 
 estate of one of the partners, worth §80,000. The plaintiffs 
 agreed, made the advance, and obtained the mortgage. The 
 mortgage did not cover the mv>rtgagor's personal property, or any 
 private property of his partner, or any property of the firni. In 
 
 V:f 
 
^36 
 
 THE INSOLVENT ACT. 
 
 less tlian three months afterwards, the debtors became insolvent 
 under the Act. They were indebted beyon<l their means of pay- 
 ing at the time of executing the mortgage, but they did not con- 
 sider themselves so, nor were the mortgagees awan; of it. The 
 moi'tgage was not given from a desire to prefer the mort- 
 irairees over other creditors, but solely as a means of obtaining: the 
 advance which the debtors fully expected would enable tliem to 
 go on with their business, and pay all their creditors. The Court 
 held tliat as to the antecedent debt, the mortgage was valid 
 against the assignee in insolvency, and no question was raised 
 as to tlie contemporaneous advance {Roynl Can. Bank y.Ken; 17 
 Grant, 4-7). 
 
 It is not an unjust preference when tlie transfer is made in pur- 
 suance of an agreement made more than thirty days before the 
 in.solvent became involved, and it is incumVtent on a party seeking 
 to impeach, as an unjust ])reference. a transaction between a deb- 
 tor and his creditor, occurring more than thirty days before insol- 
 vency, to prove that such transaction took place in contemplatiun 
 of insolvency. 
 
 A. owned a barley mill, which he was endeavouring to sell to 
 one T., whose notes he was to accept in payment, and in l)(!Cem- 
 ber, 1875, he arranged with C. that these notes were to be handed 
 over in security for all his note's under discount. !Subse(iuently, 
 and on t'.ie 7th of February, 1(S7(), the sale to T. having fallen 
 through, he executed a memoivandum in writing, transferring to 
 C. as " collateral security against pa))er discounted for me, my 
 right, title and interest, in a barley mill * ♦ * keeping the 
 privilege of disposing of the same, and ])anding to you the pro- 
 missory notes of the purchaser." It was held that this was not 
 an unjust preference ; that tiie bank liaving made advances on 
 the faith of having the proceeds of the sale handed over, it was 
 no extension of their security on the sale falling through, to ob- 
 tain an assignment of the mill itself (Sider v. Merchants Bank, 
 •24 Grant, 3()5). 
 
 In may, 1874, A., a manufacturer, opened an account with a 
 ])ank, representing himself as being in good circumstances, with a 
 capital of !:§20,000 over all his liabilities, which was believed by 
 
 SliSt 
 
 l:P 
 
UXJlsr I'lUlFKKKNC'E. 
 
 :J37 
 
 iolvent 
 i)f pay- 
 ot con- 
 Tlio 
 molt- 
 ing tlk' 
 leiii to 
 C'ouit 
 valiil 
 i'ai.sL'(l 
 
 ( '., tlie l)aiik a^afiit, wlio tlioii^lit liiiii doiiiga tlourisliino' Imsiness, 
 ami A. tlieii pioiiii.st;(l to kccj) (". always well supplied with col- 
 laterals for any accoininotlation atl'ortleil liini. In Deeenil^T, \H7r>, 
 A. applie(l to C for assistance, and prop(tsed that he should ware- 
 liouse his i^oods as inainit'actured, and pledot' the recei])ts of tlie 
 warehouseman to tlu; hank fci' advances to he made to him, which 
 jn'oposal was accedi'd to hy C. Advances were accordingly m.ade, 
 for wliich receipts were deposited witli ('. on the li)th o* Janu- 
 ary, :J.')th of January, 1st of Fehiuary, and 7th of Fehruary. On 
 the :i(!th of Fehruary, A., in com}»liance witli a demand l)y some 
 (if his ci'eilitors, executed an assignment in insolvency. On a l)ill 
 tiled to impeach these transactions as an unjust prefei'ence, tlie 
 Court, lieing satisfied that tliey all took place in gcjod faitli, and 
 not in cont<'mplation of insolvency, held that the hank were 
 entitled to hold their lien on such of the receipts as were so de- 
 posited mort' than the thirty days lieforethe assignment in insol- 
 Neiu'V ; hut in resjtect of such of tliem as were deposited witliin 
 the thirty days, the hank could not claim any lien or priority. It 
 was held, also, that the same rule was applicahle to jH'omi.ssoiy 
 notes dep(jsited with tin- hank, as collateral security (iSatcr v. Mci'- 
 r/idiifs liaid', 2i' (Jrant, .SO')). 
 
 it woulil seem that any payment or preference to an indorser 
 or other surety is fraudulent and void where the other elements 
 exist to give it that character. The payment of an indorsed note 
 hefore maturity hy an insolvent delitor is a preference to tlie in- 
 i|orser,and the money may he recovered from him (A/d v. Thorner, 
 .'{ IJ. K. I IS), and tliough the invh)rser is solvent, and the holder 
 would, therefore, V)e ahle to recover the amount of the note from 
 liim, yet the payment to the holder may he a preference as to him, 
 if the other circumstances exist, and the amount may be recovered 
 from the holder (//(U'/Ao/o?" v. Bcm,, 10 H. R. 241). 
 
 When the surety or indorser is innocent of all participation in 
 any scheme hy the principal debtor to contravene the law, and the 
 debt is paid at or hefore maturity without any action on liis|^part, 
 he is not liahh' {limn v. Ltjiln, 5. B. R. :i3:i). 
 
 A trader, being in embarrassed circumstances, sold outhisbuai- 
 uess, and out of the proceeds satisfied a promissory note on which 
 V 
 
 i 
 
 n I 
 
IV.iH 
 
 THE INSOLVENT ACT. 
 
 '.! I, 
 
 liis brotlior M'a.s irulorsor before it bad become (hie, and .shortly 
 afterwards went into insolvency. The evidence did not sliow 
 that tlie indorser was aware or was a party to tlu; payment in any 
 way, antl it was by no act of liis that the note was paid. Under 
 these ciiTnmstanets the Conil held that tlie assi<^iiee in in.solvency 
 liad no right to call upon the indorsei' to refund the amount of 
 such note ; but wliere the ])ayment of the note had been pro- 
 cured by the indoisrr. he was, umh'r this section, held liabli- to 
 make <food the amount thereof (Bofham v. Anni^trowj, 13 (' L. 
 J. N. S. 88 ; s. c. 2^, Orant. 21(5). 
 
 Where the probal lie ct>nse(|Uenee of an act is to give a prefer- 
 ence, the debtor will lie conclusively presumed to liave intt'ii(lc(l 
 to give such preference (in re Dmmmomi, 1 B. R. 281 ; re liJtui\ 
 1 I). R. 853 ; re Sutherland, 1 B. U. 531 ; le D'thhc, 2 B. R. (J17 ; 
 re Welh, 3 B. R. 371 ; C><r,'<vn v. Mung>-r, G B. R. 33). 
 
 When a debtor is insolvent, and knows it, any payments tlu'ii 
 nii'de l)y 1dm to any creditor, in full, are with intent to ]trefer. 
 Tlie giving *f a pivference is a necessaiy conse(pience of tln' pay- 
 ment by an insolvent (U'btor of one of Ids creditors. The creditor 
 is preferre<I because he Ir.is received his debt, and the other 
 crediting have not. The de])tor, being insolvent, has not the 
 means to pay them, and, by paying one in full, has defrauded tin 
 others of their just proportion of his estate. Other motives iiiuy 
 liavi! actuateil the debtor, but that makes the j)ayment none the 
 less a preference. Iiuh'ed, he may expect to become ai)le in time 
 tt» pay all his creditt)rs in full and may intend to do so as soon as 
 he can, but this does not affect the questicm. The creditor whose 
 debt is paiil is nevertheless ])referred ; he has Ids money, but 
 they must depend upon the often doidile uncertainty whether their 
 debtor will, in time, become l)oth able and wdlling to pay theii 
 debts in full {Fdrrin v. Crdivford. 2 B. R. ()()2 ; re Silverman, 4 B. 
 R. 523;. 
 
 If a debtor is insolvent at the time of making a payment, he is 
 presumed to know it until the contrary appears (in i-e Silvermmi. 
 4 B. R. 523). 
 
 A mortgage of the whole stock in trade to a pre-existing 
 creditor is pnimi facie a preference. It is very strong evidence, 
 
UNJUST PKEP^ERENCE. 
 
 339 
 
 because it i out of the ordinary course of business, and is of 
 itself enou^li, if duly I'ecorded, to destroy tbe credit of any 
 tiader, and, tlierefore, would not bo resorted to ])y any one wlio 
 liiiil readier means of paying the del)t (in re Waite, Lowell, 407). 
 Till (Ugh insolvency, in fact, exists yet if the debtor honestly 
 believes he shall be able to go on in his business, and with such 
 belief pays a just debt without a design to give a preference, such 
 a payment is not fraudulent though banki uptcy should afterwards 
 ensue ; and, on the other hand, if the delitcv, being insolvent, and 
 knuwing his situati(jn, and expecting to stop payment, shall then 
 make a i)ayiaent 01' give security to a credit(jr for a just debt, 
 with a view to give him a preference over the general creditors, 
 suili paynient or giving security is fraudulent as against the 
 civilitors. It rests upon the intent with which the act was done, 
 and the intent is to be proved as a fact, eithei' by direct evidence 
 oi as the necessary and ce.'tain consecpience of other facts clearly 
 Itioved {Morijiin V. Masilck, 2 B. 11. 521 : Doan v. Cumptoii, 2 B. 
 R. (107). . 
 
 A preference to an employee is an act of bankruptcy (in re 
 KriDjon and Fenton, B. R. 238). 
 
 The fiict that the debt is fiduciary debt is of no consequence ; 
 tlir debtor has no more right to pay it than any other debt. 
 There is no distinction between giving a preference when a creditor 
 a^ks for it, and giving a preference when a creditor does not ask 
 ioy it (in re Diblve, 2 B. R. (517 ; in re Batchd(l<;r,'3, B. R. loO). 
 
 The motives of the debtor in connnitting the act are im- 
 material. It is no defence that other con.siderations were the 
 moving cause. Motive should not be confounded with intent. 
 When he intends to do tlie thing wdiich necessarily liiuders 
 and defeats the act, he, in judgment of hiw, knows wdien 
 111' dot's it that it will have that ert'ect. Knowing the ef- 
 fect, he must intend to province it when he voluntarily chooses 
 to do the act. Whativer his motive is, he acts voluntarily in 
 choosing, and, therefore, of it\tending all the legal results which 
 How from his action in the n\ntt<'r {Hard if v. Bluiilnjci', 4 B. R. 
 202). 
 
 There is nothing in the insolvent law which interdicts the loau- 
 
 JMJ 
 
 : ,m 
 

 .i;h 
 
 n40 
 
 THK INSOLVKNT ACT. 
 
 ingof monevto an insolvent, if the purpose is honest andtlieohjoct 
 not tViUHliilcnt ; and it makes no diH'erence that tlie lendn- had 
 o-ood I'cason to believe the borrower to he insolvent ; if the loan 
 was nwule in good faith, withont any intt'iition to defeat the pro- 
 visions of the Insolvent Act. It is not diHieuIt to see, that, in a 
 season of piessine, the power to raise reaily iiioiii'V may I'e of im- 
 mense value to a man in emlmrrassed eireumstanecs (Tijl'diif/ v. 
 Bnutmav, Sav. lust. '.) H. R. :i4.')). So a fair exchange for value 
 may he made at nny time, even if one of the ])arties to thr traii- 
 saetion is insolvent. There is nothing in tlu' Act, either in its lan- 
 guage or ohject whieh prevents an insolvent troJii dealing with 
 his pro])erty ; selling or e.xchanging it foi- otht'i- projierty at any 
 time hefore proeee( lings in insolvency arc taken against him ; pro- 
 vided such dealing is eonductotl without any ])urpo.se to defraudor 
 delay his cretlitors, or give a preference to any one, and does not 
 impair the value of his estate (Cuok v. Tiillis, !) H II. 481; 
 CIdA' v. Isdln, 11 H. K. :i.S7). 
 
 The pui'pose of the Act heing to enforce the e(|ual distrihution 
 of an insolvent's estate, ev«.'ry act of an insolvent, that tends to 
 defeat that pur[)ose, should he construed gtrictly as against him, 
 and Courts should indulge every presumption that is permissihie 
 according to well-.settled rules (jf law, to secure the full henetit of 
 the cardinal principle of the law. The Act ought not to Ix- con- 
 strued to prevent the exi'rci.se of reasonahle hona jiilc etiorts on 
 the part of an energetic and hopeful debtor struggling with an 
 honest intention to pay all his debts (, Wiiger v. ILdl, 5 B. R. 181 : 
 Clavk V. helin, 11 B. R. 337). 
 
 The Act has far less reference to the condition of mind of the 
 insolvent debtor, than to the condition of in.solvency a.s a fact. 
 When a debtor knows that he is insolvent he must wait, before 
 he gives a preference, until he knows that his condition is 
 changed, or that his creditors consent to the preference. It is a 
 general principle, to which there are no exceptions, that where 
 the parties know the insolvency, they must act at their peril, if 
 they appropriate the trust fund, which tlie law devotes to the; 
 equal payment of all, before they also know that creditors have 
 ceased to be such, or that they consent, after the most full and 
 
I'N.Il'ST I'UKFKUKNC'K, 
 
 341 
 
 fair (lisclosiircs, to tli<; (liscriiiiiiiation which i.s mad)!. It is 
 irivlcvant, that they thus erroiKjously, supposed that crtMlitors liad 
 oonscntt'd. Tlieir caivlcss, iasli, or interi'stod conchisioiis i^mvo 
 tliciii no power ovei' the statutory vested ri<;hts of innocent and 
 iioM-concuri'ini,' creilitors (Carvan v. Miinijcr, 4' B. R. 2!)5 ; s. c. 
 «) \i. R. 3.S). 
 
 The Act of 18(!4 ap])lied to mortgages of real estate to a credi- 
 tor by way of preference. Hut where the n)ort;,'a;,'or did not 
 Itclieve that he was insolvent (thouy;h the iuort;,'a;^ee fc^ared he 
 was so), and made a niortLja^fe of real estate under pressure froni 
 the niortpij^fee, and in tlu^ belief that he (the nioi't<fa<for) would 
 tlierehy he eriahled to Continue his business, and pay his liabilities 
 in full, the niorti^age was held valid as against his assij^nee in 
 insolvency (Curtis v. Dale, 2 Ch. Cham. 184). An arrangement 
 I ID I id fide enteriid into foi' the ])Urpose of enabling the debtor to 
 discharge his obligations will be valid {lilnk v. Sleeman, 21 
 (mint, 250). 
 
 Previous to an act of in.solvenev, certain lands in which the 
 insolvent, a defendant in a suit in (Jhancory, had an e(iuital>le in- 
 terest, had l)een ordered to be sold, and were afterwards sold, and 
 the purcha.se-money paid to the plaintiff' in e(piity. The assignee 
 in in.solvency moved that such moneys be paid into Court for 
 the benefit of the general creditors. It was held that such lands 
 were subject to the order for sale, and the motion was refused, 
 with costs; but the assignee was considered entitled to his co.sts 
 out of the estate, as the (jue.stion was a new one, and a {)roper 
 one for liim to raise in tlie interest of the general creditors ( Yala 
 V. Tollerton, 2 Ch. Cham. 40). 
 
 A conveyance, void against creditors, was made in December, 
 18(18, thi'ough a thii<l party, to the ownisr's wife; the husband, 
 in Novendier, 18(!!>, became in.solvent, and in June, 1870, joined 
 his wife in a sale of the property to a purchaser without notice ; 
 a conveyance to the purchaser was executed and registered, and 
 the purchaser gave the wife a mortgage for part of the purchase- 
 money, ami paid her the residue in cash. On a bill by the assignee 
 in in.solvency, he was declared entitled to the mortgage and to 
 any of the money which still remained in the wife's hands, and 
 
 
 III 
 

 ■:f: f: 
 
 V ! 
 
 .S42 
 
 THE INSOLVENT ACT. 
 
 to any property, real or personal, which she had purchascfl with 
 tho reHidue and still owneil ; hut the Court refiised to direct an 
 enquiry whether she liad separate estate in order to charge the 
 same with any of the residue which had been spent Ity her, or 
 with the costs of the suit (Sdinxlcru v. .S7////, IS (Jrant .500). 
 
 Under the 11th section of the English Act of LSGO, the bank- 
 ruptcy of a debtor is deemed to have relation liack to tho act of 
 bankruptcy on which the order is made o.dju<lging him bank- 
 rupt. We have no similar clatise in oi. Act ; tho title of the 
 assignee relates to the time of tlu^ fissignment or the issue of the 
 writ of attachment, and has no anterior relation. It was stated 
 in C/nivcher v. Conninx (28 Q. B. U. 0. ^HO), that fraudulent pre- 
 ferences nmst be continuing at the time the as.signee'H title 
 accrues to enable him to (piestion it. This was on the autho- 
 rity of i}favks V. Fchlman (L. R. 4 Q. B. 481), before the case was 
 revei-sed on appeal (see L. R. 5 Q. B. '27-')). The decision, how- 
 ever, in Ghiirclier v. Co(W!)!.s, was that this doctrine did not ap|)ly 
 to transactions which were ma<le void by Statute, as those under 
 this and the 134th section. 
 
 On appeal in M(i7ksv. Fekhnan, tho Court declared that, except 
 so far as it may or may not be an act of bankruptcy under tlic 
 provisions of the bankruptcy Statutes, the doctrine of lelation has 
 no application to a fraudulent preference. In case of fraudulent 
 preference, therefore, it is not necessary that there should be rela- 
 tion back to enable the assignee to avoid the transaction, in other 
 words the preferences need not be continuing when the assignee's 
 title accrues; and whether the defendant at the time of the accrual 
 of the assignee's title retains the goods, or has converttjd them in- 
 to money, the transaction still retains its original character, it is 
 good and valid as between the parties, but voidable by the assignic 
 If the conversion is after the assignee's title accrues ho may sue 
 in trover, V)ut if the conversion is before, an action for money had 
 and received is the pro])er remedy after demand in each case 
 (Markfi v.FcUhmm, siipra). In Churrher v. CoitsiriB (supra), the in- 
 solvents two days before their assignment, sold goods, taking a 
 note for the pi-ice and paid this note over to tho defendant befoi-e 
 the assifrnment, under circumstances brin<nn<f it within tho sec- 
 
CONTKMPLATION OF INSOLVENCY. 
 
 343 
 
 tion of the Act of 18(54, correHpondinj,' to sections 133 and 134 of 
 tliis Act ; it was held tliat the Hs.si<^nee nii^dit recover in trover, 
 tliesc sections niakinj,' the transaction null and void as aj,fainst the 
 assij^nee, thou<,di iMarks v. Fcldinmi is an authority that the as- 
 si<,'iit'e may recover when the transaction is voidable only. 
 
 In Marnli v. Sweeney {'2 Pu;,fsley, 454), the Court ex})resHed an 
 opinion that the words " in contemplation of insolvency" did nufc 
 neccssaiily mean contemplation of an assignment uiuler the Act. 
 In Duridnoii v. Rdsh (24 Urant, 22), the Couit did not express a 
 decided opinion on the meaning of these words, but seemed to as- 
 sume that contemplation of insolvency meant contemplation of an 
 assignment or proceedings under the Act, or having insolvency in 
 pros[)ect. Patterson^ J., says (il). p. 0!>) " I take the object of the 
 law to be to make it the duty of a trader who, from the kn(jwle<lge 
 which he has of his own att'airs or of the intentions of his credi- 
 tors, has reason to ajtprehend either that proceedings untler the 
 Act will be taken against him (/r that he may have to resort to the 
 Act for relief, to do ncjthing wliich will prejudice the rateable dis- 
 tribution of lu.s assets, by giving one creditor an unjust preference 
 ovei' the others; and 1 apprehend that,if under such circumstances 
 lie gives a preference, lie does so in contemplation of insolvency, 
 whethei' he does it from a desire to favour the preferred cre<litor 
 or only because that creditor has succeeded by urgency in overcom- 
 ing his reluctance to give the preference." 
 
 The expression in this section" in contemplation of insolvency," 
 means that the sale, deposit, pledge oi- transfer is made for the 
 purpost! of preventing "the subject thereof" from coming into 
 the hands of cieditors, into whose hands it would otherwise fall. 
 The Statute contemplates a dealing between the debtor and one 
 of several creditors ; and where the person to whom the pledge 
 or transfer is made, is not a creditor at all, or only becomes 
 a creditor by advancing money on the security of the pledge or 
 transt'ei', the Act does not apply. Thus, where A., having manu- 
 factured a quantity of goods (a number (if oil barrels), for a cus- 
 tomer, diew upon tlie latter for the price, and applied to a 
 })anker t(j cash tlu; draft. The latter agreed to do so upon re- 
 ceiving a lien upon the goods, which was given, and the bill 
 
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 THK rXSOLVKXT ACT. 
 
 cashed accordingly. On tlic followinif day, the d('l)tor made an 
 assiifnnjont to an official ass'i^noo, and it was held that tliih 
 transaction was not within cither the terms oi- tlu; spirit of this 
 section [Xcii'tuii v. ()nt<i r'lo Ha iik,\'i (Jrant 052 ; atfirnied in a))peal, 
 1.") Grant 2S;}). 
 
 Under this section, when the act lias hoen done in conteni|)la- 
 tion of insolvency, and lias been done more than thirty days 
 before insolvency happens, the act is made indl and void, on proof 
 that it -was done in contempilation of insolvency, and that it 
 gave an unjnst preference to the civditor. In such case, liow- 
 ever, there must be proof that the ti'ansaction was entered into in 
 contemplation of insolvency (Siiferv. McirJuinfs lidiiL, 24 (Jrant, 
 365). But when the act is done within thirty days, no jii'oof of 
 any kind is required to im])each it, on the ground of its being 
 made in contem])lation of insolvency. It is presumed to have 
 been done in contemplation of insolvency, and it is impeacheil ])y 
 the mere fact of the time when it was done, i.e. in so far as bein'f 
 made in contemplation of insolvency will rendei' it void. 
 
 According to the opinion of Mr. Justice Wilson in ('(impJxdl v. 
 5a?T<e (31 Q. B. U. I'. 2!) I), in the latter case the transaction 
 would not be null and void without further evidence tending 
 to show whether it was foumled on considerati(jn, whether the 
 debtor was tlien able to meet all his en^'atfements, whether in 
 fact there was an unjust preference within the section. Though 
 no evidence of its being in contemplation of insolvency is I'e- 
 quired when the presumption operates, yet in that case there 
 must be proof of facts shewing an unjust preference within the 
 section (see also Ghurcher v. Counmyi, 28 Q. B. U.(J. 540 ; Aevfoii 
 V. Ontario Bank, 13 Grant (i52 ; s. c. 15 (Jivant 2.S3 ; 40 V^ict. s. 
 29). 
 
 If the sale is macU; more than thirty days before the assign- 
 ment, the onus is on the pai-ty seeking to impeach the sale {Ma.i'nli 
 V. Siveeny, 2 Pugsley, 454). 
 
 The insolvent, about two months before the issue of a writ of 
 attachment against him, assigned to defendant, a creditor, a 
 policy of insurance upc^n certain nKU'chandise in secuiity for a 
 debt which was about to be placed in suit, and the insurance com- 
 
CONTEMPLATION OF INSOLVENCY. 
 
 345 
 
 jiaiiy, ui)(»n the occurrence of a fire, paid over the proceerls of the 
 policy to tlie c 'editor, to the extent of tlie del>t secured thereby. 
 At tlie trial, the plaintitf, Avho claimed, as assignee to recover this 
 amount, called the insolvent, who swore that wlien he assigned 
 till' policy he had no contemplation of insolvency ; that his in- 
 tention was, with liis remaining assets, and the residue of the 
 money derived from tlie policy after paying defendant to re-open 
 his 1)usiness, hut that he was (hiven into insolvency hy tlie act of a 
 a i-ertain creditor wlio, though lie had promised him time, sued 
 out a writ of attachment against him. It was held that the 
 transfer of the policy not having lieen made within thirty days 
 of the issue of the Avrit of attachment, the onus was cast upon the 
 plaintitf, of proving that the transfer was made in contemplation 
 of insolvency, and that the ahove facts were insufficient to sus- 
 tain that contention (iVc- 117^ /v/^'/' v. TAon/r, 11) C. P. U. C 302; 
 C">f;/ Havlc V. HmUh, 20 C. P. U. C. i)3). 
 
 It was held in Prince Edward Island that an assignment to a 
 creditor by an insolvent person, after service of process under 
 prossure.did not deprive the prisoner of his right toa weekly alloAV- 
 aiice under the Insolvent Act (re McKai/, Peters Reps., P. E. I. 
 105). 
 
 There is no note to the case to show what Act the decision has 
 reference to. 
 
 134. Every payment made within thirty days next before a demand of an 
 assignment, whenever such demand shall have been followed by an assign- 
 ment, or by the issue of a writ of atta hment, or within thirty days next be- 
 fore the issue of a writ of attachment, under this Act, when such writ has 
 nut been founded upon a demand, by a debtor unable to meet his engage- 
 ments in full, to a person knowing such inability, or having probable cause 
 for believing the same to exist, shall bo void, and the amount paid may be 
 recovered back by suit in any co'upetent court, for the benefit of the estate : 
 Provided, always, that if any valuable security be given up in considera- 
 tion of such [jayment, such security or the value there(jf, shall be restored 
 to the creditor before the return of such payment can be demanded. 
 
 The payment will come within this section, though the party 
 to whom the payment is made is only an indorser of the notes of 
 t\w inHoU'eni (Olaircher V. Cousins, 28 Q. B. U. C. 540), and it 
 
346 
 
 THE INSOLVENT ACT. 
 
 seems that the word "person" in the section would include a 
 surety as well as a stranger {Roe v. Smith, 15 Grant, 344). 
 
 After the execution of a deed of assignment or the issue of a 
 writ of attachment, all nioney belongi i^^ to the debtor is tlio 
 property of the assignee, and even if paid to a creditor may lie 
 recovered by the assignee for the benefit of the estatr {Hoc v. 
 Roy(d Canadian Bank, 19 C. P. U. C. 347; Roe, v. Bank of 
 British North America, 20 C. P. U. C. 351), though the payment is 
 in satisfaction of a bon((, fide debt and the person receiving piiy- 
 ment is ignorant of the issuing of the writ of attachment or the 
 execution of the assignment (ib.; citing {Tarquand v. Vaudrr- 
 plank, 10 M. & W. LSO). 
 
 In these cases, however, the moneys paid were proceeds of tlie 
 insolvent's estate, which passed t(; the assignee, and not earned after 
 insolvency. When after an assignment and before discharge, 
 the insolvent obtains a sum of moTiey and pays it away bona, 
 fide and without collusion to a [)erson becoming a creditor after 
 the assignment, the ])ayment is good and cannot be recovered 
 for the benefit of the estate (ex parte Dewhirst, 25 L. T. N. 8. 
 731 ; L. R. 7 Ch. App. 185). 
 
 In the case referred to, the bankrupt after his l)ankniptoy 
 entered into an agreement to serve a merchant for a salary of 
 £500 a year, and on the latter dissolving the agreement with- 
 out cause he allowed £200 to the bankrupt by way of "om- 
 pensation. It was out of this sum, that the payment was 
 made by the bankrupt for the rent of a house that he had 
 taken after the bankruptcy. The Court, however, intimated an 
 opinion that the trustee, on giving notice to the liankrupt's em- 
 ployer, might have intercepted the money and prevented it being 
 paid to the bankrupt (see also re Dow/in'j, L. R. 4, Ch. D. G>S!)). 
 
 It was held by the majority of the Court in Churcherv. Jolm- 
 .sfo7i(34 Q. B. U. C. 528), that an agreement made verbally be- 
 tween a trader and his creditor that the latter should advance 
 .sums of money to the trader for the purpose of enabling him to 
 cany on his business upon the express agreement between them, 
 that the money advanced should be repaid by the trader out oi 
 the proceeds of the daily sales of the trader's goods, gave the 
 
PAYMENTS NULL AND VOID. 
 
 347 
 
 creditor an eriuitable claim and mortgage on the goods, which, 
 imder the latter part of this section, was a valuable security given 
 up in consideration of the payment, and that the repayment by 
 the trader to the creditor of the moneys advanced within thirty 
 days before making the assignment did not render the payment 
 void or recoverable under this section, being protected by the 
 proviso, though the creditor knew at the time the payments were 
 made that the trader was unable to meet his engagements. The 
 majority of the Court held that, the creditor having a valuable 
 security under this section, the assignee could not recover the 
 payments without restoring the security before the commence- 
 ment of the action. In this case the moneys were advanced at 
 the rerpiest of the trader, and it seems clear that if the agreement 
 had been by bill of sale duly filed according to the Statute, it 
 would, if made for the purpose of enabling the debtors to carry 
 on their business, have been a valuable security. Morrison, J., 
 who dissented fi'om the majority of the Court, held that the " valu- 
 able security " referred to in the section must be a security recog- 
 nised in law, and which would prevail in the hands of a holder 
 against any creditoi-, which the creditor when proving could shew 
 and describe and value, and capaVile when so valued of being as- 
 signed, and delivered to the assignee for the benefit of the estate." 
 Tlie writer dissents from the judgment of the majority of the 
 Court, and concurs in the opinion of Morrison, J. The alleged 
 " valuable security " in this case constituted a mere verbal agree- 
 ment between the parties. It was not good as against creditors ; 
 Wilson, J., declaring thfit, even if in writing, it would not have 
 been good as agfiiiist creditors. It was, however, binding as be- 
 tween the parties. 
 
 The words " valuable security," in this section, would seem to 
 mean a security that was of value to the creditor (see B , v. 
 Brady, 2G Q. B. U. C. 13). 
 
 They could not be held to signify a security that was void or 
 voidable, and the writer has grave doubts as to whether they refer 
 at all to a security which the creditor holds on the property of, or 
 ilirectly from, his debtor; whether they do not more properly refer 
 to a security from some third person held by the creditor as col- 
 
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 b(. j 
 
 •848 
 
 THE INSOLVENT ACT. 
 
 lateral security for ]»is claim. Did the Court intend to interfere 
 with a creditor who held Mecurity fi'om the insolvent or from his 
 estate ;' On demanding- a return of the payment, the security 
 must be restored, the restoration would surely he anaftirmancc of 
 its validity, and the only benetit that could arise to the creditors 
 would be in the case of the propei'ty compriserl in tlie securi*^y ])e- 
 ing of insurticient value. Then the <S4th .section of the Act .vould 
 come into operation, and the parties would be in about the same 
 position as before, the creditor having the right to rank for the 
 deficiency. Ik'sides, on payment of the amount of a security, it 
 can scarcely be said to be given up in C(msidei'ation of the pay- 
 ment. The pa\'ment satisfies it and the debtor has aright thereto. 
 The 92n(l .section of the English Act provides that every con- 
 veyance or transfer of property, and every ))ayment niade by any 
 person unable to pay his debts as they become due, from his own 
 moneys, to any creditor with a view of giving such creditor a pre- 
 ference over the other creditors, shall be deemed fraudulent and 
 void if the person making it Ix'come V)ankrupt withiii three months 
 thereafter. j»rovided that the clau.se shall not affect the rights of a 
 purchaser, payee or incumbrancer in good faith and for valuabk; 
 consideration. It is h(dd that the Act must be the spontaneous 
 act of the debtor to l)e vr [ under this clause (ex parte Topham. 
 L. R. H Ch. App. G14 ; ex parte London <i' C. Bk. 29 L. T. N. S. 73) ; 
 and it must also ap|)ear either by necessary inference from the 
 circumstances or by direct evidence that the act was done with a 
 view to prefer the creditor. If there is no gromid for inferring 
 such a motive, as if a payment is made in the usual course 
 of business, and is bona fide on the part of the cretlitor, it will be 
 protected under the last proviso of the clause (ex parte Blackburn, 
 L. R. 12 E(i. 358; ex parte Batcher, L. R. 9 Ch. App. 595 ; 44 L. 
 J. Bk. 129); and it has been laid down generally that a payment 
 in the ordinary course of trade, the honouring bills of exchange 
 presented at maturity, or the payment of debts which have become 
 payable in the usual and customary manner or payments made 
 in fulfilment of a contract or engagement to pay in a particular 
 manner or at a particular time, are not open to any objection on 
 the ground of their being voluntary, even although they were 
 
PAYMKNTS NULL AND VOID. 
 
 340 
 
 matle without any exitress doniand by the creditor, unless the 
 croditor liad at the time notice of an act of l)ankruptcy coin- 
 iiiittf(l ly tlie (lehtor (ib. see Iso on tlie Englisli Act ex parte 
 J/a///eic,s,L. R.TCh.App. 24; ex parte Patmon, 30 L.T.N.S. 33.")). 
 This section of our Act is liowevei- materially ditt'erent from the 
 English Act, and the decisions on the latter Act will not apply. It 
 is not necessary that the payment should be made with a view of 
 (giving a j)reterence, nor is it necessary that the creditor should ob- 
 tain an luijust prefeivnce by the payment, nor is the element of 
 fraud necessary. If the payment is made within the thirty 
 davs, and the debtor is then unable to nu-et his engagenjents to 
 the knowledge of the creditor or if tlie latter has probable cause to 
 believe such inability, the payment will be void without anything 
 furthei' being shewn (.see oljscrvations of Wilson, >T., in (Jlnttrhcr 
 V. Johnstiin, 34 Q. B. U. C. 538, 9 ; see also Xunes v. Qtrtcr, L. li. 1 
 P. C. 34:i ; 4 xMoore, P. C, C. N. S. 222, on a .somewhat similar 
 enactment of tlie Legislature of Jamaica, where fraud was held 
 nnii*'Ce.ssary). 
 
 This .section is retroactive in making a payment closed before 
 the assignee's title accrues impeachable by him, and it seems that 
 the doctrine of relation does not apply when the transaction is 
 void {(JIutrcher v. Coii.4,u^, 28 (^. B. U. C. .UO). 
 
 The payment, to come within this section, must lie made by 
 the debtor himself within the thirty days, the debtor being at 
 the time of payment, unable to meet his engagements, to the 
 knowlediife of the creditor. Where more than two months be- 
 fore the assignment in insolvency, the debtor not being then un- 
 able to meet Ins engagements, assigned a policy of insurance, on 
 which a loss had then accrued, to his creditor, in secui'ity for a 
 debt which was about to be placed in suit, and the insurance 
 company paid the creditor about ten days before the debtor as- 
 .signed in insolvency, it was held that this section could not apply 
 That the inaliility of the debtor to meet his engagements at the 
 time of payment by the insurance company, or the knowledge of 
 the creditor at that time was immaterial, there being nothing to 
 show insolvency by the debtor at the time of the assignment of 
 the policy {McWhirter v. Thorne, 19 C. P. U. C. 802). 
 
 \H 
 
tW) 
 
 THE INSOLVENT ACT. 
 
 II ! 
 
 A debtor, who is solvent, may pay any or all of his debts, al- 
 tli()u;.,di proceedings in bankruptcy are pending agiiinst him (re 
 (h'cijoii Pi-lntinf) Gompanij, 1^3 B. 11. .')()3). 
 
 Transactions ])et\veen fatlier and son are generally regarded 
 with suspicion, but a transaction cannot be assumed fraudulent 
 merely because the parties stand in that relation to each other, 
 In one case it a]ipeared that the assignment was made on the lOth 
 (jf June, LSG.S. That on the loth of Api-il previous (over Hfty 
 days before the assignment) the insolvents had paid to their 
 father two promissorv notes, made ]>y them in July and August, 
 iJSfiT, at three months for 31)34. The father, in his exainimition, 
 swore that these notes were given by the insolvents for their re- 
 spective private debts, boiin fide due to him for m >ney lent ami 
 ])aid, and foi* board between 18G8 and l.S(!(J, and that he had no 
 knowledge of their business or inability to meet their engage- 
 ments until the 27th of April, LSGcS, when he was asked by cnie 
 of them for an advance of !?2,0()(), which he refused, not being 
 satisfied with the statement of their affair^) then produced to him. 
 His statement was confirmed by the insolvents. The Couit held 
 that these jtayments to the father could not be held preferential 
 or fraudulent (re Wallls, 29 Q, 11 U. C. 31;3). 
 
 A payment by the sheritf, imder a judgment of distribution, to 
 an opposant therein collocated, at a time when such opposant 
 was no longer pos.sessed of his estate, having assigned the same 
 under the Insolvent Act of 18G9, is good and caimot be 
 questioned .subsequently by the as.signee [Salvas \. Leoreaa, 18 
 L. C. J. 293). 
 
 A payment made within thirty days preceding the execu- 
 tion of a deed of assignment, in discharge of a capias against the 
 insolvent is not null unless it be proved that the creditor kiiew, 
 or had probable reason to know, that the debtor was insolvent 
 {Larlulcre and Saavaijeaa, 14 L. C. J. 139 ; 2 Revue Legale, 
 18G). 
 
 135. Any triinsfer of a debt due by the iiLsolvent, made within the time 
 
 and under tlie circumstances, in the next precediuj^ section mentioned, or at 
 
 any time afterwards, wlienever such demand shall have been followed by an 
 
 .assignu^t^nt, or by the issue of such writ of attachment, to a debtor knowuig 
 
TRANSFKIl OF DKIiT. 
 
 351 
 
 <>v liiiviiig prolxihle cause for buliovini,' tliu insolvent tf) bu unablu to moot his 
 t'n;,':igoin('nts, or in contompliition of his insolvi;ncy, for the purpose of en- 
 abling' the debtor to set up l)y way of compensation or set-olf the debt so 
 transferred, is null and void, as regirds the estate of the insolvent ; and the 
 di'bt due to t'le estate of the insolvent shall not bo compensated or affected 
 in any manner by a claim so acijuired ; but the purchaser thereof may rank on 
 tho estate in the place and stead of the original cre<litor. 
 
 It is clear that this section of tlie Act refers to the transfer of 
 any (leV)t which may, at the time any action is brought against a 
 (lil.toi- of the estate, l)e set-oft", whetlicr such debt be i)ayable at 
 tlic time of sucii transfer or not, and it is equally clear tliat it is 
 tlir debtor who is referred to as " knowing oi- having probable 
 cause for believing the insolvent to be unable to meet liis en- 
 giin'i'nients, or in contemplation of his insolvency," and where a 
 cliiim against an insolvent is purchased by a ])erson who is in- 
 (k'l)U'd to the insolvent, for the purpose of set-oti', it is his know- 
 ledge of the insolvent's being unable to meet his engagements, 
 and his intention in purchasing, and not the knowledge or in- 
 tention of the person selling or transfeiring the debt, which 
 jiitvents the set-otl" from being available (McLeod v. DomviUc, 2 
 I'ugsley, 422). 
 
 A note, made by the insolvent, and maturing on the 27th of 
 N'oviMuber, was purchased on the ICth of November by a person 
 wlio was indebte<l to tlie insolvent. The insolvent assigned on 
 the 18th of Noveml)er. The note at the time of the })urchase 
 was in the hands of the payee. It was held that it could not be 
 set-off", and that it was the knowledge of the person purchasing 
 which rendered the set-otf unavailable (ib.). 
 
 A party acquiring a claim under the circumstances, and for the 
 purjiose mentioned in this section of the Act, cannot set it up by 
 way of compensation or set-oft", and the transfer of the debt is 
 nidi and void as against the insolvent's estate. In such case 
 compensation cannot be accpiired under articles 1188 and 1196 of 
 the Civil Code in Quebec, which provide that compensation 
 takes place by the sole operation of law between debts which 
 are eijually liquidated and demandable, and have each for object 
 a sum of money or a certain quantity of indeterminate things 
 
352 
 
 THK INSOLVENT ACT. 
 
 1 if ! 
 
 I'f 
 
 (jf the satnu kin<l and 4iinlity (Hiddcll v. Ri'a;/, 1,S L. C. .J 
 I. SO). 
 
 I'M). Any persun wlin, foi' liinni^lf nrfm' any linn, partiiorship, orcoiiipiiny, 
 (»f wliicli liu fni'iiis [>i>i't, (ir iiM tliu iiiana^'ui', tnistoo, iiguiit or oinployou of any 
 porsun, tirni, co-|iartni!i'sliip or conijiany, imrcliasos l;oo(1.s on credit, or pi'n- 
 cures any advanccj in nioni'y, or procnrus tiic iniloi'soniunt or aucuptaiiuu of 
 any iiogotiiiblo paper witliont connidfrati'in, or imlnuus any porsou to iiuconif 
 security for liini, know ing or having iiroi)alilo ciumu for liolicvini,' iiiniHclf or 
 such porHon, lirni, co-partnership or conii)any, for wliich iio is acting, to l)e 
 unable to meet his or its ongaguuiunts, and concealing tlie fact from the per- 
 son thereby becoming his creditor, witli tiie intent to defraud such person, or 
 will) by any false pretence obtains a term of credit for the payment of any 
 advance or loan of money, or of the price or any part of the price of any 
 goods, wares or merchandise, with intent to defraud the person thereby be- 
 coming his creditor, or the creditor of such person, firm, co-partnersliip or 
 company, and who shall not afterwards have |)aitl or cause to be paid the 
 debt or debts so incurred, shall be held to be guilty of a fraud, and shall be 
 liable to imprisonmenr for such time as the Court may order, not e.\ceeding 
 two years, unless the<lebtand costs be sooner [taid : I'rovided always, that 
 in the suit or pnjceeding taken for the rei;overy of such debt or debts, tlie 
 defendant be charged with such fraud, and be declared to be guilty of it by 
 the judgment i-eudered in such suitor i)roceediiig. 
 
 The 40 Vict. (s. 30) aiueiidcil this seeticjii by {vhlino- aftei- 
 the words " kiiowiny oi," in the eighth line, the words " having 
 probable cause for." 
 
 Tlie Act of IHo!) provided " and if .such debt or debts be in- 
 curred by a partnershi[», then every member thereof who shall 
 have known of the iucui-ring, and of the intention to incur, such 
 debt or debts, shall be similarly liable." 
 
 The Supreme Coui-t of Nova Scotia helil, in Hurrlwjton v. Wit- 
 ter (unreported; a copy of the demui-rer-book and judgment 
 having been kindly sent the author by N. H. Meagher, Esq., Bar- 
 rister, Halifax), that it was suthcient in proceeding under this 
 section to show that the defendant was a trader subject to the 
 provisions of the Act, and that the word "person" did not neces- 
 sarily mean an in.solvent against whom a writ of attachment had 
 issued or who had made an assignment. In other words a trader 
 was held liable to be proceeded against under this section, al- 
 though his estate was not in insolvency. The Court also ex- 
 
PURCIIASINO GOODS ON CREDIT. 
 
 853 
 
 pressed an opinion that under the words "tnann^'er, tnistco, 
 a,L(eiit, or employee of any pei'son, tirni, co-partnership, or com- 
 pany," a mere workman lor hire, l»ein<^ an employee of a com- 
 pany, mi;^ht he procetided af^ainst under this section. 
 
 It is impossil)le to indict a firm or corporation as such, and in the 
 opinion of the wi'iter these words vveiv used to enable the Court 
 to punish a firm or cor[)oration thi'ouyh any of tlieir representa- 
 tives who were actually guilty of the fraud. It is only as the 
 representative of the co-paitnership or company that the man- 
 ager, trustee, agent or employee can be proceeded against. The 
 wold "him" in the eighth line of this section, signifies " firm, 
 partnership and company," or rather these words should be im- 
 jilicd thereafter. In the eleventh line the words "or the cre- 
 ditoi' of such jH'rson, firm, co-partnership or company ought to 
 follow the woi'd "ci'eilitor." They are used further on in the 
 section and are no doubt implied here. 
 
 Till' Court, in llarviwjtoii v. Witter, supra, seemed to be of 
 opinion that this section appliiid to a person not a trader, and 
 whose estate was not undei' adjustment in insolvency. The actual 
 decision, however, was, that it was suthcient, in proceeding under 
 this section, to show that the defendant was a tra<lei'. The 
 writer entirely dissents from the opinion that a non-tra<lor who 
 is not acting as the mere repi'esentative of a trading fii-m or cor- 
 poration, can be proceeded against un<ler this section. He has 
 very great doubts of the soundness of the decision in Hdvring- 
 ion V. Witter : whether it would not be more in accordance 
 with this section and the whole purview of the Act, to hold 
 that the defendant must be an insolvent whose estate is being 
 administered under the Act. Section 130 speaks of a debtor 
 afterwards hecomhi(j an insolvent ; nection 132 contain.s no re- 
 ference to subse(iuent proceedings in insolvency, and yet it is 
 apprehended that the estate of the debtor must be in insolvency 
 belore this section could be invoked against him. Section 133 
 uses the words " any person," and it is clear that these words 
 icfer only to a person who afterwanls becomes an insolvent 
 under the Act, as the section empowers the assignee to recover 
 the proceeds of the .sale, deposit, pledge o!' transfer for the bene- 
 w 
 
 ! i; 
 
354 
 
 THE INSOLVENT ACT. 
 
 ;l 
 
 lit oF the oHtate. Clearly this 13(ith s(;ctii»!i would apjily if a 
 tiwlcf coiitnivunt'*! its pr(n'isi()iis, and afterwards hecaine an in- 
 solvent. The |)i<»vis(), therefore, at the end of the section 
 recogni.sL's the ii;;ht to bi'ing an action a^'ainst an insolvent, 
 iiotwitlistandiii},' his assigiuiieiit, of the issue of a writ of attucli- 
 nient. This was also till' ground taken hy the Court in (taalt 
 V. fjiif/ardc (Superior Court, Montreal, IS74, ivjiorted in Wotlier- 
 Hpoon's Ins. Act, l!)4-r)), whi-ie the Court held that a creditor iiii;;lit 
 petition f<jr the imprisonment of the insolvent under this section, 
 i!Ven thougli he had tiled a claim on his estate (see the ca.ses 
 al.eady cited, S>j>ihr v. W<itf, tJ!) Q. B. V. C. 828 ; re liuWr, 'A Cli 
 Cham." 4.!)}» ; (h-nii v. Sivim 22 C. P. U. C, :}07 ; rrnusl v. Druid, 
 LS L. C. J. nOO). 
 
 "Court" in this section does not seem to mean the Insolvent 
 Court, hut the Court in which the action is Itrou^dit for thc! re- 
 covery of the debt, and this .section seems to sanction an action 
 against an insolvent after his assinnment, oi- the issue of" a writ 
 of attachment. 
 
 This section and the 137th section of the Act, heinj;' (/»(/.si 
 jtenal, ai-e to he strictly construed, and, to warrant imprisonment 
 under their provisions, the case nuist he l)i'ou;.;ht within the ex- 
 press words of the Act. It is clear that the defendant must be 
 charged with the fraud in the suit or ju'oceeding taken for tlie 
 recovery of the <lebt oi' debts, and be declared guilty of it by the 
 judgment rendered in such suit or proceeding. An action was 
 brought in New Brunswick, under the Act of 180!), on a piomis- 
 sory note, made by defendant in favour of plaintifl', and the de- 
 claration alleged fiaud and false pretences in obtaining credit, ac- 
 cording to the !)2nd section of the Act. Defendant j)leaded the 
 general issue, and gave notice of defence, denying the alk.'ged 
 frau<l. He also filed an offer to suliei' judgment by default, for 
 amount of note, wliich offer plaintiff accepted, but no judgnu'iit 
 was rendered declaring the defendant guilty of fraud. The Court 
 held that this was not such a judgment by default as was con- 
 templated by the 93rd section of the Act, the acceptance of de- 
 fendant's offer having settled all the Lssues in the suit, and, there- 
 
PUUCIIASI.Nd UOODS (»N ('HKl)lT. 
 
 35 5 
 
 \\)iv, no order for iiupriHoniiiL-nt could l»o made (Junes v. iJrJcdu, 1 
 I'linsley, XU ; St('i)licii's l)ii,a'.st, N. H ll.!].s. 22M). 
 
 Uudi'!' this section, the ddaration in the action to I'ecover for 
 tin- n'oods or money olitain<^<l should aver tlie IV.iuil, luiii^^dnn- the 
 case witliin the section, and after tlie defen<Uint has hcen pioved 
 to hi' lialile for the debt, then tlie |ihiintili' may ask that he may 
 he declared to he f^uilty of fraud, under the Statute, and hi; may 
 then l»e declared f^MiilLy if circum^tiinccs aic shown justifying such 
 judgment under the Statute. Thr averment of fraud within this 
 ^(■(•tion, wlieii thus adih'tj to tlie th'elaratioii. (^iiiinot l)e pleaded or 
 deiiiurri^d to l>y the defend'at. Thus, wlieii a declaration, after 
 (ieclaring on two bills of exchan<;« in separate counts, pi'oceed»'d 
 tiavt.'r that the doht for which the hills were given was con- 
 tracted under circumstances which rt^ndered the defeiulant liahle 
 to imprisonment under this section, and the defendant demurred to 
 this averment, ticating it as a third count, it was held that the 
 averment was ncjt the su' jeetof either a p'ea or demurrer {Ruthfr- 
 fiird V. Eakinx, 27 C P. U. C 55). This dt'cision was pronounced 
 on the authority of LUjotIi v. Taylor, L. II. 1 Exch. 51) 
 
 In ordiir that an insolvent may l)e guilty of fraud within the 
 iiu'aning of this .section, two thing,s must concur — first, the pur- 
 chase must he made or advance obtained when he knew he was 
 imahle to meet his engagements ; and, seeond, it nui.st he shown 
 that he concealed such inability from his cretlit(jr, with the intent 
 of defrauding him. The mere fact of a trader i)urchasing goods 
 who is at the time unable to meet his engagements is neither 
 fraud nor within the provisions of the In.solvent Act. A pur- 
 el lase undei' such circumstances may ije the very best and wisest 
 act which the tiader can do, and may also be the most beneficial 
 act for his creditors (re Ganntt, 2S Q. 13. IJ. v- 2(i0). 
 
 This section only a|)plieH when the in.solvent obtains a term uf 
 oredit, for the payment of an advance, &c., made by the jx'r.son 
 giving the credit. Where A. drew a bill of exchange upon B. for 
 funds of A. in the hands of B., and before acceptance or payment 
 of the bill, it was delivered to C, who became the holder, it was 
 held not a tVaud within this section, for B. to falsely pretend to 
 C on presentation of such bill for acceptance and payment, that 
 
 if 
 
 I 
 
i^ 
 
 ^1 
 
 *? 
 
 
 356 
 
 THE INSOLVENT ACT. 
 
 he had no funds of A.'s, and thereby obtain a further term foi- 
 payment ; and that C. could not, under such circumstances, main- 
 tain an action against B. for fraud under this section {Jones v. 
 Hanford, 2 Pugsley, 407). 
 
 A person who buys goods on credit impliedly assures the 
 vendor, if not of the actual sufficiency of his assets to meet his 
 liabilities at least, that there is a reasonable probability of such 
 sufficiency ; and, while the vendor on credit takes the risk of the 
 subsequent insolvency of his debtor, he is not supposed to con- 
 template the escape or the bankruptcy of his debtor, by reason of 
 a state of insolvency, actually existing at the time of the pur- 
 chase. Where, therefore, a party buys goods on credit, knowing 
 his affairs to be in a bad state, although he may have no inten- 
 tion of defrauding the vendor, yet in the eye of the law he does 
 a wrong, and if he subsequently goes into in.solvency, the Court 
 will be justified in suspending his discharge for a period, under 
 its discretionary power (ex parte Tem2)est, 11 L. C. J. 57 ; 2 L. 0. 
 L. J. 270). 
 
 In ordej" that the transactions may fall within this section, it 
 must appear that the party was insolvent, and that he was aware 
 of the fact, and made the purchase in contemplation of insol- 
 vency (ex parte T]nvrht>7', 11 L. C J. 35). 
 
 The insolvent commenced business in the year 1855, in Belle- 
 ville, and in the fall of 1857 he bought goods from different per- 
 sons to the extent of about S0,00(). He was insolvent then, Init 
 did not know it. In the spring of 1858, he took stock, and found 
 he was insolvent. His stock then amounted to $3,225, and in 
 March, 1858, he sold to his brother for fifteen shillings in the 
 pound, and took his notes for the amount. These notes were sent 
 to his creditors, and were afterwards paid. The insolvent ran 
 away to the United States immediately after he sold out to his 
 brother, and returned to this country in 1802. He then a.ssigned 
 to his brother, for the benefit of his estate, his accounts and notes, 
 amounting to !$2,097. It was held that these facts did not show 
 that the insolvent purchased goods on credit with intent to de- 
 fru,ud, within the meaning of this section ; that, though these 
 acts were unfavourable to the insolvent, they were distinguishable 
 
PURCHASING GOODS ON CREDIT. 
 
 357 
 
 
 from acts or other misconduct constituting fraud, and that unless 
 the latter was shov* n, the insolvent was entitled to the benefit of 
 the Statute (re Smith, 4 U. C. P. R. 89 ; 3 U. C. L. J. N. S. 153). 
 
 Unaer this section the intent to defraud seems to be a material 
 and siibstantial ingredient in the transaction. It will not be 
 sufficient that the person is in difficulties when the goods' are 
 purchased, or advances procured. If the person has a reasonable 
 expectation of being able to meet his liabilities, the transaction 
 will not be fraudulerxt. On the other hand, if the expectation is 
 unreasonable or improbable, the transaction may be impeached ; 
 and in determining the reasonableness of the expectation, the 
 grounds on which it is based must always be looked to. Where 
 a person in business finds himself unable to pay twenty shillings 
 in the pound, it may or may not be his duty to discontinue his 
 trade. Whether incurring fresh liabilities to continue his busi- 
 ness will be fraudulent or not, depends upon the probability of 
 these liabilities being wiped off. The liabilities may be so large, 
 and the assets so small, and the business so situate, that to con- 
 tinue it will be a fraud. In all cases, the grounds on which the 
 trader's conclusion is honestly based must be taken into con- 
 sideration, as above explained. Thus, where a trader, after dis- 
 covering that his atFairs were not in a position to pay twenty 
 shillings in the pound, continued his business in the hope which 
 was not shown to be absurd or unreasonable, that he would 
 thereby be able to pay all his debts in full and meet all his en- 
 gagements, and in the course of the business so continued con- 
 tracted some new debts, but ultimately failed in meeting his 
 liab'lities, and made an assignment in insolvency, it was held that 
 he was not thereby disentitled to his discharge (re Holt, 13 Grant, 
 568). 
 
 The mere endorsement of renewal notes by a person in insolvent 
 circumstances, where no money is advanced on the renewal, is not 
 a violation of this section ; but if there was any false pretence, 
 it might amount to obtaining a term of credit for the payment of 
 an advance within the meaning of the section (re Jones, 4 U. C. 
 R R. 317). 
 
 A "^"^ad 3r who was heavily indebted, and whose entire real pro- 
 
 i 
 
'■I 
 
 
 358 
 
 THE INSOLVENT ACT. 
 
 perty was mortgaged to various creditors for its full value, or 
 more than its full value, obtained credit from Montreal merchants 
 when he knew or believed himself to be unable to meet his f-n- 
 gagements, concealing this fact from them and falsely allegin- 
 that he was worth $4,000 more than he owed, this was held to be 
 such a fraud as disentitled him to his discharge under the Act (re 
 Owens, 12 Grant, 5G0). 
 
 The 92nd section of the Act of 1869 used the words " unless 
 the debt or costs be sooner paid." The present Act substitutes 
 "and" for "or," in the Act of 1869. The necessity for this 
 change is shown by the following cases. 
 
 In Rogers v. Saucer, (18 L. C. J. 57), the Court held that the 
 words " unless the debt or costs be sooner paid," in the Act (jf 
 1869, should be read, " unless the debt and co.sts " be sooner 
 paid, and where the Court was satisfied that the fraud charged in 
 an action, under this section, had been proved, the insolvent 
 was ordered to be imprisoned, in default of payment of costs, 
 as well as of the debt. 
 
 In a subsequent ca^o, however, it was held, that in orderino- 
 imprisonment, under this section, the Court is bound to limit the 
 payment, by way of release, to the debt or costs, and that tliey 
 could not order the payment of both (Warner v. Buss, 18 L. C. J. 
 184). 
 
 137. Wliether the defendant in any such case appear and plead, or make 
 default, the plaiutitl' shall be bound to prove the fraud charged, and upon 
 his proving it, if the trial be before a jury, the judge who tries the suit or 
 proceeding shall ininiediiitely after the verdict rendered against the defend 
 ant for such fraud (if such verdict is given), or if not before a jury, then 
 immediately upon his rendering his judgment in the premises, adjudge the 
 term of imprisonment which the defendant shall undergo ; and he shall 
 forthwith order and direct the defendant to bo taken into custody and im- 
 prisoned accordingly ; but such judguient shall be subject to the ordinary 
 remedies for the revision thereof, or of any proceeding in the case. 
 
 This provision, rendering the judgment sulyect to the ordinary 
 remedies for revision, is most important, if the decision in Ruther- 
 ford V. Eakins (27 C. P. U. C 55) is correct, as, in that case, the 
 only remedy open to the defendant would seem to be a motion in 
 arrest of judgment. 
 
1 
 
 FRAUDS BY AGENTS. 
 
 OFFENCES AND PENALTIES. 
 
 359 
 
 138. Every assignee, to whom an assignment is made under this Act, is an 
 agent within the meaning of the seventy-sixth and following sections of the 
 "Act respecting larceny and other similar offences," and every provisiim of 
 this Act, or rosoliition of the creditors, relating to the duties of an assignee, 
 shall be held to be a direction in writing, within the meaning of the said 
 seventy-sixth sectitm ; and in an indictment against an assignee, under any 
 of the said sections, the right of property in any moneys, security, matter or 
 iliing, niay l)e laid in "the creditors of the insolvent (mimimj /tim,) under 
 the Insolvent Act of 1875," or in the name of any assignee subsequently ap- 
 poiiited, in his (juality of such assignee. 
 
 The Act referred to is the Statute of Canada, 32 & 33 Vict, 
 chap. 21. This Statute provides as follows: — 
 
 An to fnmds by agents, banker.% or factors. 
 
 70. Whosoevei', liaving been intrusted, either solely, or jointly 
 with any other person, as a banker, merchant, broker, attorney or 
 other agent, with any money or security for the payment of money, 
 with any direction in writing to apply, pay or deliver such money 
 or security or any part thereof respectively, or the proceeds, or 
 any part of the proceeds of such security for an^ jjurpose, or to 
 any person specified in such direction, in violation of good faith, 
 and contrary to the terms of such direction, in anywise converts 
 to his own use or benefit, or the use or benefit of any person other 
 than the person by whom he has been so intrusted, such money, 
 security, or pi-oceeds, or any part thereof respectively, and whoso- 
 ever, having been intrusted, either solely or jointly with any other 
 person, as a banker, meichant, broker, attorney, or other agent 
 with any cliattel or valuab^ .' security, or any power of attorney 
 f(jr the sale or transfer of any share or interest in any pu]»lic stock 
 01- fund, whether of the United Kingdom, or any part theronf, or 
 of this Dominion of Canada, or any Province thereof, or of any 
 British Colony or Possession, or of any foreign state, or in any 
 stock or fund of any body corjjorate, company or society, for safe 
 custody oi- for any special purpose without any authority to sell, 
 negoeiate, transfer or pledge, in violation of good faith, and con- 
 trary to the object or purpose for which such chattel, security, or 
 
 r r 
 
860 
 
 THE INSOLVENT ACT. 
 
 power of attorney has been intrusted to luni, sells, Tiejj^ociates, 
 transfers, pledges, or in any manner converts to his own use or 
 benefit, or the use or benefit of any pei'son other than the person 
 by whom he has been so intrusted, such chattel, or security, or 
 the proceeds of the same, or any part thereof, or the shai'e or 
 interest in tlie stock or fund to whicli such pf)wer of attoi-ney 
 relates, or any part thereof, is guilty of a misdemeanor, and shall 
 be liable to be imprisoned in the Penitentiary for any term not 
 exceeding seven years and not less tlian two years, or to be impri- 
 soned in any other gaol or place of confinement for any term less 
 than two years, with or without hard labour, and with or witlK)ut 
 solitary confinement; but nothing in this section contained relat- 
 ing to agents shall affect any trustee in or under any instrument 
 whatsoever, or any mortgagee of any property, real or personal, in 
 respect to any act done by such trustee or mortgagee in relation 
 to the property comprised in or affected by any such trust or 
 mortgage ; nor shall i-estrain any banker, merchant, broker, attor- 
 ney or other agent from receiving any money due or tf) become 
 actually due and payable upon or V>y virtue of any valuaV)le 
 security, according to the tenor and effect thereof, in such manner 
 as he might have done if this Act had not been passed ; nor from 
 selling, transfeiTing, or otherwise disposing of any securities oi- 
 effects in his possession, upon which he has any lien, claim, or 
 demand, entitling him by law so to do, unless such sale, transfer 
 or other disposal extends to a greater numV)er or part of such 
 securities or effects than are requisite for satisfying such lien, 
 claim or demand. 
 
 The prisoner, a stock and share <lealer, was employed by the pro- 
 secutrix to purchase securities for her. He bought in his own name 
 and received money from her from time to time to cover the amounts 
 he had j.aid or had to pay for the securities. Such |)ayments were 
 not made agaiast any particular item, but in cheipies for round 
 sums. On one occasion he wrote to her, ''I inclose a contract note 
 for £300 J. bonds at 112, £?8()." And the contract ran "sold 
 to Mrs. S. (the prosecutrix) £300, J. at 112 £330 ;" and was signed 
 by the prisoner. The prosecutrix wrote in reply, " I have just m- 
 ceived your note and contract note for three J. shares and inclose 
 
FRAUDS BY AGENTS. 
 
 mi 
 
 ■A cHlmjuc for £330 in payment." The prisoner never paid for the 
 bonds, but in violation of good f.iith appropriated to his own us 
 thf proceeds of the cheque. It was held that the letter of the 
 |)rosecutrix was a direction in writing to apply the proceeds of the 
 clu'(|ue to pay for the bonds if they had still to be paid for, within 
 the meaning of the corresponding section of the English Act, 24 
 and 25 Vict. chap. 96 (lieij. v. ChrisH<m, L. R. 2 C. C. R. 94). 
 
 It is necessary that there should be a direction in writing under 
 the first branch of this section. 
 
 The defendant, an attorney, was employed to raise a loan of 
 money on mortgage, of which he was to apply a part in paying off 
 an earlier mortgage and to hand over the rest to the mortgagor. 
 He prepared the mortgage-deed, received the mortgage money and 
 lianded over the deed to the niortsjairee in exchange. He then 
 niisappropriateil a part of the money to his own use. It was held 
 that the prisoner could not be convicted under the first branch of 
 the si'ction for want of a direction in writing, and also that the 
 case was not within the second branch of the section (Meg. v. 
 Coopc)', L. R. 2 C. C. R. 123). 
 
 The second branch of the section seems to apply to cases where 
 tlu' party deals with the securities without authority and contrary 
 to the ])urpose for which they were entrusted, and where the 
 security, etc., is used for the purpose for which it is entrusted, the 
 charge cannot be sustained, unless, perhaps, in a case where it is 
 shown that the prisoner at the time of receiving the security in- 
 tended to convert it to his own use. The prisoner was an insurance 
 broker and had as such eflected insurances on a ship for the prose- 
 cutor ; and the ship having been lost, the prosecutor sent him the 
 policies, three in number, one with the A. office, one with the J. office, 
 and one with the underwriters, with other documents necessary for 
 recovering the loss. On the 17th December, the prisoner received 
 the amount of the J. office's policy, and on the 31st December, the 
 amount of the A. office's policy. Each amount was paid him by a 
 checjue to his own order, which in each case he paid into his own 
 l)ank to his own credit. The pi'isoner did not pay over to the 
 prosecutor any of the money so received by him, but being pressed 
 for it gave various excuses for not doing so. On the 27th January 
 
 ULI 
 
3G2 
 
 THE INSOLVENT ACT. 
 
 following, he filcfl a petition for liquidation, and his balance at his 
 bank was then much less than the sum received on the policies ; it 
 was held that the prisoner could not be convicted, it appearing that 
 by the understanding between the parties the prisoner was not to 
 hand it over at once to his principal, but to carry it to an account 
 between them, and to pay it only in settlement of the account 
 {Re<j. V. Tatloch, ^i. R. 2 Q. B. D. 157). 
 
 77. Whosoever, being a banker, merchant, broker, attorney, 
 or agent, and l)eing intiusted, either solely, or jointly with any 
 other person, with the pi'operty of any other person for safe cus- 
 tody, with intent to defraud, sells, negociates, transfers, pledges. 
 or in any other manner converts or appropriates the same or part 
 thereof, to or for his own use or be lefit, or the use or ])enetit of 
 any person other than the person b^ whom he was so intrusted, is 
 guilty of a misdemeanor, and shall be liable to any of the punisli- 
 ments which the Court may award as hereinbefore last mentioned. 
 
 78. Whosoever, being intrusted, either solely, or jointly with 
 any other person, with any ])ower of attorney, for the sale or 
 transfer of any property, fraudulently sells or ti'ansfeis, or otiiei - 
 wise converts the same oi" any part thereof to his own use or 
 benefit, or the use or benefit of any person other than the person 
 by whom he was so intrusted, is guilty of a misdemeanoi', and shall 
 be liable to any of the punishments which the Court may award 
 as hereinbefore last mentioned. 
 
 79. Whosoever, beino' a factor or agent intrusted eitlier solelv 
 or jointly with any other person, for tlK' p-.rpose of sale or other- 
 wise, with the possession of any gf* ■ , y of any document of 
 title to goods, contrary to or without .. .. ol'iority of his princijial 
 in that behalf, for his own use (u- beneiH i.- the use or benetit of 
 any person, other than the person by whom he was so intrusted, 
 and in violation of good ftiith, makes any consignment, dej>osit, 
 transferor delivery, of any goods or document of title so intrusti"! 
 to him as in this secti(jn before mentioned, as and by way of a 
 pledge, lien or security for any money or valuable security, bor- 
 rowed or received by such factor or agent at or before the time < )f 
 making such consignment, deposit, transfer or delivery, or intended 
 to be thereafter borrowed or received, or contrary to, or without 
 
FRAUDS BY AGENTS. 
 
 SGS 
 
 f ':. i: 
 
 such authority, for his own \ise or benefit, or the use or benefit of 
 any person, other than the person by whom he was so intrusted, 
 and in violation of good faith, acce{)ts any advance of any money 
 or valuable security on the faith of any contract or agreement to 
 consign, deposit, transfer or delivery of any such goods, or docu- 
 ment 'of title, is guilty of a misdemeanor, and shall be liable to 
 any of the punishments which the Court may award as herein- 
 before last mentioned ; and every clerk or other person who 
 knowingly and wilfully acts and assists in making any such con- 
 signment, deposit, transfer or delivery, or in accepting or procu- 
 ring such advance as aforesaid, is guilty of a misdemeanor, and 
 shall be liable to any of the same punishments ; provided, that 
 no such factor or agent shall be liable to any prosecution for con- 
 signing, dei)ositin^', transferring or delivering any such goods oi" 
 documents of title, in case the same are not made a security for, 
 or subject to the payment of any greater sum of money than the 
 amount, which at the time of such consignment, deposit, transfer 
 or delivery, was justly due and owing to such agent from his 
 principal, togethei- with the amount of any Inll of exchange drawn 
 by or on account of such princi[)al, and accepted by such factor or 
 
 agent. 
 
 (SO. Any factor or agent intrusted as aforesaid, and possessed of 
 any such document of title, whether derived immediately from 
 the owner of such goods, or obtained by reason of such factor or 
 agent having been intrusted with the possession of the goods, or 
 of any other document of title thereto, shall be deemed to have 
 been intrusted with the possession of the goods represented by 
 such document of title ; and every contract pledging or giving p 
 lien upon such document of title as aforesaid, shall be deemed to 
 be a pledge of and lien upon the goods to which the same relates J 
 and such factor or agent shall be deemed to be possessed of such 
 goods or document, whether the same are in his actual custody or 
 held by any other person subject to his control, or for him, or on 
 his behalf ; and where any loan or advance is bona fide made to 
 any factor or agent intrusted with and in possession of any such 
 goods or document of title, on the faith of any contract or agree- 
 ment in writing to consign, deposit, transfer or deliver such goodfi 
 
 n 
 
^64 
 
 THE INSOLVENT ACT. 
 
 or (locumont of title, and such goods or document of title is or are 
 actually received by the person making such loan or advance, 
 without notice that such factor or agent was not authorized to 
 make such pledge or security, every such loan or advance shall be 
 deemed to be a loan or advance on the security of such goods or 
 document of title, within the meaning of the last preceding sec- 
 tion, though such goods or document of title are not actually 
 received by the person making such loan or advance till a period 
 subsecjuent thereto ; and any conti'act or agreement whether made 
 direct with such factor or agent, or with any clerk or other person 
 on Ins behalf, shall be deemed a contract or agreement with such 
 factor or agent ; and any payient made, whether by money or 
 bill of exchange or other negotiable security, shall be deemed to 
 be an advance within the meaning of the last preceding section ; 
 and a factor or agent in possession as aforesaid, of such goods or 
 document, shall be taken for the purpose of the last preceding sec- 
 tion, to have been intrusted tlierewith by the owner thereof, un- 
 less the contrary be shown in evidence. 
 
 81. Whosoever, being a trustee of any property for the use or 
 benefit, either wh(dly or partially, of some other person, or for 
 any public or charitalde purpose, with intent to defraud, converts 
 or appropriates the same or any part thereof t(j or for his own use 
 or benefit, or the use or benefit of any person other than such per- 
 son as aforesaid, or for any purpose other than such public or 
 charitable purpose as aforesaid, or otherwise disposes of or destroys 
 such ])roperty or any part thereof, is guilty of a misdemeanor, and 
 shall be liable to any of the punishments which the Court may 
 award as hereinbefore last mentioned ; provided that no proceed- 
 ing or prosecution for any offence included in this section shall be 
 commenced without the sanction of the Attorney-General, or Soli- 
 citor-General for that Province in which the same is to be insti- 
 tuted ; provided also, that when any civil proceeding ^has been 
 taken against any person to whom the provisions of this section 
 may apply, no person who has taken such civil proceeding shall 
 commence any prosecution under this section without the sanction 
 of the Court or judge before whom such civil proceeding has been 
 had or is pending. 
 
FRAUDS BY AGENTS. 
 
 365 
 
 82. Whosoever, being a director, member, manager or puVjlic 
 officer of any body co-porate or pul)lic company, fi-audulently 
 tal<es or a})plies for his own use or benefit, or f jr any use or pur- 
 puses other than the use or ])urposes of such body corporate or 
 public company, any of the proi)erty of such body corporate or 
 public company, is guilty of a misdemeanor, and shall be liable to 
 any of the punishments whicli the Court may award as hereinbe- 
 fore last mentioned. 
 
 (S3. Whosoever, being a director, member, manager or public 
 officer of any body corporate or pul)lic company, as such receives 
 or j)OS,sesses liimself of any of the property of such body corporate 
 or pul)lic company, otherwise than in payment of a just debt or 
 demand, and with intent to defraud, omits to make, or to cause or 
 direct to be made, a full and true entry thereof in the books and 
 accounts of .such body corpoi-ate or public company, is guilty of a 
 misdemeanor, and sliall be liable to any of the punishments which 
 the Court may award as hereinbefore last mentioned. 
 
 84. Whosoever, being a director, manager, public officer or 
 member of any body corporate or public company, with intent to 
 defraud, destroys, alters, mutilates or falsifies any book, paper 
 writing or valuable security belonging to the body corporate or 
 public company, or makes or concurs in the making of any false 
 entry, or omits, or concurs in omitting any material particular in 
 any book of account or document, is guilty of a misdemeanor, and 
 shall be liable to any of the punishments which the Court may 
 award as hereinbefore last mentioned. 
 
 85. Who.soever, being a dii-ector, manager, or public officer or 
 member of an}"^ body corporate or public company, makes, circu- 
 lates or publishes, or concurs in making, circulating or publishing 
 any written statement or account which he knows to be false in 
 any matei-ial particular, with intent to deceive or defraud any 
 member, shareliolder, or creditor of such corporate or public com- 
 pany, or with intent to induce any person to become a shareholder 
 or partner therein, or to intrust or advance any property to such 
 b(jdy corporate or public company, or to enter into any security 
 for the benefit thereof, is guilty of a misdemeanor, and shall be 
 

 3(JG 
 
 THE INSOLVENT ACT. 
 
 liable to any of the punishinonts wlucli tl>o Court may award m 
 horeinboforu liiHt mentioned. 
 
 80. Nothing in any of the last ten preceding seetions of this 
 Act contained, shall enable oi' entitle any person to refuse to mako 
 a full and complete discovery by answer to any bill in equity, or 
 to answer any (question or interrogatory in any civil proceeding in 
 any Court, or upon the hearing of any matte)' in banki-uptcy or 
 insolvency ; and no pei'son shall be liable to be convicted of any 
 of tlie misdemeanors in the said sections mentioned, by any evi- 
 tlence whatever, in respect of any act done by liim, if, at any time 
 jjreviously to liis being charged with such oti'ence, he has first 
 disclosed such act on oath, in conscMjucnce of any compulsory pro- 
 cess of any Court of law or eijuity, in any action, suit oi' proceed- 
 ing, Itona fide instituted by any party aggrieved, or if he has first 
 disclosed the same in any compulsory examination or deposition 
 before any Court, upon the hearing of any matter in bankruptcy 
 or insolvency. 
 
 «7. Nothing in the last eleven preceding sections of this Act 
 contained, nor any proceeding, conviction or judgment to lie had 
 01' taken thereon against any person under any of the said sections 
 shall prevent, lessen, or impeach any remedy at law or in equity 
 which any party aggrieved l)y any ottence against any of the said 
 secticms might have had if this Act had not been passed ; but no 
 conviction of any such ofi'endei- .shall be received iu evidence in 
 any action at law or suit in e([uity against him ; and nothing in 
 the said sections contained shall att'ect or prejudice any agreement 
 entered into, or security given by any trustee, having for its 
 object the restoration or repayment of any trust i)roi)erty mis- 
 a2:)propriated. 
 
 139. Any assignee who in any curtiticatu required by this Act shall wilfully 
 misstate or falsely represent any material fact for the purpose of ileceiving 
 the judge, the creditors, or the insi^octors, shall be guilty of a misdemeanor, 
 and shall be liable at the discretion of the Court before which he shall be con- 
 victed to imprisonment for a term not exceeding three years. 
 
 140. From and after the coming into force of this Act, any Insolvent who, 
 with regard to his estate, — or any president, director, manager or employee 
 
OFFENCES AND PENALTIES. 
 
 867 
 
 of iiuy co-piirtnorship, or of any iiiooi'ijoratud comijuiiy not Bjiocially ox- 
 cupioil ill tliu first wectioii of tiiis Act, witli regard to the ostato of such co- 
 jiiutuurship or coiiipany, wlio sli dl ilii any of tho acts* or things following 
 witli intent to dofrav.l or defeat the rights of his or its creditors, shall ho 
 guilty <if a niisdenioano; , and shall he liahle, at tho discrotion of the coiU't 
 lu'fore which ho is conv. ;led, to punishment by iiuprisonniont for not more 
 thiui throe years, or f<: any greater punishment attached to the ofl'enco by any 
 existing Statute : — 
 
 if hi' dues not upon examination fully and truly discover, to tlie best of 
 liis knowied'^e and belief, all his property roal and personal, inclusive of his 
 riiriits and credits, and how and to whom, and for what consideration, ami 
 when he disposed of, assigned or transferred the same or any part tliereof, 
 excejtt such part has been really an. I honn Jiilc before sold or disposed of in 
 i!ie way of his trade or business, or laid out in ordiiniry family or hcjusehold 
 expenses, and fully, clearly and tridy state the causes to which his instlveucy 
 is owing ; or shall not deliver up to tho Assignee all such part thereof as is 
 ill his possession, custody or power (except such part thereof as is exempt 
 friiiii seizure as hereinbefore provided), and also all books, papers and 
 writings 'n his possossion, custody or power relating to his property o.v 
 atiairs ; 
 
 if, within thirty days prior to the denian<l of assignment, or the issue of a 
 writ of attachment under this Act, he doth, with intent to defraud his 
 creditors, remove, conceal or embezzle any part • f his property, to the value 
 of lifty dollars or upwards ; 
 
 If, in case of any person having to his knowledge or belief proved a false 
 deiit against his estate, ho fail to disclose tho same to his Assignee witliin one 
 ill nih after coming to the knowledge or belief thereof ; 
 
 If, with intent to defraud, he wilfully and fraudulently omits from his 
 schedule any oti'ects or property whatsoever ; 
 
 If, with intent to conceal the state of his atiairs, or to defeat the object of 
 this Act or of any part thereof, he conceals, or prevents, or withholds the pro- 
 duction of any book, deed, paper or writing relating to his property, deal- 
 ings or atiairs ; 
 
 If, with intent to conceal the state of his atiairs or to defeat the object of 
 the present Act or "f any part thereof, he parts with, conceals, destroys, 
 alters, mutilates or falsities, or causes to be concealed, destroyed, altered, 
 mutilated or falsified, any book, paper, writing or security or document re- 
 lating to his property, trade dealings or atiairs, or makes or is privy to the 
 making of any false or fraudulent entry or statement in or omission from 
 any book, paper, document or writing relating thereto ; 
 
 If, at his examination at any time, or at any meeting of his creditors held 
 under this Act, he attempts to account for the non-production or absence of 
 any of his property by fictitious losses or expenses ; 
 
 If, within the three months next preceding the demand of assignment, or 
 
 m 
 
 i • ' 
 
 y ' 1 
 
 
 i t 
 
 !, i. 
 
 B 
 
308 
 
 TIIK FNSOLVFNT A(;T. 
 
 the iBH\in of n writ of attachiiiunt in liiiuidation, ho pawitH, |)1u<1)(uh nr (Uh- 
 poHt'Sof, othtii'wigu tliaii in thu ordinary way of h\n tradu, any propurty.goodH or 
 oti'uctH, the price of which roniains nnpaid hy hint during such three niontlm. 
 
 Thu last clau.se of this .si'ction diH't'i'H from clauno fi of .section 
 147 of tlio Act of 1H(I!>. Tliiit, ill tlic former, the words," (leinand 
 of as,si<jfnmeiit," are substituted for "execution of a deed of aHsi^rn- 
 ment" — voluntary nssitjftiments l)ein<,' aliolished l)y the last Act. 
 An iasolvent may he guilty of an ortencc;, uiuler this .section, 
 although the goods are not disposed of to liis own u.se, hut to 
 .satisfy creditors ; and although the term of credit theret)n has not 
 expired at the time of the demand of assignment, or the issue of 
 the writ of attachment. The prisimers were indicted, under the 
 147th section of the Act of 180}), for having, within three months 
 preceding the execution of an assignment in insolvency, i»awned, 
 pledged, and disposed of, otherwise than in the way of tiade, cer- 
 tain goods, which had remained unpaid for, during the .said three 
 months. The go<((ls which had been purcliased on credit, the 
 period of which had not expii-ed, wlien the pi'iscmers were in- 
 dicted, were given on the day of assinnment, but before its execu- 
 tion, to a clerk on account of .salaiy due him, .and to indemnify 
 him against accommodation in(h)r.sements, to a carter in their em- 
 ployment, in .satisfaction of a sum of money previously (le[)osited 
 Avith them, and to a person who had given them accommodation 
 notes. The indictment was found <m the 2.Srd of October, but the 
 information had been laid and the pi'isoners arrested Itefore the lii'st 
 of September, when the Insolvent Act of l87o came into force, 
 The disposal, under these cii-cumstances, was held an otl'ence, 
 under section 147 of the Act of 18()9, and that the time of credit 
 expired by the effect of the assignment (Reg. v. Kerr, 20 C P. U. 
 C. 214) 
 
 It is necessary that the goods, &c., removed, should be the pro- 
 perty of the insolvent at the time the alleged otl'ence is connnit- 
 ted. Where the debtor had executed a bill of sale of the goods^ 
 which was void, against the assignee in insolvency, for want of 
 registration, it was held that he was not liable for removal of the 
 goods comprised in the bill of sale, for the projjerty therein had, 
 on execution, pa.ssed to the bargainee, and the fact that the 
 
 cor 
 pro 
 diit 
 of 
 
 Up€ 
 
 ins( 
 
I'UOOF OK ASSICNMKNT. 
 
 .SO!) 
 
 a9si<,'n<'o in insolvcnoy was t'iititlt'<l, as ai,'ainHt tho harj^'aiiict-, did 
 not alter th(! cast' (lly. v. Cm'sc, L. 11. 2 ('. ('. R. 105 ; 2!) L. T, N. 
 S, Si)7). The fraud contompIatcMl under this section, is active 
 fraud, sucli as a false representation (ex parte liirtt, L. K. 1 Ch. 
 
 I). i:.l). 
 
 Wliere a trader obtained ^jjoods on creilit, and soon after, by 
 bill of sale, assijrned them and othei' j;'oods to his sister, t(J He(nire 
 an antec(s<lent debt, it seems the case would come witiiin thin 
 claust" (Itiy. V. T/umuit^, 22 L. T. N. S. i:W). Hut when; tlie «,'oods 
 uure liou;,dit by tlie i)ajd<iupt on credit in the ordinary course of 
 (leaiiny, and exporteil, and money was raised by him on the bill 
 of lading, this was held not to be within the corresponding sec- 
 tion of the Knglish Act (ex parte liratt, 21. VV. R. 10 1 j. 
 
 It would seem tlnit the latter part of this clause was intended 
 to punish frauds on the creditors generally, and not on the par- 
 ticular creditor wlio sold the g(jods, though if the goods were ob- 
 taiiu'il upon credit with the intent of disposing of them to raise 
 money the fraud on tlii; seller would be tlie most obvious one 
 IJ. S. V. Petin, 13 B. R. kit). The making of a fraudulent 
 chattel mortgage lenders a party liable un<ler this provisi(jn {U. 
 S. V. Hain'r, l-S B. R. 8(S). It is not necessary that the goods 
 which have been disposed ol should have been obtained within 
 three months prior to the assignment {U. S. v. Smith, Hi B. R. 
 (il). 
 
 141. Evury ottbiice punishablo niult'r this Act sh<all bo tried as utliur 
 offoiicua (»f tho siviuo dogreo .iro tritiblo in thu Pruviuco whore such otience 
 i» ooiiiinittud. 
 
 Tlie 148th section of the Act of 18G9 recjuired that the jury 
 slunild be a special jiuy, t(j obtain which the proceedings neces- 
 sary in a civil case had to be adopted (see notes to .section 149). 
 
 142. If any creditor of an insolvent, directly or indirectly, takes or re- 
 ceives from such insolvent, any payment, gift, gratuity, or preference, or any 
 promise of jjayment, gift, gnitnity, or preference, as a consideration or in- 
 ducement to consent to the discharge of such insolvent, or to execute a deed 
 of composition and discharge with iiim ; or if any creditor knowingly ranks 
 upon the estate of the insolvent for a sum of money not due to him by the 
 insolvent, or by his estate, such creditor shall forfeit and pay a sum etjual to 
 
 X 
 
 I>ii.^ 
 
 
370 
 
 THE INSOLVENT ACT. 
 
 treble the value of the payment, gift, gratuity, or preference so taken. ••' . 
 ceived, or promised, or treble tlie amount impropei'ly ranked for, as the case 
 may be, jind the same shall be recoverable by the assignee for the Ijenefit (if 
 the estate, by suit in any competent Court, and when recovered, sliall be dis- 
 tributed as part of the ordinary assets of the esta'^e. 
 
 (See sections 06 and 87, and notes thereon). 
 
 143. If, after a demiind is made for the issue jf a writ of attach nieut in 
 insolvency, or for an assignment of his estate under this Act, as the case 
 may bo, when such demand shall be followed by the issue of a writ of at- 
 tachment or by an assignment under tliis Act, the insolvent retains or re- 
 ceives any portion of his estate or effects, or of his moneys, .securities for 
 money, business pajjcrs, documents, books of account, or evidences of debt, 
 or any sum or sums of money, belonging or due to him. and retains and 
 withholds from his a3sij;nce, without lawful right, such portion of his untate 
 or etlects, or of his moneys, securities for money, business jiapers, docti- 
 ments, books of account, evidences of debt, sum or sums of money, the as- 
 signee may make application to the judge, by sunnn.iry petition, and after 
 due notice to the insolvent, for an order for the delivery over to hiui of the 
 effects, documents, or moneys so retained ; and in default of such delivery in 
 conformity with any order to be made by the judge upon such application, 
 such insolvent may be imprisotied in the common gaol for sucli time not ex- 
 ceeding one year, as such judge may order. 
 
 The assionment, or the issue of tlu^ writ of attacliiiicnt, in ooni- 
 
 pulsory liquidation, vests in the assignee or guardian thc! wIidIc 
 
 of the estate and effects of the insolvent, and tlie latter lias no 
 
 riirht to retain or witldiold from tlio assi<;nee after the date of the 
 
 assignment, or the issue of the writ, any part of such estate or 
 
 effects, even though the same is retained without fraud, and to 
 
 meet the personal expenses of the insolvent. The latter lias no 
 
 right to retain them for any purpose (ex parte Tempest, 11 L 
 C. J. 5 ; see also section 134, and notes tliereon). 
 
 Prior to the passing of the Act of 180!), it was held tliat 
 
 wliere an insolvent received a sum of money belonging to tlu' 
 
 estate, during the time which intervened between the date tif tlie 
 
 notice of the meeting of crc<litors, and tlu^ appointment of the 
 
 assignee, and refused to pay over the mon<^y to the assignee, 
 
 this was a " retaining and withholding without lawful right," 
 
 within the meaning of the 29 Vict. chap. 18, s. 29 (re War- 
 
 m'mrjtoii, 12 L. C.J. 237. 
 
PROOF OF ASSIGNMENT. 
 
 371 
 
 An insolvent cannot legally be oommitted under this section 
 Avitlioiit an opportunity of showing cause, and it should appear in 
 till' order of committal, that he has had notice of the oi'der for 
 delivery, «fcc., for non-compliance with which an order of com- 
 mittal is asked (re Hicks, 5 U. C. P. R. 88 ; 5 U. C. L. J. N. S. 
 180). 
 
 144. The deeds of assignment and of transfer, or in the Provhice of Que- 
 bec autlientic copies thereof, or a duly ^autlienticated copy of the record of 
 the appointment of the r.asignee certified by tlie clerk or prothonotary of the 
 Court in which such record is ^deposited, under the seal of such Court, shall 
 bu prima facie evidence in all Courts, whether civil or criminal, of such ap- 
 pointment, and of the regularity of all proceedings at the time thereof, and 
 antecedent thereto. 
 
 UUILDI.VO AND JURY FUND. 
 
 145. One per centum upon all^ moneys proceeding from the sale by an 
 assignee, under the provisions of this Act, of any immovable property in the 
 Province of Quebec, shall be retained by the assignee out of such moneys, 
 and shall, by such assignee, be paid over to the sheriff of the district, or of 
 eitlier of the Counties of Gaspe or Bonaventure, as the case may be, within 
 which the immovable property sold shall be situate, to form part of the 
 building and jury fund of such district or county. 
 
 1 4G. The Governor in Council shall I '.ve all the powers with respect to im- 
 p ' Mg a tax or duty upon proceedings under this Act, jwhicli are conferred 
 upon the Governor in Ccmncil by the thirty-second and thirty-third sections 
 of the one hundred and ninth chapter of the Consolidated Statutes for Lower 
 Canada, and by the Act intituled " An Act to make jirovision for the erection 
 or repair of Court Houses and Gaols at certain places in Lower Canada " C12 
 Vict. chap. 112). 
 
 PKOCEDUKE IN THE CASE OF INCORPORATED COMPANIES. 
 
 147. The provisions of this Act shall ipply to the estates of incorporated 
 companies, not specially excepted in the first section of this Act, subject to 
 the following modifications : — 
 
 ( I . ) No writ of attachment shnll issue against the estate of an incorporated 
 company except upon the order of the judge, and after notice of at least 
 forty-eight hours has been given to such company of the application for such 
 writ. The judge in all cases where proceedings have been adopted under this 
 Act ftgain»t an incoqjorated company, may, before granting a writ of attach- 
 ment, order the official assignee to inquire into the affairs of the company. 
 
372 
 
 THE INSOLVENT ACT. 
 
 and to report thereon within a period not exceeding ten days from the date nf 
 such order : 
 
 (2.) Upon such order it shall be the duty of such company, and of the pre- 
 sident, directors, managers and employees tliereof, and of every other person 
 having possession or knowledge thereof, to jxhibit to the official assignee, ur 
 lo his deputy, the hooks of account, togetlier with all inventories, papers, and 
 voucliers referring to tlie business of the company, or of any other person ; 
 and generally to give all such information as may bt re(iuired by the official 
 assignee to form a just estimate of the affairs of tlie said company ; and any 
 refusal on the part of the said president, directors, managers or employees of 
 the company to give such information shall, on evidence of such refusal, lie 
 considered as a contemjjt of an order of the Court or judge, and punishable 
 by fine or impriscmment or by both at tlie discretion of the judge : 
 
 (3.) From the time the above order is served upon the company, the presi- 
 dent, directors, managers and employees thereof, and all other perstms having 
 the C(mtrol or pos8essi(m of its afiairs or property, shall hold the estate and 
 property of the said company upon triist for the ci'editors of the said com- 
 pany, and shall be bound to account for all the property of the said c(mipany 
 under the same obligations, liabilities, and responsibilities as trustees ui>- 
 pointed by courts of law or equitj' in the several Provinces, or as guardians 
 and secpiestrators in the Province of Quebec, are bound : 
 
 (4.) Upon the report of the OfKcial Assignee or before any order is given 
 for the examination into the affa'rn of the company, as herein provided, tha 
 judge may order that a meeting of the creditors be called and held in the 
 manner provided for by this Act for the first meeting of creditors, at which 
 meeting the creditors present in perstm or represented by proxy who shall 
 verify their claims under oath, may pass such resolutifms either for tlie wiml- 
 ing up of the affairs of the company or for allowing the business thereof to be 
 carried on as they may deem most advantageous to the creditors ; and may 
 also appoint two inspectors and indicate the mode in which the business of 
 the company should be wound up or should be continued (39 Vict. chap. 30, 
 s. 17) : 
 
 (5.) The resolutions so adopted shall be submitted to the judge at the time 
 and place appointed at the meeting, and at least forty-eight h(mrs' notice 
 shall be given by the official assignee to the company of the time and place 
 so fixed : 
 
 (G. ) The judge, after hearing such creditors as may bo present, the as- 
 signee and the company, may confirm, reject, or modify the said resolutions ; 
 and he may order the immediate issue of a writ of attachment to attach the 
 estate of the company, or direct that the issue of such writ shall be suspended 
 for a period not exceeding six months ; during which period he may order 
 that the official assignee or the insiiectors (if any have been appointed by the 
 creditors) shall exercise a general superviaion over the estate and business of 
 
INX'OUI'ORATED C:OM?ANIES. 
 
 373 
 
 the said ccimpany by reciiiiriny from the president, directors, managers and 
 enijiloyees of the company, such periodical accounts and statements, of the 
 business done, and of the moneys received and expended or disbursed since 
 tlio last statement as may be required by the said insjiectors or the said official 
 assignee to obtain a proper knowledge of the affairs of the company : 
 
 (7.) The judge may also, if he deems it for the advantage of the creditors, 
 aiii)oint a receiver charged with such duties as to the auperinten dance or 
 niHiiagement of the affairs of the company as may be imposed upon him by 
 the order of the judge ; anil who sh.all also assume and be invested with all 
 the iiowers vested in the directors and stockholders respecting the calling in 
 and collecting of the unpaid stock of the company, and subject to such orders 
 and directions as he may, from time to time, receive from the judge : 
 
 (S.) Such receiver shall account, whenever ordered by the Court or judge, 
 for all moneys or prijperty he may have received from the estate ; 
 
 (!•.) Before the expiration of the six months next after such order the 
 official assignee or tlie receiver, as the case may be, shall cause another meet- 
 ing of the creditors to be called : 
 
 (10.) On the resolutions adopted at such meeting the judge may either 
 grant a fiu'ther delay not exceeding six months, or cause a writ of attachment 
 to isstie at the instance of any creditor or creditors : 
 
 (11. ) If, at the expiration of such prolonged delay, the demands made upon 
 tilt' company to ]jlace it in litpiidation have not been satistieil, the judge shall 
 order the issue of a writ of attachment ; and the estate of the said company 
 shall lie wiiund uji under the provisions of this Act, unless the creditor or 
 creditors entitled to such writ shall consent to a further delay : 
 
 (12.) Nothing in this section shall prevent the judge before the explication 
 of the delays he may have granted mider the i^receding sub-sections, from 
 cancelling the orders so given by him, and from ordering the issue of a writ 
 of attachment or from releasing the company from the effect of any such order, 
 as circumstances may require : 
 
 13.) The president, directors, managers, or other officers or employees of 
 the company, and any other person, may be examined by the assignee or by 
 the judge on the affairs of the company, and each of them shall, for refusal 
 to answer questions j.ut in reference to the business within his own cogni- 
 zance, be liable to the same penalties as ordinary traders refusing to answer 
 questions put under the prt)visions of this Act : 
 
 (14.) The renmneration of the official a&„ignee and of the receiver for 
 services performed under the preceding sub-sectitms shall be fixed by the 
 judge. 
 
 (15.) Nothing in the preceding sub-sections shall prevent the president, 
 directors, managers, or employees of the company, on being duly authorized 
 to that effect, from making an assignment of the estate of such company to an 
 official assignee in the form provided for by this Act, before the expiration of 
 
 
 'i 
 
374 
 
 THE INSOLVENT ACT. 
 
 the delays which may have been granted to such company by the Court or 
 judge. 
 
 GENERAL PROVISIONS. 
 
 148. The foregoing provisions of this Act shall come into force and take 
 effect upon, from and after the first day of September, in the present yoar 
 1875, and not before, except in so far as relates to the appointment of official 
 assignees, and the making and framing of rules, orders, and forma, to be 
 followed and observed in proceedings under this Act, with respect to which 
 the said provisions shall be in force from the time of the passing of this 
 Act. 
 
 149. " Tlie Insolvent Act of 1804," and the Act to amend the same passed 
 by the Parliament of the late Province of Canada, in the twouty-nintli ye.ar 
 of Her Majesty's reign, " The Insolvent Act of 18(59," the Act amending the 
 same passed in the thii'ty-third year of Her Majesty's reign, and the Act 
 amending the same passed in the thirty-foiu-th year of Her Majesty's reign, 
 and the Act passed in the thirty-seventh year of Her Majesty's reign con- 
 tinuing the same, the .Act passed by the Legislature of Prince Edward Island 
 in the thirty-fii'st year of Her Majesty's reign, chaptered fifteen, intituled, 
 '' An Act for the relief of unfoi'tunate debtors,'' and the several Acts amend- 
 ing and continuing the same which are in force in the said Province of Prince 
 Edwiird I&land, which are mentioned in and continued by the last mentioned 
 Act passed in the thirty-seventh year of Her Majesty's reign, the Act of the 
 Legislature of the Colony of Vancouver Island, passed in the year 1802, and 
 intituled: "An Act to declare the law relative to Bankruptcy and Insolvency 
 in Vancouver Island and its dependencies,'' and the Act of the Legislature of 
 the Colony of British Columbia, passed in the year 1805, and intituled : ".\n 
 Ordinance to amend the law relative to Bankruptcy and Insolvency in British 
 Cohimbia,'' and all Acts of the said Legislatures, or either of them, amending 
 the same, are hereby continued in force to the first day of September in the 
 present year 1875, after which date the same shall be repealed, except so far 
 as regards proceedings commencetl and then pending therexinder, and also 
 as regards all contracts, acts, matters and things made and done before such 
 repeal, to which the said Acts or any of the provisions thereof would have 
 applied if not so repealed, and especially such as are contrary to tlie [iro- 
 visions of the said Acts, having reference to fraud and fraudulent prefer- 
 ences, and to the enregistration of marriage contracts within the Province of 
 Quebec ; and as to all suc^^ contracts, acts, matters and things, the pro- 
 visions of the said Acts shall remain in force, and shall be acted upon as if 
 this Act had never been passed : Pnjvided always, tliat as respects matters of 
 procedure merely, the provisions of this Act shall, upon and after the said first 
 day of September, in the present year 1875, supersede those of the said Acts 
 even in cases conunenced and then pending, except cases pending before any 
 
i 
 
 INCORPORATED COMPANIES. 
 
 375 
 
 lirt or 
 
 take 
 
 year 
 
 irticial 
 
 to bo 
 
 J which 
 
 if this 
 
 
 otticial assignee, in liis judicial capacity ; And all Becurities given under the 
 said Acts shall remain valid, and may be enforced, in respect of all matters 
 and things falling within their terms, whether on, before or after the day 
 last aforesaid ; and especially all securities theretofore given by official 
 assignees shall serve and avail hereafter as if given under this Act. All 
 otlier Acts and parts of Acts now in force in any of the Provinces to which 
 this Act applies, which are inconsistent with tlie provisions of this Act, are 
 hereby repealed. 
 
 llie Act of 1864 was not confined to traders. An assicrnment 
 was made under the Act, in March, 18GI), by an inn-keeper who, 
 according to the law in Ontario at that time, was not a trader. 
 Tlie Act of 1869 was passed on the 22nd of June, 1869, but the 
 discharofe of the insolvent was not obtained until November, 
 1870, and was entitled " Insolvent Act of 1869." An execution 
 was is.-<uod against the insolvent, on a debt contracted before the 
 assignment, and it was held that as the insolvency proceedings 
 were conuaenced, under the Act of 1864, they must all be con- 
 sidered as taken under that iVct, the procedure merely being 
 rc'gidated by the Act of 1869, and as the defemlanl could avail 
 himself of the provisions of the Act of 1864, the execution was 
 set aside {Caniexjie v. Tmr, 10 C. L. J. N. S. 196 ; 6 P. R. U. C. 
 165). 
 
 Where goods were disposed of, contrary to clause 8 of section, 
 147 of the Act of 1869 before the 1st of September, 1875, and 
 an information therefor was laid prior to the coming into force 
 of the present Act, on 1st September, 1875, though the indictment 
 was not found until the 23rd of October following, it was held 
 that the prosecution as well as the offence came within this saving 
 clause, the laying of i\\(\ information being the commencement of 
 the prosecution. Section 148 of the Act of 1869 provided that 
 all offences punishable under that Act shotdd be tried by a spe- 
 cial jury, and section 141 of the present Act directs that all of- 
 fences punishable undeu' the Act shall be tried as other offences 
 of the same degree, and liy the proviso in this section, as respects 
 matters of procedure, the provisions of the present Act supersede 
 those of the Act of 1869, even in cases commenced and pending. 
 Where, therefore, before the trial for misden;ieanor, under section 
 147 of the Act of 1869, the Crown gave notice of, and struck, a 
 
 n 
 

 
 376 
 
 THE INSOl.VENT ACT. 
 
 special jury, ])iirsuant to section 1 4>H of that Act, and tlio spcicial 
 jury were in attendance at the trial, but th Crown, notwith- 
 standing, elected to call and try the case b}'^ a common jury, the 
 ])risoners' counsel objected thereto, and the case pi'oceeded, the 
 prisoners entering into full defence, but sulject to such objec- 
 tion, which was renewed at the close of the case with tlie further 
 objection that there had been a mis-trial. It was lield that the 
 case should have ])een tried by a s)iecial jury, for the offence was 
 not punishable under the Act of 1875, and the matter was not 
 one of procedure within this section. That there had, thertiforc, 
 been a mis-trial, which the prisoners, under the circumstances, 
 hwd not waived their right to insist upon, and that this was a 
 " question of law which arose (m the trial," which might properly 
 be reserved, and not an objection to be raised b}' challenge to the 
 jury (Ueg. v. Kerr, 26 C. P. U. C. 214). 
 
 150. The foregoing provisions of this Act shall apply to each and every tlie 
 Provinces in the Dominion of Canada. 
 
 151. The provisions of " The Insolvent Act of 18(59," applied by Schedule 
 A of the Act thirty-fourth Victoria, chapter thirteen, to insolvents resident 
 in the Province of ]\Ianitoba, shall continue to api>lj to such insolvents, in 
 the case of composition and discharge mentioned in the said provisitms, until 
 the said first day of .Septemher, 1875, until wliich day the aai<l provisions are 
 hereby continued in force for that purpose ; and upon, fi'oin, and after tiic 
 said day the same shall be repealed, subject to the like excejitions and provi- 
 sions as are made in the next preceding section but one, as to the Acts and 
 laws repealed by the said section ; and in the pnjvisions so continued in furce 
 "the Court" shall mean the Court of Queen's Uench of Manitoba, and 
 " the judge " shall mean the chief justice or one of the puisne judges of tlie 
 said Court. 
 
 152. This Act shall be known and may be cited as " The Insolvent Act of 
 1875.' 
 
 39 VICT. CHAP. 30. 
 An Act to Amend " The Insolvent Act of 1875." 
 
 [AiiHeiited to 12th April, 187*).] 
 WHP]REAS it is expedient to make certain amendments in 
 " The, Insolvent Act of 1875 " : Therefore Her Majesty, l)y and with 
 the advice and consent of the Senate and House of Connnons of 
 Canada, enacts as follows : — 
 
tlio special 
 
 n, notwith- 
 
 n j'n-y, tlu" 
 
 oceodt'd, tlu.' 
 
 sucli olijec- 
 
 tln' furtluT 
 
 (1 that tlio 
 
 ofi'enee Avas 
 
 tor was not 
 
 d, tliorofore, 
 
 cumstancos, 
 
 tl'is was a 
 
 L;'lit properly 
 
 lenye to tlic 
 
 and evory the 
 
 I l)y Schedule 
 vents resident 
 insolvents, in 
 •ovisiuns, until 
 provisions are 
 iind after the 
 ons and provi- 
 the Acts and 
 inued in force 
 lanitoba. and 
 3 judges of the 
 
 lolvent Act of 
 
 1875." 
 'n7j87().] 
 indiiients in 
 hy and with 
 !onnnons of 
 
 AMENDING ACT OF 1870. 
 
 377 
 
 1. SiiV)-Hcction h of the second section of the said Act is her(d)y 
 aiinnded by adding after the words "and if no such Gazette is 
 puMished," the words following : "or if such Gazette is not, in the 
 opinion of the Court or judge, published with sufficient fre(piency 
 to enaVjle the required notice to be conveniently publislied tlierein." 
 
 2. The fourth section of the said Act is hereby amended by 
 adiliiig after the Avord " original " in the third line from the end, 
 the word " afHdavit.' 
 
 3." TliC fourteenth section of the said Act is hereby amended by 
 stiiking out the words " or against whom a writ of attachment 
 has issued as j)rovided by this Act," in the second, third, and fourtli 
 lines, and the words " or writ of attachment " in the twelfth line; 
 anil by striking out the Avords " oi- by section nine" in the fifteenth 
 line : and the Avords " or Avho issued the writ of attachment" in 
 the nineteenth and twentieth lines; and the eighteenth section of 
 the said Act is hereby amended l)y inserting after the word 
 li([uidation " in the ninth line, the following words " or for want 
 of. <ir for a substantial insufficiency in the affidavits required by 
 section nine." 
 
 4. The twentieth section of the said Act is hereby amended l)y 
 striking out the word " tAvice " in the third line from the end 
 tlii'reof, and inserting in lieu thereof the AA'ord " once," and by in- 
 serting aftei- the Avord " Gazette " in the same line, the words 
 folloAving, " and once in one local or the nearest published neAvs- 
 paper." 
 
 0. The twenty-sixth section of the said Act is hereby amended 
 by inserting after the AVord " ansAvei' " in the fifth line tliereof, the 
 Avords "upon oath," and by striking out the Avord "and " in Vne 
 eighth line, and inserting in lieu thereof the words " or to be 
 SAvorn, or" 
 
 (>. All securities given, or to be given, under the twenty-eighth 
 and twenty-ninth sections of the said Act, shall be deposited Avith 
 the judge, and kept as jiart oi the records of the Court, subject to 
 the right of any person entitled to sue upon any such security, to 
 such production and delivery tliereof, as may be necessary iji 
 order to the exercise of sucli right. 
 
 7 An}' creditor of the estate may, in the case of any person re- 
 
 ' Bt^ 
 
 1 ' 
 
 
 i 
 
878 
 
 THE INSOLVENT ACT. 
 
 (luivcd, under tho said twenty -cightli and twenty-ninth sections 
 to give .security, have inspection of such secui'ity, and may, if in 
 his opinion the surety or .sureties in .such .security are insutiicicnt, 
 apply, on notice, to the judge for an order tliat naw or additional 
 sureties be furnished ; and tlie judge may upon .such application 
 make such order as shall .seem reasonable, both as to the furnish- 
 ing of sureties and as to the costs of the application. 
 
 8. The thirtv-tifth section of the .sai<l Act is hereby amended 
 by striking out the word " as " between the words " assignee "and 
 "ins])ector" in the fourth line from the end, and inserting in lii'u 
 thereof the word " ov." 
 
 9. The thirty-sixth section of the said Act is hereby amended by 
 adding the f(jllowing words, " subject to tin; pVoviso as to sale en 
 bloc contained in the thirty-eighth section of this Act." 
 
 10. The thirty-eighth section of the .said Act is hereby amended 
 by adding thereto the following sub-section : — 
 
 " (2.) It shall not l)e neces.sary to adverti.se under the ])rovisions 
 of the seventy-fifth s^'ction of this Act any proposed sale of the 
 estate f'7i6/o6' under this .section, although the estate may comprise 
 real estate." 
 
 11. The forty-lirst section of the .said Act is hereby amende<l by 
 inserting the following at the end thereof : — " And every register 
 of (jr coming into the possession of an official assignee, and every 
 other record recjuired to be kept by an ofHcial assignee in connec- 
 tion with the perfoi'iiiance of his duties, .shall l)e held to l)e the 
 propei'ty of Her Majesty; and upon the death of an official assignee, 
 or his ceiising to hold office, the judge shall be entitled and shall 
 assume possession and control of such register or other record, 
 which shall thereafter be kept among the records of the Court 
 open to inspection as aforesaid." 
 
 12. The forty-third .section of the said Act is hereby amended 
 by inserting after the words " removal of property " in the 
 thirteenth line the following words, " the creditors may, in case 
 in their opinion the remuneration of the assignee under the 
 preceding part of tins section is inadeijuate, at any meeting called 
 for the purpose, fix such additional remuneration to be paid out 
 of the estate to the assignee as they shall think reasonable,'" ami 
 
AMENDING ACT OF 1870. 
 
 :i7» 
 
 by adtling, after the word " creditors " in the third line from the 
 end, tlio following words, " arjd the remuneration of the assignee, 
 wlu'ther he be the official or the creditors' assignee, in cases in 
 in which the estate is settled by com])Osition." 
 
 I ii. The forty-fourth section of the said Act is hereby amended 
 by adding after the words " five creditors," the following words. 
 " if there are five or more, or by all the creditors if there are less 
 tlian five." 
 
 14. The sixty-sixth section )f the said Act is hereby amended 
 by adding at the end thereof the words " or judge." 
 
 I .'). The eighty -fourth section of the said Act is hereby amended 
 l)y sti'iking out the worils " and revalue " in the last line, and by 
 inserting at the end the words " and tri;at such liability as un- 
 secured " (see however 40 Vict. chap. 41, ,s. 32). 
 
 Ki. The one hundi-ed and twenty-eighth section of the said Act 
 is hereby amended by striking out the words " either of tlie 
 Superior Courts of Common Law or to the Court of Chancery, 
 or to any one of the judges of the said Courts," and substituting 
 in lieu thei'eof the words " the Court of Error and Appeal, or to 
 any judge of that Court." 
 
 17. The fourth sul)-section of the one hundred and forty-seventh 
 section of the said Act is hereby amended by inserting after the 
 woi-d " present " in the sixth line thereof the words " in person or 
 represented by proxy," 
 
 15. Every assignee shall, before the end of October in each year, 
 fill up and transmit to the Minister of Agriculture, or in case this 
 branch of the subject of statistics and the registration thereof be, 
 by the Governor in Council, transferred to any other minister, 
 then to such other ministei', a schedule showing the particulars 
 contained in the register to be kept l»y him under the forty-first 
 section of the said Act, and such other schedules foi' the year end- 
 ing the thirtieth day of Septembei' next }>receding, relative to the 
 insolvency matters transacted by him, as sliall be, from time to 
 time, prescribed by the Governor in Council, according to forms 
 published in the Canada Gazcitc ; and it shall be the duty of every 
 assignee, to make from day to day, and to keep entries and records 
 of the particulars to be compiised in such schedules. 
 
 .'■! 
 
 J, f 
 
 .* 
 
 ^lit^u. 
 
380 
 
 THK TNSOLVKNT ACT. 
 
 I!). Any ussignoe neglecting or refusing to fill up and transmit 
 any sehedule under the eigliteentli section of tliis Act, or wilfully 
 making a false, partial, oi- incorrect schedule thereunder, shall 
 fiirfeit and ))ay the sum of forty dollars, together with full costH 
 of suit, to be recoverea hy any person siung for the same !»y action 
 of debt or information in any ('ourt of record in the Proviiu-c in 
 which such return ought to liave been made, or is made, or in the 
 E.\che([uer Couit of Canada, and oni' moiety whereof sliall be [laid 
 to the partj'^ suing, and ^he t)ther moiety in the hands of Her 
 Majesty's Keceiver-Oeneral to and for the public uses of Canada. 
 
 -0. The statistics collected by the Ministei- of Agricultuic, or 
 siich other minister as aforesaid, under this Act, shall bt> abstracttul 
 and rt'gistered, and the results thereof shall be ]»rinted and 
 published in an annual rejioit. 
 
 21. The word "county " in the said Act includes any judicial 
 district in the Province of Ontario not organized into a county. 
 
 22. No amendment hereby made .shall be lield to be a declara- 
 tion of the construction of any provision of the said Act as aj)pli- 
 cabk' to any })roceeding heretofore had under the said Act. 
 
 40 VICT. (^HAP 41. 
 
 An Ac"T to Amexi) the " Insolvent Acj of 1S7'), and the 
 Act amending the .same." 
 
 [Assented to 2Hth April, 1877.] 
 
 HER MAJESTY, by and with the advice and consent of the 
 Senate and House of Commons of (^anada, enacts as follows : — 
 
 1. The sections reierred to in sections two to twenty-nine, both 
 inclusive, of this Act are .sections of " The Insolvent Act of 1875." 
 
 2. Section eleven i.s amended by adding thereto the words " to 
 be inserted once in the Ojfieial Gazette, and once in one local or 
 the nearest jjubli.shed news[)aper." 
 
 3. Section seventeen is amended by striking out the word 
 " ten" in the first and third lines and inserting in lieu thereof the 
 word '"seven." 
 
 +. Section nineteen is amended by adding aftei' the word " or," 
 in the third line, the words " in Quebec by the proper Notary or 
 
THE 
 
 AMENDIN'O ACT OK 1877. 
 
 381 
 
 hy;" and nddln",' after tlio word "such" in the seventh line, the 
 words " copy of the." 
 
 .'). Section twenty is amended hy adding after tlie word "lield." 
 in tli(^ seventh line, the vvords "within twenty-one days," and l»y 
 stiikin<;'()iit the words " three weeks," in the eleventh line and in- 
 scrtint^' in lieu thereof the words "ten days," and by addinjf iuMiie- 
 (lii\tely after the last word in the section the words " Provided 
 always, that if tin; assintiee omits to call sneh meeting' to he held 
 within the timealun'e limited, the judge shall, on the application 
 of tlu! assignee or of any creditor, order the meeting to he calle<l 
 for the earliest possible day thereafter ; and should the said omis- 
 sion have arisi'U from the negligence of the assignee, the judge 
 shall order him to pay the costs of the application ; Provided also, 
 that (jn application of any creditor, the judge on being sa^istinl 
 that there are creditors of the insolvent whose unsecured claims 
 amount to at least one-third of his direct liabilities, resident in 
 any place from whence their attested claims cannot with due dili- 
 gence be received before the day of the meeting, may order that 
 the meeting lie adjinu'ned to some diiy not more than a week there- 
 after; a copy of the order shall forthwith be served on the assignee, 
 who shall forthwith, by prepaid letter or circular, notify each 
 creditor of the adjournment. In ca.se such order be made no 
 business shall be transacted at the meeting, which shall stand ad- 
 journed according t(j the terms of the order." 
 
 G. Section twenty-one is amended by adding after the word 
 "mail," in the fir.st line, the words "prepaid and registered," and 
 by striking out, in the second line, the words "in writing," and 
 inserting in lieu thereof the words " of such meetii g, and a list of 
 the insolvent's creditoivs, and the amounts of their i'e.spective 
 claims," and by striking out all after the word " require," in the 
 seventh' line, to the end of the section. 
 
 7. Section twenty-two is amended by adding thereto the words 
 "in default of an appointment of chairman by the creditors." 
 
 8. Section twenty-eight is amended by inserting after the words 
 "public officer," in the eighteenth line, the words following ; "Pro- 
 vided always, that when any person appointed assignee or joint 
 assignee, under the provisions of the twenty -seventh section, has 
 
 W^Wn i: 
 
 ft% n 
 
t]H'l 
 
 THE INSOLVKNT ACT. 
 
 <,Mvon till' security fur the diic fiiltiliiieiit ami (lischarf^fc of liis 
 duties, nM|uirt'(l liy tlic itrcecdiu^ ]»ait of tliis suction, tlioii any 
 jievsoTi who lias Itcconio surety in that Itchalf", when no loii;;cr 
 disposed to continue liis suretyslii|», may {j;ivt' notice thereof in 
 writing to liis principal, and also to tlie Secretary of State of 
 Canachi, and all aeeruinj;' responsihility on the ]»artof such j)erson 
 as such surety shall cease at the expiration of tlnce months from 
 tlie receipt of the last of such notices, or ujMm the aceeptiince hy 
 the Crown of the security of anotlier surety, whichever shall Hrst 
 happen, and the itrincijtal shall, within one month from the receipt 
 of the last of such notices, ^\ve the seciu'ity of anotliLr surety, 
 but if it ap{)ears to the Uoveinoi' in ('ouneil that the ])erio(l so 
 limited for givin<f the security of a new surety is, for any reason 
 insiitficicnt, the Oovernor in C-ouncil may allow such further 
 jti'riod for giving' the secuiity of such new surety as appears to him 
 proper, hut such extcndecl poi'iod shall in no case exceed two 
 months beyond the one montli within whidi such new st :urity is 
 ri'quired to be given as above mentioned; and this pi'oviso shall 
 apply to the case of any new .security which may from time to 
 time be given." 
 
 9. Section thirtyis amended by adding after the word "him," in 
 the second line, the words " or if no security be required, then 
 innnediately u]»on his appointment." 
 
 10. Section thirty -one is amended by adding after tlie word 
 "advertisement," in the second line, tlie words " to be iiiseited 
 once in the Uncial Gazette." 
 
 11. Section thirty-two is hereby repealed and the following 
 vsubstituted in lieu thereof: — 
 
 " 32. No person sliall act as the attorney or agent of any creditor, 
 upon any (juestion as to tlie appointment of such person as as- 
 signee, or in reference to any claim or demand of such creditor, on 
 an insolvent estate of which such person is tlie assignee, nor shall 
 any partner or employee of any ])erson, act as the attorney or 
 agent of any creditor in any matter in which under this section 
 such person himself could not act, nor shall any assignee employ 
 any pei-son being his partner, as counsel, advocate, attorney, soli- 
 citor, or agent for such assignee in respect of the insolvent estate." 
 
AMENDINO ACT OK 1H77. 
 
 nn.s 
 
 lii Section tliirty-fivc is uiiicihIimI by adding; thereto the 
 wonls "or any claim aj,'ainst siidi estate; nor shall any assi;,'nee 
 employ any inspector, nor shnll any inspector employ any jx-ison 
 iiciiiii' his ])artnt'i', or licinj,' the jiartnrr of any assii^nee, or the 
 partner of any inspector, as eoiuisel, advocate, attorney, solicitor 
 or agent, in respect of the insolvent estate." 
 
 13. Section forty-three is amended by adding after the word 
 "fixed," in the twenty-tirst line, tlie words "l»y the creditois at 
 their tirst m(-eting, or liy the inspectors within ojie week there- 
 after, snhject in eithci- case to I'cvision hy the court oi' judge, and 
 ill default of heing so lixcil, sliall he .settled," and hy adding there- 
 to the following })aragraph : " Any assigne, who shall insert any 
 cliargi" in his account ahove or heyond the remuneration allowed 
 to him liv law, and who shall not remove it theretVom at the re- 
 (piest in writing of jtriy creclitor or of the in.spectors, within three 
 days after the recciipt of such recpiest, shall forfeit and pay, in 
 ciise the iudir<' shall so oi'der, trehU' the amount of the ovoi'charffo 
 to the funds of the estate." 
 
 14. Si'ction tifty-eight is repealed. 
 
 1"). Section sixty-five is amended by adding thereto the words 
 '• Provided always, that the Judge shall not grant any discharge 
 uniler this section in any ca.se, unless some one of the following 
 conditions lie established by proof, that is to .say : 
 
 I. That a dividend of not less than fifty cents in the dollar on 
 the unsecured claims has been, or will be, paid out of the insol- 
 vent's ])roperty ; or 
 
 '1. That such a dividend might have been paid but for the 
 negligent' or fraud of the assignee or inspectoi's ; or 
 
 3. That the insolvent had, on some one day prior to the in- 
 stitution of the jtroceedings in insolvi'ncy, mailed, prepaid and 
 registered, to the address of each of his creditoi.s, so far as known 
 to him, a declaration acknowledging his insolvency; and that no 
 jiroceedings in insolvency had been instituted against the in.sol- 
 vent for more than one nifinth after the mailing of such notices ; 
 and that such a <lividend would have been paid but for circum- 
 stances for which the insolvent cannot justly be held responsible, 
 
 1 
 
 
 r 
 
 
 
 IK 
 
 ( 
 
 li 
 
 
 g 
 
884 
 
 THE INSOLVENT ACT. 
 
 arising more tlmn one month after the mailing of such declara- 
 tion." 
 
 16. Section seventy -one is amended by adding after the word 
 " creditors" in thii sixth line the words " or inspectoi's," and l)v 
 adding to the section the following words : " But if the first meet- 
 ing of creditors is not held until within such j»eriod of tlnfc 
 months, then the power of terminating the lease may })e exercised 
 by ihe creditors at such meeting or by the insj)eetors, within one 
 w 'ek tliereafter, but not later." 
 
 17. Section seventy-two is amended by adding after the word 
 " creditors" in the fourth line, the words " or Inspectors." 
 
 IS. Section seventy-three is amended by adding after the wuid 
 " creditors" in the fourth line, the words " or inspectors." 
 
 19. Section seventy-fou)' is amended by striking out the words 
 " one year" in the fourth line ami inserting in lieu thereof the words 
 " six months." 
 
 20. Section seventy-five is .amended by .striking out the wmd 
 " only" in the .second line, and inserting in lieu thereof the words : 
 " in any Province other thaii Quebec no .sale shall be completed 
 " unless (a) the proposed sale has been sanctioned by the creditors 
 " at their first meeting or at any subsecpient meeting called tn; 
 " the purpose, oi' by the inspectors; or (6) the assignee has ad- 
 " vertised an auction .sale or sale by tender in aect)rdance with the 
 " directions in that behalf given Ity the creditors at their first 
 " meeting or at any sub.seciuent meeting eall(;d for the purpose, nr 
 " by the inspectors, and the inspectors' .sanction in wiiting the 
 " acceptance of a price not greater than the amount bid or ten- 
 " dered ; in the Province of Quebec no sale of real estate .shall l»e 
 " made unless." 
 
 21. Section eighty-four is amended by striking out the last 
 two lines, and inserting in lieu thereof the word.s, " if such claim 
 is mature or exigible at the date of the a.ssignment or the issue of 
 the writ of attachment, or becomes .so and remains unpaid tlieic- 
 after, whether before or after proof, such creditor shall be e?r 
 titled for ranking to treat the claim as unsecured, but for voting 
 or consenting to a discharge, or a deed of comjwsition and lii.s- 
 charge, or for any other purpose, save iaid<ing, he .shall be still 
 
AMENDING ACT OF 1877. 
 
 385 
 
 considered to hold security within the meaning of this section, 
 and sliall, for all such purposes, put a value on the liability of the 
 |mrty primarily liable thereon as beinij;' his security for the pay- 
 ment tliercof." 
 
 22. Section ninety-one is amended by striking out of the sixth 
 line the word " three," and sul)stituting in lieu thereof the word 
 ' two," and by striking out of the eighth line the words " two 
 months," and substituting in lieu thereof the words "one month;" 
 and by adding immediately aftei- the last word in the section the 
 \V(ji(ls "and no assignee, jmyable by couuuission^ shall be entitled 
 to charge foi' any disltursement for procuring to be performed any 
 service which he might properly have caused to be performed by 
 any such clcik or other persim, anil lor which ho might otherwise 
 chaige under this Act ; and no assignee whose remuneration is 
 not fixed by this Act shall be entitled to remuneration for any 
 service or for any <lisbuisc)iieni in respect of any service which 
 he might properly have caused to be performed by such clerk or 
 other person. 
 
 2o. Section one hundit-i and 'wo is amended by striking' out 
 after the wor<l " meeting,' in the fourth liui', the words " and re- 
 presenting also the maj(;r:ty in value of such creditors," and by 
 adding after the last word in the section the words, ' Provided, 
 " however, that no costs of or iucidi;ntal to any such reference 
 " shall be paiil out of the estate, ami the decision of the judge on 
 " any reference uu(K'r tliis section in which the resolutions re- 
 " f erred involve the ap})ointment of an assignee or inspector tt 
 " the estate, shall be final." 
 
 24. Section one hundred ami three is amended by striking out 
 till' words "three wet'ks" in the .secoml line, ami insertinijf in litMi 
 thereof the words " ten days." 
 
 25. Section one hundred and eighteen is amended by striking 
 out the words " and the costs of thi- judgment of confirmation 
 " of the discliarge of the insolvent, except when such confirmation 
 " is upon a deed of composition, or of tin; discharge if obtained 
 " direct from the Qmrt. ' 
 
 20. Section one hundreil and twenty -three is amended l»y 
 striking out the words " Superior Courts of Common Law, and of 
 
 
380 
 
 THE INSOLVENT ACT. 
 
 " the Court of Chancery or any five of tlieni, of whom the Chief 
 " Justice of the Province of Ontario, or the Chancellor, or the 
 " CI lief Justice of the Common Pleas, shall Ije one ;" and insertinir 
 in lieu thereof the words "Court of Api)eal, or a majority of thoiu." 
 
 27 Section one hundred and twenty-five is amenihjd hy strik- 
 ing out the words " if not an Dthcial assignee," and adding at the 
 end of the section the words "from the assigneeship of the estate, ' 
 
 2(S. Section one hundred and twenty-eight is amended hy strik- 
 ing out the worils " or unless lie," in the tliirty-tifth line, and in- 
 serting in lieu tliereof the word "and," and by adding after the 
 last word of tlie section the words, " Tlu; judgment oi the Court 
 "to which, under this section, the ajipeal can he made, sliall he 
 final. ' 
 
 21). Section one hundreil and thirty-three is amended ])y gli- 
 ding after the word " presumed" in the last line but one, the wordts 
 " pi I III d facie." 
 
 80. Section one hundiccl and thirty-six is an)ended by adding, 
 after the words " knowing or," in the eighth line, tlie words "h;iv- 
 ing proljable cause for," 
 
 :U. For all the purposes of "The Ivmhrai Ad o/ isTo,' tlie 
 temyiorary Judicial District of Nipi.ssmg, in the Province of On- 
 tario, .sliall be taken and considered as pait of the Coimty of Ren- 
 frew, and so much oi tlie territoiy comprising the Territorial 
 District of Parry Sound and tlie Territoiial District of ^fuskoka 
 as is not already included in the Judicial (V)unty of Simcoe, shall 
 be taken and considered as part of the said judicial (bounty of 
 Simcoe; and all persons and courts having authority or jurisdic- 
 tion in the said Counties of Renfrew and Simcoe respectively, 
 under the said Act, shall have like authority and jurisdiction in 
 the said District of Nipissing, and the said Districts of Parry 
 Sound and Musk oka respectively. 
 
 82. Section fifteen of the Act thirty-ninth Victoria, chapter 
 thirty, intituled : " An Act to amend the Insolvent Act of 1875," is 
 hereby repealed. 
 
 33. No a,ssignee shall directly or indirectly at any time advance 
 orjend to any creditor any money, or become liable for any credi- 
 tor to any other person for any money, upon the security or col 
 
AMENDING ACT OF 1877. 
 
 387 
 
 latevfil secuvity of such creditor's claim against tlie estate, or of 
 any dividi'iid declared or to be declared thereon, or of any security 
 held ly or for such creditor upon any part of the estate. 
 
 lU. Every official assignee shall piint and cause to be posted up 
 in a conspicuous place in his office, sections thiity-two, forty-three 
 and f(M'ty five of the said " Insolvent Ad of 1<S75," as amended, 
 and at every meeting of creditors a printed copy of the said sec- 
 tions shall he laid upon the table. 
 
 .*>."). If it appears to the Court or judge that an official assignee 
 lias been guilty of any fi'aud, breach of duty or wilful violation 
 of any of the provisions of " The Insolvent Act of l<S7o," or the 
 amending Acts, or has inserted any improper charge in any account 
 or claiiii preferred liy him against the estate, tlie Court or judge 
 shall forthwith make a I'cport of the facts to the Secretary of 
 State of Canada, for the information of the Governor. 
 
 .■)tl. In all cases where money or costs art; ordered by the Court 
 or judge to be paid, the .same proceedings, as near as may be, may 
 lit! taken for the collection of such numey or co.sts as if the t)rder 
 was a juilgment of the Court and the same were payalde under 
 such jutlgment. 
 
 .")7. The assi-i-nee shall, within the first five (hivs of each calen- 
 liar month, file in the t)fHce t)f the Clerk of the Court, a statenumt 
 of the receipts antl disbursements of the estate during the last 
 preceding month, shewing also the balance t^f cash then in bank. 
 
 .'iN. No amendment hereby made shall be held to be a declara- 
 tion of the construction of any provision of " The Insolvent Act of 
 1875 " as ai)plicable to any proceeiling heretofore hail umler the 
 said Act, and the amentlments made by the fifth, fourteenth, 
 fifteenth, nineteenth antl twenty-second sections of this Act shall 
 nt»t apply tt) any case in which an assignment was made, or a writ 
 of attachment issued, before the passing of this Act. 
 
 :i!). The " Insolvent Ad of 1875," the Act of 187G amending it, 
 and this Act, may be cited together as ' The insolvent Act of 1875, 
 unit amcndiwj Acts!' 
 
 
 % 
 
FORMS. 
 
 if 
 
 FORM A. 
 Thk Insolvent Act of 1875 and Amending Acts. 
 
 residence 
 
 and descrii>i'i(>n 
 
 To {lutme 
 of insolvent.) 
 
 You avv hereVjy required, to wit, by A. B., a creditor, for the 
 .siuu of $ (describe in (i sitvimary manner tlie nitture 
 
 of llw <le})f,) and by 0. D., a creditor, fee, to make an assigniiicnt 
 of your estate and ettccts, under the above-mentioned Act for tlie 
 l)eiietit of your creditors. 
 
 /*/('('(' date. 
 
 Sif/naturr of Creditor or Creditors 
 
 FORM. B. 
 The Insolvent Act of 1,s75 and Amending Acts. 
 
 } 
 
 Canada, 
 Province of 
 
 Di.surict of 
 A. B. , (name, residence, and description,) 
 
 vs. 
 
 Plaintiff, 
 
 {na.vie, residence, anddescnption.) 
 
 ^' 1^ 
 
 * Defendant, 
 
 I, A. B. {name, residence, and description) being duly 
 
 sworn, depose and say : — 
 
 1. I am the Plaintitf' in this cause (or one of the Plaintiffs, or 
 the clerk, or the agent of the Plaintiff in this cause duly autho- 
 rized for the purposes thereof). 
 
 ■: 
 
390 
 
 THE INSOLVENT ACT. 
 
 2. The Defendant is indebted to me (or to the Plaintiti, ()/■ as 
 the case may he) in the sum of dollars currency for (stah 
 (onciaely and clearly the nature of the debt). 
 
 3. To the Lest of my knowledge and belief the Defendant is in- 
 solvent within ihe meaning of " The Insolvent Act of lcS75 and 
 amending Acts," and has rendered himself liable to have his t'state 
 placed in liquidation under the said Act; and my reasons for 
 so believing are as follows — (fttatc concisely the facti* relied 
 upon as rendering the debtor insolvent, and as subjectinij hisestati- 
 to be placed in liquidation). 
 
 4. I do not act in this matter in collusion with the defend- 
 ant, nor to procm-e him any undue advantage against his crc- 
 uitoi's. 
 
 And I have signed (or I declare that I cannot sign). 
 Sworn before me this 
 
 day of 187 . 
 
 and if the deponent cannot sign, add 
 — the foregoing affidavit having been 
 first read over by me to the deponent. 
 
 y 
 
 FORM C. 
 The Insolvent Act of 1875 and Amending Acts, 
 
 Canada, 
 Province of 
 District of 
 
 No. 
 
 ^ VICTORIA, by the Grace of God, of the 
 [-United Kingdom of Great Britain and Ire- 
 ) land, Queen, Defender of the Faith. 
 
 To the Ofiicial Assignee of the County (or Judicial Distiict or 
 
 Electoral District, as the case may be) of 
 
 Greeting : 
 
 We command you at the instance of 
 to attach the estate and effects, moneys and securities for money, 
 vouchers, and all the office and business papers and documents of 
 
FORMS. 
 
 3t)l 
 
 ')/■ as 
 
 \i is iii- 
 '7-3 and 
 t'stati.' 
 
 |011,S fill' 
 
 of every kind and nature whatsoever, 
 
 of and belonging to if the 
 
 same shall he found in {ruime of district or other territorial juris- 
 diction), and the .same so attached, safely to hold, keep and detain 
 in your charge and custody until the attachment thereof, which 
 shall be so made under, and by virtue of, this writ, shall be deter- 
 mined in due course of law. 
 
 We command you also to summon the said 
 to be and appear before Us, in our Court for 
 
 at in the County (or D is". ict 
 
 of on the day of to show 
 
 cause, if any he hath, why his estate should not be placed in 
 liquidation under " The Insolvent Act of 1875 and amending 
 Acts," and further to do and receive what, in our said Court before 
 Us, in this behalf shall be considered ; and in what manner you 
 shall have executed this Writ, then and there certify unto Us with 
 your doings the seon and every of them, and have you then and 
 there also this Writ. 
 
 In Witness Whereof, We have caused the Seal of our said 
 Court to l)e hereunto affixed, at aforesaid 
 
 , this day of in the year 
 
 of Our Lord, one thousand eight hundred and seventy 
 in the year of our Reign. 
 
 FORM D. 
 The Insolvent Act of 1875 and Amending Acts. 
 
 A. B„ 
 
 Plaintiff. 
 
 C. D., 
 
 A writ of attachment has issued in this cause. 
 (Place date.) 
 
 Defendant. 
 
 (Signature,) 
 Official A,ssignee. 
 
 ' ij 
 
392 
 
 THE INSOLVENT ACT 
 
 FORM E, 
 
 The Insolvent Act of 1875 and Amendino Acts. 
 
 This assignmt'iit made between 
 first part, and 
 
 witnesses, 
 
 (or) 
 On this (lay of 
 
 liefui'e the undersigned notaries 
 came and apj)eared 
 of the first part, and 
 of the second part, whicli said parties 
 ries : — 
 
 of tile 
 of the second part, 
 
 declared to us nota- 
 
 That, under the provisions of " The Insolvent Act of 1(S7'> and 
 amending Acts," tlie said party of the first part, being insolvent, 
 has assigned, and hereby does assign to the said party of tlu: 
 second part, accejiting thereof as assignee under the said Act, and 
 foi- the purposes therein provided, all his estate and cti'ects, i'(;al 
 and personal, of every nature and kind whatsoevev. 
 
 To have and to hold to the party of the second part as assignee 
 for the purposes and under the Act aforesaid. 
 
 In witness whereof, kc. 
 Done and passed, &c. 
 
 (,>r) 
 
FORMS. 
 
 FORM F. 
 The Insolvent Act of 1875 and Amending Acts. 
 In thf matter of A. B., an Insolvent. 
 
 Schedule of Croditois. 
 
 393 
 
 1. Direct Lialnlitios. 
 
 Niiine. 
 
 Residence. 
 
 Nature of Del»t. 
 
 Amount. 
 
 ! 2. Indirect liaV)ilities, maturing before the day 
 fixed for the first meeting' of creditors. 
 
 Nam 
 
 e. 
 
 Residence 
 
 Nature of Uel)t. 
 
 Amount. 
 
 3. Indirect liabilities, maturing after the day 
 fi.xed foi- the first meetiuif of creditors. 
 
 1 - 
 
 ] Name. 
 
 Residence. 
 
 Nature of Del)t. 
 
 Amount. 
 
 
 
 
 
 
 ■ 
 
 1 
 
 4. Negotiable papei 
 unknown. 
 
 •, the 
 
 holders of which arei 
 
 1 
 
 Date, 
 
 Name of 
 Maker. 
 
 N.i 
 lial 
 Insc 
 
 imes 
 le to 
 Ivent. 
 
 When due. 
 
 1 
 
 i 
 
 Amount. 
 
 
 
 
 
 
 
 
 1 
 1 
 
 Total. 
 
 f; 
 
 » 
 
 
394 
 
 THE INSOLVENT ACT. 
 
 FORM G. 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 In the matter of an Insolvent. 
 
 The Insolvent has made an assi^fiinient of his estate to me {or, 
 a writ of attachment has l)een issued in this cause) and the credi- 
 tors are notified to meet at in 
 on the day of at 
 o'clock to receive statements of his 
 afffiii's, and to appoint an Assignee if they see fit. 
 (Date and residence of A.ss'Kjnee.) 
 
 (Signature.) 
 
 Assign oe. 
 
 {The foUoiviiig is to be added to the notices sent by post.) 
 
 The Creditors holding direct claims and indirect claims for one 
 hundred dollars each and upwards, are as follows : {narne.^ of 
 Creditors and amount due) and the aggregate of claims under 
 one hundred dollars is 3 
 {Date.) 
 
 {Signature.) 
 
 FORM H. 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 In the matter of A. B., an Insolvent. 
 
 This deed of release (()?• transfer) made under the provisions of 
 the said Act between (C. D.,) 
 
 Assignee to the estate of the said Insolvent of the first part ; and 
 (E. F.,) of the second part, witnesseth : 
 
 That whereas by a resolution of the creditors of the Insolvent 
 duly passed at a meeting thereof, duly called and held at 
 
 , on the day of , the said party of 
 
FORMS. 
 
 305 
 
 tho second part was duly appointed Assiiriico to the estate of tin- 
 said Insolvent : Now, therefore, these presents witness that tlic 
 said party of the fii'st ])art, in his said capacity, hereby releases 
 (or transfers) to the said jiarty of the second ])art, the estate and 
 cHects of the said Ins(»lvent, in conformity with the provisions of 
 the said Act ; and for the purposes therein provided. 
 In witness whereof, kc. 
 
 (This form sladl he aiUiplad in the Provlvce of Qttebec iu fhi: 
 iiol (trial form of execution of documenta irrcvailiv<j there) 
 
 FORM I. 
 
 TiiK Insolvknt Act of LSTo and Amknding Acts, 
 
 In the matter of 
 
 A. B. [or A. B. k Co.,] 
 
 an Insolvent. 
 I, tlie undersigned [name and residence'], have been appointed 
 Assignee in this matter. 
 
 Creditors are I'ecpiested to file their claims before me, within 
 one month. 
 
 (Place Date,) 
 
 (Signature) 
 
 Assignee. 
 
 FORM J. 
 The Insolvent Act of 187o and Amending Acts. 
 
 Canada, 'v In the (name of Court) 
 
 Province of y In the matter of A. B. (or 
 
 District (or County) of ) A. B. & Co.,) an Insolvent. 
 
 The undersigned has filed in the office of this Court, a consent 
 by his creditors to his discharge (or a deed of composition and 
 discharge executed by his creditors), and on 
 the day of next, he will apply to the said 
 
 L'ikauA- 
 

 3Ik; 
 
 THK INSOr.VKNT ACT 
 
 Court (or to tlu' .Jiidj^c of the said Court, im tl '" ttKiyhc) t'oi 
 a c'oiifinnation of tho diHchai-^e tlitTulty ftfoctou 
 {Place, Uiitc.) 
 
 {Siynutair of Ivsolrcitl^DV ofliis Attorvty ad lilrm.) 
 
 FORM K. 
 The Insolvent Act ok \s7') and Amendincj Acts. 
 In the mattci' of A, li., An insolvi nt 
 
 I, A. l>.,of an insolvent, now making; 
 
 application to tlu- for a contirniatioii of 
 
 n»y disclmr<,'e (or of my deed of composition and dis(;hari>c), ln'in^ 
 duly swoin, depose and say : 
 
 That no one of my creditors who has v the said dis- 
 
 cliai'^ie (or the said deed of comj)osition ami discnar^e) has l)een 
 induced so to do hy any payment, promise of payment, oi- ad- 
 vantage whatsoever made, secured or promised to him hy me, oi' 
 with my knowled<,'e, l)y any person on my lii;half 
 
 And 1 have signed. 
 Sworn before me at 
 this day of 
 
 187 
 
 1 
 
 FORM L. 
 
 The Insolvent Act of 1is75 and Amendino Acts 
 
 Canada, v In the (name of Court) 
 
 Province of I In the matter of A. B. (or A. B. ^ Co) 
 
 District (or County) of) an Insolvent. 
 
 On the day of next, 
 
 the ujidersigncd will a))ply to the said Court (or the Judp^e of 
 t,ie said Court, as the case may be,) ■' ^ a, discharge under the 
 said Act. 
 
 (Place date.) 
 
 (Signature of the hifiolvent, or of his Attorney ad litem.) 
 
FOK.MS. 
 
 :m 
 
 tor 
 
 FORM M. 
 
 Till", Insolvent Act ok is?') and Amkndinc; Acts. 
 
 In the iiiattcf (»f A. 11, 
 
 an Iii8()lv(iiil. 
 In considt'mtidii of tlic stun (if !i^ whereof <|uit : (J. 
 
 I).. Assignee of tlic Insolvent, u\ that capacity liereby sells and 
 .'isKi;4ns tt) K. K., accepting,' thereof, all claim liy tlie Insolvent 
 iiLjainst (J. K. of (tlfscrlhinij the' Defttor) with tlie evidences of 
 ili'lit and seciuities thereto aj)pertainin<,', hut witliout any war- 
 ranty of any kind oj' nature whatsoever. 
 
 C. ])., Assignee. 
 E. F 
 
 tht 
 
 FORM N, 
 
 This (Ust'ii niatki ynd(;r the jMovisions of 'The In.solvent Act of 
 
 IS?') and ainendintf Acts," the 
 
 Ix'tween A. 15, of 
 
 of the estate .and effects of 
 
 of assi<fiUlient e.\ecute(l on the 
 
 iit in 
 
 and executed on the 
 
 in 
 
 on the 
 I), of 
 
 day of 
 
 iVc. 
 
 (tec, in his capacity of iVssin'nee 
 an In.solvent, under a deed 
 day of 
 and of a release made 
 , day of , 
 
 (or nnd(M' an older of the Judge made at 
 day of ' )oftheo)ie pail, and 
 
 kc, of the other [)art, witnesseth : That he, 
 the said A. J>., in fus .saitl capacity, hath c^iused the sale of the 
 real estate liereinaftei' mentioned, to he advertis(,'d as recpni-ed }»y 
 law, and liath adjudged (or and hath offered for sale pursuant to 
 sucli advertisement, l)ut the bidding therefor being insuflicient 
 did withdraw the same from such .sale, and hath since l)y 
 "Mthority of the creditors agreed to sell) and dotli hereby grant, 
 bargain, sell, and confirm the saie.e, to wit : unto the said C. D., liis 
 heirs and a.H,signs for ever, all (tw Ontario, Nova Hcotid aytd Nciv 
 Branszvick, Manitoba and British Colambia, insert " the rights 
 
;^9S 
 
 THE INSOLVENT ACT. 
 
 and interests of the insolvent in") Oiat certain lot of land, kc 
 ,'oi>t<rf here a description of the propertf/ sold) : To have and to 
 hi )lil the same, with the app.irtenances thereof, unto the said ('. 
 J)., his ludrs and assigns for ever. The said sale is so made 
 for and in consideration of the sum of S in hand 
 
 paiil by the said C. D. to the said A. B., the receipt whereof is 
 hereby aeknowledu'ed (or of which tlie said ('. D, hath ])jud to 
 the said A. B., the sum of the receipt whereof is here- 
 
 by acknowlediied and the balance, or sum of 6 tlie 
 
 said C. D. hereby promises to pay to the said A, B., in his said 
 capacity, as follows, to wit — (here state the terms of payraenl) — 
 the whtde with, interest payable and as 
 
 security for the payments so to lie made, the said C. D., hereliv 
 specially mortgau'es and liypothecates to and in favour of the 
 said A. B., in his said capacity, the lot of land !>nd premises here- 
 by sold). 
 
 In witness, &c. 
 
 A. B. [L. 8.] 
 C. D. [L. S.] 
 Signed, sealed, and <lelivered 
 in the presence of 
 E. F. 
 
 (This form she U be (idapted, in the Province of Quebec to the 
 notorial form of execution of documents prevailimj th£re.) 
 
 FORM O. 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 Instil e matter of 
 
 A. B. (or A. B. & Co.,) 
 
 an Insolvent. 
 
 A dividend sheet has been prepared, open to objection, until 
 
the 
 be paid. 
 
 (Place.) 
 
 FORMS. 399 
 
 day of , after which dividend will 
 
 (Date.) 
 
 Signature of Assignee. 
 
 FORM P. 
 
 Thk Insolvent Act of 1N75 and Amending Acts. 
 
 In tlio matter of 
 A B., 
 
 An In.solvLiit, and 
 C D., 
 
 Claimant. 
 I. (,'. D., of , being duly sworn in 
 
 depose and say : ' 
 
 1. I am the claimant (<)>•, the <luly anthorizetl agent of the 
 claimant in this behalf, and have a personal knowledge of the 
 matter hereinafter deposed to, or " member of the firm of 
 claimants in the matter, and the said firm is composed of my- 
 self and of E. F. .) 
 
 2. The Insolvent is indebted to me (or to the claimant) in the 
 sum of dollar.s, for {here state the nature and particu- 
 lars (if the claim, for which piirpofie reference may also be made 
 to accounts or documents annexed). 
 
 8. I (or the claimant) hold no security for the claim, (ot I or the 
 claimant hold the following, and no other, security for the claim 
 namely: state the particulars of the sccuritg). 
 
 To the best of my knowledge and belief, the security is of the 
 value of dollars. 
 
 Sworn before me at 
 this day of 
 
 And I have signed. 
 
 i I 
 
 ..dUWMilf 
 
4()(» 
 
 THE INSOLVENT ACT. 
 
 ADDITIONAL FORMS. 
 
 FORM 1. Sue Sec. 4. 
 The Insolvent Act of 1875 and Amending Acts. 
 
 Ill the County Court of the County of 
 County of N I, A. B. (name, "esUknce, and description), 
 y being duly sworn deiDOse and say : 
 
 To Wit : j 1. That 1 am tlic plaintiff ((>?• the duly author- 
 izA'd ai^ent of the jilaintiff in this behalf, and liave a personal 
 knowledge of the matter hereinafter deposeil to, or a member of 
 the iirm of plaintitis in this mattei', and the said firm is composed 
 of myself and E. F.) 
 
 2. That the defendant is indeV)ted to me {or to the plaintiff as 
 the case may i)e) in the sum of i? for (state concisely 
 and clearly the nature of the debt.) 
 
 3. I do not act in this matter in collusion with the def(Midant 
 nor to procuiv him any undue advantage against his creditors. 
 And I have signed {or declared I cannot sigii). 
 
 Sworn befoi'e me at the 
 of in tlie County of 
 
 this <lay 
 
 of A.D. 187 
 
 avd if the deponet l cannot si(jn,ndd:— 
 "the allidavit having been first read [ 
 and explained to the said A. R., who 
 see'.ncd perfectly to understand tlie 
 same, and made his mark in my pre- 
 sence," 
 
 FORM 2, See Sec. 4. 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 To {name, residence and description of Insolvent), you iirt.' 
 heieby leijuired to wit Ity A. B. a Creditor for the sum of 
 
FORMS. 
 
 401 
 
 $ (describe in a customary manTier the nature of 
 
 ike debt), and by C. D., a Creditor, &c., to make an assignment 
 of your estate and effects under the above-mentioned Act, for the 
 benefit of your Creditors and we {the said A. B, and G. D)., hereby 
 elect and appoint the office of 
 
 in the of in the County 
 
 of , as the domicile at which service of any 
 
 answer, notice or proceeding may be served on us or on the said 
 G. H., or any of his partners or clerks for us. 
 
 FORM 3. 
 
 Deed of Composition and Discharge (Secs. 49 & 52). 
 The Insolvent Act of 1875 and Amending Acts. 
 
 one thousand 
 
 This Indenture made the day of 
 
 eight hundred and 
 
 Between A. B., of etc. (hereinafter called the insolvent), of the 
 fii'st part, and the several persons, firms and coi-porations who 
 are creditors of the insolvent (hereinafter called the creditors), 
 
 of the part, and C. D., assignee of the estate and effects of 
 
 the said A. B., of the part. 
 
 Whereas the said insolvent is unable to pay his liabilities in 
 full, and his creditore have agreed with him for a composition and 
 discharge upon the terms, and in manner hereinafter mentioned, 
 and under the provisions of the Insolvent Act of 1875 and 
 Amending Acts ; and whereas the said insolvent has agreed to se- 
 cure the payments of his creditors hereinafter mentioned by (set 
 out the "nature of the securities offered). 
 
 Now, therefore, this Indenture witnesseth, that in considera- 
 tion of his indebtedness, and'of the discharge hereby given, the 
 z 
 
 :| 
 
 
402 
 
 THE INSOLVENT ACT. 
 
 said insolvent covenants and agrees with all his creditors, collec- 
 tively and severally, that he will pay to them, and each of them 
 
 respectively, a composition of cents in the dollar of their 
 
 respective claims against him, in manner and at the times follow- 
 ing, that is to say : cents in the dollar in months 
 
 from the day of 187 ; cents in the dollar in 
 
 months from said date, &c., &c. And that he will give to 
 
 each of them his promissory notes for such composition payments 
 secured by (as the case may be), such notes to bear date on the 
 
 said day of 187 , and to he payable according to the 
 
 times of said respective composition payments, and the said in- 
 solvent further covenants and agrees to pay forthwith upon con- 
 firmation hereof all costs, charges and expenses connected with 
 the proceedings in insolvency respecting his estate, and inclusive 
 of the costs of this deed and of confirming the composition and 
 discharge hereby effected {inclu<lmg the costs of th^ soil citov for 
 the assiynee as between solicitor and client in connection with 
 sa^d proceedinrjs, amd the assignee's remuneration). 
 
 And in consideration of the said composition payments so to be 
 made, and of the said secui'ity so to be given, the said creditors 
 do, and each of tliem doth, release and discharge unto the said in- 
 solvent all their respective claims against him. And the said 
 creditors do hereby direct and authorize the assignee of the estate 
 of the said insolvent to deliver up and convey to the said ins(jl- 
 vent all his estate and effects upon this deed of composition and 
 discharge being executed by a majority in number of the credi- 
 tors of the said insolvent who have proved claims to the amount 
 of one hundred dollars and upwards, and who rejiresent at least 
 three-fourths in value of all the claims of one hundred dollars and 
 upwards, which have been so proved. 
 
 And it is declared and agreed that this deed of composition 
 and discharge is made in pursuance of the Insolvent Act of 1875, 
 and may be confirmed theieunder ; and also that the same shall 
 l)e ineffectual unless and until the same shall be executed by the 
 aforesaid proportions in numlier and value of the said creditors of 
 the said insolvent. 
 
c; 
 
 , coUec- 
 f them 
 3f their 
 follow- 
 inonths 
 lollar in 
 trive to 
 
 FORMS. 
 
 403 
 
 In witness whereof the said parties have |hereunto set their 
 
 hands and seals. 
 
 Signed, sealed and delivered by each party 
 hereto in the presence of the witness 
 whose name is set opposite to each sig- 
 nature respectively. 
 
 Witness : 
 
 [L.S.] 
 
 rL.s.] 
 
 [L.S.] 
 [L.S.] 
 
 FORM 4. 
 
 Order confirming consent Discharge, or Deed of Com- 
 position AND Discharge (Sec. 57). 
 
 The Insolvent Ad of 187o oynd Amending Acts. 
 
 Canada. 
 Province of — 
 County of — 
 
 In the County Court of the County of- 
 
 In the matter of 
 
 A. B. 
 
 An Insolvent. 
 Upon hearing tlie application of the aV)Ove named insolvent, 
 and upon reading his petition for the confirmation, under the In- 
 •solvent Act of 1875, and amending Acts, of a certain consent 
 discharge, (or, of a certain deed of composition and discharge,) 
 and it appearing that the said insolvent has filed in the office of 
 this Court the said consent discharge (or deed of composition 
 and discharge), duly executed by the recpiired proportion of his 
 creditors under the said Acts, together with the certificate of the 
 assigmee under the fifty-second section of .the said Act annexed 
 thereto ; and it appearing that no one of the creditors who have 
 signed the said consent discharge (or Vleed of compo.sition and 
 
404 
 
 THE INSOLVENT ACT. 
 
 discharge), has been induced to do so by any preferential payment, 
 promise of payment or advantage whatsoever, made, secured or 
 promised to him, by or on behalf of the said insolvent, and that 
 the said insolvent has delivered a sworn statement of his liabili- 
 ties and assets as required by said Act ; and upon reading the 
 noUce of this application, and it appearing that the same has been 
 duly advertised and sent to the creditors of said insolvent pur- 
 suant to the said Act ; 
 
 And no one opposing the said application for confirmation of 
 such discharge {or upon hearing what was alleged in opposition 
 to granting such confirmation of discharge, and the evidence 
 adduced), 
 
 I do order that the said consent discharge (or deed of com- 
 position and discharge), be and the same is hereby absolutely 
 confirmed. 
 
 Or, 
 
 I do order that the discharge of the said insolvent contained 
 in the said consent discharge {or deed of composition and dis- 
 charge), be and the same is hereby confirmed, to take effect only 
 
 on, from and after the day of until which said last 
 
 mentioned day the said discharge is hereby suspended. 
 
 Or, 
 
 I do order that the discharge of the said insolvent contained in 
 the said consent discharge {or deed of composition and dis- 
 charge), be and the same is hereby confirmed ; nevertheless I here- 
 by declare such discharge to be of the second class under the 
 said Act. 
 
 Given under my Hand and the Seal of the County 
 
 Court of the County of at in 
 
 the County of on the day of 
 
 in the year of our Lord, 187 . 
 
 Judge of the County Court of the County of 
 
yinent, 
 ured Ol- 
 id that 
 liabi li- 
 ng tile 
 as been 
 nt pur- 
 
 in 
 
 FORMS. 
 
 FORM 5. 
 
 405 
 
 Order of Discharge, when granted after expiration of 
 
 ONE TEiR FROM DATE OF ASSIGNMENT OR WrIT OF ATTACH- 
 MENT (Sec. 64). 
 
 Tlie Insolvent Act of 1875 and Amending Acts. 
 
 Canada.. 
 Province of — 
 County of 
 
 In the County Court of the Couty of ■ 
 
 In the matter of 
 
 A. B., 
 
 An Insolvent, 
 
 Upon hearing the application of the above-named insolvent, 
 and upon reading his petition for a discharge under the Insolvent 
 Act of 1875, and amending Acts, and the affidavits and papers 
 
 fik'd in this matter; and it appearing that on the day of 
 
 in the year of our Lord one thousand eight hundred and 
 
 the said insolvent duly executed a deed of assignment 
 
 under the said Act (or a wiit of attachment under the said Acts 
 issued against the said insolvent) ; and it further appearing that 
 although more than one year has elapsed from the date of said 
 assignment (or the issue of said writ of attachment), yet the 
 said insolvent has not obtained from the required jiroportion of 
 his creditors a consent to his discharge, or the execution of a 
 deed of composition and discharge under the said Act ; and it 
 also appearing that the said insolvent has in all respects confonned 
 himself to the provisions of the said Act ; and upon reading the 
 notice of this application, and it appearing that the same has been 
 duly advertised and sent to creditors of said insolvent, pursuant 
 to the said Act ; and (if the judge has required it) upon read- 
 ing the report of the assignee in this matter upon the conduct of 
 the said insolvent, and the state of his books and affairs before 
 and at the date of liis insolvency ; and no one opposing the said 
 ajiplication for a discharge (or upon hearing what was alleged in 
 
 ■■ f I 
 
406 
 
 THE INSOLVENT ACT. 
 
 opposition to granting said discharge and the evidence adduced), 
 1 do order that an absolute and unconditional discharge, under 
 the said Act, be and the same is hereby allowed and granted to 
 A. B., the said insolvent. 
 
 Or, 
 
 I do order that a discharge, under the said Act, be and the 
 same is hereby allowed and granted to A. B., the said insolvent, 
 
 to take effect only on, from and after the day of until 
 
 which said last mentioned day this discharge is hereby suspended. 
 
 Or, 
 
 I do order that a discharge, under the .said Act, be and the 
 same is hereby allowed and granted to the said insolvent ; never- 
 theless, I hereby declare such discharge to be of the second class, 
 under the said Act. 
 
 Given under my Hand and the Seal of the County 
 
 Court of the County of at in the 
 
 County of on the day of in the 
 
 year of our Lord, 187 . 
 
 Judge of the County Court of the County of 
 
 FORM 6. 
 Affidavit verifying statement of Liabilities, (Form F) .\nd 
 
 STATEMENT OF AsSETS (SeCS. 17, 23 & 140). 
 
 The Insolvent Act of 1875 and Amending Acts. 
 
 In the matter of 
 County of ^ A. B., 
 
 An In.solvent. 
 the above named insolvent, being duly sworn, 
 
 TO wit : 
 I, A. B,, of - 
 depose and say as foUow.s : 
 
 1. The annexed statement now shown to me and marked with 
 
luced), 
 
 under 
 
 ited to 
 
 lind the 
 folvent, 
 -until 
 )ended. 
 
 iss, 
 
 County 
 in the 
 in the 
 
 FORMS. 
 
 407 
 
 the letter " A" contains a true, full and correct list of my liabili- 
 ties according to its purport, and correctly classified, together with 
 the names, additions and residences of my creditors, and the 
 securities held by them, in so far as they are known to me. 
 
 2. The annexed statement now shown to me and marked with 
 the letter " B " contains a true, full and correct statement of all 
 the property and assets vested in the assignee in this matter by 
 the deed of assignment {or by the writ of attachment) herein, 
 and the said statement last named also includes a full and true 
 account of the causes to which I attribute my insolvency, and the 
 deficiency of my assets to meet my liabilities. 
 
 Sworn before me at 
 
 County of this 
 
 of A.D. 187 . 
 
 A (Commissioner in B. R., &c. 
 
 FORM 7. 
 
 Contestation of Claim — Notice of Objection (Secs. 93, 95 
 
 & 114). 
 
 The Insolvent Act of 1875 and Amendiny Acta. 
 
 In the matter of 
 
 County of 
 
 to WIT: 
 
 / 
 
 AND 
 
 A. B., 
 
 CD., 
 
 E. F., 
 
 An Insolvent. 
 
 Claimant. 
 
 Contestant. 
 The said contestant hereby appears and contests the claim of 
 the said claimant on the estate of the said insolvent, filed on or 
 about the day of A.D. 187 , and says that the said 
 
408 
 
 THE INSOLVENT ACT. 
 
 claimant is not a creditor of the said insolvent for the amount 
 of his said pretended claim, nor any part thereof, nor entitled to 
 be collocated on the said estate, or on any dividend sheet therefor, 
 because the contestant says (set oiU grounds of objection distinctly 
 and concisely). 
 
 Wherefore the contestant prays that the said claimant be not 
 collocated for, nor paid the amount of his said pretended claim, 
 or any part thereof, and that the said claim may be dismissed 
 with costs against the said claimant. 
 
 G. H., 
 Attorney for Contestant. 
 
 Dated day of A.D. 187 . 
 
lamount 
 itlod to 
 
 ^herefoi-, 
 itinctly 
 
 bo not 
 claim, 
 
 Isniisser] 
 
 RULES OF PRACnCE AND TARIFFS OF FEES. 
 
 IN THE PROVINCE OF QUEBEC. 
 
 Rnlei^ and Orders and Tdrif of Fees made by the Judges of tJie 
 Superior Court for Loiver Canada, under and by virtue of 
 the Statute 27 and 28 Vict, cliap. 17, " intituled '• An Act 
 respecting Insolvency !' 
 
 8ee sections 122 and 124 of the Insolvent Act of 1875. 
 
 1. There shall be assigned in the court house of each judicial 
 district at which the sittings of the superior court are held, two 
 rooms for matters in insolvency, one in which the sittings of the 
 judge shall be held, and the other for the office of the clerk in in- 
 solvency. 
 
 2. All judicial proceedings in insolvency shall be had and con- 
 ducted in the said court room alone, and not elsewhere ; and the 
 sittings of the judge shall commence at 11 A. M., or at such hour 
 as the judges or judge in each district shall hereafter appoint, and 
 shall continue till the business of the day shall be completed, or 
 until the judge shall adjourn the same. 
 
 3. The clerk's office shall be kept open everj' juridical day, 
 from 9 A. M. to 4 P. M., and shall be attended during that time 
 by a clerk appointed i>v the district prothonotary, and who shall 
 be known as " The Clerk in Insolvency." 
 
 4. To ensure i*eguiarity of proceedings at the sittings of the 
 judges, the business shall be conducted in the following order: 
 
 1. Meetings of creditors ; 
 
 2. Motions: 
 
 8. Rules nisi ; 
 
 4. Petitions, except as hereafter mentioned ; 
 
 m 
 
410 
 
 THE INSOLVENT ACT. 
 
 5. Proceedings on applications for ili.scharge of insolvents ; 
 
 0. Proceedings on applications for dischurge of assignoo ; 
 
 7. Appeals. 
 5. Proceedings before a judge or court may l)e conducted by 
 the insolvent himself, or hy any party having interest theiciii, 
 or by their attorney tul litem, admitted to practise in Lower 
 Canada, and by no other person. 
 
 G. All motions, petitions and claims, and all papers in the 
 nature of pleadings in insolvency shall be intituled : " In Insol- 
 vency for the District of In the matter of 
 
 Insolvent, and. . Claimant, Petitioner oj- Applicant," as the 
 case may be, plainly written, withont interlineations or abbi'evia- 
 tions of words; and the subject or purpose thereof shall bu 
 plainly and concisely stated. They shall also be sub.scribed by 
 the petitioner, applicant or claimant, or by his attorney a<l litem 
 for him. And they shall be subject to the "dinary rules of 
 procedure of the superior court in respect of similai' papers, as 
 regards the names and designations of the pai'ties, and the mode 
 in which they shall be docketed and Hied. 
 
 7. No paper of any description shall be received or filed in any 
 case, unless the same .shall be ])roperly numbered and intituled in 
 tlie case or proceeding to vvhieli it may refer or belong ; and be 
 also endorsed ^^'ith the general description thereof, and with tlie 
 name of the party or his attorney ad litem tiling the same. 
 
 8. In all appealal»le matter in dispute, the pretensions of the 
 parties shall be set forth in writing, in a eleir. precise and in- 
 telligible manner, and the notes F verbal evidence taken 
 before the assignee shall be plai ' ' iiten, shal ' be signed by 
 the witness if he can write a ign his naui and shall lie 
 certified by the assignee, as havii.^ been s\vorn before him. And 
 in the event of an appeal, the assignee s' dl make and certify a 
 transcript from his register of the proceedings before him in the 
 manner appealed from. And he .shall also make and certify list 
 of the documents composing such proceedings and appertaining 
 thereto, and shall annex such transcript and list to such docu- 
 ments with a strong paper or parchment cover, before producing 
 the record before the judge, as required by the said Act. 
 
fcntM ; 
 llco ; 
 
 •tfd l,y 
 
 Itln'ifin, 
 Low or 
 
 in the 
 1 1 Isol- 
 
 de 
 
 RULES OF PRACTICE. 
 
 411 
 
 0, All proceedings before a jii<l<,'e or court .shall bo entered 
 daily, in order of date, in a docket of proceed in<,'H, to be kept by 
 the clerk for each case ; and shall from time to time, and until the 
 close of the estate, bo fairly transcrilu^l in registers suitable there- 
 for, which shall be kept and preserved by tln^ prothonotary, in the 
 same manner as the registers of proceedings oi the superior 
 court. 
 
 10. No demand, petition or application of which notice is re- 
 (piired to be given, either by the j)rovisions of the said Act or by 
 an order of the judge or court shall be heard until after such 
 notice shall have been given, and due return thereof made and 
 tiled in the case. 
 
 11. Except where otherwise limitiMl and provided by the .said 
 Act and upon good cause shewn, the time for proceeding after 
 notice thereof has been given, may be enlarged by the judge or 
 couit whenever the rights of parties interested may seem to 
 lefjuire it for the puipo.ses of justice. 
 
 12. Whenever a particular number of days is prescribed for 
 the doing of an act in insolvency, the first and last day shall 
 not be computed nor any fractions of a day allowed ; and when 
 the last day shall fall upon a Sunday or holiday, the time 
 shall be enlarged to the next juri<lical day. 
 
 13. All afiidavits of indebtedness made l>y a creditor or by the 
 clerk or agent of a creditoi-, shall set forth the particulars and 
 nature of the debt, with the same degree of certainty and pre- 
 cision as is required in affidavits to hold to bail in civil process in 
 the courts of Lower Canada. 
 
 14. All writs of attachment i.ssued under the said Act, shall, as 
 issued, be nunibered and entered successively by the clerk in a 
 book, to which there shall be an index, and to which access for 
 examination or extract shall be had jrntis, at all times during 
 office hours. 
 
 15. Every such wi'it shall describe the parties thereto, in the 
 same manner as they are described in the said affidavits of debt ; 
 and the declaration accompanying the said writ shall be similar 
 in its form to the declarations required to be filed in ordinary 
 suits in the superior court. (The latter part of this rule is not 
 
 I f 
 
 _*6fisr*- 
 
412 
 
 THE INSOLVENT ACT. 
 
 ai)plicable to the writ of attachment under the present practice. 
 See ante, p. 70). 
 
 16. No such writ shall is.sue until after the affidavit of debt 
 upon which the writ is founded, shall have been duly filed in 
 the clerk's office. 
 
 17. All services of writs, rules, notices, warrants and proceedings 
 in Lower Canada, except otherwise specially prescribed by the 
 said act, ir.ay be made by a bailifi' of the superior or circuit 
 court, whose certificates of .service shall be in the form required 
 for service of process in the said courts ; or by any literate per- 
 son, who shall certify his service by his affidavit ; and in either 
 case, the manner, place and time of such service shall be described 
 in words, and also the distance from the place of service to the 
 place of proceeding. 
 
 18. All services of writs, rules, notices, warrants or other pro- 
 ceedings shall be made between the hours of 8 A. M. and 7 P. M., 
 unless otherwise directed by a judge or court upon good cause 
 shewn. 
 
 19. Writs of attachment need not be called in open court, but 
 shall be returned on the return day into the clerk's office, ami 
 shall be there filed for proceedings thereon, as may be advised or 
 directed. 
 
 20. Every day, except Su. .days and holidays, shall be a juridi- 
 cal day for the return of said writs, and for judicial and court 
 proceedings. 
 
 21. The sheriff to whom the writ of attachment shall be direct- 
 ed shall not be required to make any detailed inventory or j)7'oo^s 
 verbal of the effects or articles by him attached under such writ ; 
 Init a full and complete inventory of the insolvent's estate, .so 
 attached by the sheriff, shall be made by the assignee or person 
 who shall be placed in possession thereof a-'j guardian under such 
 wiit ; by sorting and numbering the books of account, papern, 
 documents and vouchei-s of the estate, and entering the same, 
 with the otlier assets and effects thereof, in detail, in a book for 
 the same, which .shall be called " The Inventory of the Estate 
 
 of ," and which shall l)e filed by the said assignee or 
 
 person in possession, on the leturn day of the .said writ, as re- 
 
ractice, 
 
 )f debt 
 iled in 
 
 edinofs 
 by the 
 circuit 
 quired 
 te per- 
 
 EULES OF PRACTICE. 
 
 413 
 
 
 f{uired by the said Act ; and the said inventory shall be open for 
 examination or extract at all times during office hours, gratis. 
 
 22. Immediately upon the execution of the voluntary deed or 
 instrument of assignment to the assignee, he shall give notice 
 thereof by advertisement in the form D of the said Act, requiring, 
 by such notice, all creditors of the insolvent to produce before 
 liim, within two months from the date thereof, their claims, 
 specifying the security therefor, with the vouchers in support of 
 such claims, as required by such notice. 
 
 23. The clerk shall prepare for the judge or court, a list of 
 matters pending, or ready and fixed for proceeding on each day, 
 following therein the order of procedure prescribed by the 4th 
 rule, which list shall be communicated to the judge on the pre- 
 vious day. 
 
 24. The record of proceedings in each case shall at all times 
 during office hours, be accessible, at the clerk's office, to creditors 
 and otliers in interest in such cases, for examination or extiact 
 therefrom, gratis. And in like manner the minutes of meetings 
 of creditors, and the registers of proceedings, together with the 
 claims made and the documents in posses.sion of the assignee, 
 shall also be accessible to creditors and others in interest in the 
 case, at convenient hours, daily, to be appointed by the said 
 assignee. 
 
 25. The assignee shall, from time to time, under order of date, 
 and within twenty-four hours after the proceedings had before 
 him, file in the said clerk's office, a clear copy under his signature 
 as such assignee, of such proceedings, together with a copy of the 
 several newspapers and Official Gazette, in which he shall have 
 caused notices of such proceedings to be advertised, which said 
 copy and newspapers shall form part of the record of proceedings 
 of the particular case. 
 
 26. The assignee shall, on the third juridical day of each month, 
 after he shall have commenced to deposit estate moneys in a bank 
 or bank agency, as required by the said Act, file of record in the 
 case an account of the estate, showing the balance thereof in his 
 hands, or under his control, made up to the last day of the pre- 
 ceding month. And no moneys so deposited shall be withdrawn 
 
 1 
 
 
 
 
 
 1 ^ 
 
 
 ^9 ' 
 
 ! 
 
 1 : 
 
 
 
 ■ 
 
 
 
 T 
 
 )■ ' 
 
 
414 
 
 THE INSOLVENT ACT. 
 
 without a special order of the court, entered in the docket of pro- 
 ceedings in the case, or upon a dividend sheet prepared and 
 notified, as required by the said Act, or unless otherwise ordered 
 !)}• the creditors, under the powers conferred upon them by the 
 said Act. 
 
 TARIFF OF FEES IN INSOLVEJ^CY, FOR THE PRO- 
 VINCE OF QUEBEC. 
 
 IN PROCEEDINGS FOR COMPULSORY LIQUIDATION, 
 
 ON BEHALF OF THE PLAINTIFFS, 
 
 If not contented : % cts. 
 
 To the prothonotary for writ of attachment 1 SO 
 
 Do. copy of writ 30 
 
 Sheriff for warrant 2 50 
 
 Copies of warrant, each 50 
 
 All proceedings by the slierirt" or liis agent or messenger in 
 
 the seizure and return, exclusive of mileage 2 00 
 
 Guardian, ))er day 1 00 
 
 Do. making u]) inventory and statements, to be sul)ject 
 to taxation by the judge : 
 
 To the prothonotary on retuin of writ 5 00 
 
 Crier's fee on retui'n 80 
 
 To the prothonotary for copy of order for meeting 50 
 
 To the prothonotary for meeting 1 00 
 
 To the prothonotary for each copy of Judgment a}»pointing 
 
 official a.ssignee 50 
 
 Attorney's fee for conducting proceedings to appointment 
 
 of official assignee 30 00 
 
 If contested, oxidltional fees: 
 
 To the ])rothonotary on inscription 2 00 
 
 To the prothonotary on every witness examined foi' j)lain- 
 
 titt", exceeding two in number 30 
 
 And for each suitsequent deposition exceeding 400 words 
 
 in length, for every 100 words 10 
 
)f pro- 
 2(1 and 
 )i"dered 
 by the 
 
 ^RO- 
 
 :'iON. 
 
 $ cts. 
 
 1 so 
 
 30 
 
 2 50 
 
 r,o 
 
 2 00 
 
 1 00 
 
 5 00 
 
 80 
 
 50 
 
 1 00 
 
 50 
 
 30 00 
 
 2 00 
 
 30 
 
 10 
 
 TARIFF OF FEES. 
 
 415 
 
 Attorney's fee, additional S20 00 
 
 Counsel fee at enquete 10 00 
 
 ON BEHALF OF THE DEFENDANTS, 
 
 //' not contested : 
 
 Attorney's fee for appearance 10 00 
 
 If confefited, add Itioyial fees : 
 
 To the prothonotary on filing petition in contestation C GO . 
 
 On every witne.ss examined for defendant, not exceeding 
 
 two in number 30 
 
 And for each subsequent deposition exceeding 400 words in 
 
 length, for every 100 word.s 10 
 
 Attorney's fee additional 20 00 
 
 Coun.sel foe at ent^uSte 10 00 
 
 ON VOLUNTARY ASSIGNMENTS ; 
 To the prothonotary for filing and entering deed 2 00 
 
 ON PETITIONS, OTHER THAN PETITIONS IN 
 APPEAL, IN CONTESTATION OF PROCEED- 
 INGS FOR COMPULSORY LIQUIDATION, OR 
 FOR EXAMINATION OF DEBTOR: 
 
 Totho pi'titiimer's attorney on every petition, not contested 5 00 
 If conti'sted, without en(|uete , 10 00 
 
 If contested, with enquete 15 00 
 
 To the respondent's attorney — 
 
 If conte.sted, without enijuete 8 00 
 
 If contested, with en(iuete 12 00 
 
 To the jirothonotary — 
 
 Filing petitions 2 00 
 
 Copy of onier 50 
 
 If contested on filing contestation 2 00 
 
 If there be an enquete, for every deposition 30 
 
 For all words over 400 in any deposition, per 100 10 
 
 I .'I 
 
416 
 
 THE INSOLVENT ACT. 
 
 ON PETITIONS IN APPEAL TO A JUDGE : 
 
 To the assignee for transcript of record and making up re- 
 cord and attendance before the judge ... $5 00 
 
 To the prothonotary — 
 
 Filing petition Hi) 
 
 Remission, of record. 
 
 1 00 
 
 To the attorney for the petitioner — 
 
 If not contested 10 00 
 
 If contested 20 00 
 
 To the attorney for the respondent 15 00 
 
 ON PETITIONS FOR ORDER FOR EXAMINATION 
 OF DEBTOR OR FOR OTHER PERSONS RES- 
 PECTING THE ESTATE AND EFFECTS OF 
 THE INSOLVENT : 
 
 To the petitioner's attorney 2 50 
 
 To the prothonotary, for order to serve 50 
 
 ON CLAIMS. 
 
 To the attorneys — 
 
 For every chirographic claim, without security 1 00 
 
 For every chirographic claim, with security 2 00 
 
 For every hypothecary claim, if not contested 5 00 
 
 To the assignee — 
 
 On every chirographic claim and hypothecary claim, not 
 
 contested 10 
 
 ON CONTESTATION OF CLAIM; 
 
 Withoni Enqiiete, 
 
 To claimant's attorney 10 00 
 
 To contestant's attorney 10 00 
 
 With Enquete, additional, 
 
 To claimant's attorney 20 00 
 
 To contestant's attorney 20 00 
 
TARIFF OF FEES. 
 
 417 
 
 '20 
 
 1 00 
 
 To the assignee — 
 For every witness examined on the contestation of a 
 
 claim » $0 25 
 
 On inscription of contestation for argument 2 00 
 
 ON CONTESTATION OF DIVIDEND SHEETS: 
 
 The same fees and disbursements to counsel and to assisrnee 
 as on contestation of claim. 
 
 2 50 
 .50 
 
 DISCHARGES. 
 
 On application for discharge by the Court, for confirma- 
 tion f)f discharge, or for annulling discharge : 
 To the applicant's attorney — 
 
 If not contested 
 
 If contested, without enquete 
 
 If contested, with enquete ..., 
 
 To the respondent's attorney — 
 
 If contested, without enquete 
 
 If contested, with enquete 
 
 To the prothonotary — 
 
 Filhig application 
 
 Every deposition 
 
 All words over 400 in each depo.sition, per 100 
 
 15 
 
 00 
 
 25 
 
 00 
 
 35 
 
 00 
 
 15 
 
 00 
 
 26 00 
 
 2 
 
 00 
 
 
 
 30 
 
 
 
 10 
 
 MISCELLANEOUS. 
 
 To all the attoi'neys, prothonotaries and bailiffs, fees and disburse- 
 ments on all rules, motions, copies of rules, judgments, and 
 orders, commissions rogiitoires, and other incidental matters, 
 according to the same rates as are allowed by the present 
 tariff in first-class actions in the superior court. 
 
 All necessary disbursements for advertisements and notices. 
 AA 
 
 ■ 1 
 
 J^ 
 
418 
 
 THE INSOLVENT ACT. 
 
 IN ONTAKIO. 
 
 General Order of December, 1864, and Tarij^ of Fees for Insol- 
 vency Proceedings in Ujiper Canada. Promuhjated by the 
 Judges of ike Superior Courts of Common Law, and of the 
 Court of Chancery, under 27 and 28 Victoria, chap. 17. 
 
 Sec sections 123 and 124 of Insolvent Act of 187o. 
 
 Whereas it is provided by the Insolvent Act of 1864, anionf,'st 
 othei' things, that the judges of the Superior Courts of Connnon 
 Law, and of the Court of Chancery in Upper Canada, or any of 
 them, of whom the Chief Justice of Upper Canada, or the Clian- 
 cellor, or the Chief Justice of the Common Pleas, shall be one, shall 
 have power to hx and settle the costs, fees and charges which 
 shall be had, taken or paid, in all cases and proceedings under tlic 
 said Act, by or to attorneys, solicitors, counsel, officers of court.s, 
 whether for the officers or for the Crown, as a fee for the fee fund, 
 or otherwise, sheriffs, assignees, or other persons, whom it may l)c 
 necessary to provi<le for ; 
 
 And whereas the Chief Justice of Upper Canada, and the judges 
 of the Superior Courts of Common Law and Equity.at Toronto, have 
 assumed the duty so imposed upon them ; 
 
 In pursuance, therefore, of the power so contained in the Insol- 
 vent Act of 1864, the following table of costs has been framed by 
 the Chief Justice and judges, and it is hereby declared, determined 
 and adjudged, that all and singular the costs and fec^s mentioned 
 in the said table, and no other or greater, shall be allowed on tax- 
 q^Jion, or taken or received, I)y any counsel or attorney, sheriff or 
 officer, respectively, for any service rendered under the said Insol- 
 vent Act of 1864. 
 
 Toronto, December 19, 1864. 
 
fnsol- 
 hy the 
 of the 
 
 TARIFF OF FEES. 
 
 TARIFF. 
 
 419 
 
 Ftes to Solicitor or Attorney, as betiveen party and "party, and 
 also as between Solicitor and Client. 
 
 Instructions for voluntary assignment by d -jbtor, or for 
 comjtulsory liquidation, or for petition, where the 
 Statute expressly requires a petition, or for brief, where 
 matter is required to be argued by counsel, or is 
 authorized by the judge to be argued by counsel, or 
 
 for deeds, declarations, or proceedings on appeal §2 00 
 
 Drawing and engrossing petitions, deeds, affidavits, notices, 
 advertisements, declarations, and all other necessary 
 documents orpapers when not otherwise expressly pro- 
 vided for, per folio of 100 words, or under 20 
 
 Making other copies when re(£uired lU 
 
 When more than ^/i re copies are required of any notice or 
 other paper, five only to be charged for, unless the 
 notice or paper is printed, and in that case printer's 
 bill to be allowed in lieu of coi)ies, drawing schedule, 
 list, or notice of liabilities, per folio, when the number 
 
 of creditors does not exceed twenty 20 
 
 When tlie number of creditors therein exceeds twenty, 
 
 tlien for every folio of lOO words over twenty 10 
 
 Ever}' common affidavit of service of papers, including at- 
 tendance 50 
 
 Every common attendance 50 
 
 Every special attendance on judge 2 OO 
 
 For every houi- after the Hrst 1 00 
 
 (T(j Ite inci-eased by the judge in his discretion.) 
 Every sj)ecia] attendance at mijetings of creditors, or before 
 
 assignee, acting as arbitrator 1 00 
 
 Fee on writ of attachment against estate and effects of in- 
 
 solventj including attendance 2 Oo 
 
 PY'es on rule of court or order of judge 1 00 
 
 Fee on sub ad teat., including attendances 1 00 
 
 Fee on 8^d> rftu-cs tecum, including attendance 1 25 
 
 II 
 
 1 
 
 1 ■; 
 
 
420 
 
 THE INSOLVENT ACT. 
 
 And, if above 4 folios, then for each ad<litional folio, over 
 
 such 4 folios SO 10 
 
 Fee on every other writ 1 00 
 
 Every necessary letter .')() 
 
 Costs of preparing claim of creditors, and procuring same 
 
 to be sworn to, and allowed at meeting of creditors, 
 
 in ordinary case, where no dispute 1 00 
 
 Costs of solicitor of petitioning creditor.for examiningclaims 
 
 filed up to appointment of assignee, for each claim so 
 
 examined 50 
 
 Cost of assignee's solicitor for examing each claim required 
 
 by assignee to be examined 50 
 
 Preparing for publication advertisements required by the 
 
 Statute, including copies and all attendances in relation 
 
 thereto 1 00 
 
 Preparing, engrossing, and procuring execution of bonds or 
 
 other instruments of security 2 00 
 
 Mileage for the distance actually and necessarily travelled, 
 
 per mile 10 
 
 Bill of costs ; engrossing, including copy for taxation, per 
 
 folio 20 
 
 Copy for the opposite party 50 
 
 Taxation of costs 50 
 
 No allowance to be made for unnecessary documents or papers, 
 
 or for unnecessary matter in necessaiy documents or papers, or 
 
 for unnecessary length of proceedings of any kind. In case of 
 
 any proceedings not provided for by this tariif, the charges to be 
 
 the same as for like proceedings, as in the tariffs of the sujjcrior 
 
 courts. 
 
 COUNSEL. 
 
 Fee on arguments, examinations, and advising proceedings, to 
 be allowed and fixed by the judge as shall apj)ear to him pioper 
 under the circumstances of the case. 
 
 FEE FUND. 
 
 Enery wari'ant issued against estate and effects of insolvent 
 
 debtors $1 00 
 
10 
 00 
 oO 
 
 00 
 
 r>{) 
 
 50 
 
 TARIFF OF FEES. 421 
 
 Every other warrant or writ SO 30 
 
 Every summary rule, order or fiat 30 
 
 Every meeting of creditors before judge 50 
 
 If more than an hour 1 00 
 
 If more than one on same day, $2.00 to be apportioned 
 
 amongst all. 
 
 Every affidavit administered before judge 20 
 
 Every certificate of proceedings by judge of county court 
 
 for transmission to a superior court or judge thereof.. 50 
 
 Ever bankrupt's certificate 1 00 
 
 Every taxation of costs 15 
 
 FEES TO CLERK. 
 
 Every writ, or rule, or order 50 
 
 Filing every affidavit or proceeding 10 
 
 Swearing affidavit 20 
 
 Copies of all proceedings of which copy bespoken or re- 
 
 4ulicd, per folio of 100 words 10 
 
 Every certiiicate 30 
 
 Taxing costs 50 
 
 Taxing costs and giving allocatur 65 
 
 For every sitting under commission, per day 1 00 
 
 If more than one on same day, $2.00 to be apportioned 
 amongst all. 
 
 Fee for keeping record of proceedings in each case 1 00 
 
 For any list of del)tors ])roved at first meeting, (if made)... 50 
 
 For any list of debtors at second meeting 50 
 
 Any search... 20 
 
 A general .search relating to one bankruptcy, or the bank- 
 ruptcy of one person or firm 50 
 
 SHERIFF. 
 Same as on corresponding proceedings in superior courts. 
 
 WITNESSES. 
 
 Same as in superior courts. 
 
 M- li 
 
422 
 
 THE INSOLVENT ACT. 
 
 RULES OF PRACTICE, NOVA SCOTIA. 
 
 No special rules of practice in Insolvency, have been laid down 
 by the Judges in Nova Scotia. 
 
 It is ordered that the Commissioners for taking affidavits in 
 this Court, appointed by the Governor in Council, untler the au- 
 thority 'of the Revisoil Statutes, be and hey are hei-eby appointed 
 Commissioners within their respective counties, for taking affi- 
 davits to be swoni in proceedings in insolvency, pursuant to said 
 Act. 
 
 By the Court, 
 
 J. W. Nutting, Froth 'y. 
 
 •27th December, 18G9. 
 
 TARIFF OF FEES IN INSOLVENCY IN THE PRO- 
 VINCE OF NOVA SCOTIA. 
 
 Insolvent Act, 18G9. 
 
 It is ordered, under and by virtue of the 32 and 33 V'ict. chap. 
 16, intituled : " An Act respecting Insolvency/' section 13!), that 
 until further direction therein, the same costs, fees, and charges, 
 shall or may be had, taken, or paid by and to Judges of Probate, 
 Coun.sel, Attorneys, Solicitors, and Sheriffs, as are now payable 
 to and taken by them in the Supreme Court and Court of Pro- 
 bate in this Province, under and by virtue of tho Acts in that 
 behalf. 
 
 Halifax, 13th September, 1869. 
 
 (Signed) W. Youno. 
 
 J. W. Johnston. 
 W. F. DesBarres. 
 
 L. M. WiLKINS. 
 
 I, James Walton Nutting, of the City of Halifax, in the 
 Province of Nova Scotia, prothonotary in and for the County of 
 Halifax, of the Supreme Court of said Province, do hereby cer- 
 
Iiown 
 
 ts in 
 le au- 
 
 linted 
 affi- 
 said 
 
 .th' 
 
 y- 
 
 TARIFF OF FEES. 
 
 423 
 
 tify that the foregoing paper writing, headed " Insolvent Act, 
 1801)," contains a true copy of an order made by the chief jastice 
 and assistant judges of said Court, whose ^nanies are thereunto 
 suuscrilied, regulating the costs and fees to be charged in said 
 Province under said Act. 
 
 (Signed) J. W. NuTTiNG, Froth'*', 
 
 Halifax, 29th October, A.D., 18G9. 
 
 The fees of the Judge of Probate for his services in Insolvency 
 were fixed by an order of tlie Judges of the Su[)renie Court in 
 September, 1870, and are as follows : 
 
 Where the value of the insolvent estate does not exceed 
 $H()(), and the judge has been called upon therein. In 
 
 full of all fees 
 
 In cases beyond that value. 
 
 Every warrant or attachment, including order therefor . . . 
 
 Every order confirming or annulling discharge of insol- 
 vent, and the hearing thereon 
 
 Signing every other order 
 
 Administering every oath 
 
 Testimony taken by the judge in writing, per folio 
 
 Attending every meeting of creditors 
 
 If more than one hour, for every subsecpient hour 
 
 Not to exceed in any one day 
 
 Attending personal exau'ination of insolvent 
 
 Every hearing under sections 15 and 28 
 
 Transmitting appeal with statement of decision 
 
 Examining and taxing costs 
 
 m 00 
 
 1 00 
 
 •3 
 
 00 
 
 
 
 40 
 
 
 
 20 
 
 
 
 20 
 
 1 
 
 00 
 
 1 
 
 00 
 
 5 
 
 00 
 
 5 
 
 00 
 
 
 
 00 
 
 5 
 
 00 
 
 50 
 
 The fees allowed to registrars, proctors, advocates, &c., are the 
 same as in the Probate Court. These will be found in full in the 
 Revised Statutes of Nova Scotia, Fourth Series, pages G18, 619, 
 and 620. 
 
 -jd-- 
 
424 
 
 THE INSOLVKNT ACT. 
 
 REGISTRAR'S FEES. 
 
 Whore the estate does not exceed S400, in full of all fees.. 
 
 Over 1J400— 1?800 
 
 For filing every paper 
 
 Probate of will and letters of administration and entry of 
 order therefor, where est<\t<' is under SHOO 
 
 Above ^800 and less than $4000, and entrv of order 
 therefor 
 
 Letters of guardianship or ml colli'je.ndmn, and entry of 
 order 
 
 Copy of will and probate, per folio 
 
 For prepai'ing Viond in all necessary cases 
 
 Preparing citation and seal 
 
 Each copy thereof 
 
 Preparing necessary affidavits, each 
 
 Filing every warrant and seal 
 
 Filing every certificate of license to .sell real estate 
 
 For all copies of papers, per folio 
 
 For every certificate and Deilmius potestatem 
 
 For entry of every decree in registry l>ook, and of every 
 order not specially providetl for, per folio 
 
 Every search or inspection of docunientw 
 
 Preparing subpama and seal 
 
 Filing eacii ticket for the same 
 
 Filing every appeal ov eavedt 
 
 Preparing every execution, attachment, or other process 
 not specially provided for, and entry of ordei- there- 
 for 
 
 Filing every decree 
 
 Every oath administered by him 
 
 U 00 
 
 U 00 
 
 07 
 
 3 .■)() 
 
 !) 50 
 
 Taxing costs 
 
 2 
 
 00 
 
 
 
 10 
 
 
 
 so 
 
 
 
 40 
 
 
 
 20 
 
 
 
 20 
 
 
 
 50 
 
 1 
 
 00 
 
 
 
 10 
 
 1 
 
 00 
 
 
 
 10 
 
 
 
 20 
 
 
 
 40 
 
 
 
 10 
 
 
 
 40 
 
 
 
 40 
 
 2 
 
 00 
 
 
 
 20 
 
 
 
 50 
 
 PROCTOR AND ADVOCATE. 
 
 Taking instructions for client to commence or defend pro- 
 ceedings in probate court 2 00 
 
TARIFF OF FEES. 
 
 425 
 
 U 00 
 
 a 00 
 07 
 
 3 :,o 
 
 Proparin;,' evory |)otitlon $1 00 
 
 Prt'paiinff every allegation or otlier pap* r necessary to bo 
 
 prepared by him, including accounts, per folio 20 
 
 Every additional ct)py thereof, per folio 10 
 
 Every nticessary attendance on judge 1 50 
 
 Every hearing or argument before the judge, not less than 
 
 two dollars and fifty cents, nor more than ten 
 
 dollars, at the discretion of the judge 
 Serving every notice or other paper on each person 20 
 
 '' 
 
 2 
 
 00 
 
 
 
 10 
 
 
 
 so 
 
 
 
 40 
 
 
 
 20 
 
 
 
 20 
 
 
 
 50 
 
 1 
 
 00 
 
 
 
 10 
 
 1 
 
 00 
 
 
 
 10 
 
 
 
 20 
 
 
 
 40 
 
 
 
 10 
 
 
 
 40 
 
 SHERIFF OR OTHER MINISTERIAL OFFIC 
 
 Serving citation or other process (.subpoena excepted) on 
 
 each person 50 
 
 Posting up the same in three public places directed by the 
 
 judge 1 00 
 
 Serv ing subpoena on each persi m 20 
 
 Travelling fees, per mile 10 
 
 APPRAISERS' FEES. 
 
 Eor appraising the estate of a deceased person, not to ex- 
 ceed, for each day he shall be actually employed 2 GO 
 
 TARIFF OF FEES IN NEW BRUNSWICK. 
 
 In pursuance of the power given by " The Insolvent Act of 
 18G9," the following table of fees and charges has been fixed and 
 settled by the chief justice and judges of the Supreme Court of 
 New Brunswick, to be taken and paid in all cases and proceed- 
 ings under the said Act, by or to attorneys, solicitors, counsel, 
 and officers of courts, for any services rendered under the .said 
 Insolvent Act, and no other or greater shall be allowed on taxa- 
 tion. 
 
 i< ! 
 
426 
 
 THE INSOLVENT ACT. 
 
 FEES TO SOLICITOR OR ATTORNEY AS BETWEEN 
 
 PARTY AND PARTY, AND ALSO AS BETWEEN 
 
 ATTORNEY AND CLIENT. 
 
 Instructions for voluntary assignment or compulsory liqui- 
 dation, or for petition, or brief, when matter is re- 
 ([uired to be argued by counsel, or for i)roceedings on 
 appeal 
 
 Drawing and engrossing all proceedings, notices, &c., per 
 folio 
 
 Copies thereof, when required or necessary 
 
 Every common attendance on judge 
 
 Every special attendance on judge 
 
 Every special attendance at meeting of creditors, or before 
 
 82 00 
 
 assignee 
 
 Fee on writ of attachment against insolvent, including at- 
 tendance 
 
 Every rule of court or order of judge, including attend- 
 ance 
 
 Fee on every other writ 
 
 Every necessary letter 
 
 Costs of preparing claim of creditor, procuring tlie same 
 to be sworn to and allowed at meeting of creditors, 
 in ordinary cases where no dispute 
 
 Attorney of )>otitioning creditor, for examining claims filed 
 up to appointment of assignee, for each claim 
 
 Assignee'.? attorney, examining each claim reiiuired, by as- 
 signee to be examined 
 
 Preparing for publication advertisements required by Act, 
 including copies and attendance in ^elation tliereto... 
 
 Preparing, engrossing and procuring execution of bonds or 
 other securities 
 
 Mileage actually and necessarily travelled (if beyond the 
 county in Avhich the attorney resides) per mile 
 
 Bill of costs, engrossing, including copy for taxation, per 
 folio 
 
 
 
 20 
 
 
 
 10 
 
 
 
 .-)0 
 
 .) 
 
 00 
 
 1 
 
 00 
 
 2 
 
 00 
 
 I 
 
 00 
 
 I 
 
 00 
 
 
 
 oO 
 
 1 
 
 00 
 
 
 
 .30 
 
 
 
 .■)0 
 
 1 
 
 00 
 
 2 
 
 00 
 
 
 
 10 
 
 
 
 •-0 
 
JEN 
 
 In 
 
 \S2 00 
 
 
 
 20 
 
 
 
 10 
 
 
 
 .■)0 
 
 .) 
 
 00 
 
 1 
 
 00 
 
 2 
 
 00 
 
 I 
 
 00 
 
 1 
 
 00 
 
 
 
 .10 
 
 TARIFF OF FEES. 
 
 427 
 
 Copy for the opposite party , 80 50 
 
 Attending taxation of costs oO 
 
 Copy of taxed costs to be filed with the clerk 50 
 
 No allowance made for unnecessary documents or papers 
 or unnecessary prolixity in the same. For all other nec- 
 cessary proceedings, not provided for in this scale of fees, 
 the charges to be the same as for like proceedings in the 
 Supreme Court. 
 
 TO THE CLERK OF THE COUNTY COURT. 
 
 Signing every writ, rule or order 
 
 Filing and entering deed of assignment, record of appoint- 
 ment or attachment 
 
 Filing every other paper 
 
 Reading every paper in court 
 
 Swearini; affidavit or administering: oath 
 
 Copy of all ])roceedings furnisned, per folio of 100 words.. 
 
 Certificate under seal of the court 
 
 Every other necessary certificate 
 
 Every meeting of creditors held before the clerk 
 
 For keeping record of proceedings in each case 
 
 Every search 
 
 General search on one day relating to one case or firm 
 
 For taking minutes of evidence before the judge when re- 
 quired, per folio 
 
 Copy of minute of evidence for Supreme Court or judge 
 thereof on appeal, to be paid by appellant, per folio .. 
 
 For scheduling and filing all papers from assignee after 
 
 discharge 
 
 For all other services not included in the above scale, to 
 
 be allowed the same rates as are allowed for like services 
 
 in the county courts of New Brunswick. 
 
 COUNSEL. 
 
 Fees on arguments and examinations before judge, to be 
 allowed and fixed by the judge, as shall appear to him 
 proper under the circumstances of the case,not exceed- 
 ing twenty dollars. 
 
 50 
 
 1 
 
 00 
 
 
 
 10 
 
 
 
 10 
 
 
 
 ■10 
 
 
 
 10 
 
 
 
 00 
 
 
 
 30 
 
 1 
 
 00 
 
 1 
 
 00 
 
 
 
 •20 
 
 
 
 50 
 
 
 
 10 
 
 
 
 10 
 
 1 
 
 50 
 
4.28 
 
 THE INSOLVENT ACT. 
 
 TO THE INTERIM ASSIGNEE, ASSIGNEE OR GUARDIAN. 
 
 Drawing affidavit, notice, advertisement, and all other 
 
 necessary documents or papers, per foUo $0 20 
 
 Making other copies when re([uired, per folio 10 
 
 When more than five copies are required '" any uotices, 
 
 five only to be chargetl for, unless the notice is printed, 
 
 and in that case printer's hill to he allowed in liru of 
 
 copies. 
 
 For every witness examined before him :>.) 
 
 Mileage for the distance actually and necessarily travelled, 
 
 per mile 10 
 
 For calling first meeting of creditors and attending thereat 4 00 
 For attending meeting of creditors, other thai, tj?!^::, and 
 
 keeping minutes 3 00 
 
 Attending at clei'k's office, and writing duplicate record, 
 
 per folio 20 
 
 Guardian, per day 1 00 
 
 SHERIFF 
 
 The same fees as on corres[)onding proceedings in the 
 Supreme Court. 
 
 WITNESSES' FEES. 
 
 The same fees as are allowed in the Supreme Court. 
 
 All postages and printers' bill to be added. 
 
 The foregoing fees and charges shall, in each and every case,l»e 
 taxed by the judge, and together with the commission jirovidt'd 
 for by the Act, shall constitute all charges to be made for any 
 services rendered under the said Act ; and a copy of the bill of 
 costs .so taxe'l shall in all cases be filed with the clerk immediately 
 after such taxation. 
 
 All pai)ers relating to any insolvency after the discharge of the 
 assignee, and the allowance (tr disallowance of the certificate to the 
 insolvent, shall be filed with the clerk of the court, and kept among 
 the records thereof. 
 
TARIFF OF FEES. 
 
 429 
 
 IDIAN. 
 
 80 20 
 10 
 
 io 
 
 10 
 4 00 
 
 3 00 
 
 20 
 
 1 00 
 
 A copy of this tariff of fees shall be kept at all times posted up 
 in a conspicuous place in the offices of the clerks and assignees 
 respectively. 
 
 W. J. RITCHIE, 
 JOHN C. ALLEN, 
 J. W. WELDON, 
 CHARLES FISHER, 
 A. R. WETMORE. 
 I'Oth August, 1870. 
 
 IN PRINCE EDWARD ISLAND 
 
 No special rules of practice have been made. The following is 
 the general order of September, 1875, and talile of fees for in- 
 solvency jiroceedings, of the Province of Prince Edward Island ; 
 jironndgated by the Judges of the Supreme Court of Judicature, 
 under " The Insolvent Act of 1875." 
 
 In pursuance of the powers contained in and given to us by 
 " The Insolvent Act of 187o," passed by the Parliament of the 
 ])omini(mof Canada in its last session, the following table of 
 costs lias been framed by the undersigned, being a majority of the 
 judg<^s of tlie said Province of Prince Edward Island, and it is 
 hrreby declared, determined and adjudged, that all and singular 
 the costs and fees mentioned in the said table, and no other or 
 greater shall, until further order, be allowed on taxation or taken 
 or received by any counsel or attorney, sheriff or officers, or other 
 person, respectively, for any services rendered under the said In- 
 solvent Act of 1875 : — 
 
 FEES TO ATTORNEY OR SOLICITOR. 
 
 Instructions, including retainer for assignment by debtor, 
 or for compulsory liquidation, or for petition where 
 the Statute requires a petition $2 50 
 
430 
 
 THE INSOLVENT ACT. 
 
 It) 
 
 S 
 
 1 . Instructions for brief where matter is to be argued by 
 counsel, or is autliorized by the judge to be argued by 
 counsel, or for deeds or declarations or proceedings on 
 appeal SI 50 
 
 '1. Drawing and engrossing deeds, petitions, affitlavits, de- 
 clarations, demands, and all other necesary documents 
 and papers when not otherwise expressly [)i'ovided for, 
 per folio of 100 words or under 
 
 8. Making other copies when re(pnred 
 
 When more than five copies are required of any notice 
 o)' other paper five only to be cliarged for, unless the 
 notice or ])apt'r is printetl, and in that case printer's bills 
 to be allowed instead of copies. 
 
 4. Drawing schedule list or notice of liabilities per folio, 
 when the number of creditors does not exceed twenty 
 
 .'). When the nund)er of creditors exceeds twenty, then 
 for every folio of 100 words over twenty folios 
 
 (i. Every counnon affidavit of service of jjapers including 
 attendance and copy 
 
 7. Eveiy connnon attendance 
 
 !S. Every special attendance on j udgi' 
 
 {). Every special attendance at meeting of creditors or be- 
 fore assignee, if re(piired in opinion of the judge on 
 taxation 1 00 
 
 10. Fee on issuing writ of attachment against estate and 
 
 effects of insolvent, including attendances 
 
 11. Fee on rule of Court or order of judge 
 
 12. Yii^ on siihpuinaad test, including attendance 
 
 1 3. P\'e on sub. duces tecum including attendance 
 
 14. Fee on every other writ. 
 
 1.1. Every nece.s.sary letter 
 
 10. Cost of i)reparing claim of creditors and procu ling same, 
 
 to be sworn to and allowed at meeting of creditors, or 
 
 otherwi.se, in ordinary cases, where no dispute 
 
 17. Costs of solicitor of petitioning creditor, for examining 
 claims filed, up to appointment of assignee, not less 
 than one dollar or more than tliree dollars at discretion 
 ofjudge 3 00 
 
 
 
 in 
 
 
 
 s 
 
 
 
 50 
 
 
 
 50 
 
 1 
 
 00 
 
 1 
 
 50 
 
 1 
 
 00 
 
 
 
 60 
 
 
 
 <•) 
 
 
 
 75 
 
 
 
 50 
 
 1 
 
 00 
 
 1 
 
 00 
 
 i 
 
 .o 
 
81 50 
 
 10 
 
 s 
 
 
 
 l(i 
 
 
 
 .s 
 
 
 
 50 
 
 
 
 50 
 
 1 
 
 00 
 
 1 00 
 
 1 50 
 1 00 
 GO 
 75 
 75 
 50 
 
 TARIFF OF FEES. 
 
 431 
 
 IS. Cost of assignee's .solicitor for examining claims re- 
 cjuirefl hy assignee, to be examined same as in last item, 
 No. 17. 
 
 If). Preparing for publication arhx'rtisements required by 
 the Statute, including copies and all attendances in re- 
 lati(m thereto 1 00 
 
 •20. Pieparing.engros.sing and procuring execution of bonds 
 
 or other instruments of security 2 00 
 
 21. Bill of costs, engro.ssing, inchuling cop}' for taxation 
 
 per folio Ki 
 
 22. Copy for other necessary opposite party, in all 50 
 
 28. Taxati<m of costs inclufling attendance... 50 
 
 FEES TO CLERK. 
 
 Every wi'it 
 
 Evury ruh' or order 
 
 Filing every affidavit or proceeding 
 
 Swearing affidavit 
 
 Copies t)f all })roceedings of which copies bespoken and re- 
 (juired, per folio of 100 words 
 
 Every certificate 
 
 For every sitting under commis.si(m per day 
 
 If more than one on same day, two dollars; to be ajtpor- 
 tioncd among.st all 
 
 Fee for keeping record of proceedings in each insolvent 
 case 
 
 Foi' any list of creditors proved at 1st meeting, if bespoken 
 and made 
 
 For any list of creditors pr(;ved at 2nd meeting, if be- 
 spoken and made 
 
 Any search 
 
 A general search relating to one bankruptcy or the bank- 
 ruptcy of one jterson or finn , 
 
 
 
 50 
 
 
 
 36 
 
 
 
 10 
 
 
 
 10 
 
 08 
 
 
 
 25 
 
 1 
 
 00 
 
 2 
 
 00 
 
 1 
 
 00 
 
 
 
 50 
 
 
 
 50 
 
 c 
 
 IG 
 
 # 
 
 p 
 
 
 M I 
 
 50 
 
432 
 
 THE INSOLVENT ACT. 
 
 COUNSEL. 
 
 Fee on arguments and exaniinati(ms and hearing.s, to be allowed 
 and fixed by the judge as shall appear to him proj^er under the 
 circumstances of the case. 
 
 WITNESSES, 
 Same as in Supreme Court. 
 
 SHERIFF AND CONSTABLES, 
 
 Same as on corresponding proceedings in Supreme Court. 
 
 No allowance to be made for unnecessary documents or papers, 
 or for unnecessary matter in necessary documents or papers, oi- 
 for unnecessary length of procee<lings of any kind. In case (jf 
 any proceedings not provided for l)y this table, the charges to be 
 allowtnl or disallowed at the discretion of the judge ; but in no 
 case to exceed the charges allowable as for like proceedings in the 
 Supreme Coui-t. 
 
 EDWARD PALMER, Chief Justice. 
 
 JOSEPH HENSLEY, Assistant Judge. 
 
 Charlottetown, 1st September, 1875. 
 
UFFKJIAL ASSIGNEES 
 
 433 
 
 OFFICTAL ASSIGNEES. 
 
 Pl'.OVIXCK OF OXTAIJTO. 
 'JoTH Aphii., 1H77. 
 
 Assignee. 
 
 Kesiili'iK.e. 
 
 L'niiiity. 
 
 .Intiu Dfiviilsnll 
 
 Silver J.-<let . . . 
 
 District Alj,'oma. 
 
 KirlKinl ( 'Miii''y 
 
 Sault St<'. Marie . 
 
 do 
 
 Tliiiin.is liiithain 
 
 P.rantfonl . . 
 
 Brant. 
 
 ( ieiir^'c ( iiiiiM 
 
 VV'alkei'ton 
 
 Piriiee. 
 
 I'lini M<riiiiis 
 
 Teeswater 
 
 d.- 
 
 Win. :M. Smith 
 
 Walkerton . 
 
 do 
 
 Will. Fin^'liuiil 
 
 Ottawa . . 
 
 (.'arleton, ineludini; Ottaw.i 
 
 Fnincis Cli'iiiow 
 
 do 
 
 do do 
 
 niiiiifl S. Ka-itwdoil 
 
 d.i .. 
 
 Miirrislmrt; 
 
 <Io do 
 
 Svlvi'>ti'i' Kciiviiii .Nriitht'wi- 
 
 Dnndas. 
 
 
 lidwniaiiville 
 Port Hope 
 
 Durham. 
 
 Si-th S. Sniitli 
 
 do 
 
 ( 'ciliii Aliinrn 
 
 St. Thomas 
 
 Elgin. 
 
 .Iiiiii .McCrac 
 
 WiiiilKor 
 
 Esse.x , 
 
 ('iiiiii'li;i- Valk-an Pricp 
 
 KiiiL;ston 
 
 Frontenac, including Kingston. 
 
 D.malil MclifUaii 
 
 William.stowii 
 
 (Jlengarry. 
 
 ( Icoi'^'c I'rift' 
 
 (Jweii Simiid 
 
 (irev. 
 
 .John Hastoii 
 
 Prescott 
 
 Grennlle. 
 
 Kli^azcr 11. Wliitiiiarnh 
 
 Merrickville . 
 
 <io 
 
 Fit'ih'iiik (Jon. A. Hfiidcrsim 
 
 ( 'avuu'a 
 
 Tlaldiinand. 
 
 |)avi(l Watsoii ('ani]>hcll 
 
 Milton 
 
 Halton. 
 
 Marsliall 1'.. Koh'.in 
 
 Bellonlle 
 
 Hasting.s. 
 
 .Iiihii Parker 'riioinaH 
 
 • lo 
 
 do 
 
 Ivolioit < iihljoiis 
 
 Goderich 
 
 Huron. 
 
 Saiimc] F'. McC'auKhey .i 
 Huj^'h Francis (AuuniinK . .' 
 
 Seaforth 
 
 do 
 
 Chatham 
 
 Kent. 
 
 I [arrv Hlaok 1 
 
 do 
 
 do 
 
 \Vm. T. Keays 
 
 Samia 
 
 Laiabton. 
 
 .Fainos Flintnft, iuiiior 
 .Fi>hii A. • ieninii 1 
 
 do 
 
 do 
 
 Alinniite 
 
 Lanark. 
 
 .^ \V. Ik'll 
 
 f'arletoii Place . . 
 BfikK wile 
 
 do 
 
 .loan Nnrnian Abbott 
 
 Leeds. 
 
 Nurtoii Marshall 
 
 do 
 
 do 
 
 W.atiT S. Williams 
 
 Napanee ... 
 
 Lennox and A'idington. 
 
 Wm. Flotcher Hall 
 
 do 
 
 do 
 
 F.dward Andrew Deniche ... 
 
 do 
 
 do 
 
 -laineh McKilwaril 
 
 St. (."athnriiii'H . . 
 
 Lincoln, 
 
 Hy. Xi<lnils(m 
 
 Stratliroy 
 
 Middlesex, 
 
 
 London 
 
 do including I-ondon. 
 do a<) 
 
 
 do 
 
 m 
 
 
 
 l> 
 
434 
 
 THE INSOLVENT ACT. 
 PROVINCE OF ONTAIUO.-Continucd. 
 
 Assignee. 
 
 IteMidence. 
 
 Thoma.'i M. Unwenuan 
 
 lh< 
 
 Anpustinc J. Doiily 
 
 A(lclis<iii Vars 
 
 Kdniund Alex. MacaNchtan . 
 
 John S. M. Willcnx 
 
 Ausoii T. Button 
 
 James M('l\ in Wil.xon 
 
 Georffe I'erry 
 
 Janien AfcNVhirter 
 
 Janu's Wni. Main 
 
 Jiihn Hossie 
 
 Thuman Miller 
 
 JanicH A. Hall 
 
 James Pendleton Wellw .... 
 
 Wm. Carter 
 
 John D. MauDonald 
 
 George PearHon 
 
 Alfred J. Fortier 
 
 James Bell 
 
 Peter McLaren 
 
 A. J. Aljwrt 
 
 Thomas (Joffatt, junior 
 
 Jr)sei)h Kogers 
 
 Thomas I). McConkey 
 
 Samuel Driffell 
 
 Theophilus Kohert Earl .... 
 
 Donald McDonell 
 
 Robert McFarlane 
 
 George Kemiit 
 
 Alexander !NlcGregor 
 
 Menno Eby 
 
 Fletcher Swayze 
 
 JoHe;)h Shaw 
 
 John Smith 
 
 Alex. David.son 
 
 Ralph Leeming Gnnn 
 
 Alex. Innes McKenzie 
 
 Fred. 1). Suter 
 
 Wm. Thomas Mason 
 
 James 15. Bo\istead 
 
 Snt<'e;i^^':"}j"'"tAs.signees 
 
 Wm. F. Munro 
 
 Robert Hall Smith 
 
 Bracebridge . 
 do 
 
 Simcoe 
 
 Colborne . . . . 
 
 Cobourg 
 
 Whitby 
 
 I'xbridKe . . . . 
 InLfersdU . . , . 
 Woodstock 
 
 do 
 Brami)toii . . . . 
 Stratford . . . . 
 
 do 
 
 Peterborough 
 Vankleek Hill 
 
 Picton 
 
 Renfrew 
 
 Eganville . . . . 
 
 Pembroke 
 
 Arn]irior 
 
 O.sbonie 
 
 Orillia 
 
 do 
 
 Barrie 
 
 do 
 
 Bradford 
 
 Collingwood . . 
 C(jrnwall .... 
 do 
 
 Iiin<lsay 
 
 Gait 
 
 lierl'u 
 
 Well.and .... 
 Orangeville .. 
 
 Flora 
 
 Hamilton 
 
 do 
 do 
 
 Uundas 
 
 Toronto 
 
 do 
 
 do 
 
 do 
 
 do 
 
 Newmarket . . 
 
 ::i 
 
 Muskoka County or District. 
 I'arrv Sound and Nipissing Dist. 
 Norfolk. 
 Northumbt-rhind. 
 
 do 
 'Ontario. 
 
 ' do 
 Ox for. 1. 
 
 do 
 
 do 
 I'eel. 
 Perth. 
 
 I <lo 
 
 i Peterborough. 
 
 Prescott. 
 i Prince Edward. 
 
 Renfrew. 
 
 I do 
 
 I do 
 
 .1.1 
 
 Russell. 
 Simc.je. 
 I do 
 I do 
 
 d.) 
 
 do 
 I do 
 Stf.rmont, 
 i do 
 i Victoria. 
 IWaterlo.). 
 
 iWellan.l. 
 
 Wellingt.in. 
 
 j .1.1 
 
 Wentw.irth, including Hamiltnn. 
 
 ' do (1(1 
 
 I do do 
 
 I do do 
 
 York, which includes Toronto. 
 
 do .lo 
 
 do do 
 
 do do 
 
 do do 
 
 <lo do 
 
OFFFCfAL ASSIGNEKS. 
 
 PROVINCE OF (iUEUEC. 
 25th Ai'KiL, 1877. 
 
 AX 
 
 AHHiiiHiee. 
 
 Ilesidence. 
 
 Judicial or Electoral District 
 I for which Appointnieiit in made. 
 
 Siiucdii Eraser. . 
 Octavo Oiiclk't. . 
 l,iiuis liainvillf 
 Pniiii'l I)iiran . . 
 
 I!lit' liiiiiiH Noiinaiiden . , 
 
 I'ttfi- ( 'iiwaii 
 
 Thoinas UnisNurd 
 
 tItMii .\lfri'(l (i.i^iiL' . . . 
 
 ( 'iiarlt's A. Tiehcl 
 
 .\l|iliiiiise l)iimais 
 
 I.uiii-* \. .Vii^'er 
 
 \diiliiht' Mairnan 
 
 • ■ Mliztar Tdulidt 
 
 .Mficil I.t'inii'ux , . 
 
 Do _ 
 
 'I'liadi'i' S. Midland . . . . 
 I'laiHois Xav'itT Talliot 
 I honiilia^ HeaiHoleil . . 
 
 l.diiis Jiist'iih Lajoie 
 
 li'AvL'iiiur 
 
 Soiiiernet 
 
 St. ('hrirtti>iilit'i' 
 St. Joseph de la 
 
 Heance 
 
 I )riiisto\vn 
 
 Velsimville 
 
 Waterloo 
 
 < 'hifdutiiiii 
 
 Xew Carlisle .... 
 IJaHsill l\r (Jiispi' . . 
 .St. ( iregorie d'lber- 
 
 ville 
 
 .Foliette_ 
 
 Fraserville 
 
 Levis 
 
 ^ do _. 
 
 St. Jean Port Joli. 
 
 Moiitmau'iiy 
 
 Montreal 
 
 Judicial District, 
 
 ■ do 
 do 
 
 do 
 do 
 do 
 I do 
 do 
 do 
 do 
 
 Arthalianka. 
 do 
 do 
 
 IJeauce. 
 
 lieauliarnois. 
 
 Heiifonl. 
 
 do 
 
 Chicoiitiini. 
 CJaspi'. 
 
 do 
 
 do 
 
 .I:iines Court 
 
 .Arthur Perkins 
 
 William Ivlnnd 
 
 .Vlpliiiii.ie Doutre 
 
 'I'liomas Darliiij,' 
 
 .Andrew liuehanan Stewart. . 
 
 < Mivier Lecours 
 
 .Iiilii\ Fair 
 
 |)avid ( 'raii,' 
 
 liiuiis |)\ipuy 
 
 .Inhn White 
 
 Edward Evans 
 
 F. Samuel Maekay 
 
 Ale.x. Boiwxeau 
 
 I). C. Simon 
 
 liiiuis .\1. ( 'outtee 
 
 William Walker 
 
 ■ do 
 do 
 do 
 do 
 do 
 do 
 do 
 do 
 do 
 do 
 do 
 
 do _. . . . 
 
 Papineauville 
 
 Avlmer 
 
 Hull 
 
 Aylmer 
 
 IJueheu 
 
 Iticliard Henry Wurtele 
 
 ( twen Murphy 
 
 ( )dilon l{oy 
 
 Jaciiues An(;er 
 
 .Adolphe Germain 
 
 Victor (iladu 
 
 .\ Eviiriste ilrassard 
 Eiezear ( 'oti^ 
 
 do 
 
 do 
 
 do 
 
 do 
 
 Sorel 
 
 St. F'rani,'ois du 
 
 Lac 
 
 Sorel 
 
 ' Ste. liUce 
 
 do Ihervijle. 
 
 <i" Joljitte. 
 
 <lo Kaniouraska. 
 
 ilo lievis. 
 
 do Eotbiniere. 
 
 do .MontmaKuy. 
 
 do (1(1 
 
 Judicial District, Montreal, except 
 Montreal East, Montreal West 
 and Montreal Centre. 
 Electoral Districts, Montreal East, 
 Montreal West, ami Montreal 
 Centre. 
 
 do do 
 
 do do 
 
 do do 
 
 do do 
 
 do lid 
 
 <h) do 
 
 do do 
 
 do do 
 
 do do 
 
 do do 
 
 do do 
 
 do do 
 
 Judicial District, Ottawa, 
 do do 
 
 do do 
 
 do do 
 
 Judicial District, (Juebec, except 
 Ticvis and Lothiniire. 
 
 do do 
 
 do do 
 
 do do 
 
 do do 
 
 Judicial District, Richelieu. 
 
 do 
 
 do 
 
 do 
 
 do 
 
 do 
 
 RimouskL 
 
+:JG 
 
 THK INHOLVKNT ACT. 
 T'nOVlNCK (IK C,»Ui:HKC. Continuvl 
 
 AHHit^neu. 
 
 Williiuii HriHikt' 
 
 H. C. H. ChuKiion .... 
 
 iHriK'l Wl)Otl 
 
 .l(iHe|ih A. Archaiiibiiult 
 
 (Jalfii 1'. T-i>oniiH 
 
 Kl'MillclK'C. 
 
 iliuhiiiiiiiil 
 
 .Fiiiliciul i)V Elt'ctnml lH»tiirt 
 fur wliii:li AppniiiMiii'iit is nwuli 
 
 . . . Electoral DiHtrit^t, Kiclinioiiii iiimI 
 
 I ; \V(.if... 
 
 Coaticoiike .iKh'ctiirul Difttrict, Staiistfiiil. 
 
 StaiiMtt'iul I ilii <lo 
 
 Sliurl)n)(ike IJudicial l)i»trict. St. Kraiui>, i'\ 
 
 I cciitiii^,' tlitTi'iiiil Staiisti!i<l ;iiiil 
 
 ' l;iclii 1(1 and Wolf.'. 
 
 ... ill) ilii 
 
 I 
 
 do 
 
 Cliarlfgi .1. L. Uacoti I dii 
 
 V.Vu: AiiL'iT Murray Hay 
 
 Mii'lii'l K;<ilraH liuriiier , ..'St. llyacintliu . . 
 
 Kraiii,-iiiH Xavier LaiiiljiTt iKivirrc dii Loup. 
 
 (Javiii Walker jljaciiute 
 
 ( K'tavi,' Fi)rj,'ft . iTfrn-lmiine 
 
 Charli'.i I). Hflicrt YaiiiacliiclH' 
 
 Ailiiliilin Aililoii Honlc St. ( 'tlfHtiii 
 
 .Feaii BaptiHteOiii'BeiiiitDuinonti'rhre : Uiveix 
 
 (Ill (III 
 
 Iiiilicial DiHtrii't, Sa^'iiciiny. 
 
 (Ill St. Hyaiiiitlic 
 
 i|ii Tlirci' l!i\('r>. 
 
 ilii 'rcrri'l)iiimi-. 
 ilii (III 
 
 ilii Tlirt'c liivci*. 
 ill) (III 
 
 do (In 
 
 NOVA SCOTIA, 
 
 'J.Vni .A PHI I., 1S77. 
 
 A«Higm'i 
 
 Rfsidoncf. 
 
 ( 'iinntv. 
 
 Kiclianl Jiiliii I'uiacku Allll.•l|»lli^ 
 
 ArcliiliaM McOillivrav AiitiMoiiisli 
 
 ( 'harluH W. Hill . . .' Syilncy, ( '.H. 
 
 .laiiii'.-' K. lUair '{"nini 
 
 Huiiy Hakcr Aliilu int 
 
 ( icor^T lli'iiili,'ri<im .. . l*ik'liy 
 
 SaiiuK-l M. 1). Cuminiiigi-r Slicrlimnkc 
 
 Williimi llartnhiirii (iiivslpnrnuKli 
 
 Williiiiu t'ri'ijs'htDii Halifa.x . . 
 
 'riiiiiiiaH Avlward Windnor 
 
 .lainis McKiiri I'urt HastiiifTt- 
 
 Kdniimil J. < 'i>k«wi'11 Kt'iiiptvillc 
 
 Mciiiy S. Jiwt liUnenliurj.' 
 
 W. (;. (ilciiiiie I'ictiiu 
 
 William Foril Milton 
 
 .lolin }I. KiMidreNH Aricliat 
 
 ( 'liarlis HiMid SlielKiinic 
 
 .\. Taylor Haililick. . 
 
 St(^plu'ii B. Murray Yarmouth . . . . 
 
 Anriapiilis 
 Aiitiv;"iii.'*li. 
 
 < 'api' Hiitwii. 
 
 < 'illcllcsliT. 
 
 ( 'iiniln liaiiil. 
 
 l)iKl>y. 
 ,(iUyshiPMiu^;h. 
 
 (Juyslioriiu^'li. 
 
 Halifax, iiicliidiii.; tin ('itv ot 
 
 ; Halifax. 
 
 j Hants. 
 
 Invernuss. 
 ' Kin.n's. 
 
 liunentpur).'. ' 
 
 I'ictou. 
 
 (Queen's. 
 
 Kicliniiinil. 
 
 Sh(:'lliurnc. 
 
 Victoria. 
 1 Yarmouth. 
 
OFFICIAL ASSIGNEES. 
 I'UOVINCK OF NKW IJUl'NSVVlCIv 
 
 'J.'mi A I'll 1 1.. 1877. 
 
 487 
 
 Assignee. 
 
 Uc'sidt'iici'. 
 
 ( iiiil.;!' ( 'iilliDiui Ho|icwi'll ('a|)c.. 
 
 hiinifl ( '. ('niir-ii'r VVooilstnck 
 
 (ii'ur:,'!! Kri'iliTiik Mill .St. Stephen 
 
 K/.ekiel .MeLeixl .St. .John 
 
 Iliiliert, Klli'*, jiininr MathurHt ... 
 
 .liiiiie-i M(I)ip!iKiill . , Uichil)uctii 
 
 .liiliM KliasMleiikeiieyMrCroftdy ('.•uilwi'll 
 
 •liilin I'llli.s Xowi;a.stle 
 
 < 'illiel F. FnX (illJjetuWll 
 
 Williiiiii S. Smith DalliiniHio 
 
 (uMiriie Uli.HH Si'L'ly F^rederietciM 
 
 I'eter ( cnvniiij CiniiKl FhIIh 
 
 (iihn Mckenzie Moncton 
 
 K. I'.viDii Wiiiidow Freilorictdh 
 
 ( '(innty. 
 
 Vll-ert. 
 I'ai'letdii. 
 Clliuidtte. 
 
 (!ity ikiiil Cniiiity nt St. .luhii. 
 
 (rlouceHtcr. 
 
 Kent. 
 
 Kini,''n. 
 
 N'iii'tlinin)>ei'hin(l. 
 
 linuun'M, 
 
 Kfsti(,'oiiuho. 
 
 Sunlniry. 
 
 Victoria. 
 
 Westnioreland. 
 
 York. 
 
 PUIN(;E EDWARD ISLAND. 
 
 2.')Tii Ai'iiii,, 1877. 
 
 Ansignee. 
 
 RcKidenei', 
 
 County. 
 
 Rodei'iek Alunro 
 
 (leoivetown 
 
 Suiniiiei'Hide 
 
 Charlottetown 
 
 Kind's. 
 Prince. 
 Queen'H. 
 
 David Miiuttroinery 
 
 Honjaiuiii W'il.son Hi^jfR 
 
 MANITOBA. 
 2.5th Aimui,, 1877. 
 
 i\ 
 
 I 
 
 H I 
 
 .\sHi(?nt'e. 
 
 ReHidence. 
 
 County. 
 
 Samuel R. Marlutt 'PortaKe Laprairie. East Marquette. 
 
 Do do West do 
 
 Robert Strange Winiiiiieg Provencher. 
 
 John BalHillie | do Selkirk, including Town of Win- 
 
 I I .iiipeg. 
 
 <ie< irge Kennody i do Li«gar. 
 
*n^ ^^- 
 
 V^, 
 
 IMAGE EVALUATION 
 TEST TARGET (MT-3) 
 
 
 
 / 
 
 ^ 
 
 1.0 
 
 I.I 
 
 11.25 
 
 
 1.8 
 
 1.4 
 
 1^ 
 
 » 
 
 /,. 
 
 '^ J^ 
 
 % 
 
 >> 
 
 /5> 
 
 5>' 
 
 
 
 '/ 
 
 y^ 
 
 Photographic 
 
 Sciences 
 
 Corporation 
 
 23 WEST MAIN STREET 
 
 WEBSTER, N.Y. MS80 
 
 (716)873-4503 
 
 4^ 
 
 i\ 
 
 p. 
 
 4 
 
 o 
 
 
 N 
 ^ 
 
 6^ 
 

438 
 
 THE INSOLVENT ACT. 
 BRITISH COLUMBIA. 
 
 25th April, 1877. 
 
 Assignee. 
 
 District. 
 
 Charles Dupont [Victoria For Province B. C 
 
 .r.ames Morrison New Westniinster. i do 
 
 (ieorge Byrnes Cariboo do 
 
GENERAL INDEX. 
 
 Absconding— Debtor comniits an act of bankraptcy, 30-1. | 
 Defendant, service of writ upon, 71. 
 
 Acceptance of assignment, 80. , , , -^ i r.7 a 
 
 AcooiiNT-Assignee to account for and divide interest upon bank deposits, l.i7-». 
 How compelled to account, 167-8. 
 
 Final, to be prepared by asHigneo. (See Final Account), l.")S-0. 
 Statements of, to be prepared periodically, 225. 
 Books of. (See Book). 
 Bank. (See Bank). 
 Act of 187.")— Application of, 1-376. 
 
 Who are traders imd jr, 1-20. 
 Title of, 376. 
 
 When to take effect, 2-374. 
 Is retrospective, 20-1. 
 Act of*1876, .■57()-80. 
 Act of 1877, 380-8. 
 
 AoT OF Bankruptcy— What constitutes, 26, a sai. 
 What are continuous acts, 60-1. 
 
 Proceedings for compulsory liquidation must commence within three monthi 
 from, 60. 
 Act respecting liarceny, 3-59, et seq. 
 AOTION— Rights of which pass to assignee, 98. 
 Which remain in insolvent, 98. 
 Cannot be brought by insolvent, 149. 
 Kight of not taken away by assignment, 149-51. 
 Acts hereby repealed, 374. 
 
 When to cease to operate, 374. 
 Ai.DiTioNAL Security may be demanded from official assignee by cr«l»tor'*. l-^'^- 
 Administrator as to trust fuTids not affected by discharge under Act, ^01. 
 
 Not liable to compulsory li(H*idation, 13-289. 
 Advances in money, procuring withintent to defraud, 352. „ ,. . o7k 
 
 Advertisement -Meeting of creditors called by. (See Forms, Meetmg, Notice), 276. 
 Of notice of issue of writ of attachment, 72. 
 By official assignee on attachment, 72. 
 Assignee to give notice of his appointment by, 144. 
 Of sale by assignee of, 147. 
 Of sale of real estate, 226. 
 To describe property fully, 221. 
 Time prescribed for, 221. 
 Of completion of dividend sheet, 270. 
 
 iii 
 
440 
 
 THE INSOLVENT ACT. 
 
 Advebtisejient— Oiittiit ued. 
 
 Of applicatiuii to judge f^ir confirmation of discharge, 17fi. 
 
 Of meeting of creditors to consider coniitosition and discharge lo be pub- 
 lished, 174. 
 
 In what papers published, '275. 
 
 Of petition by insolvent for balance, 273. 
 
 Of sale of <iebts of insolvent, 212. 
 Affidavit — To be made before serving demand to assign, 47. 
 
 With wht)m to be filed, 47. 
 
 Certified cit\ y of, to be annexed to demand to assign, 47. 
 
 Who may make, 47. 
 
 Proving ilaim, 278. 
 
 Form (Appendix "P."), 31t!J. 
 
 To be produceil by insolvent on application f(jr confirmation of discharge, 
 182. 
 
 Form (Appeudi.v "K."), o'JO. 
 
 What to contain, 182. 
 
 In insolvency, before whom sworn, 2S0. 
 
 Who may make, 28(J. 
 Agent of creditor, how appointed, 144. 
 Assiijiiee cannot act as, 144. 
 
 E.xce])t by authority of the Judge, 144. 
 
 Frauds by, when within Act, 300-1. 
 
 Assignee, &c. , agent for certain purpo.ses, '.iVJ. 
 
 Affidavit may be made by, 280. 
 Aliens anci denizens, 11-12, 
 Alimony— Decree for, 203. 
 Allowance — To insolvent, how made, 267. 
 
 To be inserted in dividend sheet, 2(57. 
 
 Subject to contestation, 267. 
 i^ENDMENT — Of pleadings, 288. 
 
 Amoi'NT— For which a creditor holding security shall rank, 2.51. 
 Answer— To demand to assign, how served, 47. 
 Appeal— From order of Judge. (See Judge, Application), 304. 
 
 Costa of, where appellant does not proceed, 304-.'). 
 
 Conditions of, 304. 
 
 Judgment of court to be final, 305. 
 
 What orders, &c. , appealable, 30.5-6. 
 
 Procedure on appeal, .'J06-'J, 
 Appell\nt — Not prosecuting appeal liable for costs, ,304-5. 
 
 Dying, 300-10. 
 Application— To Judge to confirm discharge, 178. 
 
 By insolvent for discharge, 204. 
 
 How made, 204. 
 
 For apj.eal from Judge, .304. 
 
 Notice of, to be served, .304. 
 
 By aasignee for recovery of effects retained l)y insolvent, 370. 
 
 Of Act, 376. 
 Appointment— Of official assignee, 132. 
 
 Proof of, 371. • * 
 
GENERAL INDEX. 441 
 
 Appointmknt— Continued. 
 
 Of assignee, 135. 
 
 A.ssigiiee tn give u()ti<'e of, 144. 
 
 Reccrd of, 13(j. 
 
 Of agent for creditor, how made, I'M). 
 
 Of inspector to estate of insolvent, 145. 
 A' BITKATION— In case of contingent claims, 241. 
 A KUEAKS -Of salary. (See Salary). 
 
 Of rent. (See Rent). 
 Arkest— (See Imprisonment). 
 
 Under judgment summons, 202. 
 
 Malicious, discharge not to affect damages for, 201-2. 
 
 SubRe(iuent to discharge from imprisonment, .'-iOO-l. 
 AaSAUi/T— Discharge not to affect damages for, 201. 
 Assets— Want of, effect on assignment, 81-2. 
 
 Vest in assignee, 85. 
 
 Statement of, to be prepared, 110. 
 
 What are, 113-4. 
 
 ('hargeable with mortgages, 290. 
 A8SlONEF.--(See Official Assignee). 
 
 List of, 4.tt. 
 
 Definition of, 22. 
 
 What property vests in assignee under assignment, 85, ct scq. 
 
 To be appointed by creditors, 135. 
 
 Giving of security by, 136. 
 
 Need not be resident of county, 138. 
 
 Proof of ai)pointment of, 138. 
 
 Manner of voting for, 140. 
 
 May examine insolvent <m oath, 123. 
 
 Otfici il assignee to be assignee when no other appointed, 135. 
 
 May apply for examination of other parties, 128. 
 
 May be removed, 13(5-40. 
 
 Copy of resolution appointing, to be filed, 136. 
 
 Creditors of individual partners may vote for, 139. 
 
 Effect of omission of proceedings prior to appointment of, 138-9. 
 
 pjffect of neglect or irregularity in proceeding prior to appointment of, 
 i;'>8-9. 
 
 Principles which govern. (See Removal), 139-40. 
 
 Purchasing estate of bankrupt, 145. 
 
 May lie made to change solicitor, 144. 
 
 Transfer of estate to, by official assignee, 143. 
 
 To gjve notice of appointment, 144. 
 
 Not to act as agent of creditors, except by authority of Judge, 144. 
 
 Supervision of by inspector, 145. 
 
 May dispose of estate of ins(jlvent, 146, 
 
 Powers of insolvent to vest in, 147. 
 
 To wind up estate of insolvent, 147. 
 
 To be directed by creditors, 147. 
 
 May .fell estate <": hloc, 147. 
 
 To bring actions to rescind agreements made fraudulently, 148. 
 
442 
 
 THE INSOLVENT ACT. 
 
 Assignee— Con<Jnwe(i. 
 
 To sue in his own name, 148. 
 
 To bring actions to protect estate and to protect the creJitors, 148. 
 
 May represent insolvent in all suits pending at the time of his appointment, 
 
 148. 
 Declining to prosecute suit, 149. 
 Statute of Limitations applies to, 1.51. 
 Proof of party being assignee, 1.51-2. 
 Rights of action by, 1.52-3. 
 Is entitled to security for costs, 153. 
 When goods may be re])lovied from, 296. 
 To keep register, 1.54. 
 
 To o])en separate account with each estate, 154. 
 Non-official to deposit register in office of official assignee, 154. 
 Must pay over balance to Receiver-Cleneral after discharge, 155. 
 Remuner»,tion of, 156-7. 
 As to em))loying Counsel, 150-7. 
 To call meeting of creditors, 157. 
 
 When rermired to do so by inspector, 157. 
 
 Or by five creditors, 1.57. 
 
 Or by a Judge, 157. 
 To deposit moneys of estate in Bank, 1,57-8. 
 
 In whose name, 157-8. 
 
 How to be withdrawn, 157-8. 
 Omitting to account for interest, 157-8. 
 To |)roduce Bank i)ass-book at meeting of creditors, 153. 
 Making false entry in pass-book, 158. 
 Death of, 158. 
 
 How estate shall vest after, 158. 
 To prepare final accoimt, 158-9. 
 Proceedings by for final account and discharge, 159. 
 To petition Judge for discharge, 159. 
 To give notice of petition to insolvent, 1.59. 
 " " inspector, 1.59. 
 
 or creditors, 1.59. 
 To produce and file Bank certificate of deposits, 159. 
 To prepare statements, 159. 
 Accounts of to be audited, 159. 
 Penalty for neglect to petition for discharge, 159. 
 When to ajjply for discharge, 159. 
 
 To call meeting to consider composition and discharge, 159. 
 Neednotbepai'.y todeed of " " 168. 
 
 Proceedings by, after insolvent has obtained assent to discharge, 175. 
 To anne.x certificate to deed of composition, 175. 
 
 What to contain, 175. 
 To annex further cei"tificate, 175. 
 
 What to contain, 176. 
 To forward deed and certificates to Clerk of the Court or protlionotary, 176. 
 To resume possession of estate if conditions of deed of composition not ful- 
 filled, 190. 
 
■ i', 
 
 GENERAL INDEX. 
 
 443' 
 
 r 
 
 AssiONEK- OovtinvM. 
 
 To re-couvey estate to insolvent on execution of deed of comijosition, 191. 
 
 Money held bj' insolvent a«, not afiFected by discharge, 201. 
 
 May oi)|)ose discharge, 205. 
 
 Report on application for discharge, 205. 
 
 As to reserving dividends, 202. 
 What to contain, 205-7. 
 
 May sell debts at public auction, 212. 
 
 'I'd kee]j list of debts open to public ins])ection, 212. 
 
 Refusing to take certain proceedings, 213. 
 
 To deliver bill of sale of insolvent's debts to purchaser. (See Purchaser), 
 213-4. 
 
 Proof of signature unnecessary, 214. 
 
 May sell real estate, 220. 
 
 How to advertise sale of real estslte, 220. 
 
 May adjourn sale, 220. 
 
 May grant terms of credit, 222. 
 
 Sale of immovables in Quebec by, 222. 
 
 To keep accessible to creditors accoimts and statements of his doings, Ac.,, 
 225. 
 
 When to prepare dividends, 223-6. 
 
 Duties of, in case of cre-'.';,or holding security, 251. 
 
 Must procure assent of ( reditors, 250. 
 
 May require an assignm*>nt of property from creditors, 251. 
 
 May consent to retention of property by creditors, 251. 
 
 May require from creditors supjilementary oath, 259. 
 
 To reserve dividends for persons not filing claims, 272. 
 
 To transtnit objection relating to claims to Clerk of Court, 273. 
 
 May obtain order to receive insolvent's letters, 291. 
 
 To be subject to sunnnary jurisdiction, 293. 
 
 May be compelled to perform his duties, 293. 
 
 Remedies against, 29.3. 
 
 To reserve dividends in case of ap[)eal, 310. 
 
 May recover property improperly transferred by debtor, 317. 
 
 May recover money paitl within thirty days of insolvency, 345. 
 
 May recos ~f money paid within thirty days after issue of attachment, 345. 
 
 An agent within Act, as to frauds by agents, 339. 
 
 Indictment against, 3.59. 
 
 Punishment of, for wilfully misstating, 366. 
 
 May recover penalty against creditor, 369-70. 
 
 To distribute amount of same among creditors, 370. 
 
 Application by, for effects retainecl h" insolvent, 370. 
 
 Proof of apj)ointment of, 371. 
 
 To retain i)ercentage for Building and Jury Fund, 371. 
 AssiONMENT — Of property by debtor with intent to defraud, 31. 
 
 To any one in trust for ci-editors, 36. 
 
 Otherwise than in acoordajice with Act, 30, ct seq. 
 When void, 36, et seq. 
 
 Of stock in trade by way of mortgage, an act of bankruptcy, 42, et seq. 
 
 When creditors may demand, 47. 
 
 ' '. 
 
iU 
 
 THE INSOLVENT At'T. 
 
 AssUiNMliNT -Cunliimul. 
 
 TiiiR' for making may be eularged, 50. 
 
 Deed nf. (Sue Deed (jf Assii,'iimeiit). 
 
 Wlietlier in ilujilicate <ir registered, 7'.t. 
 
 ;May lie set aside liy creditor, "ti. 
 
 Acce{)tance of, 80-1. 
 
 Form of, 8"). 
 
 Notice of i)etiti()ii to set aside to lie given, 7-i. 
 
 To non-resident official assignee, 77. 
 
 What (iroperty vests in assignee nnder. So, d .vii. 
 
 Does not prevent action against insolvent, loO-j . 
 
 15y creditors to assignee of property held as security. 2'>\. 
 Attachment— Writ of, ()2. 
 
 How obtained, 63. 
 
 Secured creditor may obtain, (52. 
 
 Or creditor whose debt is not due, 04 o, 
 
 i)v indorser, •!."). 
 
 To whom to be directed, 02. 
 
 Form of. (Appendix " C"), 31)0, 
 
 Indorsement on, Oo-O. 
 
 C'lncurrent may be issued. (See C!oncurrent). 
 
 Procedure under, 69, ct set/. 
 
 Affidavit for, H7-!». 
 
 Demand need not be previously served, .57. 
 
 Where obtained, Olt-70. 
 
 Service of, 71-2. 
 
 When and how returnable, 72-3. 
 
 Notice of i,ssue of to be given, 72-3. 
 
 May be set aside, 114. 
 
 Petition to set aside, 114. 
 
 What jn'operty vests in assignee under, 74-.5. 
 
 Eegi.stration <if copy of, 117. 
 
 In Province of (Quebec, 117. 
 
 I'ayment made after, 345. 
 
 Against incorporated companies, 371. 
 
 Judge may order issue of, 371. 
 Attorneys— Right t.) vote, 13G-'.>, 141-2. 
 Auction— Debts may be sold at. (See Sale), 212. 
 AuniTrt — Accounts of assignee to be audited, 159. 
 AWAKI') — In case of contingent claims, 241. 
 
 How may be regulated, 241. 
 
 Damages claimed by lessor, 214-5. 
 
 May be appealed from. (See Judge, Assignee, Apj)eal), 210. 
 liALANOE— Assignee to pay over to lleceiver-rieneral, 155. 
 
 Remaining, after payment of debts, i)ayable to insolvent, 275 
 Bank — Moneys to be deposited in, 157. 
 
 Statute as to, 4-5. 
 
 Pass-book to be produced by assignee at each meeting, 158. 
 
 Account, in what name kept, 1.58. 
 
 Certificate as to balance in hands of assignee, 159. 
 
GENERAL INDEX. 
 
 4.4; 
 
 l^ANKF.R— When liable til bankruptcy, 15. 
 HANKuri'T, (See Insolvent). 
 
 What ju'operty of, veHts in assignee, 85 ctlseq. 
 
 Mfirt(,'at,'or, not a iiocesHary party to Huit against awsigiiee, 140. 
 Even when fraud alleged, IVJ-'tO. 
 
 Beijuest to bankrupt jiasHe.s to assignee, 96. 
 Ha HHKH- Not a trader, lH. 
 l'.ii,i,- Of Costs. (See Costs). 
 
 Exchange, holder t)f, may prove against all parties liable, '2.S8-'.l. 
 
 Sale of insolvent's debts. (See Purghase). 
 Form of. (Apiiendi.x " N."), :VJ7. 
 Bond- To be given by official assignee, VA2. 
 
 Books -Of aecoiuit, debtor not keeping, aground for ii|)posing discharge, 182-4 o-(i. 
 MuicKMAKEH — A trader under Act, 1. 
 BiKiKKii— Definition of, 1.5. 
 BllLDEKS, 15-10. 
 
 BuiLDl. (i and Jury Fund in I'rovinceof (^>uel)e(•, provision for, .'^71. 
 Ca.nada (liiiftu. (See()tticiaWr'r/jf,'/(). 
 Cai.MNi: a meeting of creditors by debtor for purpose of compounding, an act of bank 
 
 rujitcy, 20. 
 ('aI)sf.s to which assignment attributed, 110. 
 
 Ins(dvent must include in statement, 110. 
 Cektikicatk to be anne.\ed to offer or deed of composition and disch.arge. 175. 
 What to contain, 175. 
 (."oiiy of resolutions and objections to be annexed to, X'T). 
 
 Of registrar as to discharge of hypotliecs, 2211. 
 Contents of (See Immovables), 223-4. 
 
 Of Court as to default of witness in aiipearing, 285 0. 
 
 Of aKsignee containing mis-statement, 300. 
 
 ( )f bank as to balance in hands of assignee, l-5H-!t. 
 Certified Copy. (See Copy). 
 Chaihman of meeting of creditors, 122. 
 Chattels exemi)t from seizure, 103-4. 
 Claim — No more than one creditor to vote on one claim, LSO. 
 
 Not to be divided for pur]iose of voting. 130. 
 
 Purchased after insolvency, 130. 
 
 Privileged, sale of estate not to prejudice, 147. 
 
 For damages by lessor on annulling of lease. (See J.,essor), 214-5. 
 May be contested, 214-5. 
 
 ( )f landlord for rent, 217. 
 
 Contingent or conditional, 240. 
 
 Secured, 251. 
 
 Consisting of several items, 2.59. 
 
 Against a mendjer of a coiiartner.ship, 220-2(!0. 
 
 To be examined by assignee and inspector, 271-2. 
 
 Contestation of, 272-.3. 
 
 (Objections to, how determined, 273. 
 
 When interest allowed on, 275. 
 
 Proof of, 278. 
 
 Form and attestation of. (See Aifidavit, Appendix "P"), 39'.t. 
 
446 
 
 THE INSOLVENT ACT. 
 
 Clajm -Oontiniic'l. 
 
 Wliat may l)f set off, 2S1. 
 
 Wliat rank on the estate. (See I)el)ts). 
 Claimant. (See (Veditor). 
 
 Whose chiiui objected, to have tlifoe (hiys notice, 27.'<. 
 Clashification of (lisehai'K'es, lHlt-'205. 
 C/'leh(!YMA.N' liable to bankruptcy, 14. 
 
 Clekk C'oi)yof resolutions aiipointinLf assii;nee filed with, liiO. 
 Clerks have special lien for arrears of salary, 2(18. 
 
 To what clerks the Act a)iplieH, 2(!4-70, 
 May be employed by asMij,'nee, '2C)H. 
 Code of iirocediu-e to apply in Province of (Quebec, 222-3. 
 Collateual Security not affected by discliari,'e without conseii of creditor.-i, I'.tlt. 
 
 Creditors hohlinK may prove for, 251-2. 
 CoLLocATEi)— MeaniuK of, '>Ct. 
 Collocation of moneys ari.sinj^ from sale, 222-3. 
 Commission — Goods for sale oti do not jiass to assignee, 287. 
 
 Of assignee on sale of real estate, 223. 
 
 Assignee to be paid by, l.W-ti. 
 
 To examine witnesses, 285. 
 COMMISHIONEU may take certain affidavits, (iG,280. 
 
 ( 'OMI'ANIES InCOUPOKATED — 
 
 Api)lication of Act to, 3. 
 
 Meaning of words he, him, or his used in relati<m to, 2<i. 
 Act to apply to (See Incoriiorated), 371. 
 Notice of issue of attachment to be given to, 371. 
 Judge may order assignee to inquire into affairs of, 371-2. 
 Officers of, to exhibit books to assignee, 372. 
 Officers to give all requisite information to official a«i-i,:tnee, .372. 
 Refusal by officers to furnish information to assignee, 372. 
 Ofiicers to be trustees, 372. 
 Judge may order meeting of creditors .if, .372. 
 iCoMPOSITlON— Proceedings on offer of, 1.59 KiO. 
 Calling meeting to ajiprove f>f , 160-1. 
 Must be bona fide, 172. 
 Agreement to accept, releases debt, 169. 
 Failure of debtor to pay, revives original debt, 169-170. 
 But action cannot be brought pending contestation, 192-3. 
 How creditors to rank for, 171. 
 And discharge deed of, must provide for all creditors, 163, 
 
 Conditions of, 90, 106. 
 
 Creditors must prove claims to execute, 104-176. 
 
 Assignee not to be jiarty to, 168. 
 
 But insolvent must he, 167. 
 
 Not made under Act, no bat to non-assenting creditors, 162-3. 
 
 When properly executed is binding on creditors who are n it partic 
 167-8. 
 
 Signing and accepting composition under, 168-9. 
 
 Made by copartnershiji and creditors of firm, 165-6. 
 
 Creditor may approve of, 174. 
 
GENEIUL INDEX. 
 
 447 
 
 COMPOHITION —Continued. 
 
 May object to, 174. 
 Confiiination of, 1 (lit. 
 Power to reduce or modify, lllO-l. 
 Procured by kindnesHtowardH debtor, 172-S. 
 Objection to be filed with aswit'iiee, 174. 
 Certificate to lie annexed to, 174-.5. 
 What claims make up three-fourths value, 177-188. 
 To lie dejiOKited in Court, 177. 
 Notice of confirmation, 178-9-180. 
 l)ayon which apiiliedfor, 180. 
 When it may be confirmed, 181. 
 Proof of execution of, 181. 
 Affidavit to be jiroduced, 182. 
 When not entitled to confirmation, 182. 
 OinioHition when made, and l)y whom, 17!l. 
 CeasiuK to have effect, aHsignee to resume pos.sesnion, I'M. 
 Hank of creditorH, if conditionn of not fulfilled, 190. 
 Contested, 190. 
 f^iMiTLSOHV Llcji'iDATioN. (See Attachment, Writ of), 02. 
 Estate of insolvent liable to, (JO. 
 [.imitation of time for in-oceeding in, GO. 
 Ci incurreut writs may be issued, 02. 
 Service of writ, 71. 
 
 How proceedings maybe contested, 114. 
 Concealment- Within Province, an act of bankruptcy, 30. 
 Effect of on discharge, 182-H-4. 
 Of effects by debtor, ;iOO-7. 
 A misdemeanor, 367. 
 CoNCURUENT Writs maybe issued, 701. 
 
 Procedure under, 71. 
 Confirmation of 1)ihchaii(;E" On what condition gi-anted, 181-2. 
 Form of (Api)endix 4), 403 
 Creditors may opi)ose, 181-2. 
 Power of Jiidge on application for, 181-2. 
 When refused, 182, ct seq. 
 Effect of, 193. 
 
 What claims affected by, 193. 
 CoNNiviNfi by debtor at seizure of eflfects, an act of bankruptcy, 3;j. 
 Consent of creditors obtained by fraud, 208. 
 
 To discharge, 102. 
 Conhervatory proceedings may be instituted, 85. 
 
 Consideration— Contracts made with presumed, void, 314-.'i. 
 Consul may take certain affidavi'.s, 280. 
 Construction of Statements in pleadings, 280. 
 
 Of Actrulesof,C-7-8-9-10. 
 (J ontemplation of insolvency, 317-343. 
 Contestation of composition and discharge, effect of, 192-3. 
 
 Of claims, 273. 
 
 Procedure in case of, 273-4. 
 
448 
 
 THE INSOLVENT ACT. 
 
 (JONTEf<rATIf)N -Ci>iltillilt'il. 
 
 Miiy lie onlori'd hy int^poctorH, 271-2. 
 How ti) be Jetemiined, 273. 
 OosU (if, 27 1. 
 (JONTiNiiKNT Claims iivdviiliMl for, 240-5. 
 
 IntiTiist, lOO-l. 
 CONTINDINCJ Whether I ireferi'ii'ji'M umat be, M2-'.i. 
 ( 'ONTRACTH— What paHH to aBHiKiiee, 92. 
 
 Effect of iiisolvoney cm, ',YX 
 
 Kescissidii of, 108. 
 CONTHAi'TH (IK Mahuia(Ji:. (Seo ^Fil^ria,^'e). 
 
 Fraudulent, ;nO,fY .vii. 
 
 Fraudulent, with knowledj'o of party coutraeting, .'{l(i. 
 
 Tn eonteniplation of marriage. .'iHl. 
 i'oNVEYANCK. (See Assignment). 
 
 Of property l)y debtor otherwise than in accord.anee with Act. void, :{(». 
 
 When deemed gratuitous or fraudulent, 310. 
 
 Valid at the time of execution, MH. 
 CorAHTNKliSHU'. (See Partner, Partnership). 
 
 What is meant by trading, h-t), 
 
 Plights of action of an assignee of a [lartner, 1.')). 
 
 What pmiierty of vests in assignee, 8."), (t sk/. 
 {'ovs-- Authentic c(jpies <if leed of assignment and tr.ansfer, 117. 
 
 Of resolution nominating assignee, 13(j. 
 CoHTH Under execution ai)rivileged claim, 4()-2.')0. 
 
 In case of coiniter iietition by delitor, .W. 
 
 Creditor making \iureasonable demand may be ordered to jiay trelile. ."ii 
 
 Lien of solicitor for, 1.57. 
 
 Security for, 148-l.''i.S. 
 
 Of apjilication on objection to disposal of est.ate, 140. 
 
 Of composition and discharge to be [laid by in.solvent, l.')!l-()0. 
 
 When excluded from r.anking on estate, 268. 
 
 Of contestation, 274. 
 
 On wlnit pro])erty and in what order chargeable, 28lt-!M). 
 
 ( )n appellant not proceeding. (See Security), 304-.5. 
 ( !ouNCiL— ( Governor in. (See (Governor). 
 ( IdiNKKi. — Employment of by assignee, 1.5()-7. 
 
 Expenses of, to be paid out of estate, 150-7. 
 ( '( If NTY -Definition of, 22. 
 
 ( )tficial assignee appointed for each, 132. 
 Couu'r Definition of , 22-3. 
 
 Jurisdiction of as to assignee, 133-293, vl .uii. 
 
 (See Judge). 
 
 To which Court api)eal lies in several provinces, ;J04. 
 
 Will set aside a voidable contract, 315-6. 
 
 CdVEKANTH IN A LKASK— 
 
 Not to .assign, 214-.'>. 
 Credit— Terms of, to be approved by creditors, 220-1. 
 May be allowed on sales of real estate, 220-1. 
 (ioods purchased on, 352. 
 
 Cii 
 
GENERAL INDEX. 
 
 440 
 
 ruKDiTofls Moaninj,' of terni, 2i-M,. 
 
 KightHdf vntiiig, 20. 
 
 Ifijfht of, 125.140. 
 
 Miiy re(|uiro debtor to make an aHNlgnment, 47. 
 
 WhoHL' ilcl)t not <lu(!, may isHuo attachment, G4. 
 To chooHC (lomiuile for nervice of paperH, 47. 
 
 ^fayi^et aHidcaHHijjtuiient, 75. 
 
 May actpiieHce in anHij,'nniont to non-resiilent official 'WHiKnt-'q, 7.S. 
 
 LiHt of, need not be apjjendud to asuignment, 85. 
 
 Meetin;,' of. (See Meeting), lilt. 
 
 Flow called, 11!». 
 
 When called, 110-20. 
 
 Hy whom called, 11!). 
 
 Form of n' 'i. e of. (Appendix " O."), 304. 
 
 To be notified of meeting, 111>. 
 
 '-'nmmoned m a witnesH, cannot refuse to testify, 120. 
 
 May demand additional security from official aHwignee, l.ii. 
 
 May appoint asnignee, l.'W. 
 
 May remove awHignee, l;{.5. 
 
 Copy of resolution of appointing assignee, to be filed, l;ii;. 
 
 Rights of, as to voting, 13(i. 
 
 Who may vote for asuignee, l.'W-42. 
 
 No more than one to vote on same claim, 130. 
 
 Of individual partners may vote for assignee, 1.30. 
 
 Agent of, 141-2. 
 
 How ai)pointed, 141-2. 
 Assigneo not to act as, 144. 
 
 except by authority of .Judge, 144. 
 To appoint place for meeting, 144. 
 To apj)oint innpectors, 145. 
 
 May revoke appointment of inspectors, 145. 
 May fix remuneration of inspectors, 145. 
 May order sale of insolvent's estate, 14<5. 
 May object to disposal of estate, 14(i, 
 To give notice of such objection to assignee, 146. 
 To pay costs of application if objection, not confirmed, 140. 
 Non-assenting, may sue debtor, 163, ef seq. 
 
 May approve or object to deed of composition and discharge, 174 
 May oppose confirmation of discharge, 178, 
 
 Wliose debts are not discharged, not to be computed in majf>rities, 201. 
 Insolvent to give notice to, of application for discharge, 204, 
 May oppose insolvent's application for discharge, 20.5. 
 May require insolvent's discharge to be suspended, 205. 
 May require insolvent's discharge to be classified, 205. 
 To direct assignee as to sale of insolvent's effects, 212. 
 May take proceedings at their own risk. (.See Proceedings), 213, 
 May cancel or continue lease held by insolvent, 214-5. 
 Privileged, may require sale of property subject to privileged claim, 225. 
 May obtain order from Judge compelling assignee to distribute proceeds of 
 sale, 225. 
 
 ii 
 
 cc 
 
450 
 
 THE INSOLVENT ACT. 
 
 CrEDITOKH— Con((;i!t€(/. 
 
 Holding collateral security, may [irove for same, 251, et acq. ^ 
 May luuvc i"i whole ilebt in ilefaiilt of payment of composition, 171. 
 Having conditional or contingent claims, 240. 
 Holding security, 251. 
 
 From one partner for debt of fiiin, 251-5. 
 
 Must be on property of insolvent, 251-;{. 
 
 Shall specify amount of same, 251. 
 
 Shall put a value on security, 251. 
 
 How to rank and vote, 251-9. 
 
 May surrender same to as*<iguee, 251. 
 
 May realize same, 257. 
 
 Negotiable instruments on which insolvent indirectly liable, 251. 
 
 Mortgages on real estate or shipping, 25S. 
 May be re<iuired to make supj)lementary oath, 2.59. 
 Kefusing to make such oath, 2.59-60. 
 May allot an allowance to insolvent, 267. 
 Projjortion of, ref|uired to grant allowance, 2(i7. 
 
 J[ay direct costs of contestation of claims to be i)aid out of estate, 274. 
 May direct costs incurred in general intere.-st of estate to be paid nut ( 
 
 estate, 274. 
 Calling meetings of, 27.5. 
 tiuestions discussed at meeting, 276. 
 
 Cannot refuse to give evidence respecting dealings with insolvent, 129. 
 Concealment from. (See Concealment), 182. 
 Who are, 24-6, :n8-9. 
 
 Taking consideration for granting discharge, 3(i9-70. 
 Of incorporated com])any, meeting df. (See Incorporated and Companies 
 
 371. 
 Cru.VTOU. (See Trustee). 
 l)AM.\(iEs for assault, &c. , not affected hj dfecharge, 201. 
 
 To lessor on tennination of lease by creditors, 214-6. 
 
 How estimated, 216-7. 
 
 Claim for, cannot be proved, 235-6. 
 1)K.VTH— Of assignee. (See Official Assignee), 158. 
 
 How estate shall vest, 158. 
 (Jf a partner, the survivor becoming bankrupt, 150. 
 (Jf insolvent, 289. 
 Debtok -Definition of, 24. 
 
 When def med insolvent, 26-32. 
 
 Abroad, when liable to bankruptcy, 30. 
 
 Absconding commits an act of bankruptcy, 30. 
 
 Ceasing to meet liabilities, 47. 
 
 Counter petition by, in case of vexatious demand, .56. 
 
 Absent from Province, time for making assignment may be enlarged, 59. 
 
 Failing to pay composition, debt revives, 169-70. 
 
 Proceedings for discharge from imprisonment, 300. 
 
 May be examined, 301. 
 
 May be discharged by order of Judge, .301-2. 
 
 May be discharged summarily in case of Bubseijuent arrest, 302. 
 
 f 
 
 II 
 
 r 
 
 11 
 
 I) 
 ij 
 
GENERAL INDEX. 
 
 451 
 
 174. 
 
 n\lt uf 
 
 1\K 
 
 I ■allies). 
 
 d, 59. 
 
 02. 
 
 Debtor — Continued. 
 
 Contracts of, previous to insolvency, 92-4. 
 
 Making payment in contemplation of insolvency. (See Insolvent and Bank> 
 nipt), 34-5. 
 Dkbts— Imjjrisonment for, an act of bankruptcy, M. 
 Not due, may be ground for attachment, 64. 
 To be sued for in name of assignee, 148-9. 
 
 What debts may be ground for application for assignment, 47-8. 
 NVhat debts shall rank upon the estate, 220, tt seq. 
 May be sold at auction. (See Sale), 212. 
 
 May be sued for in name of purchaser. (See Purchaser), 213-4. 
 Revive where debtor fails to pay compo8itif)n, 169. 
 For which claims are not filed, how dealt with, 272. 
 ■ Not barred by discharge under foreign bankruptcy laws, 287-8. 
 Due to insolvent, subject to set-off, 281-2. 
 Transferred to debtor to enal 'e them to be set off, void, 350. 
 Transferred to debtor that purchaser may rank, void, 350-1. 
 Parties incurring, with intent to defraud, ■'^52. , 
 
 Dekd of Assignment— When to be made, 7.5. 
 To whom to be made, 75. 
 May be set aside, 7.5. 
 Porm of. (See Appendix " E."), 392. 
 
 May be received bj' Notary in Province of (Quebec, 85. ' 
 
 Registration of cojjy of, 117. 
 
 In Province of (Juebec, 117. 
 And transfer to be evidence, 371. 
 
 Form of. (See Appendix " H."), 394. 
 Ot composition and discharge. (See Composition and Discharge). 
 
 Form of. (Appendix ,3), 401. 
 Reconveyance by assignee to insolvent on execution of, 191. 
 Its effect, 191-2. 
 May be registered, 191. 
 Of sale of real estate, 220. 
 
 To have same effect as sheriff's deed, 222. 
 Form of. (Appendix "N."), 397. 
 
 Assignee may reserve special hypothec or mortgage by. (See Sale) 
 222. 
 Deed of Cojipositio.v— Notice of deposit, 161. 
 
 Meeting to approve of, 174. 
 Default— (3f witness, how proved, 285-6. 
 
 Defendant in Action— For fraudulent purchasing to be charged with fraud, 52. 
 Proved guilty, liable to imprisonment. 3.52. 
 flaking default, i)laintiff to prove fraud, 358. 
 To be taken into custody forthwith, 358. 
 Definitions. (See Different Titles). 
 Demand— Of assignment by creditors, 47-8. 
 Form of. (Appendix "A."), 389. 
 
 Service of, how effected, 53. •. 
 
 Creditors who can join in, 50-1, 
 How obtained, 47. • 
 
452 
 
 THE INSOLVENT ACT. 
 
 Deuan i— Continued. 
 
 Who may uiiil;(', t!t-r»l. 
 Form of affidavit in support of, 52-3. 
 Who may make, 52. 
 When cannot be made, 46. 
 ^^'he^e affidavit filed, 5U-4. 
 Creditor making has not Hole control of, 51-2. 
 Ma> be contested by debtor, 5(5. 
 Malicious or unfounded, ."i*)-8. 
 Effect of, 57-S. 
 
 Made without reasonable groimds, 57-8. 
 Lhnitation of time for pmceediiig under, 60-1. 
 Extension of time for contesting, .59-60. 
 Demanhs-- On estate of inccaporated companies, if unsatisfied, estates may be wound 
 
 uji. (See Incorporated Companies), 373. 
 DemI'RKEB— Aveniient of fraud not a subject of, 355. 
 Deposit— By as.-ignee of moneys received by him, 157. 
 Withdrawal of, l.')7-S. 
 Account, in whose name to be kept, 1.57-8. 
 Separate deposit account to be kept for each estate, 157-8. 
 By way of fraudulent preference void, 317. 
 Description — In deed of reconveyance, 191. • 
 
 DiSBUKSEliENT.s-How chargeable on estate, 289-90, 
 Discharge— Of assignee, proceedings for. (See Assignee), 158-9, 
 When to be api)lied for, 159. 
 Of insolvent, deed of. (See Deed of Composition and Dischai-gej, 160. 
 Creditors may ai)prove or object to, 174. 
 Confirm.-'.tion of, how obtained, 175-8. 
 Creditors may ojjpose, 178. 
 Notice A application for, to be given, 178. 
 Affidavit and certificate to be produced by insolvent on application 
 
 for, 182. 
 In what cases refused, 182-3. 
 May be absolute or conditional, 188-90. 
 May be 3usi)ended for five years, 189. 
 May be declared to be of the second class, 189. 
 Effect of c(m<irmation of, 193-8. 
 What claims affected by, 193-6. 
 Only those which are provable, 196-7. 
 Promise to pay debt barred by, 198-9. 
 Not to effect secondary liabilities, 199-201. 
 joint " 199-201. 
 
 " mortgage or other security, 199-201. 
 
 " certain debts, 201-203. 
 
 Insoivent may apply for, after a year, 204. 
 How obtained from Judge, 204. 
 To give mtice of application, 204-5. 
 Without composition, 205-7. 
 Must pay fifty cants on the dollar, 206. 
 May be suspended, classified, or refused, 205-6. 
 
GENERAL INDEX. 
 
 453 
 
 wound 
 
 licatii)u 
 
 DiaoHARGE— Comtt n wed. 
 
 Form of. (Appendix 4 and 5), 403-5k 
 
 Obtained by fraud to be void, 208-11. 
 
 Securities given to procure consent to, 210. 
 
 To be of no effect unless confirmed by Court, 208-12. 
 
 May be procured by representatives of deceased insolvent, 289. 
 
 Of insolvent from imprisonment. (See Imjirisonment, Judge), oOO-l. 
 
 Creditor taking consideration for, 369. 
 
 Under foreign Bankruptcy Laws, 287-8. 
 Disobedience— Of process, how punishable, 285-6. 
 Disposal — Of estate of insolvent. (See Sale), 146. 
 
 Creditors may order, 146. 
 
 Inspector may order, 146. 
 
 Creditors may object to, 146-7. 
 
 Court to determine objections to, 146. 
 
 Costs of objections to, 146. 
 
 Of goods not paid for, a misdemeanor, 367-8. 
 Disqualification— Of Judge, how raised and decided, 291. 
 Disthes.9— After assignment, 218-9. 
 District— Definition of, 22. 
 
 Official assignee appointed for each, 132. 
 DrviDEN us —Ratio of to be stated in certificate of assignee, 175. 
 
 To be prejjared by assignee, 225-6. 
 
 Beserved to provide for contingent claims, 202. 
 
 Claim must be proved before paid, 202. 
 
 Sheet not to disturb rank or iirivilege of creditors, 245. 
 Notice of preparation of, 270. 
 To be examined by assignee, 271-2. 
 
 Payment of, 270-1. 
 
 Reserved for creditors not filing claims, 272. 
 
 Objections to, how determined, 273. 
 
 Remaining ur claimed, 275. 
 
 To be left in Bank for three years, 275. 
 If still unclaimed, to be handed over to Government, 275. 
 Dividends- Reserved in cases of appeal, 310. 
 Documents— Official assignee to seize and attach, 74. 
 DcjMioiLE — For service of papers, to be chosen by creditor, 47. 
 
 Meaning of tenn, 55-6. 
 Do-MiNiON Parliament— Exclusive authority in insolvency, 2-;^. 
 DUPUCATB— (See Copy). 
 
 Duties— Of assignee and official assignee. (See respective head%). 
 Duty. (See Tax). 
 Effects. (See Estate). 
 
 Employees— To have special lien for arrears of salary, 268. 
 Endcuseh— Of negotiable paper. (See Surety, Discharge, Negotiable Paper). 
 
 Recklessness of insolvent in acting as, 188-9. 
 Enlargement —Of time allowed for making assignment, 59. 
 Eyi: [TABLE— Estate of insolvent vests in purchaser from assignee, 222. 
 Escape -Of debtor from custody of sheriff, 300-1. 
 
454 
 
 THE INSOLVENT ACT. 
 
 EsTA'l E— Secreting any part of by debtor, with intent to defraud creditors, an act o£ 
 bankruptcy, 31. 
 
 Of insolvent, when subject to compulsory liquidation, GO. 
 
 Writ of attachment may issue against, 62. 
 
 Assignment of, 75. 
 
 Vests in official assignee under assignment, 85. 
 
 May be sold by assignee, 85-145. 
 
 Statement of, to be furnished by insolvent, 110. 
 
 Insolvent may be examined concerning, 123. 
 
 Transfer of, by official assignee, 143. 
 
 Inspector cannot purchase, 145. 
 Evasion — By debtor on examination a ground for opposing discharge, 182-3. 
 Evidence- Of purchase of debts, 213-4. 
 
 Of default of vritness, 285-6. 
 
 Not received, except upon facts set forth in pleadings, 286. 
 
 What documents to be, 371. 
 Examination. (See insolvent, witness). 
 
 Of insolvent, 122-4. 
 
 To be signed by him, 124. 
 
 To be attested by assignee, 124. 
 
 Rules of evidence on, 125. 
 
 At what time insolvent may be examined, 12(). 
 
 Of creditor, 129. 
 
 Of debtor and of assignee, 131-2. 
 
 Of other parties, 128. 
 
 Refusal by, to appear, &c. , 128. 
 How obtained, 128. 
 
 Of debtor applying for release from imprisonment, 300-1 
 
 Of wtnesses, 285-6, 300-1. 
 
 Minutes of, to be filed, 300-1. 
 
 May be postponed, 300-1. 
 Execution- Effect of allowing to remain unsatisfied, 40-7. 
 
 Costs of allowed to seizing creditors, 46, 246, 250. 
 
 Articles exempt from seizure under, 103-5. 
 
 Lien by means of writ of, 246-9. 
 ExEontOH. (See Trustee). 
 
 Not liable to compulsory liquidation, 13, 289. 
 Exemption s--Wliat articles are exempt, IO'J.,3. 
 ExPENSEa— Of witnesses to be paid, 286. 
 
 Extravagance— Of insolvent, a ground for .suspending dischargt, ])<',l. 
 Facts -In proceedings how set forth, 286. 
 Failure— By official assignee to pay over moneys, 1.S2, 
 
 To appoint an assignee, effect of, 135. 
 False -Bidding, order of resale may be obtained for, 223. 
 
 Pretence. (See Fraud Intent). 
 Falsifying— Book, a misdemeanor, 367. 
 Fabmeh- When a trader, 19. 
 
 Fees— Tariff of, to be .xrranged by judges. (See Tariff of Fees), 292-3. 
 Feme Covert— When may prove claim, 233. 
 Fl« tiTiOUa-— Stating fictitious loss a misdemeant ., 367. 
 
GENERAL INDEX. 
 
 455 
 
 .ct of 
 
 Final -Account, when to be prepared by assignee, 158-9. 
 
 To be audited, 158-9. 
 Forcible— Entry, when allowable, 75. 
 Foreclosure— Mortgagee may proceed by, 297. 
 FOREION— Insolvency laws, discharges under, 287. 
 
 Creditors, how to be notified of meeting of creditors, 275. 
 Foreigners- Are within the Act, 11-12. 
 Forfeiture— 13y a creditor receiving a preference, 369-70. 
 
 How recoverable, 370. 
 Foiui— Of assignment, 85. (Appendix " E,'") 392. 
 Forms— Appended to tnis Act to be used, 286. 
 (See Appendix of Forma), 389, et seq. 
 Advisable to follow, 67-8. 
 Fraud- A ground for opposing discharge, 182. 
 Committed before act, 183. 
 Consent to discharge obtained Ijy, void, 208. 
 Alleged against bankrupt nuist be proved, 358. 
 By agents, 359, ct W/. 
 • An<l fraudulent i)reference, 310, cl xcf/. 
 Fraudulent- Transfer of property, 36, d si'i. 
 Preference. (See Preference). 
 Contracts, 310. 
 Gambling— Effect of, 183. 
 Gazette. (See Official Gazette). 
 Goons— Purchased on credit, 352. 
 Government -To hold dividends unclaimed at end of three years, 275. 
 
 To pay interest on such dividends, 275. 
 Governor - In Council to appoint official assignees, 132. 
 
 Power of, with resptx-t to taxes, 215. 
 Grazier- -When a trader, 19. 
 Hbirs— Of insolveiu may continue jtroceedings, 289. 
 
 How far liable, 289. 
 Holder— Of bill may prove against all parties liable, 238. 
 
 Indorser entitled to notice of dishonor, 231. 
 HU8BAND — Examination of, 128-9. 
 
 Hypothecary— Creditor's consent of necessary to abridge time <if advertising. See 
 Sale), 220. 
 Credit' -s may reciuire sale of property subject to claims. (See Creditors), 
 220. 
 Hypothecs. (See Mortgages). 
 
 Special on real estate may be reserved by deed of sale, 222. 
 Sale may be made subject to, 222-3. 
 Certificate of Registrar as to, 223-4. 
 Immovables— Sale of in Quebec, 223. 
 
 Assignee to procure certificates of the hypothecs upon, 223. 
 Contents of such certificate, 223-4. 
 Imprisonment— For debt an act <if bankruptcy, 36. 
 For disobedience of Judge's order, 293. 
 Proceedings of insolvent to obtain discharge from, 300-3. 
 Parties obtaining mouey or goods under false pretences, liable to, 352. 
 
 ! 
 
 i 
 
 MHB 
 
456 
 
 THE INSOLVENT ACT. 
 
 Impiusonment— Continuce/. 
 
 Award of ujion proof of fraud, 358. 
 Of insolvent for disobeying order, 370. 
 Incokpokated Companies— Judge may order meeting of creditors of. (See Com- 
 panies), 372. 
 Powers of Judge witlj regard to, 372. 
 
 Judge may order immediate issue of writ of attachment, 372. 
 Judge may order that issue of attachment be suspended, 372. 
 Judge may order officers of, to deliver periodical statements of affairs, &c., 
 
 373. 
 Judge may appoint receivers to estates of, 373. 
 Judge may cancel previous orders respecting, 373. 
 Judge may order examination of officers of, 373. 
 Judge shall fix remuneration of a-ssignee and receiver, 373, 
 rNDiCTMENT— Against assignee, 359. 
 Infant— When liable to bankruptcy, 13. 
 
 Proof of debts by, 234. 
 Innkeepek— Definition of, V'>. 
 Insolvency— Meaning of term, 2G, et scq. 
 Insolvent— Definition of, 24. 
 
 When a debtor is deemed to be, 26, et sti/. 
 
 Property of vests in assignee, 85. 
 
 Except property held as trustee, 85-8. 
 
 Powers of vest in assignee, 86. 
 
 Sale of estate of, by assignee, 147. 
 
 Rights of to maintain actions, 148, et seq. 
 
 To furnish statement of affairs, 110. 
 
 May petition to set aside attachment, 114. 
 
 Grounds of such petition, 114. 
 
 Must attend first meeting of creditors, 123. 
 
 To attest statement of affairs, 123. 
 
 Examination of, 123. 
 
 At instance of inspector, creditor or assignee, 12:3. 
 
 To sign examination, 124. 
 
 To execute documents, 124. 
 
 Refusal by, to answer, &c,, contempt of Court, 124. 
 
 Cannot claim expenses before being sworn, 128. 
 
 Estate of, how to be disposed of, 140-7. 
 
 Assignee to wind up, 147. 
 
 To give security for costs in certain actions, 148-53. 
 
 Assignee to represent in all suits pending at time of appointment, 148. 
 
 May procure deed of composition and discharge and deposit with assignee, 
 
 159. 
 To produce affida v'it and certificate on application for confirmation of dis- 
 charge, 182. 
 Misconduct of, 189. 
 Reconveyance to, 191. 
 May apply to Judge for discharge, 204. 
 Must prove he has conformed to requirements of Act, !^04. 
 To submit to examination touching estate on application for discharge, 205. 
 
&c., 
 
 GENERAL INDEX. 
 
 45r 
 
 i 
 
 nee, 
 dis- 
 
 m. 
 
 luaOLVEUT— Continued. 
 
 Not relieved from duties inii)08ed by Act, 202-3. 
 
 Owing debts individually and as a partner, 260. 
 
 Creditora may allot allowance to, 267. 
 
 May petition for payment of balance in hands of assignee, 275. 
 
 Death of, 289. 
 
 Representatives of may iirocure discharge, 289. 
 
 Letters of, assignee may receive, 291. 
 
 Offences by, 366-7. 
 
 Punishment of, for a misdemeanor, 366-7. 
 
 When guilty of a misdemeanor, 3(56-7. 
 
 lleceiving money and not handing same to assignee, 370, 
 Insolvent Act. (See Act). 
 iNsrECTOH— May be appointed by creditors, 145. 
 
 Ai>pointment of may be revoked by creditors, 145. 
 
 Creditors may fix remuneration of, 145. 
 
 Not to purchase estate of insolvent, 145. 
 
 Powers of, 145. 
 
 llnder English Acts, 145-6. 
 
 May order sale of insolvent's estate, 146. 
 
 To name bank where money to be deposited, 157. 
 
 May require assignee to declare dividend, 225. 
 
 To examine claims and dividend sheet, 271. 
 
 May order contestation of claims, 272. 
 
 May order payment of costs out of estate in certain cases, 272. 
 
 May direct what notice of meeting to be given, 275. 
 
 May reciuire officers of incorporated companies to give periodical statements, 
 372-3. 
 Inmtkument of Security. (See Bond). 
 Intent— When material, 30. 
 
 To defraud creditors, 208. 
 
 Contracts made with, void, 316. 
 
 Evidence of, 316, 338. 
 Intebe.st— Received upon money deposited in bank, 157-8. 
 
 To appertain to estate, 158. 
 
 How distributed, 158. 
 
 When and how accounted for, 158. 
 
 Rule as to, 232-3. 
 
 Rebate of, how to be calculated, 131. 
 
 On unclaimed dividends to be paid by Government, 2 
 
 Allowed where estate pays in full, 232-3. 
 Intebpleader, 74-5. 
 
 Interpretation— Of certain words. (See particular words), 222. 
 Ibkeoularity— In attachment, 72. 
 Judge— Definition of, 23-4. 
 
 Who can hear petition against demand, 56-7. 
 
 May enlarge time for making assignment, 59. 
 May direct manner of service of writ, 71. 
 To hear petition to set aside attachment, 114. 
 May order conservatory proceedings, 85. 
 
 n 
 
 
458 
 
 THE INSOLVENT ACT. 
 
 •Ivw.K—Continued. 
 
 May order examination of partien, 28. 
 
 Jurisdiction of aH to aHsignee, 13;J. 
 
 To determine objections to disposal of insolvent'.s estate, 14tJ. 
 
 ill certain cases as to costs of such application, 14(). 
 
 To fix remuneration of official assi^^nee when superseded, 15(i. 
 
 To name bank where money to be deposited, 157-8. 
 
 May order production of bank pass-book, 158. 
 
 Estate to invest in on death or removal of ansignee, 1.58. 
 
 May grant discharge of assignee, 159. 
 
 May refuse or suspend insolvent's di.«charge, 189, 
 
 May grant discharge without consent of creditors, 204-5. 
 
 May require report from assignee, 205. 
 
 May authorize a creditor to take proceedings. (See Proceedings), '2V.i, 
 
 May order idemnity to be given to assignee, 213. 
 
 Duties of with respect to leases to be sold, 214-6. 
 
 May order assignee to declare dividends, 225. 
 
 valuation of contingent claims, 240-1. 
 
 To determine contestation of claims, 273. 
 
 To hear and decide objections to claims, 273. 
 
 May enlarge time for prt)ceeding in contestation of claims, 273. 
 
 Direct what notice of meeting to be given, 275. 
 
 To decide between opf)osLig majorities, 276. 
 
 Powers with respect to commissioiui, 285, 
 
 May order issue of writ of subpcena, 285. 
 
 May order attendance, 285. 
 
 May punish for non-attendance, 286. 
 
 May empower assignee to open insolvent's letters, 291. 
 
 Jurisdiction of Judge in other counties, 291. 
 
 Disiiualification of, 291. 
 
 What Judge to determine in cases of disqualification, 291. 
 
 Who to presiile in Quebec, in absence of, 292. 
 
 To frame rules under this Act, 292. 
 
 Summary jurisdiction of, (See Order), 293. 
 
 May order imprisoned debtor to be brought before him, 300- 1, 
 
 May order assignee to take examination of imprisoned debtor, 300-1. 
 
 May order debtor's discharge from imprisonment, 300-1. 
 
 To adjudge term of imprisonment of defendant convicted of fraud. !"i^. 
 
 May order assignee to enquire into affairs of incorporated compani' >, :<71-2. 
 
 May order meeting of creditors of incorporated companies, 371-2. 
 
 Powers of with respect to incorporated companies, 371-2, 
 
 resolutions passed at meetings of creditors of in- 
 corporated companies, 372, 
 
 May order issue of vmt of attachment, 372-3. 
 
 May suspend issue of such writ, 372-3. 
 
 May order assignee and inspector to superintend estate, 372-3. 
 
 May fix remuneration of receiver and official assignee with respect to incor- 
 porated companies, 373. 
 JunOMlNT — Debt not a privileged lien, 246-50. 
 
 Creates a provable debt, 236. 
 
GENERAL INDEX. 
 
 459 
 
 JuDOMENT — Continued. 
 
 Summons under D. C. Act, may take effect against discharged insolveit, 202. 
 Executory as to costs on contestation of claims, 273. 
 Registration of, 102-6. 
 Jurisdiction of court and judge as to assignee, 133. 
 Assignee to be subject to summary, 293-9. 
 Jl'RY— Fund. (See Building Fund). 
 Labokeb— Wlien a trader, 1. 
 
 Labor— Personal after a writ of attachment, insolvent may maintain action for, 98-lt. 
 Landlord— Lien for arrears of rent limited, 217. 
 
 Privilege for rent, 217-8. 
 Larceny— Act respecting, 359. 
 
 Leahe— ProiJerty rented at less than the value to be sold, 214. 
 Ujwn the report of the assignee, 214. 
 Upon an order of the judge, 214. 
 Upon conditions as to lessor's security, 214-.5. 
 Subject to legal obligations, 119. 
 
 AVhen it does not pass to assignee, 214-.5. • 
 
 Extending beyond the current year, 21ti. 
 To be cancelled after a certain time, 216. 
 Lessor— Party to a lease sold bound by the covenants, 214-5. 
 
 Claiming damages, 216-7. • 
 
 How diimages to be estimated, 216-7. 
 To rank upon estate as ordinary creditor, 217i 
 Letter«— Addressed to insolvent may be opened by assignee, 291. 
 Liabilities— From which insolvent freed by discharge, 193, et seq. 
 
 Statement of, 110. 
 Libel— Damages for. (See Discharge), 201. 
 Lien— Of landlord for rent, 217. 
 For costs, 246. 
 (Jf clerk for wages, 268. 
 (See Mortgage, Security, Solicitor). 
 Limitation— Of time within wliich to take proceedings for compulsory liquidation, 60. 
 Limitations -Debts barred by Statute of, 20. 
 
 Statute of, as to action by assignee, 151. 
 Lunatic- When liable to bankruptcy, 13-14. 
 Maintenance— Money payable for, 201. 
 Majority— Of creditors may bind minority, 276-7. 
 Malicious— Demand to assign, effect of, 56-8. 
 
 Arrest ilamages for, discharge not to affect, 201. 
 Marriage— Contracts of trader to be registered in Quebec, 300. 
 
 Consequence in default of registering, 300. 
 Married Wojien— May become bankrupt, 12-13. 
 Meeting— (See Assignee, Creditor, Judge, Notice). 
 
 Calling of meeting of creditors by debtor an act of bankruptcy, 26-8. 
 Of creditors, when called, 119. 
 By whom, 119. 
 To be advertised, 119. 
 And notice sent, 122. 
 Form of notice of. (Appendix " G."), 394. 
 
 ,1 
 
 i 
 
4G0 
 
 THE INSOLVENT ACT. 
 
 MEKTlva— Continued. 
 
 Of creditoFH, who flhall preside at, 122. 
 InHolvent to attend, 123. 
 To be called by assignee on requisition, 157. 
 Mo,y he adjourned, 121. 
 Bank pass-book to be jiroduced at, 158. 
 Of incorporated companies, 371-2. 
 
 Creditors to be notified of, 119. 
 To appoint place of, 144. 
 
 To consider composition and di-tcharcre, 159. 
 How and when called, 15'.». 
 
 To be advertised in Oazette, 174, 
 
 Notice of to be given creditors, 174. 
 
 When to take place, 174. 
 
 What business may be done at first meeting, 277. 
 MiNUTEi — Of meeting to mention production of pass-book, 158. 
 
 Of examination of debtor to be filed, 301-2. 
 • C'oi'y of to 1)6 delivered to assignee, 301. 
 
 MiscoN'Dt'CT— Of insolvent in management of his business, 189. 
 Mi.sdTATEMENT— By assignee, punishment for, 3()G. 
 Monet— May be taken under a writ of attachment, 74. 
 
 Of insolvent vests in assignee by assignment, 85. 
 
 Procuring advances in, with intent to defraud, 352, 
 MoKTQAaE — Oovering stock-in-trade, may bi« an act of bankruptcy, 42-;i. 
 
 How affected by discharge, 199. 
 
 Special, may be reserved by deed of sale, 222. 
 
 By way of preference, 317, ct scq. 
 MoRTGAGEK— Of insolvent's estate may e.xercise power of sale, 297. 
 
 Creditors holding as security, 258. 
 
 May foreclose, 297. 
 MoBTGAOOB — Bankrupt. (8ee Bankru])t). 
 
 Conveying under pressure, 317, (t gtq. 
 Neglect— Of insolvent to appear, an act of bankruptcy, 30. 
 
 To distribute interest, 1,57-8. 
 
 To present petition for discharge, 1.59. 
 Negotiable Paper— Vests in assignee under assignment, 85. 
 
 Unknown to insolvent, 193. 
 
 Creditors holding, 251. 
 New Brunswick— Tariff of fees in, 425. 
 Newhpaper — Advertisement in, 22. 
 Notary— Meaning of words "before notary," 24. 
 Note —Proof of claim on, 238. 
 
 Rule where given for greater amount than debt due, 238-9. 
 Notice. (See Assignee, Advertisement). 
 
 Of ai)plication for enlargement of time for assigning, 59, 
 
 Of issue of \vrit of attachment, 72. 
 
 To be given by official assignee by advertisement, 72. 
 
 Of petition to set aside assignment or attachment to be given. 
 
 Of meeting of creditors, how given, 119i 
 When to be given, 119-20. 
 
 !■>. 
 
•K 
 
 GENERAL INDEX. 
 
 461 
 
 Vonct— Continued. 
 
 Form of. (Appendix " G."), 394. 
 Of appointment of asHitTiee, 144. 
 
 Form of. (Api)en(lix "I."), 395. 
 C)f objection to dispoHal of insolvent's estate, 14o. 
 
 To be Herved on aHHignee, 146. 
 Of meeting of creditors to state purpose for winch meeting called, 120-277. 
 To consider composition and discharge, 174. 
 To be advertised in Oa-Mte, 174. 
 To be given creditors, 174. 
 Of application for confirmation of discharge, 178. I 
 
 How given, 178. 
 
 Form of. (Appendix " J.") 395-t5. 
 Of hearing application for discharge after objections made, 181. 
 Of application to Judge for discharge, 204. 
 
 Form of. (Appendix " L."), 39(5. 
 To be sent to each creditor by mail, 1'04. 
 Of dishonour must be given to insolvent indorser, 231-2- 
 Of completion of dividend sheet, 270. 
 
 Form of. (Appendix " O."), 398-9. 
 Of petition by insolvent for payment of balance, 27ii. 
 
 To be advertised, 275. 
 To creditors of reserved dividend, 272. 
 
 To be given by letter, 272. 
 To creditors pending delay, 275. 
 Of meeting of creditors, 275-7. 
 
 To be mailed to creditors ten days before such meeting, 275. 
 To be given by advertisement, 275. 
 Of petition, motion or rule, 284-5. 
 
 Of examination of debtor as to discharge from imprisonment, 300-1. 
 Of application for appeal, 304-5. 
 
 Preliminary of issue of writ to be given incorporated companies, 371-2. 
 Non-Resident Official Ahsignke— 
 Creditors may appoint, 138. 
 Nova Scotia- Tariff of fees in, 422. 
 Oath— Insolvent to be examined under, 123. 
 
 Supplementary may be required from creditors, 259. 
 Who may administer, 123, 280. 
 Claims of creditors to be attested under, 278. 
 Objection— To proposed disposal of estate, 146. 
 Judge to determine, 146. 
 
 To composition and discharge to be filed with assignee, 174. 
 To claims, 273. 
 
 How determined, 273. 
 To be filed in writing, 273. 
 Grounds of to be stated, 273. 
 Proceedings on, 273-4. 
 Offences— Against Act, how tried, 309. , 
 
 Officebs— Public, funds due from not aflfected by discharge, 201. 
 Of court official assignee to be, 133. 
 
 I 
 
402 
 
 THE INSOLVENT ACT. 
 
 Official .Vsmkjnf.e— Ovhiiitinn of, '22. 
 
 I.iHt ..f, 433. 
 
 liv whdiii appointeil, i;t2. 
 
 Writ iif nttiichiru'iit tn Ih' directed to, (12. • 
 
 AM,si^{IlItlL'TIt to Ihj iiiiide to. 75-7. 
 
 To wluit iiHsiviTit'c, 77-!'. 
 
 To seize i^tFtjctH of iuHolvunt, 74-5. 
 
 To ifive iiutiuu of issue of writ, 72. 
 
 I>iity of executing; writ, 74. 
 
 When and how to return writ, 72. 
 ' May niako forcible entry, 7"). 
 
 Deed of assi^Tinient to >ie made to, 7-">. 
 
 Wlieii none in county to whom uHMignment to }\e made, 7.'^. 
 
 What property vests in after a.ssii,'nment, H'), li .«(/. 
 
 Powers of as to jiroperty of inHolvent, 80-147. 
 
 To preside at meotinifs, 122. 
 
 To attest examination of insolvent, 123. 
 
 To ai)i)ly for examination of other i)arties, 128. 
 
 Api)ointment of, 1.32. 
 
 Nuinl)or to he a])pointed, 132. 
 
 To give security, 132. 
 
 To hold office durint; pleasure. 132. 
 
 F««lure by to pay over money, 132. 
 
 May be rerpiired to >.'ivi' over additional seuurity, 133. 
 
 Shall be officer of court, 133. 
 
 l!esi>onsil)ility of, 133. 
 
 Subject to jurisdiction of court, 1.33. 
 
 To continue assi^,'nee if none other appointed by creditorn, 135. 
 
 Transfer of estate of insolvent by, 143. 
 
 Ilights of action by, 148. 
 
 To keej) re>,'ister, l.'i4. 
 
 To open .separate account with ouch estate, 1.54. 
 
 Remuneration of when superseded, 1.50. 
 
 Death of, 158. 
 
 How estate shall vest after, 1.58. 
 
 .fudge may order to take examination of imprisoned debtor, 300-1. 
 
 To take down such examination, 300-1. 
 
 To transmit same to judge, 300-1. 
 
 Remuneration of, im such examination, ;<00-l. 
 
 May examine officers of incorporated companieg, .372-3. 
 
 Remuneration of, with resjiect to incorporated companies. 372-3. 
 Oi'Kic'iAi. Gazette— Definition of, 22. 
 
 Advertisements to be pulilished in, 275. 
 O.NTABio — Tariff of fees in, 418. 
 Oi'i'ortiTioNS. (See Objections). 
 Okhek- For substitutional service, 71. 
 
 How obtained, 71. 
 
 Sale of insolvent's estate, ^46. 
 
 Suspending insolvent's discharge, 189. 
 
 Authorizing creditor to take proceedings, 213. 
 
if 
 
 (iENEIlAI- LNDEX. 
 
 4(i3. 
 
 Ohukii < 'mil i mud, 
 
 ( I'. re-Hale on account of falHe bidilini,', 222-iS, 
 'I'd compel iiHHiKUt'e to purfonn HIh ihitiew, 'Mi. 
 I'or KiifoiciiiK cliiini iigHinut uHHijfnct', 2!W. 
 May 1)1' ohtained by HUinniary petition, 21)H, tl sfi/. 
 
 May be afipealed from, ;MM. 
 pAllTNEIi. (Heu AxMignee, Partliernhip and (!o- Partnership). 
 I'aktnkkm -BecominK insolvent, partnerMhip diHHolved, 154. 
 (Jannot prove aKaiuHt tirni, 22(!-7. 
 
 (Creditor holding security from one, for debt of firm, 251. 
 I 'roof anaiiiHt, 2(10-7. 
 I'AltTNKioHir. (See I'o-I'artnerHhip and AHsigtiee). 
 
 Meaning of words 'he,' 'him,' or 'his,' used in relation to, 20. 
 AHHit;nment by members, 82-:^. 
 Assignee of, also takes seitarate jiroiierty, 8H-4. 
 Deed of com])o»ition should provide for sejiarate creditofH, 164-6. 
 Dissolved by bankruptcy of any member, 154. 
 Members of, iirocuring goods or money fraudulently, :W2. 
 Pass 15oOK— What to contaui. (See bank), l.")S. 
 
 pAYMKNT of ))alance to Receiver-General, by assignee after discharge, 155, 
 Of dividends, '270-1. 
 
 liy debtors within thirty days of insolvency, 'Mo. 
 Amount paid may be recovered for the estate, M.'i. 
 Security given in consideration of such i)aynient to be restored, 345 
 What is valualile security, 'Ml. 
 What payments are null and void, Mf^-hO. 
 After attachment, 345. 
 Of money into court, 101. 
 1'i;nai/iv- For non-i)ayment of l)alance after discharge to Receiver-General, 1 
 For neglecting to distribute interest, 158. 
 Fr)r neglecting to provide bank i)asH book, 158. 
 For inaking false entry in bank pass book, 1,58. 
 l'"or neglect to present |)etition for discharge, 1.5lt. 
 Money payable as, not affected by discharge, 201. 
 ]<'or neglect to obey j udge's order, 293. 
 ( )f insolvent in caso of fraud, 352. 
 For taking a bribe for granting discharge, 369-70. 
 I'eksonal Estate— Vest in assignee under assignment, 85. 
 Peksonal— Wr<ing8, action for, not to vest in assignee, 98. 
 I«abour, actio\i for, insolvent may maintain, 98. 
 Petition- By insolven'oin answer to demand to assign, 56. 
 When made, 56-7. 
 By insolvent to set aside attachment, 114. 
 
 What to show, 56, 
 To be heard by judge summarily, .56. 
 Neither cretlitors nor assignee can present, 116. 
 For discharge to be presented by assignee, 158-9. 
 Notice to be given in8olvent, 158. 
 And inspectors or creditors, 158-9. 
 Bank certificates and statements to be filed with, 159. 
 
 -6. 
 
 5.5-6.. 
 
 I I' 
 
 U 
 ■if 
 
464 
 
 THE INSOLVENT ACT. 
 
 Petition— Co»/()M((;(V. 
 
 ■ By insolvent for discharge, 178-204. 
 
 By insolvent ior jiayment of balance, 275. 
 
 What notice of to be given, 284-.5. 
 
 Against assignee, 293. 
 Place— Of meetings, 120-144. 
 Pleading— Statement in, 286. 
 
 Setting np discharge under foreign bankruptcy law, 287. 
 Pleadings— Amendment of, 288. 
 Pledgee— Rights of, 10<!. 
 Policy— Of insurance, assignment of, in contemplation of insolvency, M'X 
 
 Will pass to assignee, 97. 
 POHTPONEMENT- Of examination. (See Examination), 123-4. 
 Po\VERH-Of official .assignee. (See Official Assignee). 
 
 Of judge. (See Judge, Order). 
 
 Of insolvent to vest in assigee, 86. 
 
 Of inspectors, 145. 
 Practice. (See Rules), 292. 
 Preference— By means of judgment by deiault, 34-6. 
 
 Fraudulent, may be ground for refusal of discharge, 182. 
 What constitutes, 187, 324-6, et seq. 
 Acts constituting, render contr.act void, 310. 
 
 What is imjust preference, 319, ct seq., 333, et seq- 
 Distinction between and fraudulent, 325. 
 
 Under what circumstances -will avoid a transaction, 317, et seq. 
 
 As an inducement to obtain discharge, 370. 
 PREFERENTiAii LiEN— (See Lien). 
 
 Preliminart — Notice of i-ssue of attachment to be given incorporated companies, 371. 
 Presumption— Of intent to defr.aud, 313-7, 321. 
 Pressure— Transactions under, by debtor, 319, et seq. 
 
 To what extent material, 319, et seq. 
 
 What constitutes, 326-7. 
 Pretence— False. (See Fraud, Intent). 
 Prevarication, &c.— Of insolvent, on examination, a ground of opposing discharge, 
 
 182. 
 Prince Edward Island— Tariff of fees in, 429. 
 Privilege — (See Lien and Rank). 
 
 For costs, 246-251. 
 Privileged Creditors — May require sale of property subject to their claim. (See 
 
 Creditors), 22.V 
 
 Probable cause, 313-4. 
 Proceddrb— Code of. (See Code). 
 
 Rules of, as to amendments of pleadings, 288. 
 
 At meeting of Creditors, 122. 
 
 In matters of, this Act to govern, 374-5. 
 
 Generally, 275, et seq. 
 Proceedings— Regulation of, 292-.3. 
 
 On appeal, 304, et seq. 
 
 In case of incorporated companies, 371 , et seq. 
 Procurino — Property to be seized, an act of bankruptcy, 33-6. 
 
 Prod 
 Proo 
 
 Prom 
 Proi'i 
 
 Proi'i 
 Prot 
 
 PUBIJ 
 PlBLI 
 
 PrNi> 
 
 PCRCP 
 
 QUAR 
 (.^UEBl 
 
 CJUESl 
 
 Rank 
 Keau 
 
 Reba' 
 
 Recq] 
 
GENERAL INDEX. 
 
 4G5 
 
 Production— Of ^ mk pass-book, 158. 
 Proof — Of party being assignee, 151. 
 For what amount, 238-9. 
 Necessary to entitle creditor to vote, 141, 
 Of debts, 226, et seq. 
 Of claims, 278-80. 
 
 By whom to be made, 278-280. 
 Must be debts, 235. 
 Form of 3!J!t. 
 
 Vouchers to be attached, 278. 
 Promi>;e— To ])ay debt barred by discliarge, 198-9. 
 Proi'kui V — In foreign country does not juiss to assignee, 97. 
 
 Vests in assignee under assignment or attachment, 85. 
 In what manner helil by assignee, 85. 
 Certain exempt from seizure under assignment, 85. 
 Held by insolvent as trustee not to vest in assignee, 85. 
 PRoroRTiON— Of creditors required to make allowance and discharge, 164-176. 
 Prothonotary— Affidavit of claimant to be filed with, 47. 
 To act in absence of Judge in certain cases, 292. 
 Powers and duties of, 292. 
 Public— Officer. (See Officer.) 
 Publication— Of notices, 275. 
 
 Punishment— In case of non-appearance of witness. (See Penalty), 285-6. 
 Of assignee for wilfully mis-stating, 306. 
 Of insolvent for misdemeanor, 367. 
 
 For receiving money and not handing it to assignee, 367. 
 Purchaser— Of claim after insolvency, rights of, 1.36-43. 
 Of goods on credit, 3.52. 
 
 Believing himself unable to pay, 352. 
 And fraudulently c(jncealing the fact, 352. 
 And not afterwards paying,, Diablo to imprisonment, 352-8. 
 What persons so liable, 3.52-5. 
 Averment of fraud cannot be pleaded to, 355. 
 Plaintiff must prove fraud charged, 358. 
 Of insolvent's debts may sue in his own name, 213-4. 
 
 Bill of sale to be evidence of such purchase, 213-4. 
 No warranty in favour of, 214. 
 Of real estate; ^^^nX and eciuitable estate to vest in, 220-2. 
 
 To have same rights as purchaser at sheriff's sale, 222. 
 
 QUARRYMAN— A tl'ader, 1. 
 
 Quebec — Rules of practice in, 409. 
 
 Tariff of fees in, 414-5. 
 (Questions — At meeting of creditoi-s, how determined, 276. 
 Rank and privilege of creditors not to be disturbed by Act, 245. 
 
 (See Claim, Privilege and Lien). 
 Real— Estate vests in assignee, 85. 
 
 Sale of. (See Sale, Advertisement, Purchaser), 220. 
 May be stayed , 274. 
 Rebate — Of interest, how to be calculated, 232. 
 Reconveyance— To insolvent. (See Deed of), 161, 191-2. 
 
 DD 
 
!^ 
 
 466 
 
 THE INSOLVENT ACT. 
 
 Hv.cOitvEWiiCE— Continued. 
 
 What description necessary in deed, liil. 
 Rkcusation— Of Judge and assijjnee, 291-2. 
 
 Refusal To appear on a rule or order, an act of bankruptcy, 30. 
 To obey rule or order for payment of debts, 30. 
 
 " decree of Court of Chancery, 30. 
 By insolvent to answer, &c. , a contempt of Court, 124-5. 
 Of parties to appear, &c. , on Judge's order, 128. 
 Of assignee to take certain proceedings, 213. 
 
 By officers of incorporated companies to furnish necessary information, a 
 contempt of Court, 371-2. 
 Registeu— To be kept by assignees, 154. 
 What to contain, 154. 
 To be open to public inspection, 154. 
 
 To be depo.sited in office of official assignee for county by nim-otfici.il a-isitrnee, 
 154. 
 Registration — Of copy of writ of attachment, 117. 
 Deed of assignment, 117. 
 
 In Province of Quebec, 117. 
 Priority of, 101. 
 Of marriage contract, 300. 
 Remaining — Out of Province an act of bankruptcy, 30. 
 Remedies — Against assignee, how obtained, 293. 
 Removal — Of property with intent to defraud creilitors an act of ))ankruptcy, 31. 
 
 Of assignee, 130-9. 
 Heml'NEUAtion— Of assignee, 150. 
 
 Official assignee, when superseded, 150. 
 
 To be first charge on the estate, 1.50. 
 With respect to incorporated companies, 371-2, 
 Of receiver with respect to incori>orated comjianies, 371-2. 
 Rent -Lien for arrears cjf, limited, 217-8. 
 
 Of landlord for, 217. 
 Repe.-.l— Of Acts, 374. 
 Replevin — Against assignee, 296. 
 
 Report — On return of writ of attachment by official assignee, 74. 
 Of assignee as to leasehold property, 214-5. 
 
 " " conduct of insolvent may be re<iuired, 205-7, 
 
 Representative— Of creditor when allowed to vote, lL'6-141, 
 
 Of deceased insolvent may continue proceedings, 289. 
 How far liable, 289. 
 Reputed — Ownership clause, not in force here, 80-7. 
 Resolution — Copy of, api)ointing assignee to be filed, 136. 
 
 Of opposing sections of creditors to be submitted to Judge, 270. 
 At meeting of creditors of incorporated companies to be submitted to Judge, 
 371-2. 
 Respondent to an appeal may recover costs if appeal not prosecuted, 304-5. 
 Retention — Of leasehold property for use of the estate, 210. 
 By debtor of portionjof his effects, 182-3. 
 By creditor of property held as security, 251. 
 Retrospective— -Act is, 20-2. 
 
 
 Sai 
 
 Sen 
 
 Sec 
 
 Dt>. 
 
 Seci 
 
ation, a. 
 
 ■isii;iiee. 
 
 ;}i. 
 
 o Judge, 
 
 GENKRAL INDEX. 
 
 Return— Of writ of attachment, 72. 
 How made, 72. 
 Writ of execution, 274. 
 Revision. (See Appeal), 304. 
 Rules— Of construction, 6-10. 
 
 Of practice in Province of (Quebec, 292, 401t-12. 
 
 To be settled by Judge in other Provinces, 21)2-;i 
 Present to remain in force until altered, 293. 
 Salaut. (See Clerks). 
 Sale— Of debts, 212-13. 
 
 May be made liy assignee, 212. 
 With consent of creditors or inspector, 212. 
 At public auction, 212. 
 
 After advertisement. (See List Debts), 212. 
 Amounting to more than .?100, 212. 
 By Sheriff in (iuebec, 222-3. 
 
 May be made l)y assignee, 14G. 
 May be made en bloc, 147. 
 Not to prejudice privileged claims, 147. 
 Of leases held by insolvent, 214-5. 
 
 Subject to payment of rent, 214-,5. 
 Real estate, 220. 
 
 Assignee may sell, 220. 
 After due advertisement, 220. 
 May be postponed, 220. 
 Rights of purchaser. (See Title), 222. 
 Deed of, 222-397. 
 Real estate, in process of, 274. 
 Sale ok Real Estate— In Quebec, 220-3. 
 
 Subject to charges and hypothecs, 223. 
 Time of payment of charges, not to be extended by, 223 
 Commission of assignee on, 223. 
 Privileged creditor may obtain, 225. 
 Liable to percentage in aid of building fund, 37. 
 Preferential when presumed fraudulent, 317, et seq. 
 ScHEDiLK -To effect discharge claim must be inserted, 193-96. 
 
 False, 367. 
 Secuetixi;— Effects an act of bankruptcy, 31. 
 «I'CUKEI) (•LAIM— Proceedings on filing of. (See Claim), 251. 
 C>iiv.'UREn Creditob— May issue attachment, 62. 
 May set aside assignment, 76. 
 May jsrove as unsecured, 280-1. 
 Security— Given by official assignee, 132. 
 
 How to he recovered, 132-3. 
 T<i whom to be given, 132-3. 
 Additional maybe dtnnanded by creditors, 13. 
 Directions as to be given by creditors, 133. 
 Creditors holding not to be prejudiced by sale en bloc, 147. 
 Creditors holding, 251. 
 
 Comsisting of negotiable instruments, 251. 
 
 467 
 
468 
 
 THE INSOLVENT ACT, 
 
 Security— Continued. 
 
 ConsiHting of mortgages on real estate or shipping, 258. 
 
 Surrender of by creditors to assignee, 280-1, 
 
 Creditor may value same and rank as ordinary creditor for balance alxivt,' such 
 valuation, 281. 
 
 On prosecution of ajipeal to be given by appellant, 304-5. 
 
 Not affected by discharge without consent of creditors, 199. 
 
 For costs to be given by insolvent, 148-53. 
 Seduction —Damages for, 201. 
 Seizure. (See Execution). 
 
 Of effects, conniving at by debtor an act of bankruptcy, 33. 
 
 Under execution after appointjnent of assignee, 246, et s&i, 
 
 Property under, at time of commencement of proceeding-^, 27 1. 
 Servants. (See Clerks). 
 Servicb— Of papers by debtor after demand to assign, how effected, 47. 
 
 Of writ of attachment, 71. 
 
 Of objections to claims, 273-4. 
 
 If defendant has uo domicile or absconds, 71. 
 
 Of papers under this Act, 284. 
 
 Of process, 28.5. 
 Set-off— How allowed, 281. 
 
 Nature of claims which may be set off, 281-4. 
 
 Transfer of debts due by insolvent to his debtor to enal)le him to .^.t.-ulf, 
 350-1. 
 Sheriff— Fees of, to be settled by judges, 292-3. 
 
 May be ordered to bring in debtor for examination, 300-1. 
 
 To retain sums raised for building fund. (See Building Fund), ^i71 
 Ships — And shiijping, mortgage upon. (See Mortgage, Security), 258. 
 Slander— Damages for, 201. 
 Solicitor— Lien of, for costs, 157. 
 Specific Purpose— Property held for, 89. 
 
 Statement — Exhibiting of, by debtor, showing inability to meet liabilities, ,iii act .if 
 bankruptcy, 20. 
 
 Of affairs to be furnished by insolvent, 110. 
 What to show, 110. 
 To be attested by insolvent, 123. 
 
 Of assignee to be filed with petition for discharge, 159. 
 Contents of, 159. 
 
 To be prepared by assignee periodically, 225. 
 Constantly accessible to creditors, 225. 
 
 When assignee to prepare, 225, 
 
 Of pleadings, how made and construed, 286. 
 Stoppage- Of goods in transitu, 61. 
 SUBPffiNA — To witness, 285. 
 
 How served, 285. 
 
 Punishment for disobeying, 285-6. 
 Substitutional — Service, order for, how obtained, 71. 
 SuM.MARY— Jurisdiction. (See Jurisdiction). 
 
 Petition. (See Petition). 
 Surety — How affected by discharge without composition, 199. 
 
GENERAL INDEX. 
 
 Surety— Continued. 
 
 May prove, 228. 
 
 Paying debts of insolvent to take place of creditor, 228-9. 
 Insolvent indorser, notice of dishonor to, 231-2. 
 To give security in case of appeal, 304-5. 
 Insolvent recklessly becoming, 189. 
 SUBRENDER— Of security by creditor of, 251. 
 
 Effect of, 251. 
 Suspension— Of discharge of insolvent, 189. 
 Tariff— Of fees, costs to be taxed according to, 292-3. 
 In Province of Quebec, 292, 414-6. 
 In Ontario, 419-22. 
 In Nova Scotia, 422-5. 
 In New Brunswick, 425-8. 
 In Prince Edward Island, i'^j-M. 
 How settled in other Provinces, 292-3. 
 Time— T(i present petition against demand, 57-8, 69-70. 
 For commencing proceedings limited, 60. 
 For issuing attachment, 69-70. 
 For return of writ, 72. 
 
 For gii'ing notice of first meeting of creditors, 122. 
 Of Act taking effect, 2. 
 Petition to set aside writ, 114. 
 Title— Conveyed by assignee, 222. 
 
 Of Act, 376. 
 Traders— Act to apply to, 1. 
 Who are, 1, 14-19. 
 
 As to persons having been, how Act to apply to, 2. 
 Marriage contracts of, 300. 
 Traiiing— What constitutes, 1, et seq. 
 
 Transfer— Of estate of insolvent by official assignee to assignee, 143. 
 Of property by debtor with intent to defraud, 317. 
 Of a debt due by insolvent for set-off, 350-1, 
 Transiti:— Stoppage of goods in, 245. 
 
 Vendor's lien, ceases when right to stop gone, 245-6. 
 Trover— Action of, in case of fraudulent conveyance, 342-3. 
 Trust— Property does not pass to assignee, 88. 
 TniTCTEE— Liability to bankruptcy. (Sen Officers), 13. 
 
 Property held by insolvent as, not to vest in assignee, 85. 
 As to trust funds, not affected by discharge, 201. 
 Tutor. (See Trustee). 
 
 Unjust— Preference. (See Fraud, Preference). 
 Vacancy— In oflUce of official assignee, 158. 
 Valuation— Of security held by creditors, 251. 
 Vendors— Lien, good against assignee, 100. 
 
 Ceases in Quebec, 245. 
 Vexatious— Demand to assign, effect of, (See Demand), 56. 
 Voluntary— Assignment. (See Assignment). 
 
 Payment made by debtor, 345. 
 Vote— No claim to have more than one, 136. 
 
 469 
 
470 
 
 THE INSOLVENT ACT. 
 
 Voting— Manner of, 140. 
 
 liights of creditors as to, 2(5. 
 VorcHEKis — To acuonii)any jn-oof of claim, 278. 
 Warrant— Service of, 285. 
 
 Warranty— Of debts not created by bill of sale, 213. 
 Wages- Lien for. (See Lien, Clerk). 
 Wife— Of insolvent, examination of, 128-9. 
 
 May prove against her husband's estate, '2'M. 
 Will — Interests under, pass to assignee, 06. 
 Withholding Books— A misdemeanor, 307. 
 WiTNE.ss — Not obliged to testify luitil expenses paid, 12H-'.i. 
 
 What questions may be put to, 130. 
 
 Being creditor, cannot refuse to testify, 12'J. 
 
 (/'ommission may issue to examine, 285. 
 
 May be summoned by sul)iin'na, 285, 
 
 May be compelled to appear, 285-0. 
 
 Punishment of, for non-appearance, 283-0. 
 
 Expenses must be tendered to, 280. 
 
 May be examined on petition for discharge, 301. 
 Writ of Attachment. (See Attachment), 02. 
 Wrongs — Personal action for not to vest in as.-<iguee, '.t8. 
 
ADDE^^DA. 
 
 A DEFENDANT in an action who assigns under the Insolvent 
 Act, may still carry on the proceedings in his own name, and 
 may procure a dismissal of the plaintiff's action. The only effect 
 of the assignment is, that he may be called upon to give secui-ity 
 for costs, under the 39th section of the Act (Morin v. Henderson, 
 21 L. C. J. 83 ; see pages 14:)-51). 
 
 In the Province of Quebec, an appeal under the 128th section 
 of the Act lies only in the case of final judgment {MacKny v. 
 Ht. Lmvrenee S. F. Co., 21 L. C. J. 76 ; see pages 305-G). 
 
 In proving a claim, sums received by the claimant on account 
 of the claim before proof, must be deducted from the claim ; but 
 sums received after proof need not be deducted, provided the 
 claimant does not receive, in all, more than one hundred cents on 
 the dollai'. Thus, the holder of negotiable paper, the maker and 
 indorser of which have both become insolvent, and who has re- 
 ceived a dividend from one of them before proving his claim 
 against the other, cannot prove his claim against the estate of the 
 other foi' the full amount mentioned in the paper, on the con- 
 trary, he must deduct the amount of the dividend received from 
 the estate of the other party. But, if after proof dividends are 
 received from the estate of another party, the creditor is. never- 
 theless, entitled to dividends upon the whole amount proved, pro- 
 vided the dividends do not exceed one hundred cents on the 
 dollar on the balance really due (re Rochette, 3 Quebec Law Reps. 
 97 : see also pages 238-9).