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 THE LIBRARY 
 OF 
 
 THE UNIVERSITY 
 
 OF CALIFORNIA 
 
 LOS ANGELES
 
 /rh /« 7 pi ■ 
 
 
 A' -r. A 
 
 tj^^ 
 
 <t 

 
 THE 
 
 INSOLVENT ACT OF 1864, 
 
 W^ITH NOTES 
 
 TOGETHER WITH 
 
 rHE RULES OF PKACTICE 
 
 AMO 
 
 THE TARIFF OF FEES FOR LOWER CANADA 
 
 THE HONORABLE J. J. C. ABBOTT, Q. C, M. P. P. 
 
 m==- 
 
 PRINTED BY GEORGE DESBARATS AND MALCOLM CAMERON 
 Printer to the Queen's Most Excellent Majesty. * 
 
 1864.
 
 l9^ 
 
 WQr 
 
 TO THE HONORABLE 
 
 MR JUSTICE MEREDITH, 
 
 THIS LITTLE MANUAL 13 RESPECTFULLY INSCRIBED 
 
 TW ONE WHO WAS FORMERLY HIS STUDENT, 
 
 IN GRATEFUL REMEMBRANCE OF JIANY KINDNESSES. 
 
 ^' ^ ^
 
 PREFACE. 
 
 There has been for some years past an urgent demand in 
 Canada, for a law creating a summary mode of realizing and dis- 
 tributing the estates of Insolvents, and of affording relief from 
 liability, to debtors making a full disclosure and delivery of their 
 estates to their Creditors. The absence of such a law, left to the 
 failing debtor no chance of success in any future enterprise, unless 
 he could succeed in the almost hopeless task, of procuring a dis- 
 charge from every one of his creditors. 
 
 Thus many such were tempted to secure their remaining 
 assets by dishonest devices, rather than leave themselves destitute 
 by resigning them to their Creditors. 
 
 Whether the present law will reach the evils that have acquired 
 such considerable proportions, or afford that relief to unfortunate 
 debtors which they are entitled to in other commercial countries, 
 remains to be seen. And however successful it may prove 
 to be, there will doubtless be many particulars in which amend- 
 ments to it will be required, to enable it to be v/orked effectually 
 as to the objects sought to be attained by it, and harmoniously as 
 regards the existing laws of the two provinces. 
 
 Having always felt a strong interest in the improvement of our 
 commercial law, and given some attention to the subject of Bank- 
 rupt Laws generally and to the present Act in particular, I have 
 naturally been desirous that the Insolvent Act of 1864 should 
 receive a fair trial. And the more so that it embodies the idea I 
 have always entertained that we should engraft upon our existing 
 systems of law, such further proce4]iirc as may be required to 
 expropriate and distribute the effects of an insolvent, and to dis- 
 charge him from liability ; rather than to create new and separate 
 tribunals and proceedings for those purposes only. 
 
 I have therefore thrown together the notes to be found in this little 
 volume, in the hope that they may servo to facilitate the applica- 
 tion and use of the new statute. In preparing them I have seldom
 
 PREFACE. 
 
 ventured to offer an opinion upon the construction of clauses of 
 doubtful meaning. I have confined myself chiefly to the attempt 
 1o point out the relations between different portions of the Act, 
 and their bearing upon each other — and to indicate where, in the 
 English, French, and Scotch, Bankrupt Laws, and in the leading 
 works upon them, analogous provisions and decisions may be 
 found. Before long the light aflbrded by judicial decisions upon 
 its clauses, will render the path of the commentator more easy and 
 more safe. In the meantime, however, I trust that the materials 
 collected in the following pages may be found not to be without 
 value, in the investigation of the true scope and meaning of the 
 Act. And although I feel that after the expenditure of considerable 
 labor I have achieved but little ; I venture to hope, that the little I 
 have been able to do, may prove in some degree useful and 
 acceptable. 
 
 J. J. C. Abbott. 
 Montreal) October, 186 1.
 
 LIST OF BOOKS CITED, "WITH THE ABBREVIATIONS USED. 
 
 EDITJONS. 
 
 Jousee, — Nouveau Commentaire sur I'Ordonuance de Commerce 1782 
 
 Locre, — Esprit du Code de Commerce Paris. 1829 
 
 Pardessus, — Cours de Droit Commercial <' 1831 
 
 Archbold, — The Law and Practice of Bankruptcy 1856 
 
 Lord Raymond's Reports . . . . — ,. . 
 
 Smith's Mercantile Law 
 
 Savary, — Le Parfait Negociant et Pareres 1713 
 
 Vincens, — Legislation Commerciale 1833 
 
 Orillard, — De la competence et de la procedure des Tribunaux de 
 
 Commerce 1855 
 
 Toubeau, — Les Institutes du Droit Consulaire. 1700 
 
 Becane, sur Jousse, Commentaire do I'Ordonnanco de 1673. 
 
 Merlin, — Repertoire de Droit 
 
 Pyke's Reports 
 
 Salle, — Esprit des Ordonnances de Louis XIV ; 
 
 Rogue, — Jurisprudence Consulaire . ■ .. 1773 
 
 Nicodeme, — Exercice dea Commer§ants 
 
 Masse, — Le Droit Commercial, etc 1861-2 
 
 Boulay Paty, — Des Faillites et Banqueroutes 1828 
 
 Bonnin, — Commentaire de la Legislation Commerciale 1845 
 
 Rose's Reports . .... 
 
 Dalloz, (A.) — Dictionnaire 
 
 Denizart, — Collection de Decisions de, par LeCamus 
 
 Bornier, — Conference des Ordonnances de Louis XIV, etc 1745 
 
 Carre, — De I'Organization Ju'diciaire 1833-1839 
 
 De Villeueuve et Masse, — Dictionnaire des Contentieux Commercial. 
 
 Eden's Bankrupt Law 
 
 Cooke's Bankrupt Law 
 
 Stuart's Lower Canada Reports 
 
 Murdoch, — Manual of the law of Bankruptcy and Insolvency, (Scott- 
 land) . . 
 
 La Coutume de Paris , . 
 
 Bedarride, — Des Faillites et Banqueroutes .... 
 
 Griffith,— On the Bankruptcy Act of 1861 
 
 Scott's Reports 
 
 Le Code de Commerce 
 
 Renouard, — Des Faillites ct Banqueroutes Bruxclles. 1851 
 
 Bedarride, — Du Dol et de la Fraude - . 
 
 Hereon, — Questions sur le Code de Commerce 
 
 Chardon, — Du Dol et de la Fraude 
 
 Draft of Canadian Civil Code 
 
 Toullier, — Droit Civil Frangais 
 
 Domat, — Loix Civiles 
 
 Pothier, — Traite des Obligations 
 
 Kinnear, — On the Law of Bankruptcy, (Scotland) 
 
 Bells commentaries on the law of Scoltland, 6th Ed. : .. ... 
 
 Story on partnership 
 
 Roscoo's Criminal Evidence w 1862 
 
 Bennet and Heard's leading Criminal cases 
 
 Story, — On Conflict of Laws 
 
 Cormier,— Code Henri Quatre 1615 
 
 Burrow's Reports Burr 
 
 Durnford and East's Reports T. Rep 
 
 Blackstone Reports. Blk 
 
 1288056
 
 VlJl LIST OF BOOKS CITED. 
 
 EDITIONS. 
 
 Doria and Macrae, — The Law and Practice of Bank- 
 ruptcy D. & M 1863 
 
 Denisart, — Collection de Decisions Anc. Den 
 
 Broderip and Bingham's Reports Brod. & Bing — 
 
 Taunton's Reports Taunt 
 
 Modem Reports Mod 
 
 Comyn's Digest Cora. Dig 
 
 Lower Canada Reports L. C. Rep 
 
 The Lower Canada Jurist L. C. Jur 
 
 LaLoidu28 Mai, 1838 C. Com 
 
 The Bankruptcy (Scotland) Act 1856 S. Act 
 
 The Bankruptcy Act 1861 (England) 24 & 25 Vict. 
 
 cap. 134 E. Act 
 
 The Consolidated Statutes of Lower Canada Cons. Stat. L. C. 
 
 The Consolidated Statutes of Canada Cons. Stat. Can. 
 
 Meeson & Welsby's Reports M. & W 
 
 Barnwell and Cresswell'.s Reports B. & C 
 
 Bingham's Reports Bing 
 
 Louisiana Reports Louis 
 
 Denison's Crown cases Den. C. C
 
 THE 
 
 INSOLVENT ACT 
 
 OF 1864. 
 
 An Act respecting Insolvency. 
 
 "HERE AS it is expedient that provision be made for the Preamble, 
 settlement of the estates of insolvent debtors, for giving 
 effect to arrangements between them and their creditors, and 
 for the punishment of fraud : Therefore, Her Majesty, by and 
 with the advice and consent of the Legislative Council and 
 Assembly of Canada, enacts as follows : 
 
 1. This Act shall apply in Lower Canada to traders only, Application of 
 and in Upper Canada to all persons whether traders or non- *^^^ ^^^' 
 traders. 
 
 1, By this section the operation of ihe Statute is limited in Lower Canada 
 to traders. 
 
 In the legislation of France the test of the competency of a commercial 
 Tribunal has sometimes consisted in the nature of the transaction trought 
 before it, while at others, to give it jurisdiction, not only the transaction but 
 the persons engaged in it were required to have a commercial character. 
 The Leitres Patentes issued by Philip de Valois creating a commercial 
 Tribunal in Brie and Champagne ; the Edict of Charles VII establishing 
 the Conservateurs de Lyon in 1419 ; the Ordinance of Henry II in 1549 
 authorizing the election of Consular Judges in Toulouse ; the Edict of No- 
 vember, 1563, afterwards peremptorily enforced by declaratory Edicts in 
 1565 and 1611 ; with numerous others of a similar character, all require in 
 general, that a transaction to be cognisable by the commercial Tribunals, 
 should not only be in itself a commercial act, but should have taken place 
 between persons engaged in commerce. 
 
 The Ordinance of 1673 follows the same system — Ord. 1673, tit. XII, arts. 
 2 to 10, Jousse, Ord. 1673, pp. 184 and seq. But the modern Code de Com- 
 merce appears sometimes to render the nature of the transaction the prin- 
 cipal test of the jurisdiction of the tribunal.— Arts. 631, 636, 637, 638. 
 
 The jurisdiction created by the previous legislation may therefore be 
 called personal, from the fact that the quality of the person was essential to
 
 AVHO IS A TRADER. 
 
 its existence ; in contradistinction to tiiat established by the Code de Com- 
 merce, which is susceptible of being sustained in some cases by the com- 
 mercial character of the person, without reference to the transaction ; and in 
 others, by the commercial character of the transaction, independently of the 
 persons engaged in it. The latter jurisdiction may therefore be considered 
 at once personal and real ; personal, because the quality of a trader creates a 
 presumption that his contracts are connected with his trade, leaving him 
 to establish the contrary, while the contracts of a non trader are presumed 
 to follow his quality, unless they are essentially of a commercial character ; 
 and real, because he who enters into a contract which tlie law recognizes as 
 essentially commercial, becomes in respect of that contract, amenable to the 
 commercial Tribunals, whatever may be his quality. 4 Locre, pp. 93 and 
 .seq. ; 1 Pardessus. pp. 69 and seq., I\os. 48 and seq. ; 5 Pardessus, pp. 12 
 and seq., Nos. 1345 and seq. 
 
 Tn England there have not been of late any tribunals created for the regu- 
 lation of commercial matters solely. But an exceptional jurisdiction fof 
 bankrupts has long existed there, which was purely commercial, inasmuch 
 as until lately only traders could become bankrupt. But while the tribunal 
 was commercial, its jurisdiction was personal, for the character of the debt 
 upon which a creditor might l:)ase proceedings in bankruptcy, appears to= 
 have been held to be of no importance, even while the operation of the 
 Statutes of Bankruptcy was limited to traders. Archbold, on Bankruptcy^ 
 p. 87, and the cases there cited. 
 
 The intention of this Act appears to be like that of the English Statute, 
 to create a species of jurisdiction purely personal. 
 
 There is no limitation of its application to debts of a commercial character — 
 but only in Low^er Canada — and as respects one mode of proceeding, in 
 Upper Canada — to persons who are traders ; — the nature of the debts, upon 
 which proceedings may be adopted under it, being in most cases a matter 
 of indifference. The jurisdiction it creates is therefore purely personal. 
 
 But though the operation of the Statute is thus restricted, it contains no 
 definition of the term used to describe the class of persons who are made 
 specially subject to its provisions. 
 
 The question, who is a trader ? becomes therefore of the utmost impor- 
 tance in every case in Lower Canada, and in many cases in Upper Canada. 
 And the replies to it must be based upon the different laws which prevail 
 respectively in these two sections ofthe province. 
 
 With regard to Upper Canada, which receives from England the basis of 
 its system of law, it may be remarked that the question under consideratiori 
 appears generally to have been examined in the mother country as an 
 incident to the operation ofthe Bankrupt laws, and it is therefore chiefly with 
 reference to the law^ of bankruptcy that the word " trader" has acquired a 
 distinct and precise legal signification in England. 
 
 The earlier English statutes, though they did not use the word " trader", 
 attempted a definition or description of the persons who might fall within 
 the operation of their provisions. Thus, the 13 Eliz., cap. 7; 1 Jac. I, cap. 
 15, and the 21 Jac. I, cap. 19, provided that every one who used the trade 
 of merchandise by bargaining, &c., or sought his living by buying and 
 selling, was liable to become bankrupt. And a person was held to be 
 included within this definition though he did not sell the wares that ha 
 bought, but converted them into saleable commodities which he afterwards 
 sold. In other words an artisan who purchased materials to be used in 
 makimr articles for sale was held to be whhin the statute. Ld. Raymond, 
 741 ; 4 Burr., 2148. 
 
 _ But it was also held that to bring a person within these statutes his prin- 
 cipal means of living must have been gained, or at least sought to be gained 
 by some occupation which fell within their purview. 1 T. Rep. 573, 2 
 Elk., 476. 
 
 The 12 and 14 Car. II, cap. 2), is the first statute in which the word 
 " trader" is used. But the 6 Geo. IV, cap. 16, and subsequent Bankruptcy 
 statutes adopt it as a term in use and well understood ; and in the jurispru- 
 dence which commenced to grow up under the early statutes aad has
 
 WHO IS A TRADER. 
 
 continued to prevail to the present day, it is used as a generic term des- 
 criptive of tlie class of persons liable to become bankrupt. 
 
 The recent English statutes, commencing with the 6 Geo. IV, cap. 16, 
 contain a specific list or denomination of the persons liable as traders to be 
 made bankrupt ; a sweeping clause bringing within their provision.? all 
 persons previouslyliable as traders to the Bankrupt law.s ; and a description 
 or definition, in general terms, very similar to those of the older statutes, of 
 the kind ot occupation which made persons so liable, 'i'he distinction 
 between the persons to whom the specific denominations are applicable, 
 and those only falling within the general description of classes, is this : that 
 the former come within the Act, however little business they may transact 
 in that capacity ; but the other classes only come within it, if their busi- 
 ress holds a prominent position in their avowed or actual means of living. 
 1 Doria & Macrae, on Bankruptcy, p. 84. 1 he definition of trading, which 
 is given by the statutes of Elizabeth and James is therefore still correct so 
 far as it goes : and a very considerable number of cases illustrative of its 
 bearing — and of the distinctions which have arL^eu upon it, and upon sub- 
 sequent, but similar legislation, are collected in 1 Doria & Macrae, pp. ICO 
 and seq.; and in j^rchbold on Bankrjjptciy, pp. 39, 40. The doctrine on this 
 subject is thus summed up by the former at p. 100. Assuming that the 
 occupation under consideration is in itself of the nature of trade — they say 
 that, •' to constitute a trading in law, there must be a substantive and 
 " independent trading ; a general intention to trade," (or rather an intention 
 to trade generally) ; " and a trading as the means of gaining a livelihood." 
 
 This of course only applies to the general definition or description of a 
 trader or person subject to become bankrupt, enacted in the earlier statutes 
 of Bankruptcy and retained in the more recent ones, and not to the specific 
 denominations which are also detailed in the latter ; and it is in accordance 
 with the idea conveyed by the word " tradei" in its ordinary acceptation. 
 While these specific denominations therefore may not fall within the pro- 
 visions of this Act, except in so far as their characteristics may satisfy that 
 general definition or description, there would seem to be no good reason 
 why those and all other cases which do so satisfy it, should not, in Upper 
 Canada, be held to be within this statute. And if so, the thorough 
 examination which the subject^has received in England, fir.st upon the 
 definitions contained in the Statutes of Elizabeth and James, and afterwards 
 upon the portion of the more recent Statutes in vi^hich that definition is 
 retained ; and the multitude of adjudged cases settling every point upon 
 which difficulty could arise, will probably render it easy in Upper Canada 
 to distinguish between traders and non-traders whenever the statute requires 
 such distinction to be made. And it may be well in this connection to 
 notice the opinion of Mr. Smith, (Mer. Law, p. 1), that the word " trader" 
 would receive in general a somewhat wider construction than the Bank- 
 rupt Statutes seem to justify, if it be used without reference to those statutes. 
 
 In France no definitions of the various terms used to describe the class of 
 persons subject to Consular jurisdiction, are to be found in the older legislation. 
 And moreover there was not formerly any phrase or word like the word 
 " trader" in England, universally adopted as descriptive of that class, or as 
 comprising within its technical meaning the various trades or occupations 
 which made those who practised them amenable to the Commercial 
 Tribunals. But a short examination of the powers of some of the most 
 important of those Courts, will enable a tolerably exact idea to be attained, 
 of tlie quality of the persons, and the nature of the transactions subjected to 
 their jurisdiction. And thus the quaiuy of the persons whom the law of 
 Lower Canada would regard as being comprised wuhin the designation of 
 traders may also evostually be arrived at. 
 
 The famous tribunal of the Co7Jserva(eurs de Lyon, is said \o have heen 
 the model upon which the Consular Courts were afterwards formed. The 
 jurisdiction of this tribunal seems to have been extensive, and to comprise 
 the riglit of trying all causes of which the subject matter was of a com- 
 mercial character, provided the parties, or as it would appear by the 
 declaration of 1669, one of the parties was a ** marchand ou nesrociant." — 
 1*
 
 WHO IS A TRADER. 
 
 (See Edit of Charles VII, 1419, and the subsequent declaration of August, 
 1699, post.) 
 
 The Ord. of Henri fl, 1649, authorizing the merchants of Toulouse to 
 elect a prior and two consuls, gave to the tribunal so created, jurisdiction to 
 decide all cat*es which might arise, " pour raison de marchandises, foire* 
 *< et assurances entre les viarchands et fabricants de Toulouse.^' 
 
 The Ord. of 1563, Art. 6, gives to juges consuls jiirisiliction, "pour con- 
 naitre des marchands, et de tous proces et differends qui seront ci-apres mm 
 entre marchands et pour fait de marchandises seulenient, leurs veuves mar- 
 chandes publiques, lenrs Jacteurs, serviteurs et commetlants, tous mar- 
 chands.^^ These expressions would seem to limit the consular power to a 
 comparatively small class of those pert^ons who are certainly traders — but 
 the remainder of the article shews plainly that such was not the intention 
 of the law. For it >ioes on to ^ay : soit que les differends proccdent d'obli- 
 gat.ons, cedules, recepisses, lettres de change ou de credit, repom^es, assu- 
 rances, transports de dettes et novations d-iceUes, calculs ou errturs en iceu.T, 
 compagnics, socicles ou associations dejd faites, ou qui seferont ci-apres. 
 Tliis description of the transactions which may be comprised within the 
 phrase, pour fait de marchamhses, shews that the won! marchandj and 
 marchandises have in this Ordinance a wider signification than that which 
 belongs to the words merchants and merchandise — and that as therein used, 
 the word marchand approximates closely to the word commer^ant — which 
 afterwards came into use as a generic term comprising all kinds of persons 
 engaged in trade, and subjected by reason of their quality to the jurisdiction 
 of the commercial Tribunals. And this interpretation of ilrese phrases may 
 be fully sustained by authority. Jcusse sur I'Ord. de 1673, tit. l,_art. 6, — 
 tit. 12, art. 1 ; 1 Savary part", neg., p. 214 ; 1 Pardessus, pp. Set seq., 
 Nos. 8 et seq. ; 1 Vincent, 127 ; Orillard, No. 121. 
 
 And the phrase ^Jour fait de. marchandises used in the sense in which it 
 appears in the Ord. of 1563, seems to have been'of frequent occurrence in 
 the official documents creating c; definingthe powers of Commercial Courts, 
 by whatever name they might be called. (See the various Kdicts, Ordi- 
 nances and Declarations on this subject — most of which are referred to ia 
 1 ToLibeaii, Liv. 1, Tit. XIII.) 
 
 A Declaration of the Sth August, 1572, %iade with reference to the town 
 of Tours, &c., uses nearly the same form of expression as the Ordinance of 
 1563. 
 
 Again, by a Declaration of the 29th March, 1623, having reference to 
 consular jurisdiction generall)', it was ordered que tous marchands, voituriers, 
 ncgociateurs, proccderont par-devant les Juges et consuls. 
 
 By an Pallet of the 13th August, 1669, passed for the purpose of settling 
 difficulties as to conflicting jurisdictions which had arisen between the 
 ordinary and Commercial Tribunals at Lyons, it was declared with reference 
 to ihe Con servateur, or Prevot des Marchands: qu'il connaltra de ioutes 
 Claires entre marchands et ncgocianis en gros et en detail, manufacturiers 
 des choses servant au negoce et autres de quelle qualite et condition quHls 
 soient, pourcu que Vune des parties snit marchand ou negociant, et (pie ce soit 
 pour fait de negoce, merchandise ou manufacture. And by the same Edict, 
 those, amongst others, who sell merchandise, or buy it to sell again, are 
 declared amenable to the jurisdiction of the Conservateurs. 
 
 In the famous Ord. of 1673, there is a greater amplitude of detail as to the 
 persons amenable to the Consular tribunals, than is to be found in any of 
 the earlier acts of legislation taken separately — but in reality it merely 
 embodies what may be gathered from the whole of the previous actes, 
 declarations and ordonnanccs taken together. Unity of purpose is percep- 
 tible enough running- through the various oflicial documents relating to the 
 commercial jurisdiction, extracts from some of which have been cited, 
 though the mode of expressing that purpose is different in many of them, 
 and defective in nearly all. The Ord. of 1673 therefore was made'to convey 
 what was no doubt the intention of all, though somewhat more than was 
 expressed in any one of the legislative or quasi legislative acts which 
 preceded it. And it has been considered to be explanatory of the Ordinance
 
 WHO IS A TRADER. S 
 
 of 1563, and declaratory in most respects of the law as it existed at the time 
 of its passage. 
 
 By this ordinance the juges consu/s were empowered to take cognizance 
 of all Bills of Exchange and sales of merchandise, between marchands et 
 negociants ; commissions and charges of commercial agents connected with' 
 traffic ; insurances and other contracts connected with maritime trade ; and 
 also sales made to artisans et gens de metier of merchandise to be sold 
 again, or to be used in their trade. It would appear that bankers also were 
 subject to the same jurisdiction. And as it has been shewn that these 
 tribunals were purely commercial, only taking cognizance of commercial 
 transactions ; it may be said that the sanction of the law is plainly given 
 for describing the species of transactions referred to in the articles ci|ed from 
 the Ord. of 1673, as ades de commerce, or, as our Ordinance (25 Geo. Ill, 
 cap. 2,) terms them, " Commercial Matters :" and that those who enter into 
 such transactions; habitually or in the language of the English Statutes 
 "seek their living " by so doing, may without impropriety be styled co?rt- 
 mergants or traders. 
 
 7'he terms of the articles regulating this subject are as follows : 
 
 Art. 2. " Les juges-consuls connaitront de tous billets de change faits 
 " eutre negociants et marchands, ou dont ils devrunt la valeur, et entre 
 " tou!es personnes pour lettres de change ou remises d'argenl de place en 
 ** place." 
 
 Art. 4. " lis connaitront les differends pour rentes faites par des mar- 
 " chands, artisans ct gens de metier afin de revendre ou de travailler de 
 •'* leur profession, comme a tailleuts d'habits pour etoftes, etc., etc., * * * et 
 " autres semblables. 
 
 Art. 5. " Connaitront aussi des gages, salaires, et pensions des commis- 
 " sionnaires, facteurs ou servi eura des marchands pour le fait du trafic 
 *' seuleinent." 
 
 Art. 7. " Connaitront des dilTerends a cause des assurances, grosses- 
 " avenlures, promesses, obliirations et contrats concernant le commerce de 
 " la mer, le fret et le naulage des vaisseaux." 
 See also 'lit. 2, Art. 6. 
 
 Without seeking further to investigate the law of France on the subject 
 under consideration, it would not be ditiicult to discover from the Legislation 
 and Jurisprudence previous to 1673 ; a great portion of which might be cited 
 as law in Lower Canada; what must have been the nature of a iiian's occu- 
 pation to cause him to be subjected to consular juris^diction. 13ul if further 
 and authoriiative aid can be obtained in the development of this subject, it 
 is expedient that it should be sought for and made use of. 
 
 Ii has been already attempted to be shewn, and it will be hereafter 
 assunted to be the fact, that the Ord. of 1673, converted no act previously 
 non-commercial, into a commercial act, but merely collected and grouped 
 the numerous transactions that previous enactments and the judgments of 
 of the Courts had characterized as commercial ; and gave to tlie juri.'-pru- 
 dence so created ihe sanction of authority. That this assuniplioii is es.sen- 
 tially correct, will not, it is believed, be mnch controvert d in Lower 
 Canatia ; and if it were, it could be supported if not established, by an 
 array of citations much too extensive for the present note. 
 
 But while the terms of this ordinance and the commentaries of various 
 laborious and learned writeis upun it, are of ib.e utmost importance in this 
 investigation, there is yet available, later, more elaborattd and more complete, 
 authoritative dicta, in the article^ of the code de fo»rn;.er<'c appropiiaie to the 
 sutiject. And the numerons and learned writers upon the code have been 
 able to bring the liirlit oi modern experience, and ail the mocif-rn facilities 
 for research, to bear upon the deTelopmeut of its pMivi.^ioi.s. In aiticles 
 1, 63 J and 633, oi that code, " traders " and commercial iransaciions are 
 defined and described. 
 
 Art. 1. Enacts as follows ; 
 
 " Sent commer9ants, ceux qui exercentdes actes de commerce, et en font 
 " leur profession habituelle." 
 
 And articles 632 and 633, thus describe what are to be held in law to be 
 actes de commerce :
 
 WHO IS A TRADER. 
 
 Art. 632. " La loi repute acte de ccmTierce tout achat de denrees et 
 " marchandises pour les revendre, soil en nature, soil apres le.? avcir travail- 
 *' lees et mises en Geuvre, ou meme pour en louer simplement I'usage. Toute 
 *' entreprise de manufactures, de commission, de transport par terre cu par 
 " eau." 
 
 " Toute entreprise de fournitures, d'agences, bureaux d'affaires, etablisse- 
 " ment de ventes a I'encan, de spectacles publics ; 
 
 *' Toute operation de change, banque ou courtage ; 
 
 " Toutes les operations de banques publiques ; 
 
 " Toutes obligations entre negoeiants, marchands et banquiers ; 
 
 " Entre toutes personnes, les lettres de change, ou remises d'argent taites 
 " de place en place." 
 
 Art. 633. " La loi repute pareillement acte de commerce, toute entreprise 
 ^' de construction, et tons achats, ventes et reventes de batiments pour la 
 *' navigation interieure ; 
 
 " Toutes expeditions maritimes : 
 
 " Tout achat ou vente d'agres, apparaux et avitaillemenls ; 
 
 " Tout affretement ou nolisseraent, emprunt ou pret a la grosso ; toutes 
 *' assurances ou autres contrals concernant le commerce de la mer; 
 
 " Tous accords et conventions pour salaires et loyers d'equipages ; 
 
 " Tous engagements de gens de mer pour le service de batiments de 
 ^' commerce." 
 
 If these definitions introduced no new principle into tlia commjjrcial law 
 of France ; but constituted merely the result of the labours of the learned 
 men to whom the code owes its origin, in their search for a concise and clear 
 description of the classes of persons and of transactions previously subject 
 to the consular jurisdiction and about to be rendered amenable to similar 
 tribunals under a different name ; they may be adopted here as correct expo- 
 nents of the law as to the classes of persons subject to the present Act, and 
 .as to the classes of transactions, the practioe of which will bring persons 
 within its provisions. And the conrments upon them of such men as Par- 
 dessus and Masse will receive a character of authority which will greatly 
 facilitate the decision of any questions that may arise upon the terms of this 
 clause of our statute. 
 
 If on the other hand these definitions are mere arbitrary enactments, 
 having no foundation in the old law, they cease to be of interest in this behalf, 
 and render it necessary to confine the enquiry, to the state of the law pre- 
 vious to their promulgation. 
 
 It is co;i!en(led, however, and with much reason, that in many respects, 
 and specially in lespect of those matters legislated upon by the three above 
 cited arlii-!es, the rodn de romracrce did not change in any mattninl degree 
 the ancient law. (Becane sur Jousse, com. de i'ord. de 1673, pp. '~S^ 305, 
 in notis. 1 Vincens, p. ]2l. Orillard, JS'o. 181 ; Merlin, Rep. to. Marchan- 
 dises, fait de, Pozer vs Meiklejohn, Fyke, p. 11.) 
 
 And any one may verify the correctness of the assertions of these vi^riters 
 by comparinij, in the arrets and judgments of the respective periods, the 
 persons and acts that have been adjudi^ed under the ancient legislation and 
 under the code respectively, to be jusiiciablea by the commercial tribunals. 
 
 The essfiilial elements of the definitions ol the generic terms commergant 
 and acle de coiiimerce which are given by the code, may be gathered irom 
 previous legslauon, and from the p.irisprudence which prevaih^d previous to 
 its enactirieiit Long before that time the wcjnl commerg ant had h<' gun to be 
 used as des'-riprive of persons amenable to Commercial tribunals. 1 'I'oubeau, 
 p. 260. Salle sarl'o'd. de 1673, pp.415, 4]6,438, Anc. Den. vo. commer- 
 gans ; Rogrori, jur. con. passiyn, Nicodeme Ex. des Com. And the sense ia 
 whicli it is so used seems to accord precisely with the definition given of it 
 by the code. 
 
 In fact the Code de Commerce appears to have performed in its turn, 
 that which was done with n spect to a previous age by the Ord. of 1673 ; 
 and allhoiiiih the progress and extension of trade, rendered expedient greater 
 detail, no chunge was operated in the principles which siiould regulate 
 the classificaiion of a transaction or of a person as being commercial or 
 non-comnierciaJ.
 
 WHO IS A TRADER. 
 
 Assuming then what it is believed might easily be more fully demon- 
 strated, that the definitions given by the Code de Commerce o[ commergants 
 and oi actes de commerce, are only developments of principles vrhich are to 
 be found in the ancient legislation and jurisprudence, and correctly express 
 those principles ; the commentators on the Code become valuable auxiliaries 
 in the investigation of the true construction of the first of those expressions, 
 ■which is used incur statute to designate those persons specially subject to its 
 provisions. 
 
 " Le commerce," says Masse, " envisage sous un point de vue general 
 est done une communication reciproque entre deux personnes, dont I'une 
 donne a i'autre une chose pour une autre chose qu'elle en refoit. Mais 
 lorsque ces rapports interesses ont lieu avec suite et frequemment entre 
 .personnes dont, soit I'une ou I'autre, soit toutes les deux, se proposent un 
 profit qui doit etre le resultat des communications ttablies entre elles, alors 
 ce commerce est d'uue espece particuliere, et constitue le commerce pro- 
 prement dit. Finis mercatorum est lucrum. En ce sens plus restreint et 
 plus usuel, le commerce consiste done dans une speculation ou I'on achete 
 afin de revendre — et ou I'on vend ce qu'on a achete pour le revendre ; ou 
 mieux encore, dans les diverses negociations qui ont pour objet d'operer ou 
 de faciliter les echanges des produits de la nature ou de I'industrie a I'effet 
 d'en tirer quelque profit." I Masse, Droit Com., pp. .3, 4. 
 
 The latter part of this defitiition is taken verbatim from Pardessus, 1 
 Pard. droit com., p. 1. 
 
 It would be impossible within the limits of the present note to follow the 
 developments of this definition by M. Masse, oi his discussion of the various 
 Actes de Commerce detailed in art. 632 and 633 of the Code. He appears 
 to have desired to shew that the legislation which constituted these trans- 
 actions, Actes de Commerce, was not purely arbitrary, but was based upon 
 principle and upon aulhoriiy — and it is difficult to read his lucid and logical 
 treatise without being of opinion that he has succeeded in doing so. His 
 opinion therefore also supports the position that the Code de Commerce 
 enacted no new thing in its delinitions of traders and of commercial acts, 
 but merely declared what was deducible from the legislation and jurispru- 
 dence in force and prevailing at the time it was proiriulgated. 
 
 It may probably theiefore be safely assumed, that by an examination of 
 the old law which is actually in force as law in Lower Canada, aided by 
 the light which may be derived from the new law and from the commen- 
 tators upon it, those transactions which are Actes de Commerce., can be 
 accurately defined and ascertained, and that he may be taken to be a 
 trader who engages in them and makes of them his habitual occupation. 
 
 The qualifying word " habitual," mu.=;t not, however, be taken in a 
 sense, either too wide or too narrow ; as always requiring a constant succes- 
 sion oi commercial transactions, or as being always satisfied by the occur- 
 rence of a limited number of them. On the one hand a manifest intention 
 to make of commerce a habitual occupation, will constitute a trader — 
 ■though the acts of commerce really performed are few and infrequent. 
 For instance tiie opening of a shop for the sale of goods — or of any particular 
 kind of merchandise will qualify hi)n who opens it, as a trader, though his 
 actual sales may be few, or even though he may have failed to effect one. 
 2 Masse, p. 162, — 1 Pardessus, p. 78,-1 Boulay-Paty, Ues faillites, pp. 9, 
 10, 11. On the other hiiud a man may do commercial acts without thereby 
 constituting himself a trader — for he may buy double the quantity of pro- 
 vision he requires for his household, with the intention of making a profit 
 by the sale of what he does not want — and may actually sell and make 
 that profit— yet he will not thereby become a trader. 1 Pard. loc. cit., — 1 
 Masse, p. 161, — Oriiiard, p. 4,~Bonnin, Leg. Com., p. 5. See also on 
 these points, 1 Toub. vol. 1, pp. 274 et seq., though he strains the law in 
 favor of the consular jurisdictions. 
 
 The English law on this point is in accordance with our own. There in order 
 to make a man liable to be a bankrupt by buying or selling, or by the 
 workmanship of goods or commodities, it was necessary that there should 
 be a repeated practice of it, or a commencement of it, coupled with an 
 intention to continue it ; for a single act of buying and selling, unaccom-
 
 3 WHO IS A TRADER. 
 
 panied by such intention, would not be sufficient. But if that intention 
 existed, the extent of the trading, whether large or trifling, would be imma- 
 terial. Archbold, p. 43, and cases cited. Wells vs. Parker, 11 T. Rep. 34, 
 and Summersett vs. Jarvis, 3 Brod and Bing 2. In ex parte Magennis, 1 
 Rose 84, Lord Eldon said, " the question of trading depends not on the 
 quantum of dealing, but the intention — and it is enough if a man will sell 
 to any one who cornea to buy." See also Ex parte Galliraore, 2 Rose 428 — 
 Holroyd, vs. Gwynne, 2 Taunt, 476. 
 
 To establish therefore that a man makes the engaging in commercial 
 transactions his habitual occupation, evidence of the intent to do so, with 
 but few instances in which he has done so, will suffice ; while if external 
 evidence of the intent be wanting, a much more extensive series of trans- 
 actions would be required to establish liis commercial quality. And the 
 Judge will be greatly facilitated in deciding upon such an enquiry, by the 
 previous occupation of the man, his nominal occupation at the time, if he 
 has any, and by the character of the transactions proved to have been 
 entered into by him. 
 
 Taking then as guides to the interpretation of our Statute in the respect 
 under consideration, the legislation and juri-sprudence of France from the 
 earliest times to the present day, the following persons may be suggested as 
 being, amongst others, subject in Lower Canada to the provisions of our 
 Statute : 
 
 1. Merchants, viz : persons habitually engaged in the buying and selling 
 of goods, wares and merchandise for profit ; 
 
 2. Manufacturers of goods, wares or merchandise for sale ; 
 
 3. Bankers and dealers in money and commercial paper and securities ; 
 
 4. Factors or commission merchants ; 
 
 5. Brokers ; 
 
 6. Auctioneers ; 
 
 7. Insurers and underwriters ; 
 
 8. Common carriers for hire, whether by land or water ; 
 
 9. Hotel and tavern, eating-house and boarding-house keepers ; 
 
 10. Warehousemen and wharfingers ; 
 
 11. Mechanics and tradesmen wlio buy goods, wares or merchandise, 
 either in the form of raw materials or wholly or partially manufactured, 
 with intent to sell, after having by their labour improved the articles so 
 purchased, or converted them into something else ; such as Jewellers — 
 Boot and Shoemakers — Builders— Merchant tailors — Hatters and furriers — 
 Watch and clockmakers— Shipbuilders — Printers— Butchers — Millers. 
 
 The proposition that mechanics and tradesmen under the circumstances 
 mentioned, are traders, has been at times more or less disputed. Respect- 
 able jurisconsults of the sixteenth and seventeenth centuries are to be found 
 who hold that he who purchased goods for the purpose of applying to them 
 his own labor, and of afterwards selling them, was not a trader, although 
 they admitted that he would be, if he so bought them whh the view of 
 causing them to be worked upon by others, and of afterwards selling them. 
 See authors cited in 1 Masse, p. 20. And certain modern authors though 
 unwilling to deny the general proposition, have endeavored to make a dis- 
 tinction between those artisans who buy materials and having worked upon 
 them, offer them again for sale, and those who only buy such materials and 
 bestow labour upon them when orders for them are received from a 
 customer. The former they d3 nut deny to be traders, but the latter they 
 hesitate to admit into the rank of Commerganls, more espdcially if the work 
 be of more value than the materials purchased. 1 Pardessus, No. 81. 
 Armand Dalioz, Vo. Commergant, § 20. But Mr. Pardessus in favoring a 
 construction which seems to be founded on no principle, does so with such 
 hesitation as to take from his opinions in this instance the weight which is 
 ordinarily and justly attached to them. On the other side of the question, 
 however, may be ranged a greater array of learned authors, who hold that 
 the only distinction sustainable on principle is between the artisan who 
 buys materials, and him who simply works at his trade. The first is a 
 trader, the latter is not. 1 ToubQau.'^pp. 277, 278, 279. Jousse, Ord. do 
 1673. Tit. 12, art. 4. 5 Noureau Denizart, p. 449. 1 Jur. Con. p. 17. 2
 
 WHO IS A TRADER. ^ 
 
 Bornier, 736. 1, Masse, pp. 20 et eeq. 1 Boulay-Paty, Des faillites et Banq. 
 p. 15. 1 Vincens, p. 126. Orillard, nos. 148, 149. 2 Cane, p. 542. And 
 see also the numerous adjudged cases collected in De Villeneuve et Masse 
 Diet, des Cont. Com. Vo. Commer9ant, § 2. 
 
 In this respect the authorities upon the older English statutes, whose 
 terms permit of no greater latitude of construction than those of the contem- 
 poraneous French enactments, are at one with the weight of authority in 
 France. " Persons," says Mr. Eden, p. 8, " who buy the raw materials 
 ** of trade and sell them again under another form, or improved by the 
 ** labour of manufacture, have always been considered traders, liable to the 
 " bankrupt laws, such as bakers, brewers, &.c., who all purchase the raw 
 '' material, which they respectively manufacture ami sell for a profit after 
 *' a certain amount of bodily labor has been expended upon it." See also 
 the cases collected in Cooke, pp. 48 et seq. Daly vs. Smith, 4 Burr. 2148, 
 3 Mod. 330. Com. Dig. Bankrupt A. 
 
 In Lower Canada the laws respecting evidence in commercial cases and 
 on the subject of trial by Jury, have rendered it occasionally necessary to 
 discriminate between acts and persons possessing a commercial character 
 and the contrary. The 25 Geo. III., cap. 2, already alluded to, provided 
 that " every person having suits at law and actions in any of the said 
 " Courts of Common Pleas grounded on debts, promises and contracts of a 
 " mercantile nature only, between merchant and merchant, and trader and 
 " trader, so reputed and understood according to law, should be entitled to 
 " a trial by Jury." And although this restrictive provision has since been 
 modified, (see the Statutes embodied in the Con. Stat, of L. C.,"pp. 791-2, 
 and the Act of last session, intituled : " An Act respecting Juries and 
 Jurors,") the character of the subject matter of the suit and of the parties 
 engaged in it, has always been and still is an element in the consideration 
 of the right to trial by Jury in civil matters. 
 
 And the same Ordinance, § 10, provided that " in proof of all facts con- 
 " cerning commercial matters, recourse shall be had in all the Courts of 
 *' civil jurisdiction in this province, to the rules of evidence laid down by 
 " the laws of England." 
 
 And again, the same Ordinance, § 38, authorized execution against the 
 person of the defendant for the satisfaction of all judgraeuts given in com- 
 mercial matters between merchants and traders, as well as of all debts due 
 to merchants or traders for goods, wares and merciiandises by them sold. 
 
 And the Act 10 and 11 Vict., cap. 11, made various provisions respecting 
 " Commercial matters", introducing with respect to actions basetl upoa 
 them, a particular species of limitation — and cerlain special rules of practice. 
 
 Upon these Statutes there have been frequent discussions in Lower Ca- 
 nadian Courts of justice, and although comparatively few of the decisions 
 upon them have begn preserved, owing to the want of reports while the 
 jurisprudence was being settled — enough are to be found to indicate the 
 views of our tribunals upon the points under con.^ideration. 
 
 In Pozer vs. Meiklejohn, Pyke's Rep., p. 11, which was an action by a 
 merchant against a brewer for the price of a quant iiy of beer stored with 
 the latter, and not delivered back ; the English rules of evidence were 
 held applicable. 
 
 In Pozer vs. Clapham, a demand for an alleged overpayment in making 
 a return of the proceeds of goods sold at auction, was held to be a commercial 
 matter. Stuart's Rep. 122. 
 
 In Patterson vs. Welsh, Quebec, 1819, a tavern keeper was held to be a 
 trader. And a similar decision was rendered in MoRoberts vs. Scott, 
 Quebec, 1821. 
 
 In Riveis vs. Duncan, Quebec, 1819, it was held that in an action by a 
 merchant against the master ot a ship for iho value of goods lost on a 
 Toyage to Quebec, the subject matter was between a merchant and a 
 trader, and that either party had a right to a trial by jury. . 
 
 Hiring river craft was held to be a fact of a commercial nature in Brehaut 
 vs. Meran, Quebec, 1811, 
 
 The endorsement ^owr aval of a promissory note, is a fact concerning a 
 commercial matter. Paterson vs. Pain, 1 L. C. Rep., p. 219.
 
 10 
 
 VOLUNTARY ASSIGNMENTS. 
 
 The sale of a wagon" and harness by a hotel keeper to the defendant 
 described as culiivateur et commerQant, is a fact respecting a commercial 
 matter. Vandal vs. Grenier, 6 L. C. Rep. 475. 
 
 A contract by a carpenter and joiner to build a house for a person not a 
 trader, is a commercial matter. Kennedy vs. Smith, 6 L. C. Rep. p. 260. 
 
 A contract between a bricklayer and mason and a railway builder, is a 
 commercial matter, as being one which in France would have been within 
 the jun'sdiction considaire. Fahey vs. Jack(?on, 7 L. C, 27. 
 
 A contract of Insurance against fire between an insurance company and 
 a non-trader, is a commercial matter. McGillivray vs. The Montreal 
 Insurance Co. 8 L. C. Rep., p 401. 
 
 A contract to furnish materials for a house, and to build it, is a com- 
 mercial contract. McGrath vs. Lloyd, 1 L. C. Jur., 17. 
 
 A contract of affreightment, is a commercial contract. The Secretary o{ 
 State vs. Edmonstone et al., 6 L. C. Jur., p. 322. 
 
 A contract entered into with commissioners appointed under an Act of 
 Parliament to provide stone for makhig a canal, is a commercial matter. 
 Mackay and Rrtherford, 13 Jur., 21. 
 
 On the other hand, a sale by the proprietor of a farm, to his lessee, of a 
 quantity of firewood and hay remaining upon it when leased, is not a com- 
 mercial transaction. Desbarats vs. Murray, 3 L. C. Jur., p. 27. 
 
 And a loan of money by a non-tr£ider to a trader without averment that 
 it referred to a commercial matter, is not lv commercial fact. Wishaw vs. 
 Gilmor, 6 L. C. Jur., 319. 
 
 A loan o'f money by a "bourgeois " to an '^ ouvrier " is not a commercial 
 matter, Asselin vs. Mongeau, 5 L. C. Jur., 26. 
 
 OF VOLUNTARY ASSIGNMENTS. 
 
 Proceedings 
 
 for voluntary 
 assignment of 
 an Insolvent 
 estate ; meet- 
 ing of cre- 
 ditors to be 
 called. 
 
 Sclietiulesof 
 creditors, &c. 
 
 Attestation. 
 
 Assets, books, 
 
 Q. Any person unable to meet his engagements, and desi- 
 rous of making an assignment of his estate, or who is required 
 so to do as hereinafter provided, may call a meeting of his cre- 
 ditors at his usual place of business, or at his option at any 
 other place which may be more convenient for them ; and such 
 meeting shall be called by advertisement (Form A), stating in 
 such advertisement the object of such meeting; and at such 
 meeting he shall exhibit statements showing the position 
 of his affairs, and particularly a schedule (Form B), con- 
 taining the names and residences of all his creditors, and 
 the amount due to each, distinguishing between those amounts 
 which are actually overdue, or for which he is directly liable, 
 and those for which he is only liable indirectly as endorser, 
 surety or otherwise, and which have not become due at the 
 date of such meeting ; and also the particulars of any nego- 
 tiable paper bearing his name, the holders of which are 
 unknown to him, — which schedule shall be sworn to by the 
 Insolvent, and may be corrected by him likewise under oath at 
 the meeting at which it is so produced, also the amount due to 
 each creditor, and a statement showing the amount and nature 
 of all his assets ; and he shall also produce his books of account, 
 and all other documents and vouchers, if required so to do by 
 any creditor : 
 
 1. Or icho is required so to do — 
 
 Viz : by two or more creditors for sums exceeding in the aggregate $500. 
 § 3, p. 2.
 
 VOLUrrTARY ASSIGN'MENTS. H 
 
 2. At Ills option at mnj other place — 
 
 There is no expressed restriction even as to the section of the Province 
 in which the place of meeting may be fixed, provided it be more convenient 
 to the creditors than the locality of the debtor's plac? of bu'^iness. Thus the 
 insolvent, being a resident of Montreal, might hold ids preliminary meeting 
 at Toronto, if the majority of his creditors resided at or near the latter city. 
 But in such a case, care must be taken that an Assignee is appointed who 
 is competent to act. If the creditors decide upon an Assignee, there would 
 appear to be no obligation upon them to select one who resides within the 
 County or District in which the insolvent's place of business is situate. 
 But if the debtor is obliged to choose an Assignee from among the ofhcial 
 assignees, he must select one ^ who is resident wilhin the same County or 
 District as that in which he carries on his business, § 2, p. 4, § 3, p. 10, . 
 § 4, p. 1. 
 
 If the insolvent shoald either by error, or designedly, select a place of 
 meeting, other than his place of business, and less convenient to his 
 creditors, and assign to the assignee named at such meeting, his estate 
 would become liable lo compulsory liqr.idation under § 3, p. i. For this 
 would not be a mere neglect or irregularity covered by p. 5 of § 2 ; but an 
 assignmeni made "otherwise than in the manner prescribed by this Act." 
 
 3. By adDertisement — 
 
 The mode of giving notice in all cases in which the act. requires it to be 
 given " by advertisement," is regulated by §11, p. 1, which should be 
 strictly followed. 
 
 4. iifuiemerits sJicwing the x>osition of lis affairs — 
 
 Ord. de 1673, tit. XI, art. II. C. Com. art, 439. S. act § 81. E. act § 142. 
 
 5. Amounts which are aduaUy orerchie, or for ichich he is direcily lialde, 
 and those for which hcis only liable indirectly, and ichichhave not hecorne due — 
 
 This distinction is required to enable the voting at the preliminary meet- 
 ing to be properly regulated ; those persons to whom the insolvent is 
 directly liable, and "those holding his overdue indirect liabilities being alone 
 allowed to vote. Those holding immature claims upon which he is only 
 liable indirectly as endorser, surety, or the like, are not allowe>^l to vote, 
 (p. 3, post.) Thus a holder of a Bill not yet due, drawn or endorsed by 
 the insolvent, would have no right to vote ; but if the bill were dishonored 
 before the meeting he could vote upon it. The object vrould seem lo be to 
 obtain the sense of those creditors really interested in the estate, which 
 a person would not be merely because he held a bill or note, the acceptor 
 or maker of which was solvent. 
 
 6. Particulars of negotiahle p)(^p(i' bearing his iiarne, the holders of which ^ 
 are unJcnoicn to him — 
 
 This is necessary in the interest of the creditors ; but it also has an 
 important bearing on the discharge of the insolvent. For if this class of 
 paper be omitted from the Schedule, unless the unknown holder files his 
 claim, tlie discharge does not relieve the insolvent from the debt due such 
 holder. § 9, p. 3. 
 
 7. Sworn to — 
 
 In Lower Canada, before any .Jii.->t;ce of the Peace or any Commissioner 
 of the Superior Court. Con. Stul. L. C, p. 698. 
 
 2. Each notice of such meeting sent by post, as hereinafter ^^^^'^^'^^ 
 provid(>d, shall be accompanied by a list containing tlie names 
 of all the creditors of the Insolvent whose claims exceed one 
 hundred dollars, and llic aggregate amount of those under one 
 hundred dollars ; 
 
 1. Sent hy 2'>ost — 
 
 When notice is required to be given <' by advertisement," the person 
 giving it, in addition to inserting it in newspapers, must also address and 
 send by post, a similar notice to each interested party. § 11, p. 1-
 
 12 
 
 VOLUNTARY ASSIGNMENTS. 
 
 Assignee ap- 
 pointed by 
 creditors. 
 Votes of cre- 
 ditors. 
 
 Assignment. 
 
 2. Whose claims exceed one hnndred dollars — 
 
 This paragraph speaks of claims exceedhuj %\0(\, and of those under %\Q0, but 
 omits mention of such as amount exactly to $100. On the other hand the 
 form of notice prescribed for use in the fulfilment of this provision, (Form A) 
 describes the first class of claims as being ^'for one hundred dollars and 
 upwards." The list should be made in conformity with the form. 
 
 The general rule as to voting gives the right of decision to the majority in 
 number and value of the creditors present or represented, '' for sums above 
 one hundretl dollars." § 11, p. 2. 
 
 The proportion in number of tire creditors who may effectually discharge 
 the debtor is described as the majority in number " for sums of one hundred 
 dollars and upwards." § 9, p. 1. 
 
 And the same proportion of creditors may grant an allowance to the 
 insolvent. § 5, p. 8. 
 
 It is probable that the distinction thus created was not contemplated in 
 framing the Act, but care must be taken not to confound the two modes of 
 computation. 
 
 3. At such meeting, the creditors may name an assignee, to 
 whom such assignment may be made ; and if a vote be taken 
 upon such nomination, each creditor shall only represent in 
 such vote the amount of direct liabilities of the Insolvent to him, 
 and the amount of indirect liabilities then actually overdue ; 
 and thereafter the Insolvent shall make an assignment of his 
 estate and effects to the assignee so chosen ; 
 
 1. At such meeting — 
 
 The meeting should be regularly organized. And correct minutes con- 
 taining a list of all the creditors present or represented, and full details of 
 all the proceedings, should be made nt the time and preserved, in order 
 that evidence of proceedings of such meeting maj' he available if subse- 
 quently required. And it would be proper to appoint a Chairman and 
 Secretary as is usual at ordinary meetings. See Murdoch on Bankruptcy, 
 p. 289, in notis. 
 
 2. May name an Assignee — 
 
 There is U) restriction as to the person who may be nominated for 
 Assignee by the creditors. He need not be a creditor, nor an official assignee. 
 
 3. If a vote he tal'en — 
 
 The majority in number of the creditors for sums above $100, present or 
 represented will decide, if they also represent the majority in value, § 11, p. 
 2. If the two majorities differ — see ihid, hr the proceedings to betaken. 
 In England the majority in value appoint, 24 and 25 V. 134, § 116. So also 
 in Scotland, S. act § 181. 
 
 The mode of voting upon the nomination of an assignee, at the preliminary 
 meeting, is not to be confounded v.'ith that to be adopted at the same 
 meeting, upoii incidental disputes as to the amount of a creditor's claim, 
 and the like. The precautions taken for ascertaining and reg'.rlating the 
 amount which each creditor may represent, render this plain. For instance, 
 p. I, not only requires that a statement of liabilities shewing the amount 
 due to each creditor should be produced at this meeting, but al.-^o that the 
 liabilities should be divided into two classes— direct, and overdue indirect — 
 and indirect which are not due. And each creditor can only represent 
 *• the amount " of his direct and overdue indirect claims. P. 5, also pro- 
 vides that any dispute which arises as to the " amount " which any one of 
 the creditors is entitled to represent in the nomination of an assignee, shall 
 be disposed of by the voles of the majority in number. It is therefore clear, 
 as already stated, that at this, as at all other meetings of creditors, the 
 sense of the meeting is taken by a computation of value as well as num- 
 ber — according to the rule laid down in § 11, p. 2. The exceptions as to 
 disputes about the amounts of claims, and other questions (which should 
 probably be held to mean other similar questions) are made for con-
 
 VOLUNTARY ASSIGNMENTS. J§ 
 
 venience, as at the time of the first meeting no regular scrutiny of the 
 claims can have been effected, or can be obtained. 
 
 4. Thereafter — 
 
 The time within which the assignment must be made is not limited by 
 this clause, the debtor being allowed a certain discretionary latitude in the 
 proceedings he voluntarily commences. But if any delay which occurs be 
 such an unreasonable delay as to constitute a " neglect to proceed," the 
 estate of the debtor becomes liable to compulsory liquidation, — § 3, p. 4. 
 And if such delay were to be accompanied by suspicious circumstances, 
 such as continuance of trade, realization of assets, and the like, these would 
 constitute other grounds for compulsory proceedings, under § 3, p. b and c. 
 
 4. If no assignee be named at such meeting, or at any ad- If no assignee 
 
 iournment tliereof, or if the assio-nee named refuses to act, or if ^^ appointed 
 T ..ix T_ ^- ^i,r 1 i • by creditors, 
 
 no creditor attends at such meeting, the Insolvent may assign iijgoivent may 
 
 his estate to any solvent creditor resident within this Province, select one. 
 not related, allied, or of kin to him, and being such creditor for a 
 sum exceeding five hundred dollars, or if he has no such credi- 
 tor for so large a sum who will accept such assignment, then 
 to the creditor otherwise competent and willing to accept, repre- 
 senting the largest claim upon him ; or he may make such q^. ^ssio-n to 
 assignment to any official assignee resident within the district an Omclal 
 or county within which the Insolvent has his place of business assignee. 
 and nominated for the purpose of this Act by the Board of 
 Trade in such district or county, or if there be no Board of 
 Trade therein, then by the nearest Board of Trade thereto ; 
 
 1. To the creditor othertc'tse coivpetent and wUlinn to accept^ representing the 
 largest claim vp)on Mm — 
 
 It might be contended that this clause means that among the creditors 
 otherwise competent and willing to accept the office, he who holds the 
 largest claim shall be selected as Assignee ; or that it provides that the 
 insolvent is permitted to assign only to the largest claimant under $500, 
 and if he be incompetent or unwilling to act, then that one of the official 
 assignees must be selected. The first construction would seem to be most 
 in accordance whh the context, and with the spirit of the Act. 
 
 5. If any dispute arises at the first meeting of creditors as to In case of dis- 
 
 the amount which any one of the creditors is entitled to repre- pute at first 
 . • .1 • i- ' r • ii meetins: of 
 
 sent in the nomination ot an assignee, or upon any other qties- creditors as 
 
 tion which may properly be discussed at such meeting, such to votes. 
 
 dispute shall be decided by the votes of the majority in number 
 
 of the creditors present, or represt^nted by agents or proxies ; 
 
 but if the dispute have reference to any pretension of any credi- Irregularity 
 
 tor as to the existence or amount of his claim, such creditor °°* ^.° ■^^^^'''*^ 
 
 shall not vote upon the question ; but no neglect or irregularity *PP°^^ ^®" • 
 
 in any of the proceedings antecedent to the appointment of the 
 
 assignee shall vitiate an assignment subsequently made to an 
 
 assignee competent to receive it under this Act ; 
 
 1. If any dispute arises — 
 See note 3 to § 2, p. 3. 
 
 2. JMo neglect or irregularity — 
 
 This provision appears to be intended to prevent the grave evil which 
 would result to all parties concerned, if mere irregularities in proceedings 
 antecedent to an assignment would avoid such assignment. The entire inob-
 
 14 
 
 VOLUNTARY ASSIGNMENT?. 
 
 servance of any'proceeding provided for hy the act, would probably render 
 the estate of the debtor liable to compulsory liquidation under § 3, p. i. 
 But a defective performance of the requirements of the act in respect of any 
 proceeding, would be cured, under this clause, by a subsequent assign- 
 
 Form of Deed 6. The deed or instrument of assignment may be in ibe ^mn^ 
 ofassignment, Q q^ \ji jj^y other form equivalent thereto, and if executed in 
 
 Counterparts 
 of deed. 
 
 Upper Canada shall be in duplicate; and a copy of the list of 
 creditors produced at the first meeting of creditors shall be 
 appended to it ; and no particular description or detail of the 
 property or effects assigned need be inserted in such deed ; and 
 any number of counterparts of such deed required by the assig- 
 nee shall be executed by the Insolvent at the request of the 
 assignee, either at the time of the execution of such deed or 
 instrument, or afterwards, to which counterparts no list of 
 creditors need be appended ; 
 
 1. Xo particular description or detail — 
 
 There is nothing in the Act which requires that a debtor should have 
 anything to assign ; as in alFording means of relief to debtors with insuffi- 
 cient assets, those who have none at all could not reasonably be excluded. 
 
 2. Cou7iterparts—\__,^.^,,,_,^^^ ^;_^^ 
 For registration. 
 
 Effect ofas- 
 signment, as 
 to estate of 
 ineolvent. 
 
 Exception. 
 
 7. The assignment shall be held to convey and vest in the 
 assignee, the books of account of the Insolvent, all vouchers, 
 accounts, letters and other papers and documents relating to his 
 business, all moneys and negotiable paper, stocks, bonds, and 
 other securities, as well as all the real estate of the Insolvent, and 
 all his interest therein, whether in fee or otherwise, and also all 
 his personal estate, and moveable and immoveable property, 
 debts, assets and effects, which he has or may become entitled 
 to at any time before his discharge is effected under this Act, 
 excepting only such as are exempt from seizure and sale under 
 execution, by virtue of the several statutes in such case made 
 and provided ; 
 
 1. Excepting only such as are exonpt — 
 
 See Cons. Stat. L. C, pp. 795-6. E. act. § 117. 
 
 8. Forthwith upon the execution of the deed of assignment, 
 the assignee, if appointed in Upper Canada, shall deposit one 
 
 Duplicate or 
 authentic 
 
 copy of assign- ^f ^j^g duplicates thereof, and if in Lower Canada, an authentic 
 ment to be , ^ „ . , re c ^ i-\ i • • i 
 
 deposited, and copy thereof, ni the ofnce of the proper Court; and in either 
 
 •where. case the said list of creditors shall accompany the deed or 
 
 instrument so deposited ; 
 
 1. The. proper Court — 
 
 That is, in Upper Canada, in the office of the County Court, in the 
 County or Union of Counties in which the proceedings are carried on. And 
 in Lower Canada, in the office of the Prolhonotary of the Superior Court in 
 the District in which the proceedings are carried on. § 12, p. 4.
 
 COMPULSORY LIQUIDATION. J5 
 
 9. If the Insolvent possesses real estate, the deed of assign- p,e„5stration 
 ment may be enregistered in the Registry Office for the Regis- of deed of 
 tration Division or County within which such real estate is assignment, if 
 situate ; and no subsequent registration of any deed or instru- j^^^ reai^^^°* 
 ment of any kind executed by tj}e Insolvent, or which other- estate, 
 wise would have afl'ected his real estate, shall have any force 
 
 or effect thereon ; and if the real estate be in Upper Canada Assio'nment 
 and the deed of assignment be executed in Lower Canada executed in 
 before Notaries, a copy of the deed certified under the hand j^- ^- ^'^.Y' ^• 
 and official seal of the Notary or other public officer in whose e'dintheotlier 
 custody the original remains, may be registered without other section of the 
 evidence of the execution thereof, and without any memorial ; l^ro'^^mce. 
 and a certificate of such registration may be endorsed upon a 
 like copy ; and if the property be in Lower Canada and the- 
 deed of assignment be executed in Upper Canada, it may be 
 enregistered by memorial or at full length in the usual manner ; 
 but it shall not be necessary to enregister, or to refer on regis- 
 tration in any manner to the list of creditors annexed to the 
 deed of assignment ; 
 
 10. If such deed be executed in Upper Canada, according Deed executed 
 to the form of ^execution of deeds prevailing there, it shall have "^ ^- C form 
 the same force and effect in Lower Canada as if it had been j^ l_ q^ ^^^^ 
 executed in Lower Canada before notaries ; and if such deed vke vena. 
 be executed in Lower Canada before notaries it shall have the 
 
 same force and effect in Upper Canada, as if it had been exe- if Notarial, 
 cuted in Upper Canada, according to the law in force there ; 
 and copies of such deed, certified as aforesaid, shall constitute, 
 before all courts and for all purposes, prim d facie proof of the 
 execution and of the contents of the original of such deed 
 without production of the original. 
 
 COMPULSORY LIQUIDATION. 
 
 3. A debtor shall be deemed insolvent and his estate shall In -what cases 
 become subject to compulsory liquidation : the estate of 
 
 Insolvent— {"^a^^e^' shall 
 
 Persons unable to meet their liabilities, have been divided into two or -^fTt^^co^-Dul- 
 more classes both in England and France' — the distinction between them ■'g liquii^- 
 having relation either to their occupations, or to their conduct. tion. 
 
 In England the broad distinction between an insolvent and a Bank- 
 rupt was that the latter was a trader, while the former generally was not. 
 The degree of the relief to which these classes were, respectively entitled 
 was difierent also, the Bankrupt being as a rule capable of obtaining a dis- 
 charge from his debts, while the insolvent could only receive protection 
 from process. In consequence of these distinctions the words Bankrupt and 
 Insolvent had a precise technical signification, and conveyed very difierent 
 ideas, although the laws applicable to both differed only in detail, except as 
 to the relief which the debtor could obtain for himself. The Bankruptcy 
 Act of 1861, seems however to have abolished the insolvent courts, and 
 to have made every one amenable to a system to which the term Bank- 
 ruptcy is applied. The word " insolvent " therefore is not used in this Act 
 in the sense it had acquired in England, but corresponds with the English^ 
 word Bankrupt in its more modern meaning.
 
 ^Q ACTS OF INSOLVENCY. 
 
 In France the inability of a person to meet his engagements might be 
 described as deconfiture, or asfaillite, and the/aillite under certain circum- 
 stances became hanqiierotde. 
 
 A state of deconfiture — which is synonimous with insolvahilite (Nouv. 
 Den. Vo. Deconfiture) is described, by the law of Lower Canada, as exis- 
 ting "quand les biens du debiteur, tant meubles qu'immeubles, ne suffisent 
 '* aux creanciers apparents." (Cout. de Paris, Art. 180.) 
 
 But in France, the mere stoppage of payment by a trader cause a faiUite. — 
 And the question whether his assets if realised, would meet his engagements or 
 not, is of no importance. " La faillite est un etat de cessation de paiemens, ou 
 pour cause d'insolvabilite reelle ou pour cause d'embarras dans les affaires.- ' 
 Celui qui cesse ces paiemens dans le langage de commerce (says Boulay- 
 Paly) — est en etat de faillite pour ^es creanciers. Peu imporle que d'ailleurs 
 il puisse etre solvable : silot qu'il n'aoquitte plus ses obligations coramer- 
 ciales il faillit a ses engagements, et sa conduite, comme commer9ant doit 
 etre examinee." Boulay-Paty, Tit. 1, Sec. 1. 
 
 But the word Bankruptcy, — banqueroute, — under the French system, 
 still conveys the meaning which it originally possessed in England — 
 namely, that the misfortune of the debtor is not unaccompanied by a 
 greater or less degree of culpability. " La Banqueroute est I'etat de tout 
 commer^ant failli centre lequel s'elevent des fails d'inconduite, d'impru- 
 dence ou de fraude." .3. Bedarride, No. 1202. Nouv. Den. Vo. Banque- 
 route 5 Jousse, Ord. 1673, p. 149. 
 
 But while these or similar distinctions have prevailed in France fcr 
 several centuries, and are familiar to every lawyer, they are not recognized 
 as law in Lower Canada. Any person, whether a trader or non-trader, 
 may fall into a state of deconfiture, or actual and absolute insolvability ; 
 but the stoppage of payment has no legal efi'ect, except as a circumstance 
 which may create a presumption of the insufficiency of a debtor's assets, and 
 thereby aid in establishing his insolvability. 
 
 In the present Act the words " insolvent "and " insolvency " are used 
 in a similar sense to the words " Bankrupt " and " Bankruptcy " in Eng- 
 land, and to the words '^failli " and ^'■faillite " in France. It is not 
 necessary that a debtor should be actually en deconfiture, to bring him 
 within the purview of the Act. It is sufficient if by any of the acts or 
 defaults specified in the law, he satisfies its conditions : and except in one 
 particular case, (§ 3, p. 3,) the question whether or no his assets will finally 
 pay his debts in full or not, is not material. But under this Act, as in 
 England, no distinction exists between what would be called in France 
 faillite and banqueroute, except in so far as the facts constituting the latter 
 state, may operate to prevent the insolvent from obtaining his discharge, or 
 retard him in so doing. 
 
 Debtor abs- o,. If he absconds or is immediately about to abscond from 
 conding. this Province with intent to defraud 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 out of the Province he 
 so remains with a like intent, or if he conceals himself within 
 this Province wdth a like intent ; 
 
 a. Absconds, oris immediately about to abscond, with intent to dejraud — 
 These have long been sufficient grounds in Lower Canada for the issue 
 of a capias ad respondendum, or of a saisie-arret before judgment ; to the 
 latter of which processes the writ of attachment under this Act is assimi- 
 lated. The jurisprudence already established as to the construction of these 
 provisions, the nature of the evidence which will be held to establish the 
 intention to abscond, &c., will therefore be of service to the practitioner in 
 acting npcn this clause. 
 
 See Ross vs. Burns, 7 L. C. Jur., p. 85. Lamarche vs. Lebrocq, 1 L, C. , 
 p. 21.5. Benjamin vs. Wilson, 1 L. C, 351. Leeming vs. Cochrane, Vfti'rf, 
 p. 3.52. Cornell vs, Merrilt, ibid, p. 357. Wilson vs, Reid, 4 L, C, p. 157.
 
 ACrrS OP INSOLVENCY. | ^ 
 
 Wilson vs. Ray, ibid, p. 159. Berry vs, Dixon, ibid, p. 218. Larocque vs. 
 Clarke, ?6»rf, p. 402. Hasset vs. Mulcahay, 6 L. C, p. 15. Talbot vs. 
 Donnelly, 11 L. C, p. 5 Tremaine vs. Sansouci, 4 L. C. Jur., p. 148. 
 McDougall Vs. Torrance, 4 L. C. Jur., p. 148. Dumont vs. Court, ibid, p. 
 119. 
 
 The English Bankruptcy law has a very similar provision in the 12, 
 13 Vict. c. 106, § 67, which is not repealed by the new statute ; and this 
 clause in its turn was taken nearly verbatim from the 6 Geo. 4, cap. 16, 
 §3. And a similar enactment is made in § 70, of the Bankruptcy Act of 
 1861, as to non-traders. An immeiise mass of authorities on the construc- 
 tion of this and the other definitions oi acts of Bankruptcy contained in 
 5hose sections, is collected in 1 Doria and Macrae, on Bankruptcy, pp. 127 
 et seq. ; also, in Archbold, on Bankruptcy, pp. 48, 49, 62, 63, and in 
 Griffith's Bankruptcy Act, pp. 34 et seq. 
 
 h. Or if he gccretes or is immediately about to secrete any Secreting 
 part of his estate and efi'ects with intent 1o defraud his «8*^*«' 
 creditors or to defeat or delay their demar?.ds or any of them ; 
 
 Or if he secreles, or is immediately about to secrete, * * * with 
 i^nient, ^c. 
 
 This also under the existing law of Lower Canada, ferms a sufficient 
 ground for the issue of a cap. ad res. or of a saisie arret before judgment. 
 And there are numeroiis cases reported,^ llustrative of the construction put 
 ypon this provision by the Courts. 
 
 f^ee Shaw vs. McCoanell, 4 L. C, 49. Dumont vs. Court, 7 L. C. Jur., 
 319. JVlolson's Bank vs. Leslie, Montreal, 1863. Macfarlane vs. Lynch, 
 Montreal, 18o4. Langley vs. Chamberlin, 5 L. C. Jur., 49. 
 
 There does not appear to be any act of Bankr-uptcy similarly described 
 in the English Acts, though some of those which are to be found there, 
 ■might constitute a fraudulent secreting. Such, for instance, as the Bank- 
 rupt making a fraudulent grant, conveyance, gift, delivery or transfer of 
 his assets, which was the act that was held to be a frau(lulent secreting 
 in Langley vs. Chamberlin, and in Molson's Bank vs. Leslie. 
 
 c. Or if he assigns, removes or disposes of, or is about or Fraudulentiu 
 attempts to assign, remove or dispose of any of his property assignirg. 
 with intent to defraud, defeat or delay hi-s creditors or any of 
 them ; 
 
 Or if he assigns, removes or disposes of, with intent, ^-c. 
 
 This would seem to be very similar in its purport to the last clause, at 
 ieast as regards Lower Canada. 'Jhe acts described in it would constitute 
 a fraudulent secreting. It is nearly identical with the acts of Bankruptcy, 
 twelfthly and fouiteenthly mentioned in the English Act, and would be 
 construed in Upper Canada in a similar manner. See the discussion of 
 these clauses and the cases collected upon them, in Archbokl on Bank- 
 ruptcy, pp. 64 et seq., and I Doria vs. Macrae, on Bankruptcy, pp. 136 et 
 seq. 
 
 (1. Or if with such intent he has procured his money, goods, Or procuring 
 chattels, lands or property to be seized, levied on or taken jt to be seiied.t 
 under or by any process or execution, having operation where •^ execution, 
 the debtor resides or has property, founded upon a demand 
 in its nature proveable under this Act and for a sum exceeding 
 two hundred dollars, and if such process is in force and not 
 discharged by payment or in any manner provided for by law ; 
 2
 
 18 
 
 ACTS OF tNSOLVE'NClf. 
 
 Or being im- 
 prisoned in 
 civil action. 
 
 Or if with, such intent he has procured his money, goods, ^c, to be taken 
 in execution. 
 
 See 10th Act of Bankruptcy in English Act Aichbold, p. 54. 1 Doris 
 and M.,p. 134. 
 
 e. Or if he has been actually imprisoned or upon the gaol 
 limits for more than thirty days in a civil action founded on 
 contract for the sura of two hundred dollars or upwards, and 
 still is so imprisoned or on the limits ; or if in case of siich 
 imprisonment he has escaped out of prison or from custody of 
 from the limits : 
 
 Or if he has been actually imprisoned. 
 
 A similar provision to this is to be found in § 7l of the English Bank- 
 ruptcy Act of 1861. which is however merely a re-enactment of a clause oi 
 the English Act, of 1849, (§ 69). See Archbold, p 63, and 1 Doria and 
 Macrae, p. 156. 
 
 Or refusino- to /• ^^ i^ '^^ wilfully neglects or refuges to appear on any rule 
 appear. or order requiring his appearance to be examined as to his 
 
 debts tinder any statute or law in that behalf; 
 
 Or to obey 
 orders for 
 payment. 
 
 g. Or if he wilfully refuses or neglects to obey or comply 
 with any such rule or order made for payment of his debts or 
 of any part of them ; 
 
 Or any order /*• Or if he wilfully neglects or refuses to obey or comply 
 or decree in with the order or decree of the Court of Chancery or of any of 
 Chancery. ^j^^ judges thereof, for payment of money ; 
 
 Or if h<' ivilfuUy refuses or neglects to obey an order to appear for 
 examination ; 
 
 Or to pay his debts ; 
 
 Or to pay money. 
 
 These are^imilar to tlie 76th and following sections of the English Act of 
 1861, ami ihey are more particularly applicable to Upper Canada. 
 
 Or assigning I. Or if he has made any general conveyance or assignment 
 generally, ex- of his property for the benefit of his creditors, otherwise than 
 th?s X-t"^ ^^ ''"^ manner prescribed by this Act : 
 
 Or if he has made any general conveyance or assignment. 
 
 This would be held in England to be an act of Bankruptcy, as being of 
 necessit)' a fraudulent conveyance, because it is said, as the result would 
 be to detoat or delay the creditors, such would be held to be the intent. 
 Stewart vs. Moody, 1 Scott, 777. Siebert vs, Spooner, 1 M. and W. 
 714. Chase vs. Goble, 3 Scott N. R., 245. By making it a substantive 
 act of Bankruptcy, however, its application is extended, and discussion is 
 prevented. 
 
 Demand of 2. If a trader ceases to meet his commercial liabilities 
 
 assignment, if generally as they become due, any two or more creditors for 
 S meet^'hia ^"^""^ exceeding in the aggregate five hundred dollars, may 
 commercial make a demand upon him (Form E.) requiring him to make 
 liabilities. an assignment of his estate and effects jfor the benefit of kis 
 creditors ;
 
 ACTS OF INSOLVENCY. 
 
 l.Ifa trader ceases to meet his commercial lidbilities generally as they 
 become due — 
 
 The stoppage of payment by a trader has always been regarded in the 
 commercial world as an indication if not as conclUMive proof of insolvency. 
 If not proof of the insufficiency ( f the debtors assets, it establishes his 
 inability to carry on his business ; drin other words to lulfil his engagements 
 to his creditors. Whenever this occurs it become.'j the rii^ht of the creditors 
 to enquire into the affairs of their debtor, and his duty lu'ly to inform them 
 of everything which it is their interest to know. All this would result from 
 natural equity as applied to the relations between ihe debtor and his 
 creditors ; and practically obtains whenever the failing debtor is disposed to 
 deal fairly with his creditors. And it is at this point that ii becomes also 
 the interest of the creditors to assume an active part \u the niunagement jf 
 the debtor's estate ; — fur the fact of his cessation of payments afTurds a strong 
 probability, and as experience has shewn, almost a certainly, that his 
 assets will do no more than pay them wii.it is due i here has been great 
 diversity of opinion on the question wlicther or no, the power of assmanjg 
 possession of the estate should be given to the creditors at this stage, and 
 the legislation of the two great cuniniercial couiilries of Europe has been 
 dissimilar on this point. 
 
 In England the entire stoppage of payment by a debtor would not render 
 him amenable to the Bankrupt law, the acts of bankruptcy there being 
 divisible into two leading classes, acts of the Baiikmiit tendnig to deliaud 
 his credhors or impede their remedies against him; and neglects of the 
 Bankrupt to obey judgments or orders of some Court. 
 
 In France on the other hand the stoppage of payioent has long been 
 regarded as a ground ior transferring the admin i-icdion of the debtor's 
 estate from himself to some person representing his creditors. 
 
 Although this is not declared in the Ord. of 167:i lo be an indication of 
 J'aillite, yet, says M. Joiisse, p. 15(t : La Jailliie mu tidnqueroute est aussi 
 reputce ourerte du jour que le debittur est dti^t^nu insolimfile, et a cesse 
 enderement de payer ses creancicrs. 
 
 In the Code de Commerce of 1807, and in the ameiidments of 1838, the 
 stoppage of payment is declared to constitute a stale of insolvency. Tout 
 commerQanl qui cesse ses paiemens est en eiat deJailiiLe. Art. 437. 
 
 ') he present act has adopted a middle course bt ivveon these two extremes, 
 and without either denying a reasonable weight oi pivisumption of insol- 
 vency to the stoppage of payment, or treating i. as u conclusive presump- 
 tion ; enables the creditors upon its occurrence to >&'■■ ilic machinery of tlie 
 act in motion towards procuring tlie contiol of thw es'ate, ;f the debtor ^houid 
 prove to be really insolvent ; and as will be seen hereiiiior provitles a means 
 of arresting the proceedings, if the stoppage is fbrt.ntous and temporary. 
 
 The words of the act seem to constitute merely an expansion or explana- 
 tion of the usual phrase applicable to sucii a state of liungs stoppage of 
 la^yraewia— cessation de paiemens. And they eml)i)dy in a few words ihe 
 interpretation given to the 437th article of the Code de Commerce by wiiiers 
 of authority. The phrase "censes to meet his engagements generally as 
 they become due," would not u>ualiy be satisfied b_v otie or even several 
 protests of negotiable paper, if the debtor continued his business and 
 manifested in no other M'ay any disorder in his atiaiis. IV]. Parde^-us 
 remarks upon this point with his usual pr.ictical -ense — on ne deoraii pas 
 toujaurs voir un signe de cessation de jiuieuu-ns dans un ou qu^lquis protcts. 
 Combien de commergans, mime dans le" grandtts villes, tuats surtoul duns 
 les petiles, oil les ressources pom renli.-ier proiniitentent, soit des ejf'ets d 
 longs ternies snit des marchandises, soul i:vlrein.i:inen( rares, Sf trour, nt 
 avoir leurs magnsins tt leur portejeuilles renipHs el sunt nomnunnsjorces 
 de laisser protester des engagtmtns quits acquii.ie t insuite/ 4 I'ani. p. 
 2f>8, iNJo, 1101. See also I Bedarride. des Kailliies, No. 18. 2 Via-^se, 
 1148. Dememe (says IM. Renoiiard, j) Vll) que quelques paiemens refustSy 
 pour des motifs spcciau.v, ou par suite de. amtc-^tattons partirulieres, ne 
 amslituent pas en /aillite le comnurgant qui coniintce a acquit ter ri gubcre- 
 menl Pensemble de ses engagements ; de nieme aussi, quelques puiet/tens 
 operes n'empechent pas que la faillile ait lieu, i he discretion of the Ju ige 
 2* 
 
 i%
 
 20 PETITION FOR PROTECTION. 
 
 or Court must be exercised in the decision of each case according to cir- 
 cumstances, for it is plain that the same number of failures to pay, which 
 in one case would be disregarded as affording no evidence of stoppage, 
 might in another establish it conclusively. The words of the clause would 
 seem to avoid ambiguity as much as could be anticipated. Payments of 
 commercial liabilities generally must cease, which could not be paid of 
 isolated and intermittent instances of non payment. While it might with 
 propriety be considered to have taken place, though but few cases of non 
 payment had occurred, where the debts left unpaid were large, and where 
 payment was not resumed. 
 
 It is also made essential that the unpaid liabilities should be commercial, 
 thus constituting the only case in which the jurisdiction created by the act 
 is both real and personal. This is similar to the rule ot the French law, as 
 expressly enacted in the Code of 18u7, ari. 441 ; and as established by the 
 opinions of the writers upon the amendment of 1838. 2 Masse, p. 307. 1 
 Bedarride, des faillites, p. 27. 
 
 2. Any two or niore creditors — 
 
 An additional precaution against a misconstruction of this clause, and 
 against the use of the act by an exacting creditor as a mode of enforcing 
 payment of a debt. 
 
 3. May make a demiand upon him — 
 
 The demand should be in duplicate, and one duplicate should be pre- 
 served, with a note by the person who served it upon the debtor, of the time 
 and place of service. 
 
 Counter pe- 3. If the trader Oil whom such demand is made, contends 
 
 titiondenying ^j-,^^ |j^g claims of snch Creditors do not together amount to five 
 the truth ot , i i i n , > i • i i 
 
 the alle<^- hundred dollars, or tliat they were procured in whole or m part 
 
 tiouslnsuch for the purpose of enabling such creditors to take proceedings 
 demand. under this Act ; or that the stoppage of payment by such 
 
 trader was only temporary, and that it was not caused by any 
 fraud or fraudulent intent, or by the insufficiency of the assets 
 of such trader to meet his liabilities, he may, 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 
 Judge to de- demand ; and, after hearing the parties and such evidence as 
 cide. may be adduced before him, the judge may grant the prayer 
 
 of his petition and thereafter such demand shall have no force 
 or effect whatever ; and such petition may be granted with or 
 without costs against either party ; but if it appears to the 
 judge that such demand has been made without reasonable 
 grounds, and merely as a means of enforcing payment under 
 color of proceeding under this Act, he may condemn the 
 creditors making it to pay treble costs ; 
 
 1 Within Jive days — 
 
 Juridical day«, § 12, p. 5. Rules of practice. No. 12. 
 
 2. Present a Petition — 
 
 Of which notice should be given to the creditors signing the demand. 
 And one clear day for each fifteen miles of distance between the place 
 where the petition is to be presented and the residence of the party notified, 
 or the place of service, will be sufficient. § I, p. 9, 
 
 3. To the Judge — 
 
 In Upper Canada to the Judge of the County Court for t''e County or 
 Union of Counties in which the demand is made. In Lower Canada to the 
 Judge of the Superior Court having jurisdiction in the district within which 
 the .demand is made. § 12, p, 4. >ee also as to Lower Canada the Cons. 
 Stat, for L. C, Cap. 78, § 24, 25.
 
 ACTS OF INSOLVENCV. 21 
 
 4. That the stoppage nf payment was only temporary y and that it was 
 not caused by fraud or insufficiency of assets — 
 
 This provision is implied in the terms of p. 2, inasmuch as that p. requires 
 that there should be a cessation of payment of liabilities generally, which 
 condition would not be satisfied by a temporary and accidental stoppage 
 occurring from other causes than Irora insolvency. The intention of the 
 Legislature is thus placed beyond doubt, and the validity of the demand is 
 made to depend upon the existenjce of a state of things incompatible with 
 the successful prosecution of the debtor's business. 
 
 It must be observed however that the act does not make the temporary 
 character of the stoppage alone, sufficient to relieve the debtor from the 
 obligation sought to be imposed upon hiro by the demand. If his assets 
 appear to be insufficient to meet his liabilities, and tiiis insufficiency was 
 the cause even of a temporary stoppage ; or if the stoppage was for a 
 fraudulent purpose ; the proceeding is allowed to go on. And it seems in 
 accordance with the objects of such a law that it should ; as in the one case 
 actual insolvability is established, of which stoppage of pRyment is only 
 one of the indicia ; and in the other, a state of thiiigs which under most 
 systems of law justifies the deprivation of ihe debtor, oi all control over his 
 estate. 
 
 5. Without reasonable grounds — 
 
 This would seem to apply only to the three grounds menlioned in this 
 clause, any one of which would be sufficient to sustain a petition for pro- 
 jection. But the context shows that the euW mere particularly intended to 
 be guarded against, was the cofflveriiiag the procedure indicated by the act 
 into a mere collecting process, which could be used against any trader who 
 ♦jmitted to pay a debt, instead of being used only again.-t traders who were 
 really insolvent. 
 
 4. If sueh petition be rejected ; or if while such petition is If tli« petition 
 pending, the debtor continues his trade, or proceeds with the be rejected or 
 realization of his assets ; or if no such petition be presented sented*^^^" 
 within the aforesaid time, and the insolvent during the same time 
 neglects to call a meeting of his creditors as provided by the 
 second section of this Act ; or if he does not complete such 
 assignment within three days after such meeting, or if there be 
 an adjournment thereof, then within three days after such ad- 
 journment ; or if having given notice of a meeting of creditors, Liquidation 
 as required by the second section of this Act, he neglects to <obecompul- 
 proceed further thereunder, his estate shall become subject to ^^^^' 
 compulsory liquidation ; 
 
 1. If the Insolvent neglects to call a meeting — 
 
 The 87th chapter of the Consolidated Statutes for Lower Canada enacts 
 that somewhat similar facts shall constitute a sufficient ground for the issue of 
 a saisie-arret before judgment, or a capias ad respondendum. It is therein 
 enacted, that if it be stated in an affidavit that the defendant is a trader ; 
 that he is notoriously insolvent ; that he has refused to compromise or 
 arrange with his creditors, or to make a cession de biens to them, or for 
 their benefit, and that he continues to carry on his trade, the debtor shall be 
 held to be about to secrete his goods and chattels with intent to defraud his 
 creditors. Cons. Slat. L. C, cap. 87, § 9. 
 
 5. But no act or omission shall justify any proceeding to But proceed- 
 place the estate of an insolvent in compulsory liquidation, i'^gs must be 
 unless proceedings are taken under this Act Vin respect of the Sree minths. 
 same, within three months next after the act or omission relied 
 upon as subjecting such estate then^to ; nor after a voluntary
 
 22 ISSUE OF ATTACHMENT. 
 
 assignment has been made, or an assignee appointed under 
 this Act ; 
 
 1. Within three months — 
 
 In England the period is twelve months. Consolidation Act of 1849, § 88. 
 In Scotland four months ; Murdoch, 223. 
 
 2. After a voluntary assignment has been made — 
 
 That is, a voluntary assignment made in the manner prescribed by the 
 Act ; for an assignment made in any other way would be of itself sufficient 
 ground for proceedings in compulsory liquidation 
 
 Proceedings 6. In Lower Canada an affidavit may be made by a creditor 
 
 WrlTof at- ^^^ ^ ^^^^^ ^^^ ^^'^'^ \\rdn two hundred dollars, or by the clerk or 
 
 tachmentof Other duly authorized agent of such creditor, setting forlh the 
 
 debtors estate, particulars of his debt, the insolvency of the person indebted to 
 
 ^" * ' him, and any fact or facts which, under this Act, subject the 
 
 estate of such debtor to compulsory liquidation (Form F), and 
 
 upon such affidavit being filed with the Prothonotary of the 
 
 district within which the insolvent has his place of business, a 
 
 writ of attachment (Form G) shall issue against the estate and 
 
 effects of the insolvent addressed to the sheriff of the district in 
 
 which i^uch writ issues, requiring such sheriff to seize and 
 
 attach the estate and effects of the insolvent, and to summon 
 
 him to appear before the court to answer the premises, within 
 
 such time as is usual therein for the return of ordinary writs of 
 
 Declaration to summons; and such writ shall be accompanied by a declara- 
 
 accompany jjo^ setting forth such facts and circumstances as are necessary 
 
 to be j)roved to sustain the issue thereof; and shall be subject 
 
 as nearly as can be to the rules of procedure of the court in 
 
 ordinary suits, as to its issue, service, return and subsequent 
 
 proceedings ; 
 
 1. An affidavit — 
 Sworn to before any Judge or Commissioner for taking affidavits in the 
 
 Superior Court. The proceeding prescribed by this section is almost 
 jdeniical with that ah-eady prevailing in Lower Canada with regard to writs 
 oi saisie-Ufret before judgment and of capias ad respondendum. Rule 13. 
 
 2. For a sum not less than two hundred dollars — 
 This would seem to be sufficient, even in cases where proceedings have 
 
 commenced by a demand of assignment which requires two creditors 
 claiiniiig not less than five hundred dollars. That Act of Insolvency once 
 perfected, may therefore be taken advantage of by any creditor who could 
 initiate proceedings upon the occurrence of any other. 
 
 3. And shad be subject as nearly as can be to the rules of procedure — 
 There is no provision in the law that would necessarily cause any 
 
 departure fjx)rn the ordinary rules of procedure of the Superior Court, until 
 after the return of the writ. Then there is an entire change, as the mode 
 in which the allegations essential to the support of the writ are assailed, is 
 by petition, and ut,t by exception or plea. Post, p. 12. But the proceeding 
 U()on the petition would then be conducted in conformity with the usual 
 practice of the Court, as directed by this clause. And after such 
 petition is disposed of, either by proceeding to the appointment of an 
 assignee or by qiiasiiing the writ, no further step seems to be required in 
 t'i« case. The rea>on doubtless is, that no condemnation is sought against 
 the insolvent by the proceeding, the only object being the maintenance of 
 the writ ; and therefore the correctness of its issue is tested in the same 
 way as thai of a capias, the result being conclusive as to the whole pro- 
 ceeding, and rendering pleas unnecessary. Rules 15, 16, 19, 20, 
 
 writ.
 
 EXECUTION OF WRIT. £^ 
 
 7. In Upper Canada, in case any creditor by affidavit ^j^^ g^^^ j^ 
 of himself or any other individual (Form F), shows to the u. C. 
 satisfaction of the judge that he is a creditor of the insolvent 
 
 for a sum of not less than two hundred dollars, and also 
 
 shews by the affidavits of two credible persons, such 
 
 facts and circumstances as satisfy such judge that the 
 
 debtor is insolvent within the meaning of this Act, and that 
 
 his estate has become subject to compulsory liquidation, 
 
 such judge may order the issue of a writ of attachment 
 
 (Form G) against the estate and effects of the insolvent, 
 
 addressed to the sheriff of the county in which such writ issues, 
 
 requiring such sheriff to seize and attach the estate and effects 
 
 of the insolvent and to summon him to a[)pear before the court 
 
 to answer the premises, within such time as is usual therein 
 
 for the return of ordinary writs of summons ; and such writ Declaration 
 
 shall be accompanied by a declaration setting forth such facts to accompany 
 
 and circumstances as are necessary to be proved to maintain 
 
 the issue thereof, and shall be subject as nearly as can be to 
 
 the rules of procedure of the Court in ordinary suits as to its 
 
 issue, return, and subsequent proceedings ; 
 
 In Upper Canada — 
 
 The procetlure indicated by this clause, is intended to bear the same 
 relation to existing practice in Upper Canada as that prescribed by the last 
 previous clause does to the Lower Canadian system. 
 
 8. Immediately upon the issue of a writ of attachinent under Notice of issue 
 this Act, the Sheriff shall give notice thereof by advertisement of ^"*- 
 thereof (Form H) ; 
 
 This notice is intended to prevent third parties from permitting, or partici- 
 pating in. any attempt lo make away with the estate, or with any part of it 
 over which they may have control. 
 
 9. Under such writ of attachment the Sheriff shall, by himself How writ 
 or by such agent or messenger as he shall appoint for that pur- shall be exe- 
 pose, whose authority shall be established by a copy of the writ 
 addressed to him by name and description, and certified under 
 
 the hand oi the Sheriff, seize and attach all the estate and 
 effects of the insolvent wherever situate, including his books of 
 account, moneys and securities for money, and all his office or 
 business papers, documents, and vouchers of every kind and 
 description ; and shall return, with the writ, a report under Return 
 oath of his action thereon ; 
 
 1. Rt-porl under oath — 
 
 This dues not appear to contemp'ate the making of a detailed inventoty 
 of the effects seized, for that is afterwards provided for, post p 11. l?ut 
 merely a report iu general terms that he has performed the duty required of 
 him. See Kule 21. 
 
 10. If the Board of Trade in the County or District in which in whose cus- 
 is situate the place of business of the debtor, or if there be no ^°^^ property
 
 24 PETITION TO QUASH. 
 
 ««„>>«,i u„ii Board of Trade in such Countv or District, then the Board of 
 I « placed in 1 rade nearest thereto, has ajjpointed orhcial assignees lor the 
 i-- C. purposes of this Act, the Sheriff shall place the estate and effects 
 
 attached in the cuslody of one of such official assignees, who 
 shall be guardian under such writ ; but if not he shall appoint 
 as guardian such solvent and responsible person as may be 
 willing to assume such guardianship ; 
 
 Nearest thereto. See rsote to § 4, p. 1, post. 
 
 Duty of such 11. The person so placed in possession shall forthwith 
 person. proceed to make an inventory of the estate and effects of the 
 
 defendant ; and also such statements of his affairs as can be 
 Inventory, &c. made from the books, accounts and papers attached ; And he 
 shall file such inventory in the Court on the return day of the 
 writ ; and shall produce such statements at the meeting of cre- 
 ditors called for the appointment of an official assignee ; 
 
 1. An Inventory — 
 
 This is in lieu of the detailed inventory which would othervris^ require to> 
 be made by the seizing officer. And it should be prepared with such 
 accuracy and c(nnpleteness, as to constitute a detailed description of the 
 debtors estate, including his books of account and most important docu- 
 ments : — and should be authenticated by the person making it, ia such a 
 manner as to afford conclusive evidence against him. afterwards, if he should 
 fail to deliver any part of the estate to the assignee. 
 
 2. Statements of his affairs — 
 
 These should be similar statements to. those which the insolvent, is bound 
 lo produce at the preliminary meeting of his creditors. § I, p. 1. 
 
 3. He shall Jile such inventory * • * and shall produce such statements. 
 These duties could be enforced by rule, and t eir neglect punished by 
 
 contrainte, the guardian being an officer of the Court. But ihe non-per- 
 formance of tUese duties at the time pre&cribed, would not affect the validity 
 of the proceedings. 
 
 Petition to set '^* Except in cases where a petition has been presented as- 
 aside attach- provided for by the third paragraph of this section, the alleged 
 ment. insolvent may present a petition to the Judge at any time 
 
 within five days from the return day of the writ, but not after- 
 wards, and may thereby pray for the setting aside of the 
 attachment made under such M'rit, on the ground that his estate 
 To be decide J has not become subject to compulsory liquidation ; and such 
 .-ummanly. petition shall be heard and determined by the Judge in a sum- 
 mary manner, and conformably to the evidence adduced before 
 him thereon ; 
 
 1. Except in cases wliere a petition has been presented — 
 
 This exception is ineerted because the previous petition, if one wa.s pre- 
 sented, must have substantially covered the same ground, as that permitted 
 by this clause. 
 
 2. May present a petition ~ 
 
 This is evidently instead of a plea or exception. (See note lo p. 6). 
 
 3. Five days — 
 
 Juridical days. §■ 12, p. 5. Rule No. 
 
 4. That his estate has not become subject to compulsory liquidation — 
 This is the substantive question which must be raised by the petition.
 
 APPOINTMENT OF ASSIGNEE. 25 
 
 but the special grounds of defence to the allegations of the affidavit or of the 
 declaration should be set forth in the petition, or those allegations denied. 
 In other words as the alleged insolvent must rely either upon the falsehood 
 of the statements of his opponent, or upon other facts which avoid their 
 effect, or upon both, he must shew by his petition the position he assumes, 
 just as he would do if the proceeding were an ordinary action, and he 
 were pleading to it. 
 
 5. Conformably to the evidenct adduced — 
 
 That is to say, adduced according to the same rules as to the right to 
 begin, the burden of proof and the like, as in ordinary cases. 
 
 13. Immediately upon the expiration of five days from the Meeting of 
 return day of the writ, if no petition to quash or to stay proceed- creditors for 
 ings be filed, or upon the rendering of judgment on the ofo^ci^^^*. 
 petition to quash, if it be dismissed, the Judge upon the appli- sigupe. 
 cation of the plaintiff", or of any creditor intervening for the 
 prosecution of the cause, shall order a meeting of the creditors 
 to be held before him or any other Judge, at a time and place • 
 named in such order, and after due notice thereof, for the pur- 
 pose of giving their advice upon the appointment of an official 
 assignee ; 
 
 1. Immediately upon the expiration of Jive days — 
 
 That is after Hve clear juridical days have expired exclusive of the day 
 of the return and of the application. And tliis clause further confirms the 
 view that no plea or exception can be filed, for the only contingencies 
 which can prevent the order being given for the first meeting, are the pre- 
 sentation of a petition to quash, or to stay proceedings. 
 
 2. Or to stay proceedings — 
 Under p. 15, post. 
 
 3. Or of any creditor intervening — 
 
 When the machinery for compulsory liquidation has once been set in 
 motion, any creditor may press on the procedure as well as the plaintiff. 
 The debtor therefore has no temptation to enter into corrupt arrangements 
 with the plaintiff, with a view to arresting the proceedings. 
 
 4. And after due notice thereof- — 
 
 § 11, p. 1, provides that notices of meetings of creditors shall be given 
 by publication thereof for two weeks in the Canada Gazette, &c., and also 
 that notices be sent by post to the creditors, by the " Assignee or person " 
 calling such meeting. That provision would however seem inapplicable 
 to this clause, as no list of creditors is attainable at this stage of the pro- 
 ceeilings, and there is no '•' assignee or person " calling the meeting. To 
 avoid difficulty therefore, the Judge's order for the meeting should declare 
 what notice should he given, and that order should require at least the 
 same number of advertisements as those provided for in § 11, p. 1. 
 
 5. Giving their advice — 
 
 This is the mode in which Tutors and Curators are appointed in Lower 
 Canada. And in this case it will render unnecessary any preliminary 
 enquiry into the amounts actually due to creditors, leaving that matter to be 
 subseciLiently developed under the scrutiny of the assigneg. The present 
 French law adopts a similar mode of election: the opinions only of the 
 creditors being taken by the Juge-Commissaire, and the appointment being 
 made by the Court. C. Com. art. 462. See the remarks of M. Bedarride 
 on this provision, which are in a great degree applicable to this clause of the 
 Statute, Vol. 1, p. 295. 
 
 6. Official Assignee — 
 
 So called with reference to the mode of appointment, to distinguish it 
 from the appointment of an assignee by a voluntary deed of assignment. 
 But there is no difference in the powers or duties of the assignees in which- 
 ever mode they may be invested with the office.
 
 26 
 
 PETITION TO STAY PROCEEDINGS. 
 
 Who may be 
 appoiuted 
 official as- 
 sisuee. 
 
 14. At the time and place appointed, and on hearing the 
 advice of the creditors present upon oath (Form I,) the Judge 
 shall appoint some person to be such otiicial assignee, which 
 person shall be the person proposed by the creditors present, if 
 they are unanimous ; and if they are not unanimous, then the 
 judge may appoint either one of the persons proposed by the 
 creditors, or one of the official assignees named by the Board of 
 Trade : 
 
 If they are unanimous — 
 
 The Jiido^e has no discretionary power in the appointment of an assignee, 
 if the creditors atrree. If they differ, the power immediately becomes 
 vested solely in him, but his choice is restricted to the persons proposed by 
 the creditors, and to those named by the Board of Trade, for Official Assig- 
 nees. The reasons given by the creditors for their advocacy of one 
 candidate, or opposition to another, will probably render it easy to avoid 
 appointing an unfit person. And in case of doubt, an assignee may advan- 
 tageously be selected from the list of official assignees, deposited by the 
 Board of Trade with the Prothonotary or Clerk. § 4, p. 1. One of wuom 
 will probably be then in possession of the estate as guardian. Ante. p. 10. 
 
 Debtor may 
 petition for 
 suspension of 
 proceedings- 
 
 is. Instead of petitioning to quash the attachment, the debtor 
 may, within the like delay, petition the judge to suspend 
 further proceedings against* him, and to that end to submit such 
 petition to a meeting of the creditors anti the debtor to be called 
 for that purpose, in order that the creditors may determine 
 whether the proceedings against the debtor shall be suspended 
 or not : 
 
 1. Instead of petitioning to quash — 
 
 This, and the next seven sections provide a mode by which an estate 
 which may be raore advantageoualy wound up by the debtor himself, and 
 which belongs to a person in whom the creditors have confidence, may be 
 withdrawn from the operation of the law, and left in his hands. Experience 
 has shewn that an ill-disposed or unreasonable creditor will not hesitate to 
 force an estate into liquidation, even when circumstances prevent the 
 possibility of the value of the assets being obtained ; and that under any cir- 
 cumstances whatever, it is better for the creditors to have an estate wound 
 up by the debtor hmiself, if he is trustworthy. Most Bankruptcy systems 
 have comprised a provision of this kind. ISee E. Act § 110. 1 Doria and 
 Macrae, pp. 4S0, et seq : — S. Act § 35, et seq :— Murdoch, pp. 240, et seq : — 
 C. Com. art. 504, et seq. 
 
 2. To suspend further proceedings — 
 
 This phra.'^e is somewhat ambiguous, as is also the provision in p. 19, 
 that such suspension when granted shall be in force for three calendar 
 months thereafter ; as it is nowhere expressly stated what eflect such sus- 
 pension will nave upon the pending proceedings. At the time of the 
 presentation of the petition contemplated by this section, the writ of attach- 
 ment has issued and the guardian is in possesion of the estate and effects 
 of the debtor. Is the attachment to be put an end to and the guardian dis- 
 charged ? or is the writ to remain in force and the guardian in possession 
 for three months ? If an afiirmative answer to the latter questioi; were to be 
 considered the correct solution of the difficulty, the proceeding which is so 
 carefully described in pp. 15 to 21, would be worse than useless ; in fact it 
 would be utterly ruinous to the estate; and instead of being likely to be 
 petitioned for, would probably meet with strenuous opposinon from the 
 debtor himself. But an examination of the provisions of the act aad of the 
 intention of these clauses, seems to point to a different conclusion.
 
 PROCEEDINGS ON PETITION TO STAY. 27 
 
 While it is true that the word "suspend" is repeatedly used, and no 
 express provision is made for discharging the attachment, the I9th clause 
 prescribes the question which is to be put to the creditors. This question 
 is " shall the debtor be proceeded against under this Act or not?" and if 
 the decision be in the negative, it is declared that " it shall be in lorce " for 
 three months thereafter ; during which time no other proceedings can be 
 taken against him, based upon anything which occurred previous to the 
 institution of the pending proceedings. The decision in such case would 
 therefore be that the debtor shall not be proceeded against under the Act. 
 The obvious meaning of this provision goes beyond the mere suspensinn of 
 existing proceed tngs, if by such suspension, the continuance in force of 
 those already taken be implied. If the debtor is not to be proceeded 
 against, the attachment must be discharged ; for to retain it in force, and the 
 guardian in charge, would be to continue to proceed against him under the 
 act, and to act in the very face of the resolution of the creditors. 
 
 The spirit of these clauses leads to the same conclusion. Their object 
 evidently is to relieve the debtor from the operation of the act, which could 
 only be done by restoring to him the possession and administration ol his 
 estate ; and thus to allow him a space of three months within which to 
 make a fresh effort to carry on his business. This intention would be 
 entirely defeated if the attachment were not discharged. 
 
 16. The debtor shall produce with such petition a schedule Schedule t© 
 of his estate, and a list of his creditors with the amount of his be produced 
 indebtedness to each, and the places of their respective resi- ^[j^a. ^ ^^' 
 dences, or places of business, together with particulars of any 
 negotiable paper on which his name appears, the holders of 
 
 which are unknown to him ; the whole under oath ; 
 
 The distinction between creditors holding direct, or overdue indirect 
 claims and those holding indirect claims not yet matured, is not preserved 
 by this clause, and must be presumed to be intended to be disregarded. 
 It is of less importance, the greater the lapse of time after the stoppage of 
 payment, as the number of immature indirect claims will diminish as the 
 time passes. 
 
 17. Upon the schedule of the estate and the list of creditors Duty of Judge 
 being furnished by the debtor, sworn to as aforesaid, the judge, in such case, 
 instead of ordering a meeting of creditors to be called for the 
 appointment of an official assignee, shall order a meeting of Meeting to be 
 creditors to be called by advertisement for the purpose of taking called. 
 
 into consideration the prayer of such petition, and at such 
 meeting shall take and record by a writing under his hand the 
 opinion of the creditors thereon ; 
 
 1. By advertisement — 
 
 As the means now exist for attainingja knowledge of the creditor's names 
 and residences, notices must be sent to them by post according to § 11, p. 1. 
 
 2. For the purpose of taking into consideration the prayer of the 
 petition — 
 
 It will be necessary to appoint an official assignee at the meeting thus 
 ordered, if the creditors decide against the prayer of the petition, piist p. 20. 
 It would therefore be proper that the notice should mention as one of the 
 purposes of the meeting, the giving of advice, if necessary, ujion the 
 appointment of an official assignee. 
 
 18. The judge shall postpone the meeting so called if it Postponement 
 appears that the creditors have not been properly and reaso- of meeting.
 
 2g PROCEEDINGS ON PETITION TO STAY. 
 
 nably notified, or that important omissions have been made in 
 the creditors' list ; 
 
 Jndge to pre- 19. The judge shall preside at such meeting of creditors, 
 Bide at such and the question which they shall decide shall be, " Shall the 
 mee ing. debtor be proceeded against under this Act or not ?" And if the 
 
 Question to be decision of the majority in number*and three-fourths in value 
 decided there- of the creditors for sums above one hundred dollars, present or 
 a , an ow. represented, be in the negative, it shall be in force for three 
 caleffdar months thereafter, during which time no other pro- 
 ceedings in insolvency shall be commenced against the debtor, 
 based upon any act or omission of his which took place pre- 
 vious to the institution of the proceedings so stayed by the 
 deci-sion of the creditors ; 
 
 1. It shall he in force — 
 
 See note to p. 15.— The Jndge should then on application order the dis- 
 charge of the attachment. The costs are payable out of ihe estate, § 11, p. 
 16 and if the attachment be discharged would fall upon the debtor. 
 
 2. Above one hundred dollars — 
 t>ee note to § 2, p. 2. 
 
 3. Which took place previous — 
 
 But the decision of the creditors would not protect the debtor from 
 proceedings based upon .my fresh act of insolvency, committed after the 
 institution of the proceedings which had been put an end to. 
 
 Proceedings 20. If the decision at such meeting be not in the negative, 
 
 ©Q decision oi . , n 
 
 meeting. the judge shall at once proceed thereat to take the advice of the 
 
 creditors as to the appointment of an official assignee, and shall 
 
 appoint such assignee as hereinbefore provided ; 
 
 In case of 2 1 . If any question arises at such meeting respecting the 
 
 question as to amount of any creditor's claim, it shall be decided by the judge 
 
 ftDQount OI 'inv •/ j cj 
 
 creditor's upon a hearing of the parties, and from an inspection of the 
 claim. schedules and list so sworn to by the debtor, and of the state- 
 
 ment of the debtor's affairs prepared and produced at such 
 meeting by the guardian, or person entrusted with the writ of 
 attachment ; 
 
 1. Upon a hearing of the parties and from an inspection, S^c — 
 
 It is not intended that the Judge shall hear evidence, but that he shall 
 decide upon the evidence before him contained iu the schedules and state- 
 ments produced by the debtor, and the guardian. 
 
 2. Prepared and produced by the guardian — 
 
 As this is a meeting for the appointment of an official assignee if neces- 
 sary, the provision ot p. 11, that the guardian shall produce statements of 
 the debtor's aifairs at the meeting called for the appointment of an official 
 assignee, applies to it. 
 
 EiYeei of ap- 22. Upon the appointment of the official assignee, the 
 
 '^"•!?^"*"^ guardian shall deliver the estate and effects attached, to the 
 
 eignee. official assignee ; and by the effect of his appointment, the 
 
 whole of the estate and effects of the insolvent, as existing at 
 
 the date of the issue of the writ, and which may accrue to him
 
 EFFECT OF APPOINTMENT OF ASSIGNEE. 29 
 
 by any title whatsoever, up to the time of his discharge under 
 this Act, and whether seized or not seized under the writ of 
 attachment, shall vest in the said official assignee, in the same 
 manner and to the same extent, and with the same exceptions 
 as if a voluntary assignment of the estate of the insolvent had 
 l)een at that date executed in his favor by the insolvent ; 
 
 1. The whole of the estate and effects — 
 
 See the cases collected in D. & M , pp. 550, ei seq., and Archbold, pp. 220, 
 el seq., exhibiting the construction of similar general cJanses in the English 
 Bankrnptcy Acts. See also S. act § 102, Murdoch, p. 96, Code Corn. art. 
 443. Renonard, pp. 164 et seq. 1 Bedarride, pp. 84 et seq. 
 
 2. As existing at t e date of the issue of the writ — 
 
 In England the estate vests in the assignee from the time of the act of 
 Bankruptcy. Archbold, p. 216. 1 D. & M., p. 545. In ScoHand it ve.-ts 
 in the Trnstee from the date of the sequestration. S. act § 1U2. In France 
 the debtor is deprived of his effects from the date of the judgment dcclaratif 
 de la faillite. Code Com. art. 443. 
 
 Our Statute vests the estate of the in.solvent in his assignee, on the 
 execution of a deed of assignment, or on the issue of a writ of attachment. 
 And in this respect it is more just towards third parties tlian the English 
 Act, under which injury lias frequently resulted to innucent persons Irom 
 having transacted business with the Bankrupt, after an act of Bankruptcy 
 of which they were ignorant. The public notice which is required to be 
 given in both cases here ; namely, previous to an assignment, by the In- 
 solvent himse'f, § 2, p. 1 ; upon the assignmetit by the assignee, Form D, Rule 
 of practice No. 22 ; and upon the issue of a writ by the SherifT, § 3, p. ti ; 
 re.uiers it impo.-sible for any person e.xercising ordinary care in conducting 
 his busine.ss, to fall into a similar difficulty in this country. 
 
 3. Up to the time of his discharge — 
 
 Similar provisions are to be found in the laws of England, Scotland and 
 France ; I D. & M. p. 550. S. act § 103. Murdoch, p. 292 Code Com. 
 art. 443 1 Bedarride, No. 8!. 
 
 4. Whether seized or not seized — 
 
 It is the issue ot tne writ which operates the dessaisissemivt of the 
 insolvent, and not the actual seizure by the officer. The writ is similar to 
 the English Commission, and its issue produces the same effect m this 
 respect as the judgment declarulif de la faillite, in France. 
 
 5. I'Vith the same exceptions — 
 See note to § 2, p. 7. 
 
 6. A voluntary assignment — 
 
 For the elfect of an assignment see § 2, p. 7. 
 
 23. An authentic copy or exemplification, under the hand of F.flectof re- 
 ihe proper olficer of the Court, of the order of the Judge s'^^ti'^'t'O" f'f 
 appointing an official assignee, may be registered at full ^J^qIII^^,^?' 
 length in any registry office, without any proof of the signature' 
 of the officer and without any memorial ; and such regis! ration 
 shall have the saiue effect as to the real estate of the insolvent 
 and in all other respects, as the registration of a deed of 
 assignment under this Act ; 
 
 As the Registration of a deed of assignment — 
 
 That is, no subsequent registration of any deed or instrument which 
 would otherwise have affected the Insolvent's real estate will have any 
 force or elfect as regards that real estate In fact the appointment of the 
 official asNignee operates with regard to the Insolvent's real estate as a 
 deed of sale of it would ; and its registration has the same effect as that which
 
 30 
 
 Notice of ap- 
 poiatment. 
 
 OFFICIAL ASSIGNEES. 
 
 a deed of sale would have, in so far as regards arresting the creation of 
 new charges upon the real estaie conveyed by it. 
 
 The absence of description of the property conveyed, can produce no 
 injurious effect with regard to third persons, for the insolvency is public ; and 
 as when it occurs, no one can acquire a title from the insolvent to any portion 
 of the property held by him previous to his discharge, or even a mortgage 
 upon it, no one can be misled by the want of a description of the property 
 conveyed And the same result will follow even where the system prevailing 
 with regaril to regi^tratio^, provides that it shall be made against the land 
 affected by the deed enregistered, and not merely against the person 
 obliged by that deed. 
 
 24. Immediately upon his appointment, the official assignee 
 shall give notice thereof by advertisement (Form K), requiring 
 by such notice all creditors of the insolvent to produce before 
 him their claims, and the vouchers in support thereof. 
 
 Shall give notice thereof — 
 
 A similar provision io this, requiring the assignee under a deed of assign- 
 ment to give notice of his appointment and call in the creditors, appeared 
 in the draft of the Bill submitted to the House of Assembly in 186:2. The 
 form of notice prescribed by that provision (Form D) still stands as part of 
 the Act passed in 1864, but the clause ordering its use has disapjjt^ared. 
 To remedy this omission the Honorable Judges in Lower Canada have very 
 judiciously made a rule of practice directing that notice in the form D, 
 shall be given by the assignee under a voluntary assignment, in the same 
 manner as by the official assignee. Rule 22. 
 
 OF ASSIGNEES. 
 
 Boards cf 
 Trade miiy 
 name ofJicial 
 assignee?. 
 
 S curitv. 
 
 Notice of 
 nominatiou. 
 
 4. The Board of Trade at any place, or the Cotincil thereof, 
 may name any number of persons within the County or District 
 in which such Board of Trade exists, or within any County or 
 District adjacent thereto in which there is no Board of Trade, 
 to be official assignees for the purposes of this Act, and at the 
 time of such nomination shall declare what security for the due 
 performance of his duties, shall be given by each of such 
 official assignees before entering upon them ; and a copy of 
 the resolution naming such persons, certified by the Secretary 
 of the Board, shall be transmitted to the Prothonotary or Clerk 
 of the Court in tlie District or County within which such 
 assisnees are resident : 
 
 1. The Board of Trade at any place — 
 
 ^fhe object of this section appears to be to create a class of men, satis- 
 factory to the Commercial community generally, and under sufficient 
 security for the due performance of their duties, who shall always be avail- 
 able when a trustworthy and competent guardian or assignee is required. 
 It is intended that one of them shall take charge of an insolvent estate as 
 soon as it is seized, and devote himself, pending the return of the writ, to 
 making a full examination, and intelligible and reliable statements of the 
 debtor's affairs; and that the Judge may have them to resort to, whenever 
 the absence of eligible or impartial persons among those proposed by ihe 
 creditors, renders it necessary for him to look elsewhere for an official 
 assignee. If the plan indicated by this section proves successful, it will 
 also tend to diminish the bad effect produced by appointing as assignee 
 som ^ large creditor, or Bank cashier, which in the one instance generally 
 results in successful devices for the protection of the assignee's own claim ;
 
 SECURITV BY ASSIGNEES. 
 
 and in the other in burdening the estate with an asslffl?e^v4i3?e e^^S^ 
 duties are too onerous to enable him to attcMid to those impo.-ed upon him by 
 the office, and in the consequent necessity for agents wtio are paid out of 
 the estate, to enable him to earn his commission. And when it is remem- 
 beretl that the assignee performs the functions of arbitrator upon many 
 disputed points, the advantage of having a i^rofessional assignee becomes 
 manifest. 
 
 A similar mode of creating a class of men from whom assignees may be 
 chorien prevails in England, the nominati.c! iheie being inarJe by the Lord 
 Chancellor and the number limited to thwiv- 1 D. & M., 67. Archbold, 
 p. 2t)6. 
 
 2. County or District adjacent thereto — 
 
 That is, County in Upper Canada, or District in Lower Canada, as the 
 case may be; these being the territorial divisions marking the jurisdiction 
 of the local Judges in each section of the Province respt-ciiveiy. 
 
 This clause might be held to confine the right of nominatioa by the several 
 Boards of Trade, to the Counties or Districfs actually adjoining lliat in whifh 
 each is established ; but such would not appear lo be the iulention of the 
 Act. It would rather seem to have been contemplated that there should be 
 official assignees nominated in every County or District, and that the 
 Board of Trade within the most convenient distance should have the nomi- 
 nation. And this construction is favored by the terms of § 3, p. 10, where 
 the word "nearest" instead of " adjacent" is used. 
 
 4. Transmitted to the Prothonotary or Clerk — 
 
 That an authentic list of the otficial assignees named may be easily 
 accessible ; and specially to the iSheriff when he requires a guardian, and to 
 the Judge when he is called upon to appoint an assignee. 
 
 2. Such security shall be taken in the nanio of office of the Security to b: 
 President of such Board of Trade, for the benefit of the creditors S.'^'^n by as- 
 of any person whose estate is, or subsequently may be, in 
 
 process of liquidation under this Act ; and in case of the 
 default of any such assignee in the performance of his duties, 
 his security may be enforced and realized by the assignee who 
 shall be appointed his successor, who may sue in his own 
 name as such assignee upon such security ; 
 
 J . Taken in the name of office — 
 
 The bond should remain deposited in the office of the Board of Trade 
 that any assignee desiring to proceed upon it may have access to it. For 
 the othcial assignee to whom it applied might be acting for several estates, 
 and a defaulter to each, in which case it would iiot be proper that any one 
 assignee should have the possession and custody of the bond. Proof of it 
 might be made if necessary, by the proper officer oi the Board of Trade 
 being brought up with it under a subpccna d,uces tecum. 
 
 2. In process of liquidation — 
 
 This Avould apply to estates whether under process of voluntary or com- 
 pulsory liquidation. 
 
 3. The assignee shall call meetings of creditors, whenever Meeting of 
 required in writing so to do by five creditors, stating in such creditors, 
 writing the purpose of the intended meeting ; or whenever he ^n^^b*^- 
 is required so to do by the Judge, on the application of any signee. ^ "^ 
 creditor, of which application he shall have notice ; or when- 
 ever he shall himself require instructions from the creditors ; 
 
 and he shall state succinctly in the notice calling any meeting, 
 the purposes of such meeting ;
 
 g2 DUTIES OF ASSIGNEES* 
 
 • 1. The assignee shall call vieetings — 
 
 Of which notice must be given in the mode indicated by § II, p. 1. 
 
 2. He shall have notice — 
 
 That is one (;lear day, as provided by § 11, p. 9. 
 
 3. Or whenever he shall himself require instructions — 
 
 The act leaves in the hands of ttie creditors the power of rejijulating 
 nearly eveiy detail of the proceedings fol- the liquidai ion of the estate, for 
 the protection of their own interests, and as tending to these objects, lor the 
 regulation of the conduct of the assignee. See this section, and ss. 3, 4, 6, 
 ■8, II, 13, 16, 17, 18, 20, § 5, p. 15, § 6, p. 2, § 10, p. 1, § II, p. 3. And it 
 is important that the credhors should act upon the powers thus conferred 
 upon them. 
 
 4. And he shall .<ta!e succinctly iji such notice— 
 
 The advant.iges that creditors might oblain by using iheir powers in 
 controlling the assignee and in managing the estate, will be greatly lessened, 
 and expense and diday will be increased, unless the assignee takes care to 
 call any meeting that may be required, in such a manner as to enable the 
 creditors to act at such meeting in respect of all the matters in W'hich they 
 have jurisdiction. P^or this purpose it is necessary to specily in the notice, as 
 the purposes for which the meeting is called, the regulation of every matter 
 which is intended to be submitted to them, and thus enable the requisite 
 business to be done atone meeting, instead of several being necessary, i he 
 first meeting however which is held after the expiry of two months from the 
 appointment of an assignee, may be used for the transaction ol all the business 
 the creditors can do, without such business having been detailed in the 
 advertisement, provided a special but short form of notice is used in calling 
 it. §11, p. 3. 
 
 Vssi<^nee to '^- '^^^^ assignee shall be subject to all rules, orders and 
 
 be subject to directions, not contrary to law, or to the provisions of this Act, 
 
 certain rule?, which are made for his guidance by the creditors at a meeting 
 
 Deposit of called for the purpose ; and until he receives directions from 
 
 mi.nejs. the creditors in that behalf, if there be a Bank or agency of a 
 
 Bank in the County in \vhich the insolvent has his place of 
 
 business, or within fifteen .uiles of such place, he shall deposit 
 
 weekly, at interest, in the name of the estate, all moneys 
 
 received by him, in the Bank or Bank-agency in or nearest io 
 
 the place where the insolvent so carries on business; 
 
 Subject to all ruhs, orders and directions made by the CredVors — 
 This is very similar to the provisions of the Scotch law ; in which like 
 powers in the management of the estate and over the Trustee, are given to 
 the creditors. S. act § 82, § 96. Munioch. pp. 276, '287. The modern Freuoh 
 law allows less weight to the vole of the creditors than does any other 
 Bankrupt system, seldom permitting them to decide any question by a vote, 
 and usually leaving the decision to a judicial officer, after hearing their 
 opinions upon the matter under consiiieration. C. Com. art. 5'29 et seq. 
 Renouard, p. 5-25. But the Ord. of 1673, like the Scotch law, accorded 
 exteiisive powers to the creditors, (Ord. 1673, tit. 11, arts. 5, 6 and 7.) vi'hose 
 opinions appear to have been taken by vote at meetings held for the pur- 
 pose ; and wiiose decisions seem to have depended u[)on the majority in 
 value as well as in number,— see articles a' ove cited and the commentary 
 of M. Jous.-e. The modern English Bankrupt Act, like that of France, 
 grants but very limited powers to the creilitors. 
 
 The present act adopts the principle of the Ord. of 1673, and approaches 
 closely in its details to the mode in which the same principle is worked out 
 in the Scotch act. As to the Bank deposiip, Rule 26 requires the assignee to 
 file a monthly return of the moneys deposited and in his hands: and regu- 
 lates the mode in which moneys deposited may be drawn.
 
 DUTIES OF ASSIGNEES. gg 
 
 5. The assignee shall attend all meetings of creditors, and ^^ attend all 
 take and preserve minutes of such meetings, signed by himself, meetings of 
 and signed and certified at the time by the chairman, or by creditors. 
 three creditors present at the meeting ; and copies of, and 
 extracts from, such minutes, certified by the assignee, shall be 
 
 primd facie evidence of the proceedings purporting to be 
 recorded in such minutes ; and he shall also keep a correct And keep mi- 
 register of all his proceedings, and of all claims made to or nutes, &c. 
 before him ; 
 
 1. The assignee shall attend all meetings — 
 
 Similar duties to those imposed upon the assignee by this section, are . 
 performe t by the Truslee under the Scotch act, § 84. Of course neither 
 this provision nor that respectinii' the minutes can apply to the first meeting 
 under proceedings! for a voluntary assignxnent, as when it is held, no assignee 
 is in existence. See note on § '2, p. 3. 
 
 2. Skall be primd facie evidence — 
 
 Copies, certified as provided by this section, of the minute.^ of all meet- 
 ings of creditors are required to be filed in the office of the Superior Court, 
 Rule 25. — A record of them is required in Court whenever the Judge is 
 called upon to enforce the directions of tke creditors under § 4, p. 16. 
 
 3. Of all his proceedings — 
 
 As with regard to claims or dividends objected to, the preparation of 
 dividend sheets, the dates at which all notices are given, in fact every step 
 he takes, or that is taken before him in the case, and specially those pro- 
 ceedings the dates of which are of importance. And by Rule 24, the Minutes 
 and Register of proceedings must be accessible to all persons interested du- 
 ring office hours. 
 
 6. The assignee shall give such security and in such manner Security to 
 as shall be ordered by a resolution of the creditors, and shall tie given to 
 conform himself to such directions in respect thereof, and in creditors. 
 respect of any change or modification thereof or addition 
 thereto, as are subsequently conveyed to him by similar reso- 
 lutions ; and in every case except where the security as been The Bond. 
 taken in the name of the President of the Board of Trade, and 
 
 is not required to be changed, the bond or instrument of 
 
 security shall be taken in favor of the creditors, by the name of 
 
 the " Creditors of A. B., an insolvent, under the Insolvent Act 
 
 of 1864," and shall be deposited in the office of the Court, and jjow kept. 
 
 in case of default by the assignee on whose behalf it is given, 
 
 may be sued upon by any assignee who shall be subsequently 
 
 appointed, in his own name as such assignee ; 
 
 1. Such security as shall be ordered — 
 
 If the creditors are satisfied with the security given by the official assig- 
 nee, to the President of the Board of Trade, no resolution need be passed. 
 
 2. And shall conform himself — 
 
 He may be compelled at any time by a resolution of the creditors to give 
 more or other security, or to change the terms of that already given. The 
 penalty for disobedience however, would only be the danger of removal by 
 the creditors. Post p. 18. 
 
 3. May be sued upon — 
 
 The remedy against the security is the same whether it be given to the 
 President of the Board of Trade or to the creditors direct. And it is the 
 same mode of procedure which is in use in Scotland. S, act § 72, Mur- 
 doch, p. 267. In England also the creditors regulate the nature and amount 
 3
 
 34 
 
 INSOLVENT PARTNERS. 
 
 Powers of in- 
 solvent vest- 
 ed in assignee. 
 
 Winding up 
 affairs. 
 
 Assignee's 
 right of ac- 
 tion, &c. 
 
 When the in- 
 solvent is a 
 partner in a 
 trading com- 
 pany, &c. 
 
 of the security, but it is taken in favor of the Registrar of the Court, who 
 may enforce it. E. act § 122. 
 
 7. All powers vested in any insolvent which he might 
 legally execute for his own benefit, shall vest in, and be 
 executed by the assignee, in like manner and with like effect 
 as they were vested in the insolvent, and might have been 
 executed by him ; but no power vested in the insolvent or pro- 
 perty or effects held by him as Trustee or otherwise for the 
 benefit of others, shall vest in the assignee under this Act ; 
 
 This clause may be said to be merely supplementary to § 2, p. 7, and § 3, 
 p. 22. 
 
 8. The assignee shall wind up the affairs of the insolvent, by 
 the sale, in a prudent manner, of all bank and other stocks, 
 and of all movables belonging to him, and by the collection of 
 all debts ; but in all of such respects shall be guided by the 
 direction of the creditors, given as herein provided ; 
 
 1. Wind up the affairs of the insolvent — 
 
 Jousse, Ord. de 1673, p. 160. C. C. art. 484 at seq. S. act § 82. Mur- 
 doch, p. 276. £. act § 127. 
 
 2. Shall be guided by the directions of the creditors — 
 
 This is in accordance with the old French law : Jousse, loc. cit ; but 
 under the modern system it is the juge commissaire who gives directions 
 as to the winding up of the estate. C. C. loc. cit. So in Scotland it is the 
 Commissioners. S. act § 85, Murdoch, 279. In England his duties are 
 prescribed by § 127, and the Court will enforce their performance. 
 
 3. Given as herein provided — 
 
 I. e. at a meeting called for the purpose, ante p. 4. 
 
 9. The assignee, in his own name as such, may sue for the 
 recovery of all debts due to the insolvent, and may take, both 
 in the prosecution and defence of suits, all the proceedings that 
 the insolvent might have taken with respect to the estate, and 
 may intervene and represent the insolvent in all suits or pro- 
 ceedings by or against him, which are pending at the time of 
 his appointment, and on his application may have his name 
 inserted therein, in the place of that of the insolvent ; 
 
 10. If a partner in an unincorporated trading Company or 
 co-partnership, becomes insolvent within the meaning of this 
 Act, and an assignee is appointed to the estate of such insol- 
 vent, the assignee shall have all the rights of action and 
 remedies against the other partners in such Company or co- 
 partnership, which any partner could have or exercise by law 
 against his co-partners after the dissolution of the firm ; and 
 may avail himself of such rights of action and remedies, as if 
 such co-partnership or Company had expired by efflux of time ; 
 
 The assignee shall have all the rights of action — 
 
 This prflvision embodies what is recognized in England as law on this 
 subject, 1 D. & M. pp. 560-1. In Scotland it would seem that Bank-
 
 SALE OF DEBTS. 35 
 
 ruptcy would be a valid ground of dissolution. Murdoch, pp. 53-4. 2 Bell, 
 643. In France the question is one of greater difhculty, it being contended, 
 that though tlie insolvency of one copartner may be a valid reason in the 
 mouths of the insolvent's copartners for demanding a dissolution, it gives 
 neither him nor his creditors any privilege or right which he would riot 
 have had under the agreement of copartnership. 4 Pardessus, p. 189, No. 
 1066. But see C. C. art 1865. 4 Duvergier, No. 443. The English and 
 Scotch system, though it respects in a less degree the conditions of the con- 
 tract of partnership,"is practically more equitable, taking the rights of all 
 parties into consideration ; and it tends to prevent a mode of evading the 
 consequences of liability, and of protecting the assets of a debtor from 
 seizure, which was gradually assuming alarming proportions in Lower 
 Canada. 
 
 2. After the dissolution of the firm — 
 
 Bankruptcy, {Faillite,) of itself operates a dissolution of a partnership. 
 Polhier, b^ociete. No. 148. Domat, liv. 1, t. 8, sect. 5, n. 12. Can. Code, 
 Partnership, No. 58. See also above cited ICnglish and Scotch authorities. 
 Story on Partnership, § 313. Code civ. art. 1865. 
 
 11. After having acted with due diligence in the collection As to doubt- 
 of the debts, if the assignee finds there remain debts due, the ful debts due 
 attempt to collect which would be more onerous than benefi- j^^ ^^ order- 
 cial to the estate, he may report the same to the creditors at a ed. 
 meeting thereof duly called for the purpose ; and with their 
 sanction he may obtain an order of the Judge to sell the same 
 
 by public auction, after such advertisements thereof as may be 
 required by such order ; and pending such advertisements, the 
 assignee shall keep a list of the debts to be sold, open to 
 inspection at his office, and shall also give free access to all 
 documents and vouchers explanatory of such debts ; but all Proviso : 
 debts amounting to more than one hundred dollars shall be sold 
 separately ; 
 
 C. Cora. art. 570. 2 Renouard, p. 335. Bed., Nos. 1064 et 6eq> 
 
 12. The person who purchases a debt from the assignee, Rights of pur- 
 may sue for it in his own name as effectually as the insolvent chaser of debt, 
 might have done, and as the assignee is hereby authorized to 
 
 do ; and a bill of sale (Form L.,) signed and delivered to him 
 by the assignee, shall be 7?nm^2/acie evidence of such purchase 
 without proof of the handwriting of the assignee ; and no war- 
 ranty, except as to the good faith of the assignee, shall be 
 created by such sale and conveyance, not even that the debt 
 is due ; 
 
 13. The assignee may sell the real estate of the insolvent, salo of insol- 
 but only after advertisement thereof, for the same time and in vent'a real 
 the same manner as is required for the actual advertisement of estate: notice, 
 sales of real estate by the Sheriff in the district or place where 
 
 such real estate is situate, and to such further extent as the as- 
 signee deems expedient ; but the period of advertisement may 
 be shortened to not less than two months by a resolution of the 
 creditors passed at a meeting called for the purpose, and ap- 
 proved of by the Judge ; and if the price offered for any real Power to 
 estate at any public sale duly advertised as aforesaid, is in the wthdrair: 
 3*
 
 86 
 
 SALE OF REAL ESTATE. 
 
 and sell after- opinion of the assignee too small, he may withdraw such real 
 ■wards. estate, and sell it subsequently under such directions as he 
 
 receives from the creditors ; 
 
 1. The assignee may sell the real estate — 
 
 There would seem to be no need of any formality of seizure or the like 
 before advertising. And as there is no restriction as to place, it would seem 
 tiiat the sale may be held at any convenient place, in the discretion of the 
 assignee. 
 
 2. After advertisement thereof in the same manner — 
 
 It may be doubtful whether this would require in Lower Canada the 
 publication ot the sale at the church door, as is necessary in sales by the 
 Sheriff. Till this point is settled, therefore, it would be a prudent precaution 
 to cause such publications to be made. 
 
 3. And to such further extent — 
 
 That is by advertisements in local papers, placards and similar means 
 of giving pubUcity to the sale. 
 
 4. The 2^^'^'^od of advertisement may be shortened — 
 
 This and the requisite directions lor the sale of the real estate if whh- 
 drawn, are proper matters to be disposed of at the general meeting of 
 the creditors referred to in § 11, p. 3. See note to that clause. 
 
 5. At any puli'Ac sale — 
 
 The first attempt at sale should be by public auction, but the subsequent 
 sale may be bj- private bargain, if so ordered by the creditors. 
 See S. act § i\A, 115. C' Com. art. 534 and art. 571 et seq. 
 
 14. Tlie sale of real estate in Upper Canada so made by the 
 assignet;, shall have the same effect as if the same had been 
 made by a Sheriff in Upper Canada, under a writ of execution 
 issued in the ordinary course ; and in LoAver Canada, such 
 sales shall have the same effect as if made by a Sheriff under 
 a similar writ ; and the deed of such sale which the assignee 
 executes, (Form M.) shall have precisely the same effect as a 
 Sheriff's deed has in that part of the Province within which the 
 real estate is situate ; but he may grant such terms of credit as 
 he may deem expedient, and as may be approved of b}^ the cre- 
 ditors for any part of the purchase money ; and if no previous 
 hypothec or mortgage remains upon such real estate, he shall 
 be entitled to reserve a special hypothec or mortgage by the 
 deed of sale, as security for the payment of such part of the 
 purchase money ; and such deed may be executed before wit- 
 nesses, or before Notaries, according to the exigency of the 
 law of the place where the real estate sold is situate ; 
 
 Effect of sale 
 of real estate 
 by assignee 
 in U. C and 
 L. C. respect- 
 ively. 1:^^ 
 
 Credit for 
 
 purchase 
 
 money. 
 
 Eeserving 
 mortp:age 
 therefor. 
 
 Duty of as- 
 signee sell! I g 
 
 1. And as may be appraised of by the creditors — 
 
 This is also a matter which should be submitted to the creditors at the 
 general meeting. See note to § 11. p. 3. 
 
 2. And if no previous hypothec or mortgage remains — 
 
 7'he previous portion of the paragraph does not limit the giving a term of 
 credit to the cases where the assignee can obtain a lirst mortgage; but although 
 this provision does not f.jrbid the taking of any but a first mortgage, it does 
 not seem to contemplate that any other will be taken. Practically therefore 
 credit will seldom be given except when the property is sold free of mort- 
 gages. 
 
 15. In Lower Canada, before advertising any sale of real estate 
 the assignee shall procure, at the expense of the estate, from
 
 REMOVAL OF ASSIGNEE, 3T 
 
 the Registrar of the County wherein such real estate is situate, real estate in 
 a certificate containing the names and residences as shewn by L. C. 
 the Registry books of all persons enregistered as hypothecary 
 creditors upon such real estate; and he shall himself deposit Notice to re- 
 in the nearest post office a notice with the postage paid tiiereon, fi^Sxms. 
 addressed to each of such creditors by the name and to the ad- 
 dress contained in such certificate, and also a notice addressed 
 to each creditor at any other place where the assignee has 
 reason to believe such creditor to be then resident, and also a And other 
 notice addressed to any other person whom the assignee has Vpj>.thecary 
 reason to believe to be then the creditor of such hypothecary ^'^ ^ °^^" 
 claim, — informing the creditors of tlie day fixed for the sale of 
 the real estate, and of the time within which the hypothecary 
 creditors are required to file their claims under this Act ; and cg^.^jg^ate of 
 before the day of sale he shall file in the oflice of the Court the Registrar to 
 certificate of the Registrar with a return thereon under oath as be filed. 
 to his doings in respect of such notices ; and the assignee j^j^^^j^j^ ^^ 
 shall be directly liable for any neglect of the duty imposed assignee for 
 upon him by this section, to any party suffering damage in neglect- 
 consequence of such neglect ; 
 
 1. Time within which the hypothecary creditors arc required to fie— 
 Witiiin six days from the daj' of sale. § 11, p. 7. 
 
 16. The assignee shall be subject to the summary jurisdic- Assignee to 
 tion of the Court or Judge in the same manner and to the be subject to 
 same extent as the ordinary officers of the Court are subject to rJ'^i^fionof" 
 its jurisdiction, and the performance of his duties may be the Court, 
 enforced by the Judge on summary petition in vacation, or by 
 
 the Court on a rule in term, under penalty of imprisonment, as 
 for contempt of Court, whether such duties be imposed upon 
 him by the deed of assignment, by instructions from ihe credi- 
 tors validly passed by them under this Act and communicated 
 to him, or by the terms of this Act ; 
 
 1. And communicated to him — 
 
 It is the duty of the as&igiiee to attend all meetings of credilors, and to 
 preserve minutes of ihem. If he performs this duty and is present when 
 the instructions are passed by the meeting, no further commuiiication of 
 them would seem to be necessary. 
 
 17. Before the period at which dividends may he declared, Removal of 
 any assignee may be removed by the Judge, upon proof of ^^^jo'^^! by a 
 fraud or dishonesty intlie custody or management of the estate, misconduct. 
 upon the application of any creditor ; and if such removal ^p.,f,intment 
 takes place, or if the assignee dies more than fifteen days of another. 
 before the said period, the Judge may appoint another assignee 
 
 in the same manner as he can appoint an assignee to an estate 
 in compulsory liquidation ; but if the assignee is removed or 
 dies within fifteen days of the said period, tiie Judge shall 
 order a meeting of creditors to be held for the piupose of 
 appointing another assignee, and shall cause notice of such 
 meeting to be given by advertisement ;
 
 38 
 
 REMUNERATION OF ASSIGNEE, 
 
 'Hemoval of 
 assignee by 
 creditoi'3. 
 
 Appointment 
 of another. 
 
 1. Before the period — 
 
 "Viz, two months from the first publication of the appointment of the 
 assignee. This is the time within which the creditors are called upon to 
 file their claims. § 3, p. 24, Rule 22, Forms D. and K. 
 
 Until this period expires, there is not supposed to be any satisfactory 
 mode of ascertaining the amount of the claims of creditors which may 
 be voted on, and the power of removal is therefore left with the Judge. 
 
 2. Within fifteen days — 
 
 Because that is the shortest period of time within which a meeting could be 
 called. — The creditors will then have proved their claims, and means will 
 exist for ascertaining the precise proportions in number and value of those 
 that vote. 
 
 18. Any assignee may be removed after the period at which 
 dividends may be declared, by a resolution passed by the 
 creditors present or represented at a meeting duly called for 
 the purpose ; and if the removal has been effected by an order 
 of the Judge, or if the assignee dies within fifteen days before 
 the said period, or if the removal is efiected by the creditors 
 after the said period, they shall have the right of appointing 
 another assignee, either at the meeting by which he is removed, 
 or at any other called for the purpose ; 
 
 1. Any assignee may be removed — 
 
 It does not- appear necessary that any reason for the removal should be 
 stated, or proved to exist. 
 
 2. Resolution passed — 
 
 That is upon the principle of computing the votes provided for by § 11, p. 2. 
 
 3. Within fifteen days — 
 
 These words must apply to the case of removal by order of the Judge, as 
 well as to the case of the assignee dying ; as if such order of removal is 
 made more than fifteen days beiore the period mentioned, the Judge him- 
 self appoints another assignee. Ante p. 17. 
 
 Assignee re- 19. The assignee so removed shall, nevertheless, remain 
 moved to re- subject to the summary jurisdiction of the Court, and of any 
 able. ' Judge thereof, until he shall have fully accounted for his acts 
 and conduct while he continued to be assignee : 
 
 Eemuneration 
 of ajsimee 
 
 20. The remuneration of the assignee shall be fixed by the 
 creditors at a meeting called for the purpose ; but if not so fixed 
 before a final dividend is declared, shall be put into the divi- 
 dend sheet at a rate not exceeding five per centum upon the 
 cash receipts, subject to objection by any creditor as exceeding 
 the value of the services of the assignee, in the same manner as 
 any other item of the dividend sheet ; 
 
 y.iiat shall be 21. Upon the death of an assignee the estate of the insolvent 
 c^tatc^inthe'^ ^^^'^ "^^^ descend to the heirs or representatives of the assignee, 
 event of his but shall become vested in any assignee who shall be appointed 
 death. by the creditors in his place and stead; and until the new 
 
 assignee is appointed, the estate shall be under the control of 
 
 the Judofe : 
 
 How assignee 22. After the declaration of a final dividend the assignee 
 Lis''di°s^harce ^^^' prepare his final account, and after due notice by adver-
 
 DIVIDENDS. 09 
 
 tisement may present a petition to the Judge for his discharge 
 from the office of assignee ; and from the time of the first 
 advertisement thereof, to the time of the presentation of such 
 petition, he shall keep such final account open for inspection 
 at his office ; 
 
 23. The assignee shall produce and file with such petition Assignee to 
 a bank certificate of the deposit of any dividends remaining file a certifi- 
 ■unclaimed, or of any balance in his hands, and thereupon the pg^it^n f^^^ 
 Judge, after hearing the parties, may refuse, or grant condition- discharge, 
 ally or unconditionally, the prayer of such petition. 
 
 1. Dividends remaining unclaimed — 
 See § 5, p. 17. 
 
 2. The parties — 
 
 Any of the creditors, the insolvent, and the assignee. 
 
 3. Conditionally or unconditionally — 
 
 One condition undoubtedly should be, that he should make up the record 
 ■of proceedings by and before him as assignee, and deposit it in the Court, 
 together with the minutes of the meetings of creditors and his register of 
 proceedings, with a correct list of the whole. 
 
 OF DIVIDENDS. 
 
 5. Upon the expiration of the period of two months from the Accounts to 
 £rst insertion of the advertisements giving notice of an assign- be kept and 
 ment, or of the appointment of an official assignee, or as soon Iped bv as^^' 
 as may be after the expiration of such period, and afterwards signee. 
 from time to time at intervals of not more than six months, 
 the assignee shall prepare and keep constantly accessible to 
 the creditors, accounts and stalemenls of his doings as such 
 assignee, and of the position of the estate and at similar 
 intervals shall prepare dividends of the estate of the insolvent : 
 
 1. Two months — 
 
 As soon as the assignee is appointed he must give notice of the fact by 
 advertisement, and call upon all creditors to file their claims within two 
 months from the first insertion of such advertisement. § 3, p. 24, Forms D. 
 and K. Rule 22. And during the same interval it will be the duty of the 
 assignee to proceed with the realization of the assets of the estate, and with 
 the investigation of its real condition. As it may reasonably be expected 
 that during this period the greater portion of the creditors will have filed 
 their claims, at its termination the assignee should be able to attain a very 
 close approximation to the actual position of its affairs. And he is there- 
 fore then required to lay before the creditors the information he has obtained. 
 For these reasons also, this is the time fi.ved for the first general meeting of 
 creditors, when all the regulations required for the guidance of the assignee 
 may be passed. § 11, p. 3. In Scotland four months are allowed for 
 similar purposes. S. Act, § 125. Kinnear, pp. 145 et seq. 
 
 2. Similar intervals — 
 
 That ie of not more than six months, but he should declare dividends as 
 often as he has funds to divide. 
 
 2. All debts due and payable by the insolvent at the time of What debts 
 the execution of a deed of assignment, or at the time of the may rank for 
 issue of a writ of attachment under this Act, and all debts due ^^^
 
 40 
 
 CONDITIONAL DEBTS, 
 
 of insolvent's ^iit not then actually payable, subject to such rebate of interest 
 
 estate and as may be reasonable, shall have the right to rank upon the 
 
 how. ^ estate of the insolvent ; and any person then being as surety or 
 
 Suretie^^of Q^l^gj.^^|gg liable for any debt of the insolvent who subsequently 
 
 ingfor him. pays such debt, shall stand in the place of the original creditor, 
 
 if such creditor has proved his claim on such debt ; or if he has 
 
 not proved shall be intitled to prove against and rank upon the 
 
 estate for such debt, to the same extent and with the same 
 
 effect as such creditor might have done ; 
 
 1. At the time of the execution of a deed of assignment — 
 
 Debts incurred afterwards would not be proveable, and therefore the 
 insolvent would not be relieved from thera by a discharge under the act- 
 Although all assets acquired up to the time of the discharge are vested in 
 the assignee. 5 3, p. 22, § 2, p. 9. Renouard, No. 89. Pardessus, No. 
 1117. 3 Locre, p. 70. 1 Boulay-Paty, No. 67. 
 
 2. Rebate — 
 
 This is the ordinary rule. 2 D. & M., p. 809. Murdoch, p. 253. 
 
 3. Reasonable — 
 
 The only reasonable mode of arriving at the rebate, is to adopt the date of 
 the deed of assignment, or of the appointment of the official assignee, as 
 the period from which it is to be calculated. 
 
 4. .4s such creditor might have done — 
 
 That is after the surety has paid the debt, but not before. 
 
 These rules with regard to sureties are similar to those in force in 
 England, France and Scotland. 2 D. & M., p. 838. Murdoch, p. 255. 12 
 and 13 Vict. cap. 173. Archbold, 154. C. Com. art. 544. 2 Bedarride, 
 Nos. 881, 882. And they are strictly in accordance with the principles of 
 our Common law. 
 
 Contingent 
 claims, pro- 
 vision for pay- 
 ment of. 
 
 In certain 
 
 cases Judge 
 may order 
 estimate of 
 value to be 
 made. 
 
 .3. If any creditor of the insolvent claims upon a contract 
 dependent upon a condition or contingency, which does not 
 happen previous tc the declaration of the first dividend, a divi- 
 dend shall be reserved upon the amount of such conditional or 
 contingent claim until the condition or contingency is deter- 
 mined ; but if it be made to appear to thejudge that such reserve 
 will probably retain the estate open for an undue length of time, 
 he may, unless an estimate of the value thereof be agreed to 
 between the claimant and the assignee, order the assignee to 
 make an award upon the value of such contingent or condi- 
 tional claim, and thereupon the assignee shall make an award 
 after the same investigation, and in the same manner and sub- 
 ject to a similar appeal, as is hereinafter provided for the 
 making of aw^ards upon disputed claims and dividends, and for 
 appeals from such awards ; and in every such case the value so 
 established or agreed to shall be ranked upon as a debt payable 
 absolutely ; 
 
 1. Dependent upon a condition or contingency — 
 
 The contingency or condition may aiTect the amount of the debt, as in 
 the case of a re7ite viagere or annuity : or the existence of the debt, as in the 
 case of a debt payable only in the event of the creditor surviving the debtor ; 
 or merely the time of payment, as in the case of a debt payable upon the 
 death of another. In such cases the rule to be applied in estimating the 
 value of the claim would be different, but may be discovered, and a 
 sufficiently accurate result obtained. This provision will most frequently
 
 PRIVILEGED DEBTS. ^^ 
 
 be called into operation by claims made by wives upon their husband's 
 estates for sums of money settled upon them in lieu of dower, and payable 
 only in case of their surviving their husbands. Unless the judgment in the 
 case of the Bank of Montreal vs. Leslie, and Delisle, opposant, be maintained, 
 deciding that such claims cannot rank at all upon the debtors estate, the 
 value of such claims will have to be ascertained by a comparison of the 
 value of the lives of the husband and wife, according to Life Assurance 
 tables or other reliable data. 
 
 2. Award after the same investigation — 
 See post p. 13. 
 
 3. Ranked upon — 
 
 And voted upon, and computed as the value of the claimants demand, in 
 all calculations of the proportionate value of creditor's claims. If a dividend 
 has been previously reserved upon the full amount of the claim, it should 
 revert to the estate, giving the creditor his dividends from the first, upon the 
 estimated value. These provisions with regard to estimating the value of 
 contingent or conditional claims, are similar to those acted upon in England 
 and Scotland. Murdoch, pp. 253 et seq. 2 D. & M , 847. 
 
 4. In the preparation of the dividend sheet due regard shall be Preparation of 
 had to the rank and privilege of every creditor, which rank and g^^^t^^ 
 privilege, upon whatever they may legally be founded, shall 
 
 not be disturbed by the provisions of this Act ; but no dividend Creditors 
 shall be paid to any creditor holding collateral security from lateraf secu- 
 the Insolvent for his claim, until the amount for which he shall rity. 
 rank as a creditor on the estate as to dividends therefrom, shall 
 be established 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 proportion is required 
 to be ascertained ; 
 
 1. Shall be paid — 
 
 But the dividend should be reserved pending the adjustment of the 
 amount for which the creditor is to rank. 
 
 2. Hereinafter — 
 See next clause. 
 
 3. In voting at meetings — 
 
 This really places the creditor's vote upon a proper footing. For if a 
 creditor could vole upon the nominal amount of Ins claim without reference 
 to his security, the hypothecary creditors would often control the manage- 
 ment of the pergonal property, without being interested in it to any con- 
 siderable extent. See note to next clause. 
 
 5. A creditor holding security from the Insolvent, or from his Duty of such 
 estate, shall specify the nature and amount of such security in secured cre- 
 his claim, and shall therein on his oath put a specified value po'T^er'oTi^- 
 on such security ; and the assignee, under the authority of the signee. 
 creditors, may either consent to the retention of such security 
 
 by the creditor at such specified value, or he may require from 
 such creditor an assignment and delivery of such security, at 
 an advance often per centum upon such specified value, to be 
 paid by hiiu out of the estate so soon as he has realized such 
 security, in which he shall be bound to the exercice of ordinary 
 diligence; and in either of such cases the difterence between 
 the value at which the security is retained or assumed and tl>e
 
 42 DOUBLE RANKING. 
 
 amount of the claim of such creditor, shall be the amount for 
 which he shall rank and vote as aforesaid ; 
 
 1. Holding security from the Insolvent—' 
 
 A creditor who holds security derived from other sources than the insol- 
 vent or his estate, is not bound to specify it in his claim, or put a value 
 on it It is only when it proceeds from the insolvent that his creditors are 
 interested in it. Ex parte Parr, 1 Rose, 76. D. & M., p. 864. S. act 
 § 59, 60. 
 
 2. May either consent to the retention of such security — 
 
 In France the assignee can only demand an assignment of the security, 
 upon paying the debt. In England he has no such right under any 
 circumstances. The rule in our act is taken from that which prevails in 
 Scotland, and which appears more advantageous to the estate than that 
 of France or England, and perfectly just towards the creditor. If he be 
 left to realise the security, the sale of it would too often be a mere device to 
 convert it to his own use at a nominal price. If it be taken from him and 
 realised for his benefit by the assignee, the expense of the sale, and the 
 depreciation of value which follows from seizure, would greatly diminish 
 the proceeds. Rut if the creditor be required to put a value upon it on oath, 
 with the privilege to the assignee of taking it from him at a small advance 
 upon such valuation, as an additional check upon its correctness ; there 
 will be a probability that the right of property in the security will finally 
 pass from the estate at its fair value, and without much expense. Under 
 all these systems the creditor is only permitted to rank for the balance due 
 him after the deduction of the proceeds of his security. C. Com. act 546 et 
 seq., and 65'2 et seq. 3 Bedarride, pp. 2 et seq., and 48 et seq. 2 Renouard, 
 pp. 387 et seq. E. act 1849, § 184. D. & M., pp. 863 et seq. Archbold, 
 pp. 160 et seq. Murdoch, pp. 256 et seq , 260 et seq. 
 
 3. Under the authority of the creditors — 
 
 This can only be given at a meeting, and should be one of the subjects 
 discussed at the first general meeting. 
 
 4. Paid out of the estate so soon as he has realized — 
 
 The assignee is not bound to pay for the security in cash, but only when 
 he has realized it ; in doing which he is bound to use ordinary diligence, 
 and if he does not, may be forced on by the Judge. But on the other hand 
 he must pay the price fixed out of the estate, whether the amount be 
 realized from the security or not. 
 
 How creditors 6. The amount due to a creditor upon each separate item of 
 
 ^ot!iJf'?^*^^^ his claim at the time of the assignment, or of the appointment 
 payment of r *u ^ • i • . ^ i i n r ^ c 
 
 claima. oi the onicial assignee, as the case may be, shall lorm part oi 
 
 the amount for which he shall rank upon the estate of the insol- 
 vent, until such item of claim be paid in full, except incases 
 of deduction of the proceedsof collateral security as hereinbefore 
 provided ; but no claim or part of a claim shall be permitted to 
 be ranked upon more then once, whether the claim so to rank 
 be made by the same person or by different persons ; 
 
 1. The amount due * * at the time of the assignment — 
 The time at which the assignee is appointed, whether by a deed, or by 
 the Judge, is the common starting point of all the claims. And the amount 
 then due upon each iiem of the claim, may be ranked upon, (except where 
 deductions are made in respect of security,) until the estate is wound up, 
 or till such item of claim is paid in full. For instance, if a creditor holds 
 several notes or bills bearing the insolvent's name as endorser, and other 
 and different names of persons liable before him, such creditor may rank 
 for the amount due upon all the paper, at the date of the appointment of 
 the assignee, and may continue to do so until the estate is fully liquidated ; 
 •unless in the interim" one of the bills should be paid by one of the parties
 
 ALLOWANCE TO INSOLVENT. , ^g 
 
 liable before the insolvent, in which case the ranking on "that item of claim 
 would cease. See a similar rule laid down in Ex parte Groom, 3 M & A., 
 157. It is with reference to this provision that power is given to the assignee 
 to demand a supplementary oath. § 11, p. 6. 
 
 2. Ranked upon more than once — 
 
 The questions arising upon double ranking, are sometimes intricate, but 
 the principle is simple. When once a claim has drawn a dividend from 
 the estate, it cannot be peraiitted to rank for the same dividend a second 
 time. And this rule cannot be evaded by any device whatever, though the 
 debt may be apparently different : as when proof is made on the consideration 
 of a bill, after the bill has ranked ; or when the creditor is changed, as by 
 making proof by an endorser after the holder has proved. 
 
 7. If the insolvent owes debts both individually and as a In case insol- 
 member of a co-partnership, or as a member of two different co- '^?°'^ °^6s iu- 
 partnerships, the claims against him shall rank first upon the arco.parmer. 
 estate by which the debts they represent were contracted, and 
 
 shall only rank upon the other after all the creditors of that 
 other have been paid in full ; 
 
 1. Individually and as a member of a copartnership — 
 'Hie creditors of an individual debtor could never rank upon the property 
 of a firm of which he was a member concurrently with the creditors of such 
 firm, for a debt due by him individually and separately, but on the other 
 hand, until lately, the creditors of a copartnership could rank upon the 
 estate of one of the partners, concurrently with the creditors of such partner. 
 
 collf 
 
 Con. Stat. L. C. p. 535, which statute is followed in the foregoing clause. 
 
 8. The creditors, or the same proportion of them that may Allowance to 
 grant a discharge to the debtor under this Act, may allot to the i^^soivent. 
 insolvent by way of allowance, any sum of money, or any pro- 
 perty they may think proper; and the allowance so made shall 
 
 be inserted in the dividend sheet, and shall be subject to con- 
 testation like any other item of collocation therein, but only on 
 the ground of fraud or deceit in procuring it, or of the absence 
 of consent by a suilicient proportion of the creditor.-* : 
 
 1. The same proportion of thtiii ~ 
 § 9, p. 1. 
 
 9. No costs incurred in snits against the Insolvent after due No costs in 
 notice of an assiernment or of ihe issue of a writ of attachment ?"''f agamst 
 in compulsory liquidation has been given according to the pro- lowed after 
 visions of this Act, shall rank upon the estate of the insolvent ; notice. 
 
 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 r^tnk upon 
 the estate as if they formed part of the original debt; 
 
 Due notice — 
 
 Thai is, ''by advertisement" according to § 11, p. 1. 
 
 10. Clerks, and other persons in the employ of the Insolvent hq^ clerks 
 in and about his business or trade, shall be collocated in the and servants
 
 44 
 
 UNPROVED CLAIMS. 
 
 shall rank for dividend sheet by special privilege for any arrears of salary or 
 wages. 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 attachment 
 under this Act, not exceeding three months of such arrears ; 
 
 1. By special privilege — 
 
 That is, out of the proceeds of the moveable property affected by such 
 privilege as the law stands. And if there be a conflict of privilege, it will 
 be decided by the law applicable thereto. Anle p. 4. And it would seem 
 that under the law the Clerks and persons engaged about the business of 
 the Insolvent are only privileged upon the goods in which he traded. C. 
 C. Can. Priv. et Hyp"! art. 32. 
 
 2. Arrears due and unpaid at the time — 
 
 The engagements of all persons in the employ of the insolvent cease upon 
 the execution of a7i assignment, or the issue of a writ of attachment. And 
 their privilege is restricted to wages actually due, no allowance for the 
 sudden cessation of their employment being permitted. This seems to be 
 in accordance with the former law. Earl vs. Casey, 4 L. C. Rep., 174. 
 Poutre vs. Poutre, 6 L. C. Rep , 463. And it is the same in France. C. 
 Com art. 549. And in Scotland. S. act § 122. And in England, D. & 
 M., 79fi. 
 
 3. Not exceeding three months — 
 
 lliis restricts very much the period for which a privilege is allowed by 
 the Common law, which is understood to be two years. See C. C. of Can., 
 loc. cit. In Scotland it extends only to one month's arrears, in England tjo 
 three months, and in France to six. (See authorities cited in last note.) 
 
 Notice of 
 dividend 
 sheet. 
 
 11. So soon as a dividend sheet is prepared, notice thereof 
 (Form X) shall be given by advertisement, and after the expiry 
 of six juridical days from the day of the last publication of 
 such advertisement, all dividends which have not been objected 
 to within that period shall be paid ; 
 
 Se& for similar provisions S. Act § 127 ; Murdoch, p. 305. 
 
 Provision in 12. If it appears to the assignee on his examination of the 
 case it appears books of the insolvent or otherwise, that the insolvent has 
 creditorshave <^rdinary, hypothecary or privileged creditors who have not 
 not filed filed claims before such assignee, it shall be his duty to reserve 
 
 claims dividends for such creditors according to the nature of the 
 
 claims, and to notify them of such reserve, which notification 
 ma;y be by letter through the post, addressed to such creditor's 
 residence as nearly as the same can be ascertained by the as- 
 signee ; and if such creditors do not file their claims and 
 apply for such dividends previous to the declaration of the last 
 dividend of the estate, the dividends reserved for them shall 
 form part of such last dividend ; 
 
 1 . Hypoth eca ry— 
 
 This must mean hypothecary creditors who have not registered. As those 
 "who have registered their hypolhcques, will have received notice under § 4, 
 p. 15. 
 
 2 And apply for such diridends— 
 
 This shouKl not be construed to mean that if the creditor does not demand 
 his dividend as well as file his claim, he will be deprived of it ; for that 
 would place this class of creditors in a diilerent position from all others. 
 But the filing of the claim should be held to be an application for a dividend
 
 OBJECTIONS TO DIVIDENDS. 45 
 
 lender this clause. And if the creditor does not afterwards claim the amount 
 awarded him, it will follow the rule as to unclaimed dividends, established 
 post p. 17. 
 
 13. If any dividend be objected to, within the said period of Case of objec- 
 six days, and any dispute arises between the creditors of the tionstoor 
 insolvent or between him and any creditor, as to the correct cli=F'^tes con- ■ 
 amount of the claim of any creditor, or as to the ranking or dends pro- 
 privilege of the claim of any creditor upon such dividend slieet, vided for. 
 
 the assignee shall obtain from the creditor whose claim or . . 
 
 i--T^ii- ** i ' 1 • Assignee's 
 
 ranking is disputed, his statements ana vouchers in duty to ex- 
 support thereof, and from the Insolvent or opposing creditor, amine, &c- 
 a statement showing his pretensions as to the amount 
 thereof, and shall hear and examine the parties and their 
 witnesses under oath, which oath the assignee is hereby 
 empowered to administer ; and shall take clear notes 
 in writing of the parole evidence adduced before him, and shall 
 examine and verify the statements submitted to him, by the 
 books and accounts of the Insolvent and by such evidence, 
 vouchers and statements as may be furnished to him ; and 
 shall make an award in tlie premises, and as to the costs of 
 such contestation, which award shall be deposited in the Court 
 and shall be final, unless appealed from within three days 
 from the date of its communication to the parties to the 
 dispute ; 
 
 1. The assignee shall obtain * * * » statements and vouchers — 
 Whether the word "statements" is to be construed as meaning "alle- 
 gations " or not, it would be for the advantage of all parties, if the contiicting 
 pretensions of the parties were required to be in writing : and accordingly 
 it is so ordered by Rule 8. Not only is the assignee to award upon these 
 pretensions, but they may require to be discussed before a Judge, and 
 even in the higher Courts of Appeal ; and written statements will be 
 absolutely necessary there to ei.able the question at issue to be satisfactorily 
 disposed of. In fact if the matter in dispute be of any importance. Counsel 
 should be employed to settle the issues, if not to conduct the case before 
 the assignee. 
 
 2. Shall hear and examine the parties^ and their witnesses under 
 oath — 
 
 That is shall do so in the manner usual in litigation, observing the ordinary 
 and reasonable rules as to evidence, of which the following maybe stated as 
 of the highest practical importance, and as requiring to be referred to, oftenest 
 in ordinary cases : 
 
 1. That the burden of proof shall be upon him who affirms a proposition 
 of fact, rather than upon him who denies it ; 
 
 2. That the party upon whom is the burthen of proof, shall begin ; 
 
 3. That the party who begins shall have the right to adduce evidence in 
 rebuttal ; but that such evidence shall only be such as tends to destroy the 
 case of his opponent, and not such as tends directly to sustain his own ; 
 
 4. That the party who holds the negative cannot usually adduce evidence 
 in reply to his adversary's evidence in rebuttal ; 
 
 5. That if the parties are examined they cannot make evidence for 
 themselves ; but that their answers cannot be divided ; 
 
 6. That the best evidence of which the case is susceptible should be 
 adduced, and that secondary evidence should not be received until proof is 
 made that the best evidence cannot be obtained ; 
 
 7. That on the examination of a witness in chief, leading questions are
 
 46 
 
 AWARDS. 
 
 not usually permissible : but may be put on cross examination. This rule 
 however may be reversed if the witness is plainly hostile to the party who 
 produces him, and favorable to his opponent. 
 
 It would be obriously impossible here, to enter into a detailed discussion 
 of the law of evidence, but enough has been said to indicate the order in 
 which the proceedings should be carried on before the assignee. If the 
 dispute be conducted by Counsel, the assignee will be called upon to decide 
 questions as to the admissibility of evidence, and as to the propriety of ques- 
 tions put to witnesses, which might raise doubts even in the mind of a 
 Judge accustomed to deal with them. In such cases, if the objection be 
 to the admissibility of evidence, it would be better for the assignee to admit 
 it, enteritig the objection to its admission. If it be to the propriety of a 
 question, it is better to permit it to be put, if the assignee has any^doubt, 
 entering the objection ; and if ii be an objection to the form of the question, 
 it is always safe to insist that the question shall be so framed as to leave 
 the facts to be related by the witness, and not put into his mouth by the 
 questioner. And the assignee should always recollect that it is easy after- 
 wards to disregard testimony improperly admitted ; but that the exclusion 
 of that which ought to have been let in, is not susceptible of so simple a 
 rem.edy. 
 
 3. Clear notes in writing — 
 
 This is an important part of the duties of the assignee ; and he is 
 required by Rule 8 to cause such notes when taken to be signed by the 
 witness, when he swears to them — and they should also be certified by 
 himself as having been sworn before him. 
 
 4. Make an award — 
 
 The award should recite in general terms the observance of all the for- 
 malities prescribed by this clause, according to the laws respecting awards. 
 
 •5. Within three days — 
 
 See note to § 7, p. 4. 
 
 6. Of its communication — 
 
 The assignee should communicate it to both parties immediately upon its 
 being rendered and deposited. The making it in triplicate ; sending a 
 part to each litigant, and depositing the third' in Court, would be a satisfac- 
 tory mode of performing this duty. 
 
 Execution of 
 bis award. 
 
 14. The award of the assignee as to costs, may be made 
 executory by execution in the same manner as an ordinary 
 judgment of the Court, by an order of the Judge upon the 
 -application of the party to whom costs are awarded made after 
 notice to the opposite party ; 
 
 Costa of con- 
 testing any 
 claim, &c. 
 
 Pending ap* 
 peal. 
 
 Unclaimed 
 dividends,- 
 
 15. The creditors may by resolution authorize and direct the 
 costs of the contestation of any claim or any dividend to be 
 paid out of the estate, and may make such order either before 
 or pending any such contestation ; 
 
 Before or pending — 
 
 This does not seem to forbid such an order being made after the contes- 
 tation, as the first part of the clause is general. But it appears to be intended 
 only to remove doubts as to the power of the creditors to make an order 
 having a prospective effect, when the amouiit for which the estate is 
 bound by such order, is uncertain. 
 
 16. Pending any appeal, the assignee shall reserve a 
 dividend equal to the amount of dividend claimed ; 
 
 17. All dividends remaining unclaimed at the time of the 
 discharge of the assignee shall be left in the bank where they
 
 LEASES. 
 
 are deposited for three years, and if still unclaimed, shall then ho^y ^g^lt 
 be paid over by such bank with the interest accrued thereon, to -with, 
 the Provincial Government, and if afterwards duly claimed 
 shall be paid over to the persons entitled thereto, with interest 
 at the rate of three per centum per annum from the lime of the 
 reception thereof by the Government ; 
 
 18. If any balance remains of the estate of the insolvent, or Balanceof es- 
 of the proceeds thereof, after the payment in full of all debts tate after pay- 
 due by the Insolvent, such balance shall be paid over to the ™^^ ^ *' 
 Insolvent upon his petition to that effect, duly notified to the 
 creditors by advertisement and granted by the Judge. 
 
 OF LEASES. 
 
 G. If the insolvent holds under a lease property having a Kow unex- 
 value above and beyond the amount of any rent payable under pi^^^ leases 
 such lease, the assignee shall make a report thereon to the jn^oiy^t ^ 
 Judge, containing his estimate of the value of the estate of the shall be dealt 
 leased property in excess of the rent ; and thereupon the Judge '^ith if the 
 may order the rights of the insolvent in such leased premises than the Talu& 
 to be sold, after notice by advertisement of such sale ; and at ofthepre- 
 the time and place appointed such lease shall be sold, upon mises. 
 such conditions, as to the giving of security to the lessor, as the Sale of his 
 Judge may order ; and such sale shall be so made subject to interest, 
 the payment of the rent and to all the covenants and conditions 
 contained in the lease ; and all such covenants and conditions 
 shall be binding upon the lessor and upon the purchaser, as if 
 the purchaser had been himself lessee and a party with the 
 lessor to the lease : 
 
 1. If the insolvent holds under a lease — 
 
 This is a most important chapter, innovating to a very extensive degree 
 upon the rights of the lessor. But such a change in the law was necessary, 
 foi a lessor might absorb a very large portion or all of the assets in his pre- 
 mises, by insisting upon payment of his rent to the termination of the lease, 
 perhaps some years in advance ; while the property thus paid for would be 
 a burthen rather than an advantage to the estate. 
 
 2. Having a value above and beyond the rent — • 
 
 Often resulting from improvements made by the insolvent with his own 
 funds, especially under long leases. 
 
 3. The Judge may order — 
 
 That is if he is of opinion that the excess of value over rent, is sufficient 
 to render it probable that a profit will be realized by such sale. 
 
 4. The giving of security to the lessor — 
 
 The lessor should not be compelled to accept a tenant affording him less 
 security for his rent than he previously possessed. Therefore, if the pur- 
 chaser of the lease be unable to furnish the premises n^ith moveables 
 sufficient to secure the rent, as eftectually as it had been secured by the 
 insolvent, or at least to a reasonable extent, the Judge should order further 
 securitv to be given for it. 
 
 2. If the insolvent holds under a lease extending beyond the Unexpired 
 year current under its terms at the time of his insolvency, ^^?^^f "^^ 
 property which is not subject to the provisions of the last pre- ^^^"^ *"*'
 
 48 
 
 LEASES. 
 
 preceding Ceding section, or respecting which the Judge does not make 
 section. an order of sale, as therein provided, the creditors shall decide 
 
 at any meeting which may be held more than three months 
 before the termination of the yearly term of the lease current at 
 the time of such meeting, whether the property so leased should 
 be retained for the use of the estate, only up to the end of the 
 then current, or if the conditions of the lease permit of further 
 extension, also up to the end of the next following yearly term 
 thereof, and their decision shall be final ; 
 
 1. Current under its terms — 
 
 That is the current year of the lease, not the current year of the calendar. 
 
 2. Property ivldch is not subject — 
 
 That is, property which is not of greater annual value than the rent 
 stipulated to be paid for it ; or not of an annual value so much greater as to 
 induce the Judge to make an ordei for the sale of the lease. 
 
 3. More than three months — 
 
 So that if they decide to give it up, the landlord may have the last three 
 months of the current yearly term, within which to obtain a new tenant for 
 the following year. 
 
 4. Up to the end of the next folloiving yearly term. 
 
 They are not permitted to retain the property for any broken period of a 
 new year, but must hold it for the whole year, or not at all. 
 
 Cancelling 3. From and after the time fixed for the retention of the 
 
 the lease, and leased property for the use of the estate, the lease shall be can- 
 lessor in such celled and shall from thenceforth be inoperative and null ; and so 
 case. soon as the resolution of the creditors as to such retention has 
 
 been passed, such resolution shall be notified to the lessor, and 
 if he contends that he will sustain any damage by the termina- 
 tion 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 vipon the estate ; and the 
 assignee shall proceed forthwith to^ake an award upon such 
 claim, in the same manner, and after similar investigation and 
 with the same right of appeal as is herein provided for in the 
 case of claims or dividends objected to ; 
 
 1. Fixed— 
 
 By the creditors, under the last preceding clause. 
 
 2. To make an award — 
 
 It is not necessary apparently that the claim should be contested before 
 the assignee commences the proceedings for his award ; but it may be 
 contested like any other claim, and probably should be, if considered exces- 
 sive, in order that there may be a party to conduct the case against the 
 lessor. 
 
 Measure of 
 damages to 
 lessor. 
 
 4. In making such claim, and in any award thereupon, the 
 measure of damages shall be the difference between the value 
 of the premises leased when the lease terminates under the re- 
 solution of the creditors, and the rent which the Insolvent had 
 agreed by the lease to pay during its continuance ; and the 
 chance of leasing or of not leasing the premises again, for a 
 like rent, shall not enter into the computation of such damages ; 
 and if damages are finally awarded to the lessor he shall rank 
 for the amount upon the estate as an ordinary creditor.
 
 signee. 
 
 APPEAL. 49 
 
 1. Measure of damages — 
 
 All the other continuing contracts of the insolvent are terminated by his 
 insolvency, without opening claims for damages for their non-performance ; 
 and it seems difficult to find a good reason why the contract of lease of 
 property, should form an exception. By this clause, therefore, the claim for 
 damage is restricted to the actual diminution in the value of the premises, 
 below the rent stipulated. The claim for damage even in this limited 
 form, would scarcely be sustainable in principle, were it not that the 
 creditors have the right under p. 1, of benefiting by any increased value, 
 and therefore may perhaps be held in fairness bound to submit to a claim 
 for any dimirmtion. 
 
 2. He shall rank for the amount — 
 
 The rent of the premises duriiig*the current yearly term, must be paid in 
 full, if the goods in the premises suffice for that purpose, or if the premises 
 are occupied by the assignee for the estate. And if they are retained for 
 any subsequent term, the rent must be paid in full ; but the damage 
 awarded is only a common debt, without privilege. 
 
 OF APPEAL 
 
 7. There shall be an appeal to the Judge from the award of Proceedings 
 an assignee made under this Act, which appeal shall be by in appeal from 
 summary petition of which notice shall be ^iven to the oppo- ^'svardof as- 
 site party and to the assignee ; and the assignee shall attend 
 before the Judge at the time and place indicated in such notice, 
 and shall produce before him all evidence, notes of evidence, 
 books, or proved extracts from books, documents, vouchers or 
 papers having reference to the matter in dispute ; and thereupon 
 the Judge may confirm such award, or modify it, or refer it 
 back to the assignee for the taking of further evidence, by such 
 order as will satisfy the ends of justice : 
 
 1. Summary Petition — 
 
 Which should set forth the matter in issue, as already set forth in the 
 statements of the parties before the assignee. 
 
 2. Notice should be given — 
 
 One clear juridical day's notice ; and only three days are allowed for 
 appealing from the award of an assignee, (§ 5, p. 13.) A question arises 
 upon the terms of this limitation of the time for appeal, whether the service 
 upon the opposite party of a petition and notice in appeal, within three 
 days from the date of the communication of the award, will satisfy the con- 
 dition that it shall be " appealed from " within three days ; or whether 
 the petition must actually be presented within the three days, to satisfy 
 that condition. The former construction would seem to be most reasonable, 
 and not to be inconsistent with the ordinary practice of the Courts. For if 
 an action may properly be said to be instituted so soon as a writ has 
 issued, reqiiiring the defendant to appear on a future day to answer the 
 demand of the plaintifl"; so also a judgment may be said to be appealed 
 from, 60 soon as the appellant has taken the proceeding prescribed by law, 
 for causing the respondent to appear at a future day before the tribunal in 
 appeal, to sustain the judgment. 
 
 3. Thereupon — 
 
 That is of course, after hearing the parties. 
 
 2. If any of the parties to such appeal are dissatisfied with And on appeal 
 such order of the Judge, they may appeal from his judgment in ^'^^^ decision 
 Lower Canada to the Court of Queen's Bench for Lower °®* 
 
 Canada on the Appeal Side thereof, and in Upper Canada to 
 4
 
 50 
 
 ALLOWANCE OF APPEAL. 
 
 either of the Superior Common Law Courts or to the Court of 
 Chancery, or to any one of the Judges of the said Courts ; first 
 obtaining the allowance of such appeal in Lower Canada by a 
 Judge of the Superior Court, and in Upper Canada by a Judge 
 of any of the Courts to which such a])peal may be made ; and 
 in either case the Judge shall be guided in allowing the same 
 by the amount to which the assets of the estate may be affected 
 by the iinahdecision of the question at issue, as well as by his 
 opinion upon the pretensions of the appellant ; but any appeal 
 JudgeinU. C. ^o ^ single Judge in Upper Canada may in his discretion be 
 referred, on a special case to be settled, to the full Court, and 
 on such terms in the meantime as he may think necessary and 
 just ; 
 
 Appeal must 
 be allowed. 
 
 As to appeal 
 to a sinp-le 
 
 1. They may appeal — 
 
 There is now, however, in Lower Canada, an intermediate Court of 
 revision created by the 27 and 28 Vict., cap. 39, and this Court has juris- 
 diction in matters of insolvency under p. Impost. 
 
 2. To any one of the Judges of the said Courts — 
 
 In Upper Canada, a Judge of an inferior tribunal being entrusted with 
 original jurisdiction in Insolvency, and with appellate jurisdiction when 
 the assignee has decided in the first instance, an appeal is given from him 
 to one Judge of the highest Courts of original jurisdiction. But such Judge 
 has the power of referring the points in dispute to the full Court. See this 
 clause post. In Lower Canada it is the Judges of the highest Court of original 
 jurisdiction who are entrusted with the management of matters in Insol- 
 vency. 
 
 3. Guided in allowing the same — 
 
 The amount claimed could not be made a test of jurisdiction in appeal, 
 for the interest of the estate and of the claimant, may be less upon a large 
 claim, if the dividend is small, than upon a claim of small amount where 
 the estate has large assets. The amount of actual interest therefore is 
 made of weight in deciding the question of the allowance of an appeal, and 
 upon this and his opinion of the merits of the appeal itself,' the Judge is 
 required to decide upon the application for its allowance. 
 
 It is not of course intended that the Judge should refuse the appeal merely 
 because his opinion is adverse to the pretensions of the appellant, unless 
 the case be one in which the appellant is plainly wrong, and where the 
 appeal can have no other effect than to keep open the estate. If the ques- 
 tion appealed upon, be sustainable by a reasonable argument, or the correct- 
 ness of the judgment be susceptible of a reasonable doubt, and if the amount 
 imperilled be sufficiently large to justify it, the appeal should be allowed. 
 
 Notice of ap- 
 peal must be 
 given ■within 
 a certain 
 period. 
 
 An] security. 
 
 3. Such appeal shall not be permitted unless the party 
 desiring to appeal applies for the allowance of the appeal, 
 with notice to the opposite party, within five days from the 
 day on which the judgment of the Judge is rendered, nor un- 
 less within five days after the allowance thereof, he causes to 
 be served upon the opposite party and upon the assignee, a 
 petition in appeal setting forth the petition to the Judge, and 
 his decision thereon, and praying for its revision, with a notice 
 of the day on which such petition is to be presented, and 
 also within the said period of five days causes security to be 
 given before the Judge by two sufficient sureties, that he will 
 duly prosecute such appeal, and pay all costs incurred by 
 reason thereof by the respondent ;
 
 APPEAL. ^J- 
 
 4. The petition in appeal, when the appeal is to a Court, Presenting of 
 shall be presented on one of the first four days of the term next petition in ap- 
 foilowing the putting in of the security in appeal, and shall not ^^ 
 
 be thereafter received ; and when the appeal is to a Judge, the 
 petition shall be presented within ten days after putting in 
 security, and shall not thereafter be received ; and on or before Filing docu- 
 the day of the piesentation of ihe petition, the assignee shall ments, 
 file in the office of the Court of Appeal, or of the Court to 
 which the Judge appealed to belongs, the evidence, papers, 
 and documents which had been previously produced before the 
 Judge, and thereupon the appeal shall be proceeded with and 
 decided according to the practice of the Court ; 
 
 1. The Petition in Ajjpcal — 
 
 Thai is to say, in appeal from the decision of a Judge, rendered upon 
 petition to revise the award of an assignee. 
 
 2. When the appeal is to a Judge — 
 
 That is, to a Judge of one of the higher Courts in Upper Canada, from 
 the decision of a Judge of the County Court. 
 
 5. If the party appellant does not present his petition on the in case peti- 
 day fixed for that purpose, the Court or Judge selected to be tion is not 
 appealed to as the case may be, shall order the record to be due^^^me " 
 returned to the assignee, and the party respondent may on the 
 following or any other day during the same term produce be- 
 fore the Court, or within six days thereafter before such Judge, 
 
 the copy of petition served upon him, and obtain costs thereon 
 against the appellant ; 
 
 6. The costs in appeal shall be in the discretion of the Court Coats in ap- 
 or of the Judge appealed to, as the case may be ; ^ 
 
 In the discretion of the Court — 
 
 As there is provision for a tariff of costs, (§ 11, pp. 17, 18,) this discretion 
 is probably only intended to be exercised upon the question, whether a 
 party shall pay costs or not, and not upon the quantum of such costs. 
 
 7. In Lower Canada any order of a Judge made under any Decision of 
 of the foregoing sub-sections, shall be subject to review under one Judge in 
 the provisions of any Act passed during the present Session, in ^•^" *?^ 
 the same manner and upon the same conditions as judgments review. 
 
 of the Superior Court for Lower Canada ; and in such cases 
 the provisions respecting appeal to the Court of Queen's Bench 
 hereinbefore made, shall apply to the judgments of the Court 
 of Review. 
 
 Subject to review — 
 
 The Act 27 and 28 Vict., cap. 39, creates a Court of review, to which 
 this clause will apply. 
 
 OF FRAUD AND FRAUDULENT PREFERENCES. 
 
 The legislation of France on the subject of the fraudulent disposition of 
 the estate of an insolvent debtor, has varied very considerably since the 
 well known Edict of 1609. That law declared absolutely null all transports, 
 4*
 
 52 
 
 FRAUD AND FRAUDULENT PREFERENCES. 
 
 cessions, ventes et alienations made to the children, presumptive heirs, and 
 friends of the debtor ; and also provided that, if ihese transactions were 
 entered into — "Jaites et acceptees^' — in fraud of the creditors — the persons 
 engaged in them should be punished as accomplices r)f the bankrupt. 
 This provision would seem to disregard the question whether the acquisi- 
 tion was gratuitous or d iitre unereu:c ; and, in so far as regarded the eliect of 
 the transaction, whether or no there was the consilium Jraudis on the part 
 of either of the contracting parties. In practice however, there is no doubt 
 that the rule of the Roman law was followed in the construction ot this 
 Edict — and that an acquisition by an onerous title without the intention of 
 defrauding creditors, or notice of insolvency either direct or constructive, 
 would have been held valid even if made to a friend of the debtor, t'ormier, 
 who wrote only six years after the promulgation of the Edict of 1609, thus 
 lays down the law as then understood : 
 
 Or, pour y avoir lieu a cfste action (he says) il fatU que le detteur ait 
 all ener pour frauder ses crcanciers ou a la veritc, ou par ■/-rcsomplion ; et 
 que cdui qui a prins les biens n^ail estc ignorant du conseil et intention 
 frauduleucc. — Ce qui est vraij quand on prend la chose en verlu dhtn 
 contract oacreux comme de vendition ou d^esfhange : autrement en serait 
 si c'estai' en vertu de contract lucraiif comme de donation ou dc legs tes- 
 iamenta re, car au dit c>:s celvy qui a prins suns autre distinction est 
 iouaiours suid a rendre ei restablir, pource qu^il est tousiours dcs7'aison- 
 nables qu^il soit enriclii uu domviage des cri^anciers. Code Henri IV., 
 Liv. 26, col. 1701, No. 5. 
 
 In 1667, a Reglement was made for the city of Lyons, by which it was 
 declared that ioutes cessions et transports sur les effects des Jaillis seront 
 nuls, s'/Ys ne sunt fails dix jours au mains avani la faillile publiquement 
 connue. — Art. 13. By the Ord. of 1673, tit. 11, art. 4, to2is transports, rentes 
 et donations de biens, meubles ou immeubles, faits enjraude des crcanciers, 
 were declared null. The former law made a certain proximity to the 
 period of failure a ground of absolute nullity — without reference to the 
 intention of the parties— the latter made the fraudulent intention of the 
 transaction a ground of nullity, without reference to the time at which it 
 took place. A declaration made in November 1702 extended the reglement 
 de Lyon to the whole kingdom, retaining the 4th article of the Ord. of 1673 
 in force : and thereafter if the transaction was within ten days of the failure 
 no proof of fraud was requisite to annul it ;— if not, it might be annulled by 
 provhig a fraudulent intent. And when such an intent was relied on, 
 it was necessary to prove the complicity of the person dealing with the 
 debtor — either directly or constructively — in which proof, the usual pre- 
 sumptions arising from relationship, the absence or inadequacy of the con- 
 sideration — and the publicity of the embarrasments of the debtor, would 
 receive their due weight. 
 
 One of the principal difficulties which attended the enforcement of the 
 declaration of 1702 was the fixation of the date of the failure. The Edict of 
 160D and the declaration of 1702, alike described it as being the period at 
 which ihefaillite became publicly known : la faillite publiquement connue. 
 But this does not in any respect solve the difficulty, except in rare cases; for 
 while the day of the stoppage of payment by a great commercial house 
 might be publicly known, the great majority of failures are gradual. In 
 most of them there is a period of struggle, during which the debtor's dilfi- 
 culties gradually increase, from the first protest or failure to pay — until his 
 stoppage is entire and irremediable. And it may be as difficult to discover 
 the dale of the first dishonor of a just pecuniary call upon him — as it un- 
 doubtedly is to ascertain the moment of time when the continuance of his 
 business becomes Iropeless. In addition to this, unless the insolvent 
 occupies a prominent position, his failure may never become publicly 
 known — or Itnown at all, beyond the limited circle of the creditors who 
 suffer by it. 
 
 This difficulty appears scarcely to have received its due weight with the 
 Commissioners for codifying our laws; for they suggest articles (Nos. 56 and 
 59, title of obligations) which would render null all transactions that are 
 entered into within ten daj's of the bankruptcy of a trader, without providing
 
 FRAUD AND FRAUDULENT PREFERENCES. 
 
 or suggesting any mode in which the dale of that bankruptcy can be ascer- 
 tained or established. And aUhough, in the introductory remarks, a defini- 
 tion ofthe word bankruptcy is promised — which may remove the ditliculty — 
 it is not easy to perceive how a mere definition can r^iach the evil which 
 it is necessary to guard against. 
 
 By the code de coaimerce of J 808, the transactions of the debtor, preceding 
 the lailure, were divided into tliose wh'ch were absolutely null and those 
 which were subject to be set ;islde. Under its provisions, duiing the ten days 
 preceding the failure, no privilege orhypotheque could be acquired upon the 
 properly^of the debtor — no gratuitous tiansfer of immoveable properly could 
 take p'ace— and no payment of commercial debts, not mature, could be 
 made. All alienations, d litre oncreux, effected duiiug the some period, if 
 fippearing to be tainted with fraud, were annullable ; and all commercial 
 6h.r-o-. ri.^ni.' f^oatruv'ted by the debtor during that time, were picsumed ;o be 
 fraucfuient as to him, and were iiabie to '^'^ ^nuuUed^ on proof of fraud on the 
 pait of those in whose favor he contracted them. A'"i-d, fmail), it wa^ de- 
 clared, as ia the old code marchand, that lous fails et pa'^'f^^^^"'^ J^"^^ ^'"^ 
 fraude des creanciers sont nuls. 
 
 But, under this legislation, the difficulty as to the period of failure was 
 again encoun'ered, though in a difll^rent f )rm. The tribunal de commerce 
 had the power of declaring the period of the ouveriure de la faillite — and 
 that period was necessariiV antecedent lo t!ie judgment which established it. 
 That judgment appeared therefore to be capable of an indirect retroactive 
 operation oi an a'lmost uirlimited character, upon the previous transactions 
 of the debtor — and in this manner transfers and payments wereas^ailed 
 which had been made many years before the Jugement declaratif de la 
 faillite, but within ten days of the period to which by such judgment its 
 ouverture was referred. In one case, a transfer made seven years betore 
 the judgment ; in another, a payment made twenty years before the judg- 
 ment, \vere thus attacked — and the injustice of sucli a ccnslruclion of the 
 law, as was contended for by the plaintiffs in those cases, was so palpable 
 as probablv to exercise a considerable influence in promoting its rejection. 
 Dalloz Joum. de Cass, 28th May and •2-2d July, 18-23. The decisionsof the 
 Court of Cassation, settling the jurisprudence upon an equitable basis, by 
 refusing to follow the letter of the Code — was made the subject of much 
 controversy. See Pardessus, Nos. 1119, 1120 and 1121, Hors.ni Ques. iNos. 
 155, 15')— Bonlay Paty, Ts'o. 9i— 2 Renouard, p. 173. But the justice and 
 equity of those decisions, if not their leg dhy, were gerierally admitted. 
 
 By the law of 1838, the provisions of ttie code de commerce, in lespect oi 
 fraudulent c mveyancfs, was considera'ly changed. The retroact vc char- 
 acter of ihe judgment declaratory of thij failure was much mo litied The 
 dessaississeineiii of the debtor reckoned from the dn'e O' tiK't jiulg-npnt, in- 
 stead <»f fri.m t!ie dale lo which thrt jutlgment referred the f ilure. AH gra- 
 tuitous transfers of property, ad p.iymenls of debts not matured, all payments 
 of debts due, made otherwise than in money or in ejfe's de commerce — and 
 all securities upon real or personal property, granted tor delns previous y 
 incurred, were declared t) b; absolutely null, if they iccured wit da ten 
 days next before the time established by the tributial as that of the stoppage 
 of paymeni. And ad other transacti n- of ih - ilebtor, filtered into aUer the 
 stoppage of payment, were annullable, if the party contri.ctirig with trie 
 debtor knew ol such stoppage. No jjrovision is made by it respecting trans- 
 actions i)revious to the ten diys next befoie tiie >-!oppage, the>e beih}>- left to 
 tire operation oi the com non law, as established by art. Ilti7 "i tlii; civd 
 code. And th'S latter artiide in'roduces the rev cilory actiun of the Roman 
 and old French law, for the annu lation o' all act- d^ne in fraud of creditors. 
 
 In Scotland, the general rule of the c vil law prevails ; bui the time, rela- 
 tively to the Bankrupti-y, at which a transac ion ta'^t^s phice has, in certain 
 cases, a direct effici upun the validity of tne ai ts of the !^ankrn,!t Mn doch, 
 pp. -l to 13. And under that system, as in Franc^ and kome. to annul g a- 
 tuitous alienations by an insolvent, required no proof of f. aad on the part of 
 the receiver; and as it adopts the principle ih t, after inso vency, a debtor'* 
 property belongs to his creditors ; there is no difference, exce))t in detail, be- 
 tween its proTisions on the subject under consideration and those of France.
 
 54 FRAUD AND FRAUDULENT PREFERENCES. 
 
 In England, the intent to defraud creditors, is the only ground required to 
 sustain a demand to annul the debtor's acts. In the English law, such acts 
 are described as being in contemplation of Bankruptcy ; and they are void, 
 as being contrary to the spirit and policy of the Bankrupt law. 1, D. & M., 
 pp. 145 et seq. The phrase '' in contemplation of Bankruptcy " has, in Eng- 
 land, a well-understood technical meaning; and, as so understoo I, describes 
 with sufficient accuracy the condition of mind of a debtor who makes a 
 fraudulent conveyance or creates a fraudulent preference. A similar phrase 
 is used in our Act , and a reference may be advantageously had to the Eng- 
 lish authorities for an elucidation of its meaning. See D. & M., loc : cit :— 
 Archbold, pp. 307 et seq. 
 
 It will appear from this cursory examination of the provisions of these 
 different systems of Bankruptcy, on the subject of acts done in fraud of cre- 
 ditors, that their spirit is the fame, and that they vary only in detail ; and 
 ■our own statute has not departed from the principles that have governed the 
 legislation of other countries on the same subject. Under its provisions, as 
 under the laws of ancient Rome, of ancient and modern France, of England 
 and of Scotland, gratuitous alienations of property by an insolvent are in- 
 valid 5 and all acts are declared to be null which are done by the debtor 
 with intent to defraud, obstruct, impede or delay creditors, if the party con- 
 tracting with him has actual or constructive notice of the insolvency, and if 
 they serve to defraud, impede or delay creditors. Fraudulent preferences, 
 by securing or paying creditors, to the injury of the estate generally, are 
 declared null ; and if such transactions occur wJtljin a time named in the 
 act, they are presumed to have the defects which it pronounces fatal. Con- 
 sequently, the student of this portion of the act may avail himself of an 
 immense mass of learning, and a vast collection of adjudged cases, to be 
 found in the English, Scotch and French treatises already cited, and in many 
 others ; all of which are as applicable — or nearly so — to our statute as to the 
 systems which they more particularly exemplify. 
 
 What shallhe 8. All gratuitous contracts or conveyances, or contracts or 
 deemed frau- conveyances without consideration, or with a merely nominal 
 
 QUI^UTj COD" ' •/ 
 
 tracts or con- consideration, made by a debtor afterwards becoming an insol- 
 veyances. vent with or to any person whomsoever, within three months 
 next preceding the date of the assignment or of the issue of the 
 writ of attachment in compulsory liquidation, and all contracts 
 by which creditors are injured, obstructed, or delayed, made 
 by a debtor unable to meet his engagements, and afterwards 
 becoming an insolvent, with a person knowing such inability 
 or having probable cause for believing such inability to exist, 
 or after such inability is public and notorious, are presumed to 
 be made with intent to deiraud his creditors : 
 
 1. All graiuiloiis conlrncis, or contracts toith a merely nominal con- 
 sideration — 
 
 Jf'L.6,§]\. Pothier Oblns., 15*?. 3 Nouv. Den. Fraude relativement 
 aux creancier^. § ], No. 10. Domat liv., 2 tit. 10, sec. 1, No. 6. 6 TouUier, 
 Nos. 353, 351. 3 Bed. du dol, Nos. 1431 et seq. C. com., art. 446. 
 Murdock, pp. 3, 4. 
 
 2. IVilh any person tvhomsoerer — 
 
 As opposed to u person knowing ihe inability of the debtor to meet his 
 enfjaiivments, Th(-! gratuitous character of the contract being considered 
 suilii-iciit to esifib'ish a presumption of complicity on the part of the 
 recipif'nt of tlie property. 3 Bed. du dol, No. 1431. Murdoch, p. 3. 
 
 3. Made tvit/n'n three months — 
 
 'J hi.s period i,s very long, but as it applies only to gratuitous contracts, it 
 is difficult to see how it can effect any serious injustice to the recipient ; 
 while the creditors whose gage the thing conveyed was, will get their 
 rights with rejiard to it.
 
 FRAUD AND FRAUDULENT PREFERENCES. 55 
 
 4. By which creditors are injured, obstructed or delayed — 
 
 See authorities above cited, and also 2 Chardon, Nos. 205, 208. 3 Bed. 
 du del, No. 1457. 
 
 5. With a person knowing such inability — 
 
 This is in strict conformity with existing law, and with the modem law 
 of France. Domat, loc. cit., No. 4. Nouv. Pen., loc. cit., Nos. 12, 15. 6 
 Toullier, Nos. 348 to 366. 3 Bed. du dol, No. 1432. C. L. art. 1975. 
 
 6. Or after such inability is public and notorious — ^ 
 3 Bed. du dol, No. 1439. 2 Chardon, No. 208. 
 
 7. Are presumed to be made toith intent — 
 
 No evidence is required to establish the intent, the presumption created 
 by the circumstances being sufficient. 
 
 The consequence of such a presumption arising, are shewn in p. 3, post. 
 
 2. A conlract or conveyance for consideration by which Contracts or 
 creditors are injured or obstructed, made by a debtor unable to conveyances 
 meet his engagements with a person ignorant of such inability, ™iyen/void- 
 and before it has become public and notorious, but within able in certain 
 thirty days next before the execution of a deed of assignment «^ses. 
 or of a writ of attachment under this Act, is voidable, and may 
 be set aside by any Court of competent jurisdiction, upon such 
 terms as to the protection of such person from actual loss or 
 liability by reason of such contract, as the Court may order ; 
 
 1. With a person ignorant of such inability — 
 
 This ignorance is insuflicient to protect the recipient of the insolvent's 
 property', if the contract or conveyance injures or obstructs the creditors, and 
 if it be made within thirty days of the insolvency. But in consideration of 
 the good faith of the party contracting with the insolvent, such a contract is 
 not absolutely void, but only voidable, and may be rescinded upon conditions 
 which will protect him from injury. 
 
 2. Upon such terms as to the protection — 
 
 If a deed be rescinded on the ground that it was executed in fraud of 
 creditors, the consideration actually given would have to be ranked for as 
 a common debt, by the parly who gave it. In the case under consideration, 
 the Court would probably order the repayment of such consideration as a 
 condition precedent to the recovery of the property. And many similar 
 cases may be imagined, where the power thus conferred upon tiie Court 
 would have a just and beneficial operation. 
 
 3. Actual loss or liability — 
 
 These expressions do not seem to convey any right to indemnity for 
 damages to the party ousted. 
 
 3. All contracts or conveyances made and acts done by a Fraudulent 
 debtor, with intent fraudulently to impede, obstruct, or delay contracts or 
 his creditors in their remedies against him, or with intent to bjTi^solvent 
 defraud his creditors, or any of ihem, and so made, done, and void, 
 intended with the knowledge of the person contracting or acting 
 with the debtor, and which have the effect of impeding, obs- 
 tructing, or delaying the creditors in their remedies, or of inju- 
 ring them, or any of them, are prohibited, and are null and 
 void, notwithstanding that such contracts, conveyances, or acts 
 be in consideration or in contemplation of marriage ; 
 
 1. All contracts or conveyances * * • with intent — 
 All such transactions as are described in this clause have been null 
 under the law of France for centuries — and they were so also under the 
 Roman law. ffL. 1, §§ 1 and 2. Qua; in fraudem credit.— Edit, de Henri
 
 56 
 
 FRAUD AND FRAUDULENT PREFERENCES. 
 
 In ■what case 
 preferential 
 sales, &c., 
 shall be 
 deemed frau- 
 dulent. 
 
 IV., 1609. Reelement pour la Ville de Lyon, 1667. Old. 1673, Tit. 11, 
 art. 4. Old. de 1679. Declaration de 1702. Pothier Oblns., No. 153. 
 Nouv. Den., Fraude relt. aux creanciers, § 1, No. 10. Domat loc. cit. 6 
 Toullier loc. cit. 3 Bed. do do], No. 1428. 
 
 2. fVHh the knoiiiedge of the person contracting — 
 
 The person contracting with the debtor must be avrare of the debtor's 
 intent, or the contract is valid. Joussfi sur I'ord., 1673, tit. 11, art. 4. 3 
 Bed. du dol, No. 1432. 
 
 But this knowledge will be presumed in the case of gratuitous contracts — 
 conveyances a vii prix — the notorious insolvency of the debtor and the like. 
 See note to p. 1, ante. 
 
 .3. And which have the effect — 
 
 There must always be the eventiis damni, as well as the consilium 
 fraud is. 
 
 4. If any sale, deposit, pledge, or transfer, be made by any 
 person in contemplation of insolvency, by v/ay of security for 
 payment to any creditor, or if any goods, effects, or valuable 
 security be given by way of payment by such person to any 
 creditor, whereby such creditor obtains or ^will obtain an 
 unjust preference over the other creditors, such sale, deposit, 
 pledge, transfer, or payment, shall be null and void, and the 
 subject thereof may be recovered back for the benefit of the 
 estate by the assignee, in any Court of competent jurisdiction ; 
 and if the same be made within thirty days next before the 
 execution of a deed of assignment, or the issue of a writ of 
 attachment under this Act, it shall be presumed to have been 
 so made in contemplation of insolvency ; 
 
 1. In contemplation ofinsolrency — 
 
 And, therefore, if by any such transaction the creditor obtains, or will 
 obtain, a peference over other creditors, it will be null. See introductory 
 note to this §, mite. 
 
 The phrase " in contemplation of insolvency " does not mean in contem- 
 plation of the issue of a writ, nor of the execution of a deed of assignment, 
 but merely that the debtor is conscious of being in difficulty, and of the 
 probability of insolvency occurring ; and gives the security or makes the pay- 
 ment as a precaution against insolvency. As has already been stated, this- 
 phrase is used in the English Act, and there have been numerous expres- 
 sions of opinion by the English Judges upon its true meaning. Bayley, J., 
 (Gibbins vs. Phillips, 7 B. and C, 5.34,) says, that it would be sufficient to 
 establish the contemplation of bankruptcy if the debtor knew himself to be 
 in such a situation that he must be supposed to have anticipated that in all 
 human probability a bankruptcy must follow ; and he adds, that in this 
 sense, contemplation of bankruptcy has always been considered evidence of 
 fraud, althopgh the party may not have expected the actual and immediate 
 issue of a commission. And afterwards in Poland vs. Glyn, reported in 
 noiis, 4 Biiig. 2-2, Abbott, C. J., told the jury, that the object of the bank- 
 rupt laws being to divide the whole of the bankrupt's property equally 
 amongst his creditors; if a tradesman found himself in such a situation,, 
 that in the judgment of an}- reasonable man a bankruptcy was inevitable, 
 no voluntary payment by him could be good, and Justices Bayley, Holroyd 
 and Best alterwards concurred in his view of the subject. And Wilde, C. J., 
 in Brown vs. Kempton. 13 L. T., Rep. 11, stales the rule still more clearly. 
 He says in this case, "' that if a payment were made at a time when the 
 bankrupts had a view to bankruptcy, thongh thev might hope to avoid 
 bankruptcy, yet if made with the object of giving the creditor an eventual 
 advantage, if the bankruptcy did take place, the payment was illegal and- 
 invalid."
 
 FRAUD AND FRAUDULENT PREFERENCES. ^9 
 
 These dicta, not only aid in consiruing the expression used in this clause, 
 but fairly describe the position of a debtor, and the effect of his acts under 
 our own law, when he has really ceased to possess sufficient assets to 
 meet his liabilities, and when he has become aware of the fact. The 
 equitable provisions of that law, make the property of the insolvent debtor 
 the gage of his creditors, and direct its apportionment among them, accord- 
 ing to ttie amounts of their claims. And any act of the insolvent debtor 
 tending to disturb this equality, will be annulled by the Court. See the 
 authorities already cited, autl also Rep. de Guyot vo. Dcconjiture, Banque- 
 Toute. 2 Chardon, 389, 3i93, 407. Capmas, pp. 76-Sl. Bryson, vs. 
 Dickson, 3 L. C. Rep., p. 65. Sharing vs. Meunier, 7 L. C. Rep., p. 250. 
 Gumming vs. Mann, 2 L. C. Jur., 195. Cumming vs. Smith, 5 L. C. 
 Jur., p. J. Macfarlane vs. McKenzie, 5 L. C. Jur., p. 109. Duncan vs. 
 Wilson et al., 2 L. C. Jur., 253. VVithall & Young & Michon, 10 L. C. 
 Rep., 149. 10 Louisiana, p. 605. Civil Code of \.. C. Obli</ations, Nos. 
 51 to 60. 
 
 The rule, however, must not be extended too far, by applying it to cases 
 in which the giving of security is not promptei by the anticipation or 
 expectation of insolvency, but is merely the result of an ordinary and 
 business-like arrangement be ween ttie paities. Most security is probably 
 taken as a precaution against insolvency, and in that sense may be said to 
 be so given in contemplation of it ; but no syhlem of bankruptcy law goes 
 the length of invalid at ing such securities. The law does not seek to 
 impugn the contract by which the debtor, for a valuable consideration : such 
 as an extension of time, a reduction of interest or the like ; endeavors to 
 protect his creditor from the general and ordinary contingencies of a com- 
 mercial career ; but assails such transactions only when their object is to 
 protect the creditor from a specilic, visible and impending danger. 
 
 2. By way of security— or by ivay of payment — 
 
 The class ot transactions relerred to in this clause, consists only of those 
 by which the position of a creditor is improved, or is intended to be improved, 
 at the expense of his fellow creditors. No doubt ihe giving of security to 
 a creditor, or of eflects other than money as payment, might be held to fall 
 within the general terms of the last two precediui- clauses of this section : 
 but the species of commercial fraud against which this clause is intended to 
 guard, is so prevalent, and its perpetration generally so easy, that it appears 
 to have been thought necessary to provide still more specifically against it. 
 Its peculiar characteristic is the fact of a pre-existing debt, ictr which 
 security is given subsequent to its creation, or which is pai.j otherwise tlian in 
 money, when the debtor sees a probability of his estate falling into insolven- 
 cy, and desires to prevent loss to the creditor in such an event. And the evil it 
 seeks to prevent, is the defeiioration of the estate by preferences to creditors 
 who have become so on the same terms as others, but who from one motive 
 or another, when the danger of insolvency becomes imminent ; are protected 
 by the debtor out of the assets of his estate, which all his creditors are 
 entitled to regard as their common security. 
 
 3. Creditor obtains, or u'ill obtain, an unjust preference — 
 
 The knowledge of the creditor is not made essential In the invalidity of 
 the transaction, nor is the time of it .relatively to the insolvency, of any 
 importance a? matter of law; and in this respect this clause differs from 
 all the other clauses of this chapter. The reasons undoubtedly are that 
 the creditor who seeks to change his position, after it has been deliberately 
 taken, must be presumed to have some reason for doing so, which has 
 been suggested by facts that have fallen within his knowledge : and facts 
 which cause him to fear the non-payment of his debt, can only be such 
 facts as warn him of dilficulty, and of threatening, if not actually approach- 
 ing insolvency. If under these circumstances, the debtor, conscious of 
 impending failure, yields to a demand for protection against it, or even 
 voluntarily provides such protection to his creditor, there is really a concur- 
 rence of intention on both sides to diminish the mass of the assets, for the 
 benefit of one creditor and to the injury of the others. And the circum- 
 stances wfiich must be presumed lo have arisen, to cause the creditor to 
 demand or even to accept further security for his debt, are also presumed
 
 5S FRAUD AND FRAUDULENT PREFERENCES. 
 
 to be a warning to him that the taking of such further security is illegal 
 and improper, and thereby to constitute him an accomplice in the fraud 
 committed by the debtor in giving it to him. Bed., Nos. 113 et seq. And 
 this rule is far from being purely modern, for we find M. Cormier stating in 
 161.5, with reference to the Paulian action : " icelfe mesme action se donne 
 contre celuy qui s^achant son deiteiir n^estre soluable tire et retorque 
 qiielque chose de luy par quelque contract que ce soit, conime de venditwn, 
 d'engagement, de dation, ou constitution ou acceptilatwn, on par quelque 
 autre paction." Code Henri IV.^ Liv. 26, Col. 1762, No. 10. 
 
 When pay- 5. Every payment made within thirty days next before the 
 
 dSmed frau-^ execution of a deed of assignment, or the issue of a writ of 
 dulent. attachment under this Act, by a debtor unable to meet his 
 
 engagements in full, lo a person knowing such inability, or 
 having probable cause for believing the same to exist, is void, 
 and the amount paid may be recovered back by suit, in any 
 Proviso competent Court, for the benefit of the estate ; Provided always, 
 
 that if any valuable security be given up in consideration of 
 such payment, such security or the value thereof, shall be res- 
 tored to the creditor before the return of such payment can be 
 demanded ; 
 
 1. Payment made tvithin thirty days — 
 
 This means a payment in money, as the last previous clause provided 
 the rule with regard to payments effected by means of the transfer of effects 
 or valuab'e secqrities : and it does not seem to be intended that any payment 
 made previous to the thirty days antecedent to the insolvency should be 
 enquired into at all. 
 
 The Code of 1808 Vv-as more stringent with regard to pa3-ments ; for while 
 it declared null all payments of debts not exigible, made during the ten 
 days preceding the failure — Art. 446 — it also declared null, without reference 
 to time, all payments made in fraud of creditors. — Art. 447. 
 
 The Code of 1838, softened very much the rigor of that of 1808 in this 
 respect. Under its provisions, as under tliose of tlie former, all payments 
 of non-exigib!e debts, made within ten days of the stoppage of payment, are 
 null : and payments made whhin the same period — in effects other than 
 money or negotiable paper — of debts exigible are also void. Art. 446. 
 1 Bed., faillites, Nos. 110 et seq. But there is no provision prohibiting pay- 
 ment in money or bills at any time previous to the stoppage of payment ; 
 nor any rule rendering any such payment liable to be enquired into. — A 
 similar principle prevailed under the regime of the Ord. of 1673, Jousse, 
 pp. 156 et seq. Savary, Pareres, No. 39, p. 311. For the English rules on 
 the subject ot payments by the bankrupt, see 1 D. &. M., pp. 457 et seq. 
 
 2. To a person knoiving — or having probable cause for believing — 
 These circumstances have always been held to make the person dealing 
 
 with the insolvent a constructive participant in the fraud. 2 Chardon, p. 
 373, No. 208. Nouv. Den. vo. Fraude. 2 Horson, Quest. 155, p. 283. 
 See also Code Louis, art. 1979. 10 Louis. Rep. 605. 
 
 Transferor 6. Any transfer of a debt due by the insolvent, inade within 
 
 debts due by thirty days next previous to the execution of a deed of assign- 
 be void in cer- ^GJit or tlie issue of a writ of attachment under this Act, or at 
 taiu cases. any time afterwards, to a debtor knowing or having probable 
 cause for believing the Insolvent to be unable to meet his 
 engagements, or in contemplation of his insolvency, for the 
 purpose of enabling the debtor to set up by way of compen- 
 sation or set-ofF the debt so transferred, is null and void as 
 regards the estate of the Insolvent ; and the debt due to the
 
 FRAUD AND FRAUDULENT PREFERENCES. ^9 
 
 estate of the Insolvent shall not be compensated or affected in 
 any manner by a claim so acquired ; but the purchaser thereof 
 may rank on the estate in the place and stead of the original 
 creditor ; 
 
 Any transfer — 
 
 That is a transfer of a debt due by the insolvent, obtained by one who is 
 indebted to him ; and who knows him to be, or believes that he is about to 
 become, insolvent, for the purpose of being set off or pleaded in compensa- 
 tion of the debt so due to the insolvent's estate. Such a transaction though 
 not participated in by the debtor, or even known to him, is a fraud upon his 
 creditors ; as it appropriates an asset of the estate to the payment of one of • 
 
 its liabilities, as efTectnally as if the insolvent had himself handed over to 
 his debtor a part of his i)roperty wherewith to pay the debt. 
 
 The same rule prevailed in France. 1 Bed., faillites, Nos. 113 to 116 bis. 
 
 7. Any trader in Lower Canada, and any person whosoever Certaia other 
 in Upper Canada, wlio purchases goods on credit or procures ^'''luds de- 
 advances in money, knowing or believing himself to be unable gards L. c' 
 to meet his engagements, and concealing the fact from the 
 person thereby becoming his creditor, with the intent to defraud 
 such person, or who 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 mer- 
 chandize, with intent to defraud the person thereby becoming 
 his creditor, and who shall not afterwards have paid the debt 
 or debts so incurred, shall be held to be guilty of a fraud, and Punishment, 
 shall be liable to imprisonment for such time as the Court may 
 order, not exceeding two years, unless the debt or costs be 
 sooner paid ; and if such debt or debts be incurred by a trading 
 company, then every member thereof who shall not prove him- 
 self to have been ignorant of the incurring, and of the intention 
 to incur, such debt or debts, shall be similarly liable ; provided Proviso, 
 always, that in the suit or proceeding taken for the recovery of 
 such debt or debts, the defendant be charged with such fraud, 
 and be declared to be guilty of it by the judgment rendered in 
 such suit or proceeding ; 
 
 !• Any trader in Lower Canadd and any person ivhom soever in Upper 
 Canada — 
 
 There does not seem to be any good reason for this distinction— as the 
 ofTence created by this clause has no relation to the proceedings for winding 
 up the estate of the debtor and for enabling him to obtain a discharge from 
 his liabilities, whicli form the principal objects of the law. The clause 
 originally applied only to traders, and the (iistiuclion between Upper and 
 Lower Canada must have been created without due consideration, when the 
 operation- of the Bill generally, was extended to al! classes in Upper Canada. 
 
 2. Concealing the J act — 
 
 That is not informing him of the fact. Active proceedings for its con- 
 cealment could hardly be considered necessary. 
 
 3. With intent to defraud — 
 
 Actornon facit renin nisi mens sit rea. 3 Inst., 307. The intent and 
 the act must both concur to constitute the offence. Per Lord Kenyon, 
 7 T. R., 514. And the intent must exist at the time the purchase was 
 made, or the advance obtained. Reg. vs. Wood, 1 Denisou, C. C. 387. 
 Reg. vs. Preston, 2 Denison, C. C. 353.
 
 60 
 
 COMPOSITION AND DISCHARGE. 
 
 But the intent could doubtless be inferred from the position and conduct 
 of the accused ; without direct evidence of it. Seethe cases collected as to 
 intent to defraud, in Roscoe's Criniinal evidence, p. 4-18. 
 
 4. IV/io shall not afterwards Jiave paid — 
 
 As the proceeding contemplated by this clause — and the remedy it gives^ 
 are rather civil than criminal — and rather intended to enforce payment than 
 to punish the debtor ; he may relieve himself from them by paying the debt. 
 
 5. Unless the debt and costs be sooner paid — 
 See last note. 
 
 6. Every member thereof who sliall not prove himself to be ignorant of — 
 That is to say, that after the fraudulent act has been brought home to 
 
 one of the partners, the burden of proof as to the complicity or innocence of 
 the others is shifted upon them. This would seem harsh, hut tlie law 
 appHes only to cases where the debt is incurred on behalf of the partnership,, 
 and where a presumption therefore fairly arises against the partners, as 
 havina' profited by the transaction. 
 
 7. That in the suit or proceeding— the defendant be charged ivith the 
 fraud— 
 
 This requires specific allegations to be made in the declaration, charging 
 the defendant with the fraud : and in Lower Canada, an appropriate 
 conclusion also, demanding a judicial declaration of guilt, and the con- 
 demnation of the accused to the term of imprisonment considered adequatft 
 to the circumstances. 
 
 As to like 
 case in U. C, 
 
 S. In Upper Canada in every such suit or proceeding whether 
 the defendant appears and pleads, or makes default, the plaintiff 
 shall be bound to prove the fraud charged, and upon his 
 proving it the Judge who tries the suit or proceeding shall 
 immediatel}^ after the verdict rendered against the defendant 
 for such fraud (if such verdict is given) adjudge the terra of 
 imprisonment which the defendant shall un(:lergo ; and he 
 shall forthwith order and direct the defendant immediately to be 
 taken into custody and imprisoned accordingly ; but such 
 judgment shall not aiiect the ordinary remedies for the revision 
 thereof, or of any proceeding in the case. 
 
 Appears and pleads or makes default — 
 
 This provision is probably intended to prevent a Judgment from being 
 entered up without proof, on the mere default of the deihndant to appear — 
 which cannot be done in Lower Canada. 
 
 OF COMPOSITION AND DISCHARGE. 
 
 When a lid to 
 ■what extent 
 a deed of com- 
 position shall 
 be binding. 
 
 When such 
 deed may be 
 made. 
 
 9. A deed of composition and discharge executed by the 
 majority in number, of those of the creditors of an Insolvent 
 who are respectively creditors for sums of one hundred dollars 
 and upwards, and who represent at least three-fourths in value 
 of the liabilities of the Insolvent subject to be computed in 
 ascertaining such proportion, shall have the same effect with 
 regard to the remainder of his creditors, and be binding to the 
 same extent upon him, and upon them, as if they were also 
 parties to it ; and such a deed may be validly made either 
 before, pending, or after proceedings upon an assignment, or 
 for the comj)uJsory liquidation of the estate of the insolvent ; 
 and the discharge therein agreed to shall have the same effect 
 as an ordinary discharge obtained as hereinafter provided :
 
 COMPOSITION AND DISCHARGE. gf 
 
 1. Majority in number of cr editors for sums of$\QO and upwards — 
 
 In calculating this majority, those creditors whose claims are not ex- 
 tinguished by an ordinary discharge obtained under the Act — and piivileged 
 creditors - are not counteil in any way ; unless the first mentioned class 
 consent, in which case they may be. — See p. 5, 2^^^^. 
 
 2. Three fourths in value of the liabilitits — 
 
 This is not limited to the value of the liabilities amounting to $100 and 
 upwards, and therefore must include all the liabilities of the Insolvent, 
 subject to the exceptions rei'erred to in the next note. There is a discre- 
 pancy in different parts of the Act, in the mode of stating the proportion in 
 value of the creditors which is required to give validity to their acts. In 
 §3 p. 19, for instance, the power is granted to " the majority ni number, and 
 three fourths in value of the creditors for sums above one hundred dollars," 
 in which case the amount due to creditors in suras of ^100 and less, v^•ould 
 not count either as to number or value. And the general rule r.s to meet- 
 ings of creditois, gives the controlling power to " the majority in number of 
 all creditors for sums above one hundred dollars * * ••■' representing also the 
 majority in value of SKc/i creditors : " thus exchuling creditors of sums of 
 $100 or less, from being computed as to number or value. — § 11, p. 2. 
 Those distinctions, though probably not intended, must not be lost sight of 
 by the practitioner. 
 
 3. Subject to be computed — 
 
 For debts which are not subject to be computed, see p. 5, post. 
 
 4. Upon him — 
 
 The most important point in which a deed of this description is binding 
 upon a debtor, is the payment of the composition agreed upon ; and under 
 this clause, a creditor who is not a party to the deed, will have the same 
 remedies for enforcing such payment, as one who has executed it. 
 
 5. Alaij be validly made either before, pending, or after — 
 
 Although this clause establishes that such a deed may be validly made — 
 it is important to consider what effect it will have, previous to the expiration 
 of the two months which are allowed to creditors for filing their claims. 
 
 The spirit of the law appears to be, to allow a delay of two months after 
 the appointment of an assignee — within which claims are to be filed — 
 foreign creditors will have time to come in, — and the assignee may be 
 supposed to have acquired a knowledge of the estate, sufficient to enable 
 him to scrutinise the claims made. It would appear to be the intention of 
 the Act that until this period expires, the creditors do not acquire that entire 
 control of the estate which they may afterwards exercise. ^ Until then 
 dividends cannot be declared, § .5, p. 1 ; the meeting for the public examina- 
 tion of the Bankrupt cannot be held, § 10, p. 1 ; the creditors cannot act in 
 the removal of the assignee, § 4, p. 18 ; and they cannot pass resolutions on 
 the various subjects respecting which autirority is given them — without 
 special notice, except at the first meeting held after this period, § 11> P- 3. 
 The reasons for the adoption of these rules doubtless are, that the actual 
 creditors and amount of indebtedness cannot sooner be ascertained with any 
 approach to certainty ; that the creditors as a body cannot be expected to be 
 sooner prepared to assert their rights in the estate with advantage ; and 
 that a knowledge of the indebtedness of the insolvent, and the co-operation 
 of his creditors, are both required, in acting upon the more important pro- 
 visions of the law. 
 
 The eifect of a composition deed depends entirely rpon the number and 
 amount of the creditors who sign it — and therefore as much as any other 
 matter or proceeding contemplated by the Act, requires an exact knowledge 
 of the amount due by the insolvent, and of the creditors who represent that 
 amount. And since this knowledge cannot be fully attained until after the 
 period of two months allowed for the filing of claims ; the insolvent claiming 
 protection under a deed of composition and discharge, before the expiration 
 of that period ; or before his estate has been brought within the operation of 
 the Act at all ; must find it difiicult, or impossible, to shew that the proportion 
 of creditors in number and value required to give it validity, have concurred 
 ixi it.
 
 62 
 
 COMPOSITION AND DISCHARGE. 
 
 Notice and 
 time -within 
 ■which opposi' 
 tion to com- 
 position must 
 be made. 
 
 If none be so 
 ina4e. 
 
 Ao-ain, by p. 2, post — the insolvent is permitted to deposit a deed of com- 
 position and discliarge, witli the assignee— vvlio may thereupon take steps 
 to divest himself of the estate. But he cannot take the initiative towards 
 this object in the smallest particular, until after the expiry of the two 
 months. If the deed can be held to establish his discharge before the expiry 
 of the two months, he should receive back his estate at the lime his dis- 
 charge is so established. If the deed has acquired its full validhy, the 
 creditors have no claim to the estate. If, on the other hand, the deed does 
 not receive its full effect until after the expiry of the two months has 
 furnished the assignee and any dissenting creditors, with the means of 
 knowing whether it is entitled to any weight or not — the provision delaying 
 the delTveiy back of the estate till after that period is consistent with the 
 construction of the Act, which would delay ihe efi'ect of the di-charge to the 
 same extent. 
 
 Again, the first clause provitles that the discharge agreed to in a deed of 
 composition aad discharge, shall iiave the same effect as an ordinary 
 discharge obtained as thereinafter provided. By p. 3, post, the effect of an 
 ordinary discharge is described, and it will be found to operate upon debts 
 and liabilities, for a full discovery of which the two months delay is 
 requisite. 
 
 Upon these considerations, it would seem to be a reasonable construction 
 of this clause, to hold that a deed of composition and discharge will not 
 operate effectually the discharge of the debtor ; or perhaps it would be 
 more correct to say, will not be susceptible of being effectually used as 
 establishing a discharge, until after the expiration of the peiiod of two 
 months from the public notice of the appointment of an assignee. 
 
 This construction does not by any means deprive the clause under con- 
 sideration of a character of great importance to the debtor. The procuring 
 the consent of creditors to a deed of composition and discharge, is generally 
 a work of time; and this clause permits that work to be proceeded with 
 while proceedings in insolvency are maturing, and even before they have 
 commenced. So that when the time arrives at which under p. 2, the 
 assignee may give notice of the deposit of the deed, the insolvent may have 
 already procured its execution in .readiness for such deposit. And there 
 seems to be no reason why the application for confirmation should not also 
 be proceeding, provided the debtor is confident that he has succeeded in 
 obtaining the assent to it of the requisite proportion of his creditors. 
 
 6, The same effect as an ordinary discharge — 
 
 See post, p. 3. 
 
 2. If the Insolvent procures a deed of composition and 
 discharge to be duly executed as aforesaid, and deposits it 
 with the assignee pending the proceedings upon a voluntary 
 assignment or for compulsory liquidation, the assignee, after 
 the period hereinbefore fixed as that after which dividends may 
 be declared has elapsed, shall give notice of such deposit by 
 advertisement ; and if opposition to such composition and 
 discharge be not made by a creditor, within six juridical days 
 after the last publication of such notice, by filing with the 
 assignee a declaration in writing that he objects to such com- 
 position and discharge, the assignee shall act upon such deed 
 of composition and discharge according to its terms ; but if 
 opposition be made thereto within the said period, or if made 
 be not withdrawn, then he shall abstain from taking any action 
 upon such deed until the same has been confirmed, as herein- 
 after provided ; 
 
 1. Period at u'hich dividends may be declared — 
 
 That is two months from the first insertion of the advertisement giving 
 notice of the appointment of an assignee. § 5, p. 1.
 
 CONSENT TO DISCHARGE. ^ft 
 
 2. Shall act upon sue h deed — 
 
 If bv the deed it is agreed that the debtor shall have immediate posses- 
 sion of "his estate, the assignee should deliver it over to him. And so with 
 any ot^;er provision contained in the deed, which falls within the province 
 of the assignee to carry out. it will therefore be necessary in preparing, 
 such a deed to make provision respecting everything required to be done. 
 Such, for instance, as the payment of such charges as the assignee may 
 lawfully make, or may be bound to make good ; the assumption by the 
 debtor of pending suits ; the transfer to him of amounts due the assignee for 
 sales made, and every other matter or thing, the omission to provide for 
 which could cause embarrassment, in obtaining back the estate. 
 
 If it should afterwards happen that the discharge contained in a deed of 
 composition is annulled by the Court, a question may arise as to the position 
 of the estate in that event, supposing it to have been returned to the debtor 
 by the assignee. There is no express provision on this point in the Act, 
 but probably the assignee would be entitled to revendicate the property 
 belonging to the estate ; or in cases of compulsory liquidation, to obtain the 
 issue of an alias or further writ of attachment in the original cause, by a 
 petition founded upon affidavit. The case is not likely to occur, as any 
 creditor having objections to make, would file them in the manner provided 
 for by this section, and thus prevent the estate from passing out of the 
 hands of the assignee. 
 
 3. Has been confirmed — 
 Under ps. 6 and 8 post. 
 
 3. The consent in writing of the said proportion of creditors Effect of con- 
 to the discharge of a debtor after an assignment, or after his s^°* of credi- 
 estate has been put in compulsory liquidation, absolutely frees or's dischargCi 
 and discharges him from all liabilities whatsoever (except such 
 as are hereinafter specially excepted) existing against him and 
 proveable against his estate, which are mentioned and set forth 
 in the statement of his affairs annexed to the deed of assign- 
 ment, or which are shewn by any supplementary list of 
 creditors furnished by the insolvent, previous to such discharge, 
 and in time to permit 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 insol- 
 vency, and whether direct or indirect ; and if the holder of any If the holder 
 negotiable paper is unknown to the insolvent, the insertion of °f^°y^^S°" 
 the particulars of such paper in such statement of affairs, with jg unkxiown. 
 the declaration that the holder thereof is unknown to him, shall 
 bring the debt represented by such paper, and the holder 
 thereof, within the operation of this section ; 
 
 1. Absolutely frees and discharges him from all liabilities — 
 There are exceptions to this discharge which are referred to in the 
 remainder of this clause, but they do not interfere with the principle of the 
 general rule, that by a discharge under this Act, the insolvent is freed from 
 all debts and claims whatsoever. Notwithstanding the apparent compre- 
 hensiveness of the phraseology of this clause, the question is frequently 
 asked whether liabilitiestincurred previous to the passage of the Act, are 
 discharged, or only those subsequent to its enactment— in other words, 
 whether the Act is retrospective or not 
 
 It must be admitted that in general, the idea of a law which has a retros- 
 pective character is repugnant to a strict sense of justice. And although 
 the right of the Legislature to pass such laws cannot be denied, their terms 
 will be strictly scrutinised and construed. And a retroactive elfect will not
 
 64 
 
 COMPOSITION AND DISCHARGE. 
 
 be conceded to them, unless those terms unmistakeably convey it. To 
 deal with the latter proposition first, and ascertain whether or no the terms 
 of this Act unmistakeably confer upon it a retrospective character, it will 
 only be necessary cursorily to refer to a few of the clauses bearing upon the 
 question. 
 
 The preamble declares it to be "expedient that provision be made for the 
 settlement of the estates of insolvent debtors." This phrase clearly covers 
 debtors then insolvent, by its natr.ral grammatical meaning ; for if it intended 
 only those who should thereafter become insolvent, it would have been neces- 
 sary tu adopt an entirely dilTerent form of words. 
 
 'ihe same remark will apply to the form of words used in § 2, p. 1. The 
 words " any pers')n unable to meet his engagements," according to their or- 
 dinary grammatical meaning, would strictly apply only to those persons who 
 were unable to meet their engagements at the time the act was passed, or, 
 perhaps, at the time it came into force ; but, as the law is regarded as always 
 speaking, it comprehends also all those who shall subsequently labor under 
 the ilisability indicated. 
 
 Under these clauses, therefore, a person who became insolvent before the 
 act passed, and remained insolvent when it came into operation, is subject to 
 its provisions. 
 
 Again, the enactments respecting compulsory liquidation, all contemplate 
 the machinery of the law being susceptible of being set in motion immedi- 
 ately upon the law coming into force. If the debtor committed any one of 
 the numerous acts of insolvency described in the act, on the 2nd September 
 last, he could have been forthwith dispossessed of his estate, and tiie pro- 
 ceedings for that purpose could have been instituted by " any creditor." 
 See § 3. 2^nssivi. It is plain that in this case also the words " any creditor" 
 cannot, by any recognized rule of construction, be held to mean those cre- 
 ditors only whose claims arose upon or after the 1st September last. 
 
 The debts which are entitled to be proved against the estate, are, " all debts 
 due and payable at the time of the execution of the deed of assignment, or 
 at the time of the issue of a writ of attachment, &c., &c. § 5, p. 2. In this 
 provision, debts which arose previous to the passing of the act are unmis- 
 takeably comprised. 
 
 The estate which passes to the assignee is, all the property of the debtor, 
 real and personal, " which he has or may become entitled to at any time be- 
 fore his discharge is eiiected." — § 2 p. 7 ; § 3. p. 22. So that there can be 
 no doubt but that it is a matter of perfect indifference, whether he acquired 
 such property before or after the passage of the act. 
 
 And, lastly, the clause now under consideration expressly declares, that 
 the consent of the requisite proportion of creditors absolutely frees and dis- 
 charges the Insolvent from " all liabilities whatsoever existing against him, 
 and proveable against his estate." Here, again, it is impossible to deny 
 that the phrase " all liabilities whatsoever existing against him," must com- 
 prise every such liability, without reference to the period ot its inception. 
 
 This statute, therefore, is retroactive, and to such an extent, that persons 
 who became insolvent previous to its passage fall within its provisions ; that 
 persons who acquired the quality of creditors before it passed, may avail 
 themselves of the proceedings it authorizes ; that the debts due to those 
 creditors may rank upon the e.-tate of the insolvent f that property acquired 
 by him before it became law, becomes vested in his assignee under its pro- 
 visions ; and, finally, that by a discharge under this act he is freed from the 
 liabilities he incurred before it was enacted. 
 
 Whatever may be the general principles applicable to retrospective 
 legislation, and however strong may be the feeling against giving retroac- 
 tivity to statutes, it may reasonably be asserted that the nature and purposes 
 of a Bankrupt or Insolvent law, necessarily exclude it from the operation of 
 those principles, and prevent its being obnoxious to the objections usually 
 urged against retroactive laws. And in fact that a Bankrupt or Insolvent 
 law having exclusively a prospective effect, must necessarily be partial 
 and unjust. This latter proposition, which includes the former, cannot be 
 better sustained than by quoting from an admirable little treatise published 
 in 1843, on the retroactivity of the Bankrupt Ordinance, 2 Vict., cap. 36,
 
 COMPOSITION AND DISCHARGE. g5 
 
 and of Bankrupt laws in general, attributed to the present INIr. Justice 
 Meredith : 
 
 " In order " (it is said at page 20,) " to effect that which is the primary 
 object of every Bankrupt law, that is, to secure the whole of the bankrupt 
 estate for the benefit of all the creditors, it is albsolutely necessary to 
 deprive the debtor of all his ordinary riiijhts over his property. The assign- 
 ment by ihe Comraiss loners has this efiect, and the warrant in bankruptcy 
 absohiteiy prevents the debtor from paying any of his creditors. The 
 debtor being thus by a single blow, denuded of all his property for the 
 benefit of all his creditors, it would te manifestly unjust to allow a part of the 
 creditors to administer and divide his estate according to their own interests 
 and wishes ; and at the same time to permit the remainder of the creditors 
 to harass the debtor with executions and imprisonment ; yet such must be 
 the result if we confine the Bankrupt law to a merely prospective operation. 
 
 " The creditors whose debts had been contracted after the passing of the 
 Bankrupt law, would, of course, avail themselves of the advantages which 
 it affonls them, and place themselves in immediate possession of the whole 
 of the bankrupt's property ; and the creditors, whose debts 'date before the 
 passing of the law, by refraining to come in under the commission, would 
 have it in their power to harass the debtor, thus divested of all means of 
 satisfying their claims. 
 
 *' So long as the debtor has his estate in his own hands, he need not 
 despair ; his friends, to supply a deficiency, may come to his assistance ; 
 his creditors may accept a compromise, or he may by some fortimate 
 speculation increase his means, so as to meet the demands of his creditors ; 
 but no situation in life can be more utterly hopeless, or more deserving of 
 commiseration than that of an honest debtor, who, after having been 
 divested by law of every vestige of his property, is cast upcn the world, 
 destitute of all means, and still exposed to the claims of unrelenting creditors. 
 
 *' A system of law which would thus on the one hand deprive the debtor 
 of his property, and prohibit him from paying any of his creditors, and 
 which at the same time would allow some of those creditors to coerce his 
 person for the purpose of obtaining payment from him, would be in the last * 
 
 degree tyrannical and unjust. 
 
 " Every humane or just mind must admit, that the same law which 
 prohibits the debtor from paying any one of his creditors, ought to prevent 
 every one of his creditors from suing him ; that if the creditors, contrary to 
 common law, are allowed to enter upon the estate of the debtor, and 
 manage it as they wish, without reference to the interests of the debtor, 
 they cannot complain if obliged to content themselves with that estate ; in 
 short, that the law which deprives an honest man of ail his assets, should 
 at the same time relieve him from all his liabilities." 
 
 Probably enough has been said to establish that the present Act is retro- 
 active in its operation, in so ftir as regards the distribution of the assets of 
 the insolvent among his creditors and his discharge, and that it is just that 
 it should have such operation. But if a more full examination of the 
 general question be desired, see the pamphlet referred to, where the subject 
 of the retroactivity of Bankrupt laws is clearly and carefully treated. 
 
 2. Which are mentioned and set forth — 
 
 This clause describes the debts from which the debtor is freed by a 
 discharge under the Act. They appear to be the following : 
 
 a. All debts mentioned in the statement annexed to the deed of assio-n- 
 ment ; 
 
 b. All debts mentioned in any supplementary statement furnished by 
 him previous to the discharge, in time to have a dividend reserved upon 
 them ; 
 
 c. All debts which appear by any claim filed ; 
 
 d. All debts upon negotiable paper mentioned by him in his statements 
 the holders being unknown. 
 
 S-"^ It may be stated in general terms that the debtor is discharged from all 
 debts, the existence of which is disclosed by him or by the credhors them- 
 selves. The object of this provision evidently is to hold out the strongest 
 possible inducement to the debtor to give full particulars of his liabilities ; 
 5
 
 ^g , COMPOSITION AND DISCHARGE. 
 
 and as the neglect of this duty imperils his discharge, the greatest care should 
 always be taken 'by the insolvent to include in his statements every debt 
 that can be alleged to exist against him. In doing this, it is not necessary to 
 admit the whole of a debt to be due, if in reality its amount is disputed. It 
 can be mentioned in the statement according to the amount claimed — and 
 either simply described as " disputed," or a more particular description 
 may be inserted of the grounds of objection to it. And in cases of compul- 
 sory liquidation, the debtor should see that every creditor has filed his 
 claim — and if not, should produce and file a list of liabilities shewing those 
 who have not done so. For unless this precauiion be taken, a creditor may 
 retain his recourse against the debtor simply by abstaining from fyling his 
 claim. See for the eiFect of a discharge 1 D & IM. p. 734, and as to 
 •questions arising upon debts contracted in a foreign country, see Story on 
 conflict of laws, pp. 567 et seq. 
 
 3. Obtaining the same dividend — 
 
 Any time before the final dividend will do, because a creditor who had 
 not previously proved, would be entitled to be collocated in the final divi- 
 dend sheet for all previous dividends out of the moneys in hand, before 
 those who had seceived the previous dividends could get anything. 
 
 4. Unknoivn to the Insolvent — 
 See § 2, p. 2 
 
 Effect of dis- 4. A discharge under this Act shall not operate any change 
 charge as re- {y^ \\^q liability of any person or company secondarily liable for 
 as^econdariW ^^^^ debts of the insolvent, either as drawer or endorser of nego- 
 liable for tiable paper, or as guarantor, surely or otherwise, nor of any 
 debts of insol- partner or other person liable jointly or severally with the 
 ^^^ ' insolvent for any debt, nor shall it aftect any mortgage, hypo- 
 
 thequc, lien or collateral sectirity held by any creditor as 
 , security for any debt thereby discharged ; 
 
 Shall not operate any change — 
 
 The object of this clause is to protect the creditor to whom the bankrupt 
 is primarily liable, fron:i losing his recourse against endorsers or sureties by 
 consenting to his discharge. A similar provision is to be found in the 
 Scotch Act, § 56. Murdoch, p. 225. See as to English rule, Brown vs. 
 Carr. 7 Bing., 508. Ex parte Williamson. 1 Atk.,84. Taylor vs. Mills. 
 2 Cowp., 625. Young vs. Hochley. 3 Wils., 346. Inglis vs. Macdougal. 
 1 Moore, 196. See also Code Com., art., 545. 2 Bedarride, p. 499. 
 
 Certain debts 5. A discharge under this Act shall not apply, without the 
 
 excepted from express Consent of the creditor, to any debt for enforcing the 
 
 di'schar°e.° payment of which the imprisonment of the debtor is permitted 
 
 by this A(5t, nor to any debt due as damages for personal 
 
 wrongs, or as a penalty for any offence of which the insolvent 
 
 has been convicted, or as a balance of account due by the 
 
 insolvent as an assignee, tutor, curator, trustee, executor or 
 
 public ofHcer ; nor shall such debts, nor any privileged debts, 
 
 nor the creditors thereof, be computed in ascertaining whether 
 
 a sufficient proportion of the creditors of the insolvent have 
 
 done, or consented to any act, matter or thing under this Act ; 
 
 But the ere- ^'^^ the creditor of any debt due as a balance of account by the 
 
 ditor may ao- insolvent as assignee, tutor, curator, trustee, executor or public 
 
 dmdend officer, may claim and accept a dividend thereon from the 
 
 estate without being in any respect affected by any discharge 
 
 obtained by the insolvent ;
 
 CONFIRMATION OF DISCHARGE. g'T 
 
 1. Be computed — 
 
 For instance, if a debtor owed £9,000, of which £500 was a balance of 
 amount due by him as tutor, and £500 due as arrears of salary, not in any 
 case exceeding three months, to his clerks and employes, he would not be 
 relieved from a demand of payment of such balance of account, or by any 
 discharge under the Act, unless the creditor of it consented to the dis- 
 charge. If therefore such creditor refused to consent, £6,000 would be a 
 sufficient proportion- in value to render his discharge valid as to ordinary 
 claims. If such creditor consented, the debtor would require the consent 
 of creditors representing £6,375 currejicy, to constitute such proportion. 
 For in the one case neither the balance of account nor the privileged 
 claims would form part of the mass, in the other, the balance of account 
 would form part of it, but not the privileged debt. 
 
 6. An insolvent who has procured a consent to his discharge Proceedings 
 or the execution of a deed of composition and discharge, within to obtain cou- 
 the meaning of this Act, may file in the office of the court the d[s™harge °^ 
 consent or deed of composition and discharge, and may then 
 give notice (Form 0.) of the same being so filed, and of his 
 intention to apply by petition to the Court in Lower Canada, 
 or in Upper Canada to the Judge, on a day named in such 
 notice, for a confirmation of the discharge effected thereby ; 
 and notice shall be given by advertisement in the Canada 
 Gazette for two months, and also for the same period, if the 
 application is to be made in Upper Canada, in one newspaper, 
 and if in Lower Canada in one newspaper published in French, 
 and in one newspaper published in English, in or nearest the Creditors may 
 place of residence of the insolvent ; andupon such application, oppoee, and 
 any creditor of the insolvent may appear and oppose such con- °^ ^^^*' 
 firmation, either upon the ground of fraud or fraudulent 2™^^ ^• 
 preference within the meaning of this Act, or of fraud or evil 
 practice in procuring the consent of the creditors to the dis- 
 charge, or their execution of the deed of composition and 
 discharge, as the case may be, or of the insufficiency in 
 number or value of the creditors consenting to or execiiting the 
 same, or of the fraudulent retention and concealment by the 
 insolvent of some portion of his estate or eflects, or of the 
 evasion, prevarication or false swearing of the insolvent upon 
 examination as to his estate and effects, or upon the ground 
 that subsequent to the passing of this Act the insolvent has not 
 kept an account-book shewing his receipts and disbursements 
 of cash, and such other books of account as are suitable for his 
 trade, or if, having at any time kept such book or books, he 
 has refused to produce or deliver them to the assignee ; 
 
 1. Of his intention to apply — 
 
 Notice of this application may be given at any time after the assignee 
 has been appointed, if the insolvent has procured the requisite consent, or 
 deed, as the case may be. For, although as shewn in the note to p. 1, 
 ante, the validity of the discharge may not be susceptible of conclusive 
 proof until after the two months allowed for filing claims have expired ; 
 there appears to be no reason why the proceedings of the insolvent prepara- 
 tory to applying for confirmation of his discharge should not be going on ; 
 as before he can actually make his application, all parties will be in a 
 position to judge of the sufficiency in number and value of the creditors 
 who have signed, and to contest it if they think proper. 
 6*
 
 68 
 
 ANNULLING DISCHARGE. 
 
 If confirma- 
 tion be not 
 demanded 
 ■within two 
 months pro- 
 ceedings may 
 be taken to 
 annul the 
 discharge. 
 
 Petition for 
 annulling and 
 proceedings 
 consequent 
 thereon. 
 
 2. Evil practice — 
 
 Such, for instance, as giving a valuable consideration to procure a consent, 
 or the execution of a deed. See post, p. 13. 
 
 3. Suhsequent to the passing of this Act — 
 
 In respect of the punishment of a debtor for not having kept proper books 
 of account, the Act is not retroactive, nor should it be. But while it does 
 not exact much in the future, the penalty for not doing the little which is 
 necessary in the waj' of bookkeeping is severe. A ca-sh book is treated as 
 being essential to every business, but as to his other books the insolvent is 
 permitted 1o follow ihe custom of those who cary on the same trade as 
 himself. If he neglects to keep a book shewing his receipts and disburse- 
 ments of cash, or neglects to keep such other books as are suitable to his 
 trade, ihe confirmation of his discharge may be prevented. 
 
 4. If having at any time kejJt such books he has refused — 
 
 This applies equally to books kept before and to those kept after the 
 passing of the Act. 
 
 7. If the insolvent does not apply to the Court or Judge for a 
 confirmation of such discharge within two months from the 
 time at which the same has been effected under this Act, any 
 creditor for a sum exceeding two hundred dollars, may cause 
 to be served a notice in writing upon the insolvent requiring 
 him to file in the Court the consent, or the deed of composition 
 and discharge, as the case may be ; and may thereupon give 
 notice (Form P.) as hereinbefore provided with regard to 
 applications for confirmation of discharge, of his intention to 
 apply by petition to the Court in Lower Canada, or in Upper 
 Canada to the Judge, on a day named in such notice, for 
 the annulling of the dTscharge ; and on the day so named may 
 present a petition to the Court or Judge, in accordance with 
 such notice, setting forth the reasons in support of such appli- 
 cation, which may be any of the reasons upon which a confir- 
 mation of discharge may be opposed ; and upon such applica- 
 tion, if the insolvent has not, at least one month before the day 
 fixed for the presentation thereof, filed in the office of the Court 
 the consent or deed under which the discharge is effected, the 
 discharge may be annulled without further enquiry, except as 
 to the service upon him of the notice to file the same ; but if 
 such consent or deed be so filed, or if upon special application, 
 leave be granted to him to file the same at a subsequent time, 
 and he do then file the same, the Court or Judge, as the case 
 may be, shall proceed thereon as upon application for confir- 
 mation of such discharge ; 
 
 Does not apply within two months — 
 
 The insolvent would probably be held to have applied within the mean- 
 ing of this section, if he has deposited the consent or deed of composition, 
 and inserted the required notices. For the period of two months from the 
 time at which his discharge has been effected, would not enable him 
 actually to present his application to the Court. 
 
 This clause merely reverses the order of procedure permitted by the 
 preceding section. If the debtor omits to bring the validity of his dicharge 
 to the test of judicial scrutiny, he may be forced to do so by any creditor 
 who might have opposed its confirmation, had he applied for it. Neither 
 the proceedings nor the result will be allected by the nature of the issue 
 when once it has been completed ; whether it be joined on the contestation 
 by the creditor of an application for confirmation, or by the insolvent of an 
 application to annul.
 
 DISCHARGE BY THE COURT. g^ 
 
 8. The Court or Judge, as the case may be, upon hearing Power of 
 the application to confirm or to annul the discharge, the objec- Court or 
 tions thereto, and any evidence adduced, shall have power to " 2®' 
 make an order, either confirming the discharge absolutely, 
 suspensively, or conditionally, or annulling the same ; and such 
 
 order shall be final, unless appealed from in the manner herein 
 provided for as to appeals from the Court or Judge ; 
 
 Suspensively or conditionally : — 
 
 That is, it may be confirmed ; but its operation may be suspended for 
 such period of time as the Court or Judge may order, as a punishment for 
 any delinquency or impropriety of conduct by the insolvent which is con- 
 sidered reprehensible, but not so much so as to justify the annulling of his 
 discharge. Or it may be confirmed, on condition of the performance by the 
 Insolvent of some act or acts which it is considered his duty to do, but the 
 neglect of which does not involve any fraud, and does not appear to the 
 tribunal of sufficient importance to justify the refusal to confirm his dis- 
 charge, provided he finally performs it. 
 
 These powers may be most beneficially exercised as a check upon the 
 conduct of debtors, by punishing their minor delinquencies, and by compel- 
 ling their attention to the reasonable requirements of their creditors. 
 
 9. Until the Court or Judge, as the case may be, has con- Effect of con- 
 firmed such discharge, the burden of proof of the discharge firmation. 
 being completely efl'ected under the provisions of this Act, shall 
 
 be upon the insolvent ; but the confirmation thereof, if not 
 reversed in appeal, shall render the discharge thereby confirmed, 
 final and conclusive ; and an authentic copy of the judgment 
 confirming the same shall be sufficient evidence, as well of such 
 discharge as of the confirmation thereof ; 
 
 Being completely effected — 
 
 That is to say, the InsolTent who pleads a discharge which has not been 
 confirmed, must prove that he has obtained the consent of the requisite pro- 
 portion of his creditors, in number and value ; which, of course, involves 
 establishing the entire amount— and, to some extent, the nature also — of his 
 liabilities ; together with the adduction of such evidence as to the execution 
 of the consent to his discharge, or of the deed of composition and discharge, 
 as the case may be, as is required to prove such execution by the ordinary 
 rules of evidence, at the place where the question is raised. 
 
 If the discharge has beeis confirmed, the mere production of a copy of the 
 judgment confirming it, proves not only such confirmation, but that the dis- 
 charge itself was "completely effected under the provisions of this Aet." 
 
 10. If, after the expiration of one year from the date of an When insol- 
 assignment made under this Act, or from the date of the issue vent may ap- 
 of a writ of attachment thereunder, as the case may be, the co^rt or judge 
 insolvent has not obtained, from the required proportion of for discharge, 
 creditors, a consent to his discharge, or the execution of a deed 
 
 of composition and discharge, he may apply to the Court in 
 Lower Canada, or to the Judge in Upper Canada by petition, 
 to grant him bis discharge, first giving notice of such applica- 
 tion, (Form Q.) in the manner hereinbefore provided for notice 
 of application for confirmation of discharge ;
 
 70 
 
 EXAMINATION OF THE INSOLVENT AND OTHERS. 
 
 First giving notice : — 
 Ante p. 6. 
 
 The English act allows of such an application 'only after the expiration of 
 three years from the refusal of a certificate of conformity. 
 
 Opposing such H- Upon such application any creditor of the insolvent may 
 application, appear and oppose the granting of such discharge upon any 
 
 ground upon which the confirmation of a discharge may be 
 
 opposed under this Act ; 
 
 Judgment of 
 Court. 
 
 Discharge, &c. 
 obtained by 
 fraud to be 
 void. 
 
 12. The Court or Judge, as the case may be, after hearing 
 the insolvent, and the objecting creditors, and any evidence 
 that may be adduced, may make an order either granting the 
 discharge of the insolvent absolutely, conditionally, or suspen- 
 sively, or refusing it absolutely ; and such "order shall be final, 
 unless appealed from in the manner herein provided for appeals 
 from the Court or Judge ; 
 
 May make an order : — 
 
 The order which the Court or Judge may grant, upon the application of an 
 Insolvent for a discharge, is substantially the same as that which may be 
 delivered upon an application for the confirmation of a discharge ; and upon 
 obtaining such discharge the debtor is in the same position as if he had pro- 
 cured it in the ordinary way and it had been regularly confirmed. See ante, 
 p. 8. And, of course, no proof would he required to support a plea based upon 
 such discharge, except an authentic copy of the judgment granting it. 
 
 The grounds upon which the Court or Judge may refuse a discharge ■ 
 are not stated in this section, and the sulficiency of the reasons urged by any 
 creditor against it will therefore be, to some extent, within his discretion. 
 But the grounds which are declared by the Act to be sufficient, when urged 
 against the confirmation of a discharge, would probably be regarded in the 
 same light, if set up against the granting of an order of discharge under 
 this section. 
 
 13. Every discharge or composition or confirmation of any 
 discharge or composition, which has been obtained by fraud or 
 fraudulent preference, or by means of the consent of any credi- 
 tor procured by the payment of such creditor of any valuable 
 consideration for such consent, shall be null and void. 
 
 See ante p. 6. 
 
 EXAMINATION OF THE INSOLVENT AND OTHERS. 
 
 When and 
 how insolvent 
 may be ex- 
 amined before 
 the assignee. 
 
 Examination 
 to be reduced 
 to writing. 
 
 1©. Immediately upon the expiry of the period of two months 
 from the first insertion of the advertisement giving notice of an 
 assignment, or of the appointment of an ofiicial assignee, the 
 assignee shall call a meeting, by advertisement, of the creditors, , 
 for the public examination of the insolvent, and shall summon 
 him to attend such meeting ; and at such meeting the insolvent 
 may be exaipined on oath, sworn before the assignee, by or on 
 behalf of any creditor present, in his turn ; and the examination 
 of the insolvent shall be reduced to writing by the assignee, 
 and signed by the insolvent ; and any questions put to the in- 
 solvent at such meeting which he shall answer evasively, or-
 
 EXAMINATION OF THE INSOLVENT AND OTHERS. 71 
 
 refuse to answer, shall also be written in such examination, _ 
 with the replies made by the insolvent to such questions ; and ^JSJi^^fj^J^^ 
 the insolvent shall sign such examination, or il he refuse to 
 sign the same, his refusal shall be entered at the foot of the 
 examination, with the reasons of such refusal, if any, as given 
 by himself; and such examination shall be attested by the. 
 assignee and shall be filed in the office of the court ; 
 
 For the public examination of the Insolvent :— 
 
 It is not nece.-^sary that the meeting ut which the public examination of 
 the Insolvent is to take place, should be called for that purpose exclusively ; 
 but such examination may be one of the numerous matters which the statute 
 permhs to be disposed of at the first general meeting of creditors which is 
 held after the expiry of two months from the date of notice of the appoint- 
 ment of an assignee. § 11, p. 3. •• 
 
 2. Ansiver evusicely : — 
 
 This is a ground for refusing to confirm a discharge, ante p. 6. 
 
 3. Ref !' se to ansiver :^ 
 
 This kind of conduct on the part of the Insolvent, though not expressly 
 declared to constitute a ground for refusing to confirm his discharge, would, 
 if the questions were reasonable and related to his estate and effects, be a 
 circumstance tending to raise a suspicion of fraudulent concealment or reten- 
 tion of his effects. But, of course, the nature of the presumption that 
 would be raised by such refusal, would depend upon the questions to which 
 it applied. An unreasonable refusal to answer, or to sign his examination, 
 or, in fact, any other contumacy on the part of the Insolvent, should form a 
 sufficient ground, however, for suspending his discharge. But umler p. 6, 
 post, he could be punished as any other whness might be who conducted 
 liimself in a similar manner ; and under the same p. he might receive pay- 
 ment for his attendance, like any other witness. 
 
 2. The insolvent may also be from time to time examined as Examination 
 to his estate and eifects upon oath, before the Judge, by the of insolvent 
 assignee or by any creditor, upon an order from the Judge j^j^g ' ^ 
 obtained without notice to the Insolvent, upon petition, setting 
 forth satisfactory reasons for such order — and he may also be 
 examined in like manner upon a subpoena issued as of course 
 without such order, in any action in which a writ of attach- 
 ment has been issued against his estate and eifects ; which 
 subposna may be procured by the plaintiff, or by any creditor 
 intervening in the action for that purpose, or by the assignee j 
 
 1. From time to time examined : — 
 
 This provision enables the assignee to obtain from the debtor any infor- 
 mation required, before the time arrives at whicii his public examination 
 takes place. 
 
 2. Without nt>tice:—T\\e uieolvent has no interest to require a notice, not 
 having any right to oppose his own examination. 
 
 3. Upon a Subpcrna : — 
 
 The power of issuing an ordinary suhpana, to compel the attendance f f 
 the insolvent, in all cases which have been commenced by ailachment, 
 renders it unnecessary to obtain the order of a Judge for that t)urpo.se, except 
 where proceedings in Insolvency have been commenced by vohintary 
 assignment. And it is a most important privilege, as it may be used by the 
 assignee, if necessary, immediately after his appointment, and afterwards 
 whenever he wishes to procure information respecting the Insolvent's estate 
 and effects.
 
 72 
 
 PROCEDURE GENERALLY. 
 
 Examination 3. The insolvent may also be so examined by the assignee 
 by assignee or or by any creditor, on the application of the insolvent for a dis- 
 applicaUoT charge or for the confirmation or annulling of a discharge, at 
 for discharge, any stage of such proceeding or upon any petition to set aside 
 &c. an attachment in the proceedings for the compulsory liquidation 
 
 of his estate ; 
 
 Other persons 
 may be es- 
 aminecL 
 
 Insolvent to 
 attend meet- 
 ings of liis 
 creditors. 
 
 Conduct of 
 vritnesses. 
 
 Thdr costs. 
 
 4. Any other person who is believed to possess information 
 respecting the estate or effects of the insolvent, may also be 
 from time to time examined before the Judge upon oath, as to 
 such estate or effects, upon an order from the Judge to that 
 effect, which order the Judge may grant upon petition, setting 
 forth satisfactory reasons for such order, without notice to the 
 insolvent or to the person, to be so examined j 
 
 5. The insolvent shall attend all meetings of his creditors, 
 when summoned so to do by the assignee, and shall answer all 
 questions that may be put to him at such meetings touching his 
 business, and touching his estate and effects ; and for every 
 such attendance he shall be paid such sum as shall be ordered 
 at such meeting, but not less than one dollar ; 
 
 The Insolvent shall attend — 
 
 This is a duty imposed upon the insolvent, for the non -performance of 
 which no punishment is prescribed ; but, doubtless, a refusal by the debtor 
 to attend a meeting of his creditors, or, when present, to answer any proper 
 question that is put to him at such a meeting, would be considered, if appli- 
 cation were made for the suspension of his clischarge. 
 
 6. Any person summoned for examination or under exami- 
 nation under this Act shall be subject to proceedings and punish- 
 ments similar to those which may be taken against or inflicted 
 upon ordinary witnesses ; and on application, the Judge may 
 at his discretion order an allowance to be made to persons so 
 examined, of a like amount to that allowed to witnesses in 
 civil cases, and order them to be paid such allowance out of 
 the estate or otherwise. 
 
 OF PROCEDURE GENERALLY. 
 
 Notices under 11. Notice of meetings of creditors and all other notices 
 t^"fo'^°*' ^°^ herein required to be given by advertisement," without special 
 ° ' designation of the nature of such notice, shall be so given by 
 publication thereof for two weeks in the Canada Gazette^ also 
 in Lower Canaria in every issue during two weeks of one 
 newspaper in English and one in French, and in Upper 
 Canada, in one newspaper in English, published at or nearest 
 to the plnce where the jiroceodings are being carried on, if such 
 newspapers are published within ten miles of such place ; and 
 in any case the assignee or person giving such notice shall 
 also address notices thereof to all creditors and to all represen- 
 tatives of foreign creditors, within the Province, and shall mail
 
 PROCEDURE GENERALLY. 
 
 73 
 
 the same with the postage thereon paid, at the time of the 
 insertion of the first advertisement : 
 
 2. All questions discussed at meetings of creditors shall be Decision ofl 
 decided by the majority in number of all creditors for sums questions at 
 above one hundred dollars, present or represented at such nieetmgs of 
 meeting, and representing also the majority in value of such • 
 creditors, unless herein otherwise specially provided ; but if 
 
 the majority in number do not agree with the majority in value, 
 the meeting may be adjourned for a period of not less than 
 fifteen days, of which adjournment notice by advertisement 
 shall be given ; and if the adjourned meeting has the same 
 result, the views of each section of the creditors shall be 
 embodied in resolutions, and such resolutions shall be referred 
 to the Judge, who shall decide between them ; 
 
 3. If the first meeting of creditors which takes place after what may be 
 the expiry of the period of two months from the date of the "lone at first 
 deed of assignment or of the appointment of an official assignee, "reditors^if 
 be called for the ordering of the affairs of the estate generally, called for or- 
 and it be so stated in the notices calling such meeting, all the tiering affairs 
 matters and things respecting which the creditors may vote, S^i^era ly, c. 
 resolve or order, or which they may regulate under this 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 meeting, notwithstanding anything to the 
 contrary in this Act contained, due regard being had, however, 
 to the proportions of creditors required by this Act for any such 
 vote, resolution, order or regulation ; ^ 
 
 Called for the ordering of the affairs of the estate generally — 
 As has been already remarked, it is of the utmost importance that as many 
 as possible of the matters and thinos, the direction of which falls within the 
 jurisdiction of the creditors, should be disposed of at this meeting, under the 
 general form of notice provided for by this clause. Among such matters are 
 the following : 
 
 1. The enactment of rules, orders and directions for the guidance of the 
 assignee. § 4, p. 4. 
 
 2. 'J"he regulation of the security to be given by the assignee. 5 4. p. 6. 
 
 3. The reception of the report of the assignee upon the debts remaining 
 uncollected— and the m.aking of tha requisite order sanctioning their sale, if 
 thought expedient. § 4, p. 11. 
 
 4. The regulation of the period of advertisement, and of the terms of the 
 Bale of the real estate : and of the sale thereof subsequent to a withdrawal 
 of it from public sale — if such withdrawal should be found necessary. § 4, 
 p. 14. 
 
 5. The removal of the assignee, and the appointment of another in his 
 place. § 4, p. 18. 
 
 6. The rate of remuneration of the assignee. § 4, p. 20. 
 
 7. Whether or no collateral security valued by a claimant, shall be 
 assumed by the estate or not. § 5, p. 5. 
 
 8. The granting of an allowance to the insolvent. § 5, p. 8. 
 
 9. Whetlier or not the costs of any specified contestation shall be paid out 
 of the estate. § 5, p. 15. 
 
 10. The continuance or cessation of the lease of the premises occupied 
 by the Insolvent. § 6, p. 2. 
 
 11. The public examination of the insolvent. § 10, p. 1.
 
 74 
 
 PROCEDURE GENERALLY. 
 
 Claims of ere- 4. The claims of creditors (Form R) shall be furnished to the 
 (liters ; form of. assignee in writing, and shall specify what security, if any, the 
 creditor holds for the payment of his claim, and when required 
 by this Act shall also contain an estimate by such creditor of 
 the value of such security ; and if the creditor holds no security, 
 then it shall also be so therein stated ; 
 
 1. In tvriling — 
 
 As to the mode of filing Tjlaims, their headings, endorsement and subscrip- 
 tion, see Rule 6. 
 
 2. Value required by this Act — 
 See § 5, p. 5. 
 
 3. An estimate — 
 
 Upon this estimate being made, the future proceedings with rei,aid to the 
 security are decided upon. If the estimate is considered reasonable, the 
 creditor is allowed to retain the security, and the value he fixes upon it is 
 deducted from his claim. If the estimate is not considered sufficient, the 
 assignee may assume the security for the benefit of the estate at ten per 
 centum advance upon the estimate, and the creditor ranks for the ditference. 
 § 5, p. 5. 
 
 Ho"w to be at- 
 tested. 
 
 5. The claims shall be attested under oath, taken in Canada 
 before any Judge, Commissioner for taking Affidavits, or Jus- 
 tice of the Peace, and out of Canada, before any Judge of a 
 Court of Record, any Commissioner for taking Affidavits 
 appointed by any Canadian Court, the Chief Municipal Officer 
 for any Town or City, or any British Consul or Vice-Consul, 
 or before any other person authorized by any statute of this 
 Province for taking affidavits to be used in this Province ; 
 
 Supplement- ^- Before the preparation of a dividend sheet, the assignee 
 ary oath in ^ may require from any creditor a supplementary oath declaring 
 certain cases.'i v^-hat amount, if any, such creditor has received in part payment 
 of the debt upon which his claim is founded, subsequent to the 
 making of such claim, together with the particulars of such 
 payment ; and if any creditor refuses to produce or make such 
 oath before the assignee within a reasonable time after he has 
 been required so to do, he shall not be collocated in such 
 dividend sheet ; 
 
 Such creditor has received in part payment,— 
 
 The object of this clause is to afford the means of carrying out the provi- 
 sions of § 5, p. 6. If the claim of a creditor is composed of several items — 
 say for instance, of several promi-sory notes or bills bearing diflerent 
 names, upon some of which the insolvent is only secondarily liable, and 
 the maker, acceptor or a previous endorser should pay one of such notes or 
 bills in full ;-the amoimt of such note or bill should be deductc^d frotn the 
 claim, and all ranking upon it should cease. And by the supplementary 
 oath, which may be required from the claimant under this clause, the 
 assignee can ascertain whether or no any such payment has been made. 
 
 It is only in such a case as the foregoing that the oath is of use — as no 
 ordinary payment on account, will give the assignee the right of demanding 
 
 a deduction from the amount ranked for, 
 rities there cited. 
 
 See note to § 5, p. 6, and autho-
 
 PROCEDURE GENERALLY. f>§^ 
 
 7. If, in Lower Canada, any claim be secured by hypotheque claims se- 
 iipon the real estate of the insolvent, or if it consists of any cured by hy- 
 hypotheque ox privUe<i:e upon such real estate or any part ^"'^'f^'"^ °^ 
 thereof, the nature of such hypotheque or privilege shall be l. C. 
 summarily specified in such claim ; but unless such claim be Documents to 
 filed with the assignee, with the deeds and documents in sup- tobefiIed,&c. 
 port thereof, within six days from the day of sale of the property 
 
 affected thereby, or if not, unless leave to file the same be 
 afterwards obtained from the Judge upon special cause shewn, 
 previous to the distribution of the proceeds of such real estate, 
 or unless a dividend upon such claim has been reserved by the 
 assignee, such claim shall not be entitled to any preferential 
 collocation upon the proceeds of such real estate ; 
 
 Unless a dividend * • =h has been reserved. — 
 
 If no claim be filed for any debt which the assignee has reason to beh'eve 
 is due — it is his duty to reserve a dividend upon the amount of such debt, 
 § 5, p. 12. 
 
 8. Any affidavit required under this Act may be made by Who may 
 
 the party interested, or by the asrent in that behalf having a makeaffida- 
 /»• t vits uhcIq]? 
 
 personal knowledge of the matters therein stated ; tl^ig ^^t. 
 
 9. One clear day's notice of any petition, motion or rule, shall Notices of 
 be sufficient if the party notified resides within fifteen miles of proceedings. 
 the place where the proceeding is to be taken, and one extra 
 
 day shall be sufficient allowance for each additional fifteen 
 miles of distance between the place of service and tho place of 
 proceeding, and service of such notice shall be made in such 
 manner as is now prescribed for similar services in that section 
 of the Province within which the service is made ; 
 
 Sei'vice of such notice. — 
 
 Rules 17 and 18 make provisions for such services, in a manner similar 
 to that adopted under the previous practice in like cases in Lower Canada. 
 
 10. The Judge shall have the same power and authority in Commissions 
 respect of the issuing and dealing with Commissions for the exa- ^'^^ examma- 
 mination of witnesses, as are possessed by the ordinary Courts negggg^ 
 
 of Record in the section of the Province in which the pro- 
 ceedings are being carried on ; 
 
 Commissions. — 
 
 See Cons. Stat. L. C. pp. 737-8. 
 
 11. All rules, orders and warrants, issued by any Judge or Rules, &c., 
 court in any matter or proceeding under this Act, may be pay be served 
 validly served in any part of this Province upon the party t^igYrovince. 
 affected or to be affected thereby ; and the service of them 
 
 or any of them may be validly made in such manner as is now 
 prescribed for singular services in that part of the Province 
 within which the service is made ; and the person charged 
 with such service shall make his return thereof and on oath, or,
 
 *2Q PROCEDURE GENERALLY. 
 
 if a sheriff or bailiff in Lower Canada, may make such return 
 under his oath of office ; 
 
 1. In any part of this Province. — 
 
 That is to say that such documents may be served in a part of the Pro- 
 vince different from that in which the Judge or Court issuing them, has 
 jurisdiction. So tliat a Judge at Montreal may issue a rule, order or war- 
 rant which may be validly served in Upper Canada. 
 
 2. Service of them may be validly made. — 
 
 That is to say the service of a rule, order or warrant issued in Lower 
 Canada will be validly made in Upper Canada, if that mode of service be 
 adopted which is usual for similar proceedings in Upper Canada. 
 
 Certain ss. of 1^- The fourth, fifth, seventh, eighth, ninth, tenth, eleventh 
 
 caps. 79 and and thirteenth sections of chapter seventy-nine of the Consoli- 
 
 80, Con. Stat, dated Statutes of Canada shall apply to proceedings under this 
 
 applyT * ^ -^^^ '■> ^^^ ^^^^ whole of chapter eighty of the said Consolidated 
 
 Statutes shall also apply to proceedings under this Act, in the 
 
 same manner and to the same extent as to proceedings before 
 
 Courts of Record in Upper and Lower Canada ; 
 
 1. TlieAth,5th, • * * • sections of Cap. 19. 
 
 These sections provide for the issue of subpa-nas running from one section 
 of the Province into the other ; for the service of such subpcDuas, and its 
 proof ; for the punishment of the parties summoned if they do not attend, 
 and the allowances to be made to them if they do. 
 
 2. Chapter Eighty- — 
 
 This chapter facilitates the admission as evidence in Upper Canada of 
 judgments, decrees and judicial proceedings rendered or made in Great 
 Britain, the United States, or Lower Canada. — And also simplifies the 
 mode of proof of official acts, judgments, and judicial proceedings generally. 
 There is a similar and more complete statute in Lower Canada, forming 
 Chapter 90, of the Consolidated Statutes for that section— which will apply 
 under its own provisions, to proceedings under this Act. 
 
 Forms ap 13. The forms appended to this Act, or other forms in equi- 
 
 pended to be yalent terms, shall be used in the proceedings for which such 
 "^^ ■ forms are provided ; but in every petition, application, motion, 
 
 cases ordinary contestation, or other pleading under this Act, the parties may 
 language to state the facts upon which they rely in plain and concise Ian- 
 be sufficient, guage, to the interpretation of which the rules of construction 
 applicable to such language in the ordinary transactions of life 
 shall apply ; and no allegation or statement shall he held to 
 be insufficiently made, unless by reason 6f any alleged insuf- 
 ficiency the opposing party be misled or taken by surprise ; 
 
 Amendment 14. The rules of procedure as to amendments of pleadings, 
 
 of proceed- which are in force at any place where any proceedings under 
 ^^^^' this Act are carried on, shall apply to all proceedings under 
 
 this Act ; and any judge before whom any such proceedings 
 are being carried on shall have full power and authority to 
 apply the appropriate rules as to amendments, to the pro- 
 ceedings so pending before him ; and no j)leading or pro- 
 ceeding shall be void by reason of any irregularity or default 
 which can or may be amended under the rules and practice of 
 the court ;
 
 PROCEDURE GENERALLY. ^J^ 
 
 15. The death of the insolvent, pending proceedings upon a Effect of death 
 voluntary assignment or in compalsory liquidation, shall not of insolvent 
 affect such proceedings, or impede the winding up of his ^^^^^"^P'^^" 
 estate ; and his heirs or other legal representatives may con- """ 
 tinue the proceedings on his behalf to the procuring of a 
 discharge, or of the confirmation thereof, or of both; 
 
 16. The costs of the action to compel compulsory liquidation Costs to corn- 
 shall be paid by privilege as a first charge upon the assets of pel compul- 
 the insolvent ; and the costs of the judgment of confirmation of ^9^'^ liquida* 
 the discharge of the insolvent, or of the discharge if obtained 
 
 direct from the Court, and the costs of winding up the estate, 
 being first submitted at a meeting of creditors, and afterwards 
 taxed by the judge, shall also be paid therefrom ; 
 
 17. In Lower Canada rules of practice for regulating the due Rules of prac-- 
 conduct of proceedings under this Act before the Court or tice and tariff 
 Judge, and tariffs of fees for the Officers of the Court, and for ° ^^^^^ 
 
 the Advocates and Attorneys practising in relation to such pro- 
 ceedings, shall be made forthwith after the passing of this Act, 
 and when necessary repealed or amended, and shall be pro- 
 mulgated, under or by the same authority and in the same 
 manner as the rules of practice and tariff of fees of the Superior 
 Court for Lower Canada, and shall apply in the same manner 
 and have the same effect in respect of the proceedings under Taxation of 
 this Act, as the rules of practice and tariff of fees of the Superior costs. 
 Court apply to and affect the proceedings before that Court ; 
 and bills of costs upon proceedings under this Act, may be 
 taxed and proceeded upon in like manner, as bills of costs 
 may now be taxed and proceeded upon in the said Superior 
 Court ; 
 
 18. In Upper Canada the Judges of the Superior Courts of puigg and 
 Common Law, and of the Court of Chancery, or any five of tariff in U. C. 
 them, of whom the Chief Justice of Upper Canada, or the 
 Chancellor, or the Chief Justice of the Common Pleas, shall 
 
 be one, shall have power to frame and settle such forms, rules 
 and regulations as shall be followed and observed in the pro- 
 ceedings on insolvency under this Act, as they may deem to 
 be necessary, and to fix and settle the costs, fees and charges 
 which shall or may be had, taken or paid in all such cases by 
 or to Attorneys, Solicitors, Counsel, Officers of Courts, whether 
 for the Officer or for the Crown, as a fee for the fee fund or 
 otherwise. Sheriffs, Assignees or other persons whom it may 
 be necessary to provide for. 
 
 GENERAL PROVISIONS. 
 
 13. In all cases of sales of merchandise to a trader in Rights of up- 
 Lower Canada subsequently becoming insolvent, the exercise of P^^^J^^^^*-/ 
 the rights and privileges conferred upon the unpaid vendor by
 
 78 
 
 GENERAL PROVISIONS, 
 
 tume de Pan* the one hundred and seventy-sixth and one hundred and 
 restricted. seventy-seventh articles of the Coutume de Pan's, is hereby 
 
 restricted to a period of fifteen days from the delivery of such 
 
 merchandise : 
 
 The rights and privileges of the unpaid vendor. — 
 
 The right of revendicating goods sold a ierme has been pressed very far 
 in Lower Canada, and has frequently resulted in great injustice to the 
 general creditors of an insolvent estate. It appears to have been considered 
 that the duration of the period between the sale and the revendication was 
 of no consequence : nor were (he eflects relieved from the operation of the 
 Jaw, by the fact of iha purchaser having given promissory notes for such 
 purchase, nor in consequence of such notes having passed out of his pos- 
 session by being discounted. Consequently a debtor with a large stock 
 of goods on hand ; and therefore with, and on the strength of, an appa- 
 rent abundance of assets ; might obtain long credit on the purchase of the 
 most saleable goods in the market. He might sell the whole of such goods, 
 expend the money and fail ; and every dollar's worth of the very goods 
 ■which gave him the appearance of solvency might be appropriated by 
 their vendors ; leaving nothing for the other creditors, although their 
 claims might be for sales made subsequently to those Avhich were thus 
 virtually paid in full. 
 
 It is plain that the existence of the right of thus revendicating goods sold — 
 though alleged to be an encouragement of trade and an aid to credit — was, 
 in reality, the reverse ; for it deprived of all weight the presumption of pros- 
 perity which would otherwise naturally have arisen from the possession of 
 an ample stock of goods. 
 
 This evil was felt strongly in France ; and in the discussion of the code de 
 commerce and of the amendments of 1838, the great majorit)' of the cham- 
 bers of commerce expressed themselves forcibly, against the right of reven- 
 dication allowed by the common law. By the law, as it now stands, the 
 right of revendication has a character almost identical with that of the Eng- 
 lish stoppage in transitu. In order that goods sold may be revendicated 
 they should be delivered ; that is, they should have passed out of the actual 
 possession of the vendor ; they should not be paid for — and they should not 
 have entered the warehouses of the purchaser. Art. 576. 3. Bed. p. 193. 
 And the latter condition is not construed over strictly, if, by doing so, room is 
 given for the occurrence of the great abuse to which this right gave rise. 
 M. Bedarride says : " La revendication a ete surtout admise parce que la 
 marchandise n'a encore auxyeu.v de personne, augmente le credit et PactiJ 
 de celui qui est de>-enu proprietaire sans en etre possesseur.^' And he argues 
 from this that if the goods have passed into the actual possession of the ven- 
 dor, so that they may have, in some one's eyes, augmente le credit et 
 I'aciifof the debtor, the right of revendication will be lost, though the goods 
 may not have actually passed into his warehouse. 3 Bed. p. 199. 
 
 Acting upon similar opinions as to the impropriety of permitting to the 
 right of revendication too extensive a character, the Legislature has materi- 
 ally restricted its exercise, by limiting it — in the case of sales of merchan- 
 dise to a trader — to the period of fifteen days from the date of the delivery of 
 the goods 
 
 In L. C. mar- 
 riage con- 
 tracts of 
 traders to be 
 registered 
 within a cer- 
 tain period. 
 
 2. In Lower Canada, every trader who marries, having pre- 
 viously executed a contract of marriage by which he gives or 
 promises to give or to pay, or cause to be paid to his wife, any 
 property or effects, or any sum of money, shall cause such 
 contract of marriage to be enregistered in the registration 
 division in which he has his place of business, within thirty 
 days from the execution thereof ; and every trader already 
 married, having such marriage contract with his wife, shall
 
 GENERAL PROVISIONS. 
 
 79 
 
 enregister the same as aforesaid, if it be not there ah-eady 
 enregistered, within three months from the passing of this Act ; 
 and every person not a trader, but hereafter becoming a trader, 
 and having such a contract of marriage with his wife, shall 
 cause such contract to be enregistered as aforesaid (if it be not 
 previously there enregistered), within thirty days from becom- 
 ing such trader ; and in default of such registration the wi/e px-ovision in 
 shall not be permitted to avail herself of its provisions in any default of sucb 
 claim upon the estate of such insolvent for any advantage ^'egistration. 
 conferred upon or promised to her by its terms ; nor shall she be 
 deprived by reason of its provisions of any advantage or right 
 upon the estate of her husband, to which, in the absence of any 
 such contract, she would have been entitled by law ; 
 
 In any claim upon the estate — 
 
 This clause, however, would not prevent the wife from holding property, 
 if she be scparee de. Mens by her marriage contract. T!ie contract is only 
 rendered useless to her to support any claim upon her husband's estate. 
 
 2. Nor shall she be deprived * * * * qf any advantage — 
 
 If, for instance, she has, by her marriage contract, renounced her custom- 
 ary dower and received the promise of a sum of money, or of the usufruct of 
 a sum of money, in lieu of such dower, — she will be unable to claim the 
 money or usufruct so settled upon her, tut she may insist upon her dower 
 under the custom. 
 
 The reason is, that if no contract be registered, the creditors are entitled 
 to presume tiiat none has been executed. But, if that presumption be acted 
 upon, the whole of its consequences must follow, and, amongt others, the 
 existence of douaire coutumier, which, in the absence of a contract, would 
 undoubtedly belong to her. 
 
 3. No judgment shall be rendered against any trader in Judgments in 
 Lower Canada in any action against him by his wife en sepa- actions £?i se- 
 ration de biens or en separation de corps et de biens, unless the li^ns, to be 
 institution of such action is advertised continuously for one rendered only 
 month in the Canada Gazette, and in two newspapers published °^ ^^.^t*^^^ 
 in or nearest to the place of residence of such trader, one in 
 French, the other in English ; nor unless such action be brought 
 in the district within which the defendant has his domicile ; 
 and any creditor of the defendant in any such suit may inter- creditors may 
 vene therein for the purpose of examining such debtor respect- intervene, 
 ing his estate and effects, without becoming liable for any 
 costs either to the plaintiff or to the defendant, and may also 
 intervene therein, and oppose the demand of the plaintifi', or 
 subsequently contest the validity of any judgment rendered 
 therein, subject to the ordinary rule as to costs ; 
 
 The experience of the last few years in Lower Canada renders unneces- 
 sary any explanation of the purposes of this clause. Those merchants will 
 understand them, from whom goods have been purchased by a trader while 
 his wife's suit en separation de biens has been actually proceeding to judg- 
 ment e.v parte, who, after getting judgment for the price of them, have found 
 his wife in possession of their own goods, amidst a shop-full of others so pur- 
 chased — acquired by her, under execution, for what will pay her lawyer lor 
 obtaining her judgment en separation ; and who have beheld the husband • 
 
 carrying on a prosperous business — as his wife's agent — with their capital, 
 and laughing to scorn their attempts to recover even the additional hundred
 
 80 
 
 INTERPRETATION. 
 
 Interpreta- 
 tion. 
 
 * Before Not- 
 aries." 
 
 " Judge." 
 " Court." 
 
 Certain pro- 
 visions to 
 apply. 
 
 dollars they have lost in endeavoring to enforce payment. And it is prob- 
 able that there are few (if any) wholesale merchants in Lower Canada who 
 have not possessed at least one opportunity of thus appreciating the advan- 
 tages of a judgment en separation de Mens, and of paying liberally for the 
 privilege. 
 
 4. The woixis " before Notaries " shall mean executed in 
 Notarial form according to the law of Lower Canada ; the 
 words " the Judge " shall, in Lower Canada, signify a Judge 
 of the Superior Court for Lower Canada, having jurisdiction at 
 the domicile of the insolvent ; and in Upper Canada a Judge 
 of the County Court of the County or Union of Counties in 
 which the proceedings are carried on, and the words, " the 
 Court " shall, in Lower Canada, signify the said Superior 
 Court, and in Upper Canada the County Court, unless it is 
 otherwise expressed or unless the context plainly requires a 
 different construction ; but the twenty-fourth and twenty-fifth 
 sections of the seventy-eighth chapter of the Consolidated 
 Statutes for Lower Canada, including subsection number two 
 of the said twenty-fifth section, shall apply in Lower Canada 
 to proceedings under this Act ; 
 
 Tke 2Alh and 25tli sections of the seventy-eighth chapfer — 
 These sections permit of the action of the Prothonotary of the Superior 
 Court in lieu of the Judge, in certain cases, antt provide a summary mode of 
 revising the acts of the Prothonotary under the powers thus conferred upon 
 him. 
 
 " Assignee." 
 
 i' Day." 
 " Creditor." 
 
 3. The word " Assignee " shall mean the official assignee 
 appointed in proceedings for compulsory liquidation as well 
 as the assignee appointed under a deed of voluntary assign- 
 ment ; the word " day " shall mean a juridical day ; the 
 word " Creditor " shall be held to mean every person to whom 
 the insolvent^, is liable, whether primarily or secondarily, and 
 whether as principal or surety ; but no debt shall be doubly 
 represented or ranked for, either in the computation for ascer- 
 taining the numbers and proportion of creditors, or in the 
 " Collocated." allotment or payment of dividends ; the word " collocated " 
 shall mean ranked or placed in the dividend sheet for some 
 dividend or sum of money ; and all the provisions of this Act 
 respecting traders, shall be held to apply equally to unincor- 
 porated trading Companies and co-partnerships ; and the chief 
 office or place of business of such unincorporated trading 
 Companies and co-partnerships shall be their domicile for the 
 purposes of this Act ; 
 
 Ao debt shall be doubly represented or ranked for — 
 See note to § 5, p. 6. 
 
 Application 
 of Act to com 
 panies, &c. 
 
 Assignees to ^' Every assignee to whom an assignment is made under 
 
 be agents this Act, and every official assignee appointed under the pro- 
 
 within the visions of this Act, is an agent within the meaning of the 
 
 meaning o forty-third, forty-fourth, forty-sixth, forty-eighth and forty-ninth
 
 GENERAL PROVISIONS. gj 
 
 sections of the ninety-second chapter of the Consolidated cqh. ^^^^.^ 
 Statutes of Canada ; and every provision of this Act, or Canada, cap. 
 resolution of the creditors, relating to the duties of an assignee ^2> sec.43, &c. 
 or official assignee, shall be held to be direction in writing, 
 within tlie meaning of the said forty-third section of the said 
 chapter ; and in an indictment against an assignee or official 
 assignee under any of the said sections, the right of property in 
 any moneys, security, matter, or thing, may be laid in " the 
 creditors of the insolvent (72a>ni?2g' him), under the Insolvent 
 Act of 1864," or in the name of any assignee subsequently ap- 
 pointed, in his quality as such assignee ; 
 
 7. Th^e deed of assignment, or an authentic copy thereof, Deed of as- 
 or a duly authenticated copy of the order of the judge appoint- signment, kc, 
 ing an official assignee, or a duly certified extract from the y„^-g evidence, 
 minutes of a meeting of creditors, according to the mode in 
 
 which the assignee orofficial assigneeis alleged to be appointed, 
 shall be prima facie evidence in all courts, whether civil or cri- 
 minal, of such appointment, and of the regularity of all proceed- 
 ings at the time thereof and antecedent thereto ; 
 
 8. One per centum upon all moneys proceeding from the Percentage 
 sale by an assignee, under the provisions of this Act, of any for Building 
 immoveable property in Lower Canada, shall be retained by pund in^L. C 
 the assignee out of such moneys, and shall by such assignee be 
 
 paid over to the Sheriff of the District, or of either of the coun- 
 ties of Gaspe or Bonaventure, as the case may be, within which 
 the immoveable property sold shall be situate, to foj-m part of 
 the Building and Jury Fund of such District or County ; 
 
 9. The Governor in Council shall have all the powers with Power to im- 
 respect to imposing a tax or duty upon proceedings under this poseatax en 
 Act, which are conferred upon the Governor in Council by the [q ^^ c, ° 
 thirty-second and thiriv=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 provision for the 
 erection or repair of Court Houses and Gaols at certain places 
 in Lower Canada, (12 Vic, cap. 112.) 
 
 13. This Act shall be called and known as " The Insolvent short title. 
 Act of 1864," and shall come into force and take effect on and 
 after the first day of September next.
 
 g2 APPENDIX. 
 
 FORM A. 
 
 Insolvent Act of 1864. 
 
 The Creditors of the undersigned arefnotified to meet at 
 in on the th day of 
 
 at {eight) o'clock for the purpose of 
 
 receiving statements of his affairs, and of naming an Assignee 
 to whom he may make an assignment under the above Act. 
 
 • 
 
 [Domicile of debtor^ and date.) 
 
 {Signature.) 
 
 {The following is to be added to the notices sent by post.) 
 
 The Creditors holding direct claims and indirect claims, 
 maturing before the meeting, for one hundred dollars each and 
 upwards, are as follows : {names of Creditors and amcunt due) 
 and the aggregate of claims under one hundred dollars is $ 
 
 {Domicile of debtor., and date.) 
 
 {Signature.)
 
 APPENDIX. 
 
 FORM B. 
 
 Insolvent Act of 1864. 
 
 Jn the matter of A. B., an insolvent. 
 
 Schedule of Creditors. 
 1, Direct Liabilities. 
 
 Name. 
 
 Residence. 
 
 Nature of Debt. 
 
 Amount. 
 
 2. Indirect liabilities, maturing before the day fixed 
 for the first meeting of creditors. 
 
 Name. 
 
 Residence. 
 
 Nature of Debt. Amount 
 
 3. Indirect liabilities, maturing after the day fixed 
 
 for the first meeting of creditors. 
 
 Name. 
 
 Residence. 
 
 Nature of Debt. 
 
 Amount. 
 
 4. Negotiable paper, the holders of which are un- 
 known. 
 
 Date. 
 
 Name 
 
 of 
 Maker. 
 
 Names 
 
 liable to 
 
 Insolvent. 
 
 When due. 
 
 Amount. 
 
 Total.
 
 34 appendix. 
 
 Provixce of Canada, 1 
 
 District [or County) ^ Insolvent Act of 1864. 
 
 I, A. B., the above named insolvent, being duly sworn, 
 depose and say : 
 
 1. That to the best of my knowledge and belief, and accord- 
 ing to my books, the above schedule contains a true and cor- 
 rect list of my liabilities, according to its purport, and that each 
 of such liabilities is correctly classified therein. 
 
 ••2. That all of the above-mentioned liabilities are honestly 
 due by me and that none of them were created or have been 
 increased with the intention of giving to the creditor thereof 
 any advantage either in voting at meetings of creditors, or in 
 ranking on my estate. And I have signed. 
 
 Sworn before me at this day of 
 
 186 . 
 
 FORM C. 
 
 Insolvent Act of 1864. 
 
 This assignment made between of the 
 
 first part, and of the second part, 
 
 witnesses, 
 
 {or) 
 
 On this day of 
 
 before the undersigned notaries 
 
 came and appeared 
 
 of the first part, and 
 
 of the second part, which said parties declared to us* Notaries. 
 
 That under the provisions of " the Insolvent Act of 1864 " 
 the said party of the first part, being insolvent, has voluntarily 
 assigned and hereby does voluntarily assign to the said party 
 of the second part, accepting thereof as assignee under the said 
 Act, and for the purposes therein provided, all his estate and 
 effects real and personal of every nature and kind whatsoever. 
 
 To have and to hold to the party of the second part as 
 assignee for the purposes and under the Act aforesaid. 
 
 And a duplicate of the list of creditors exhibited at the first 
 meeting of his creditors, by the said party of the first part, is 
 hereto annexed. 
 
 In witness whereof, &c. 
 
 Done and passed, &c. 
 
 01'
 
 APPENDIX. 35 
 
 FORM D. 
 
 Insoltent Act of 1864. 
 
 In the matter of 
 
 A.B. (or A. B.& Co.) 
 
 an Insolvent. 
 
 The creditors of the insolvent are notified that he has made 
 an assignment of his estate and effects, under the above Act, 
 to me, the undersigned assignee, and they are required to 
 furnish me, within two months from this date, with their claims, 
 specifying the security they hold, if any, and the value of it ; 
 and if none, stating the fact ; the whole attested under oath, 
 "with the vouchers in support of such claims. 
 
 {Place date) 
 
 {Signature of assignee.) 
 
 FORM E. 
 
 Insolvent Act of 1864. 
 
 To {name residence and description 
 
 ©f insolvent.) 
 
 You are hereby required to make an assignment of your 
 estate and efi'ects under the above Act, for the benefit of your 
 creditors. 
 
 Place date 
 
 ( Signature of credito7\ ) , 
 
 FORM F. 
 
 Insolvent Act of 1864. 
 
 Province of Canada, 
 District of 
 
 A. B , {namCy residence and description.) 
 
 Plaintift: 
 vs. 
 
 C. D , {name, residence and descriptio^i.) 
 
 Defendant. 
 
 I, A. B , {name, residence and description) being duly 
 
 sworn, depose and say : 
 
 1. I am :he Plaintiff in this cause {or one of the Plaititiffs, 
 or the clerk, or the agent of the Plaintiff in this cause duly 
 authorized for the purposes hereof ;
 
 gg APPENDIX. 
 
 2. The defendant is indebted to the Plaintiff (or as the case 
 may be) in the sum of dollars currency for, {state 
 concisely and clearly the nature of the debt) ; 
 
 3. To the best of my knowledge and belief the defendant is 
 insolvent within the meaning of the Insolvent Act of 1864, and 
 has rendered himself liable to have his estate placed in com- 
 pulsory liquidation under the above mentioned Act ; and my 
 reasons for so believing are as follows : {state concisely the facts 
 relied upon as rendering the debtor insolvent, and as subjecting 
 his estate to be placed in compulsory liquidation.) 
 
 And I have signed ; {or I declare that I cannot sign,) 
 this day of 186 
 
 and if the deponent cannot sign, ► 
 add — the foregoing affidavit having- 
 been first read over by me to the de- 
 ponent. 
 
 (FORM G.) 
 
 Insolvent Act of 1864. 
 
 pROTiNCE OF ^ VICTORIA, 6^ ^^e Grace of God, of the 
 Canada, > United Kingdom of Great Britain and 
 
 District of Quebec. ) Ireland, Queen, Defender of the Faith. 
 
 To the Sheriff of our District (or County) of 
 No. 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 every kind and nature whatsoever 
 
 of and belonging to 
 if the same shall be found in {name of district or other territo- 
 rial jurisdiction) and the same so attached, safely to hold, 
 keep and detain in your charge and custody, until the attach- 
 meril thereof, which shall be so made under and by virtue of 
 this Writ, shall be determined 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 Dis- 
 
 trict) of on the day of 
 
 then and there to answer the said 
 
 of the plaint contained in the declaration hereto annexed, and 
 iurther to do and receive what, in our said Court before Us,
 
 APPENDIX. g'y 
 
 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 thereon, 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 be hereunto affixed, at aforesaid 
 
 , this day of 
 
 in the year of our Lord, one thousand eight hundred and 
 sixty- in the 
 
 (FORM H.) 
 
 Insolvent Act or 1864. 
 
 A. B., 
 
 Plff. 
 C. D., 
 
 Deft. 
 
 A writ of attachement has issued in this cause, of which 
 all persons interested in the estate of the defendant, and all 
 persons having in their possession, custody or power, any 
 portion of the assets of the defendant, or who are in any way 
 indebted to him, are required to take notice. 
 
 {Place date. ) 
 
 (Signature,) 
 
 Sheriflf. 
 
 (FORM I.) 
 
 Insolvent Act or 1864. 
 
 I swear that I [or, the Jinn of which I (mi a member, or, A. 
 B. of of whom I ara the duly authorized agent in 
 
 this behalf,) am (or is) a creditor of the Insolvent, and that I 
 will give my advice in the appointment of an assignee to his 
 estate, honestly and faithfully and in the interest of his credi- 
 tors generally. 
 
 (FORM K.) 
 
 Insolvent Act of 1864. 
 
 In the matter of 
 
 A. B. {or A. B. & Co.), 
 
 an insolvent. 
 
 The creditors of the insolvent are notified that I, the under- 
 signed {name and residence), have been appointed official
 
 88 APPENDIX. 
 
 assignee of his estate and effects : and they are required to 
 produce before me within two months from this date, their 
 claims upon the said estate under oath, specifying the security 
 they hold, if any, and the value of it, and if none, stating the 
 fact, with vouchers in support of such claims. 
 
 (Place date,) 
 
 [Sigimiure,) 
 
 Official Assignee. 
 
 (FORM L.) 
 
 Insolvent Act of 1864. 
 
 In the matter of 
 
 A. B., 
 an insolvent. 
 
 In consideration of the sum of $ whereof quit ; 
 
 C. D., assignee of the insolvent, in that capacity hereby sells 
 and assigns to E. F. accepting thereof, all claim by the Insol- 
 vent against G. H. of {descrihing the debtor) with the evidences 
 of debt and securities thereto appertaining, but without any 
 warranty of any kind or nature whatsoever. 
 
 C. D., Assignee. 
 E. F. 
 
 FORM M. 
 
 This deed, made under the provisions of the Insolvent Act 
 of 1864, the day of &c., 
 
 between A. B. of &c., in 
 
 his capacity of assignee of the estate and efTects of 
 an insolvent, under a deed of assignment executed on the 
 
 day of at in 
 
 Canada, {or under an order of the Judge made at 
 on the day of ) of the one part, 
 
 and C. D., of &c. , of the other part, witnesseth : 
 
 That he, the said A. B., in his said capacity, hath caused the 
 sale of the real estate hereinafter mentioned, to be advertised 
 in the Canada Gazette from the 
 
 day of to the 
 
 day of inclusive, and hath adjudged and doth 
 
 hereby grant, bargain, sell, and confirm the same, to wit : 
 unto the sxid CD., his heirs and assigns for ever, all (m 
 Upper Canada insert " the rights and interests of the Insolvent 
 in ") that certain lot of land, &c. , {insert here a description of 
 the property sold) : To have and to hold the same, with the
 
 APPENDIX. 
 
 89 
 
 appurtenances thereof, unto the said CD., his heirs and assigns 
 for ever. The said sale is so made for and in consideration 
 of the sum of ^ 
 
 in hand paid by the said CD. to the said A.B., the receipt 
 whereof is hereby acknowledged {or of which the said CD. 
 hath paid to the said A.B. the sum of 
 
 the receipt whereof is hereby acknowledged) and the balance, 
 or sum of $ the said CD. hereby pro- 
 
 mises to pa^ the said A.B., in his said capacity, as follows, to 
 v^it— {here state the terms of payment)— ihe whole with interest 
 payable and, as 
 
 security for the payments so to be made, the said CD. hereby 
 specially mortgages and hypothecates to and in favour of the 
 said A.B., in his said capacity, the lot of land and premises 
 hereby sold. In witness, 
 
 A.B. [L.S.] 
 CD. [L.S.] 
 Signed, sealed, and delivered 
 in the presence of 
 
 E.F 
 
 FORM N. 
 
 Insolvent Act of 1864. 
 
 In the matter of 
 
 A.B {or A.B. & Co.,) 
 
 an Insolvent. 
 
 The Creditors of the Insolvent are notified that a dividend 
 sheet has been prepared, and will remain open to inspection 
 and objection at my office {describing it) every day between 
 the hours of ten and five o'clock until the 
 
 day of after which the dividends 
 
 therein allotted will be paid. 
 
 FORM 0. 
 
 Insolvent Act or 1864. 
 
 Province of Canada, ) In the {name of Court) 
 
 District {ur Count ij) of \ (In the matter of A.B. {or 
 
 A.B. & Co.), an Insolvent. 
 
 Notice is hereby given that the undersigned has filed in the 
 office of this Court, a consent by his creditors to his discharo-e 
 {or a deed of composition and discharge., executed by his
 
 90 APPENDIX. 
 
 creditors), and that on the day of 
 
 next, at ten of the clock in the forenoon, or as 
 soon as counsel can be heard, he will a)3ply to the said Court 
 {or to the Judge of the said Court^ as the case may be) for a con- 
 firmation of the discharge thereby effected in his favor, under 
 the said Act. 
 
 (Place date.) 
 
 (Signature of Insolvent, or of his Attorney ad litem). 
 
 FORM P. 
 
 Insolvent Act of 1S61. 
 
 Province of Canada, ) In \he (name of Court) 
 District (or County) of ) In the matter of A. B,, an 
 
 Insolvent. 
 
 Notice is hereby given that the undersigned creditor of the 
 insolvent has required him to file, in the office of this Court, 
 the consent of his creditors, or the deed of composition and 
 discharge executed by them, under which he claims to be 
 discharged under the said Act ; »nd that on the 
 
 day of next, at ten of the clock in 
 
 the forenoon, or as soon as counsel can be heard, the 
 undersigned will apply to the said Court (or to the Judge of 
 the said Court, as the case may be) for the annulling of such 
 discharge. 
 
 (Place dale.) 
 
 (Signature of Insolvent, or of his Attorney ad litem. 
 
 FORM Q. 
 
 Insolvent Act of 1864. 
 
 Province of Canada, ) In the (name of Court) 
 District (or County) of \ In the matter of A.B. (or A.B 
 
 & Co.) an Insolvent. 
 
 Notice is hereby given that on the day of 
 
 next, at ten of the clock in the forenoon, or as soon 
 
 as counsel can be heard, the undersigned will apply to the 
 
 said Court (or the Judge of the said Court, as the case may 
 
 be) for a discharge under the said Act. 
 
 (Place, date.) 
 
 (Signature of tlie Insolvent, or his Attorney ad litem.)
 
 APPEXDIX. 9 1 
 
 FORM R. 
 
 Insolvent Act of 1864. 
 
 In the matter of 
 A. B., 
 
 An Insolvent, and 
 C. D., 
 
 Claimant. 
 I, C. D., of , being duly sworn in 
 
 depose and say : 
 
 1. I am the claimant (or, the duly authorized agent of the 
 claimant in this behalf^ and have a personal knoicledge of the 
 ■matter hereinafter deposed to, or a member of the firm of 
 
 claimants in the matter^ and the said firm is composed of 
 myself and of E. F. of ) 
 
 2. The insolvent is indebted to me (or to the claiinant) in 
 the sum of dollars, for (here state the nature and 
 particidars of the claim, for which purpose reference may also 
 be made to accounts or documents annexed.) 
 
 3. I (or the claimant) hold no security for the claim, (or /o 
 the claimant holds the following, and no other, security for the 
 claim, namely : {state the particulars of the security.) 
 
 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.
 
 RULES AND ORDERS 
 
 AND 
 
 TAETFF OF FEES 
 
 Made by the Judges of the Superior Court for Lower Canada, under 
 
 and by virtue of the Statute 27 and 28 Vict., cap. 17, 
 
 intituled : " An Act respecting Insolvency." 
 
 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 Insolvency. 
 
 2. All judicial 'proceedings in Insolvency shall be had and 
 conducted 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 every juridical day, from 
 9 A. M. to 4 P. M., and shall be attended during that time by a 
 Clerk appointed by the District Prothonotary, and who shall be 
 known as " The Clerk in Insolvency." 
 
 4. To ensure regularity of proceedings at the sittings of the 
 Judges, the business shall be conducted in the following order : 
 
 1. Meetings of Creditors ; 
 
 2. Motions ; 
 
 3. Rules Nisi ; 
 
 4. Petitions, except as hereinafter mentioned ; 
 
 5. Proceedings on applications for discharge of Insolvents ; 
 
 6. Proceedings on applications for discharge of Assignee ; 
 
 7. Appeals. 
 
 5. Proceedings before a Judge or Court may be conducted by 
 the Insolvent himself, or by any party having interest therein, or 
 by their Attorney ad litem, admitted to practice in Lower Canada, 
 and by no other person.
 
 94 
 
 RULES AND ORDERS. 
 
 6. All Motions, Petitions and Claims, and all papers in the 
 nature of pleadings in Insolvency shall be intituled : In Insolvency, 
 
 for the District of In the matter of Insolvent, 
 
 and Claimant, Petitioner or Applicant, as the case may 
 
 be, plainly written, without interlineations or abbreviations of 
 words ; and the subject or purpose thereof shall be plainly and 
 concisely stated. They shall also be subscribed by the Petitioner, 
 Applicant or Claimant, or by his Attorney ad litem for him. And 
 they shall be subject to the ordinary rules of procedure of the 
 Superior Court in res}>ect of similar papers, as regards the names 
 and designations of the parties, and the mode in which they shall 
 be docketed and filed. 
 
 7. No paper of any description shall be received or filed in any 
 case, unless the same shall be properly numbered and intituled in 
 the case or proceeding to which it may refer or belong ; and be also 
 endorsed with the general description thereof, and with the name 
 of the party or his Attorney ad litem filing the same. « 
 
 8. In all appealable matter in dispute, the pretensions of the 
 parties shall be set forth in writing, in a clear, precise and intel- 
 ligible manner, and the notes of the verbal evidence taken before 
 the Assignee shall be plainly written, shall be signed by the 
 witness, if he can write and sign his name, and shall be certified 
 by the Assignee as having been sAvorn before him. And in the 
 event of an appeal, the Assignee shall make and certify a transcript 
 from his Register, of the proceedings before him in the matter 
 appealed from. And he shall also make and certify a list of the 
 documents composing such proceedings and appertaining thereto, 
 and shall annex such transcript and list to such documents with 
 a strong paper or parchment cover, before producing the record 
 before the Judge, as required by the said Act. 
 
 9. All proceedings before a Judge or Court shall be entered 
 daily, in order of date, in a docket of proceedings, to be kept by 
 the Clerk for each case ; and shall, from time to time, and until 
 the close of the Estate, be fairly transcribed in E-egisters suitable 
 therefor, which shall be kept and preserved by the Prothonotary, 
 in the same manner as the Registers of proceedings of the Superior 
 Court. 
 
 10. No Demand, Petition or Application of which notice is re- 
 quired to be given, either by the provisions 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 
 filed in the case, 
 
 11. Except where otherwise limited 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 Court 
 whenever the rights of parties interested may seem to require 
 it for the purposes 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
 
 RULES AND ORDERS. 
 
 95 
 
 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 juridical day. 
 
 13. All affidavits of indebtedness made by a creditor, or by the 
 clerk or agent of a creditor, shall set forth the particulars and 
 nature of the debt, with the same degree of certainty and precision 
 as IS required in affidavits to hold to bail in civil process in 
 the Courts of Lower Canada. 
 
 14. All Writs of Attachment issued under the said Act, shall 
 as issued, bo numbered 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 gratis, at all times durin^r 
 office hours. "^ 
 
 15. Every such Writ 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 Su2:)erior Court. 
 
 16. No such Writ shall issue 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 proceed- 
 ings in Lower Canada, except otherwise specially prescribed by the 
 said Act, may be made by a Bailiff of the Superior or Circuit 
 Court, whose certificates of service shall be in the form reouired 
 for service of process in the said Courts ; or by any literate person, 
 who shall certify his service by his affidavit j and in either case, 
 the manner, place arfd 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 
 proceedings, 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 
 sha be returned on the return day into the Clerk's Office, and 
 shall be there filed for proceedings thereon, as may be advised or 
 du'ected. 
 
 20 Every day, except Sundays and Holidays, shall be a iuridi- 
 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 
 
 directed, shall not be required to make any detailed Inventory or 
 
 proces-verbal of the effects or articles by him attached under such 
 
 Writ; but a full and complete Inventory of the Insolvent's Estate, 
 
 so attached by the Sheriff; shall be made by the Assignee or
 
 96 
 
 RULES AND ORDERS. 
 
 person who shall be placed iu possession thereof as guardian 
 under such Writ ; by sorting and numbering the books of account, 
 papers, documents and vouchers of the Estate, and entering the 
 same, with the other 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 be filed by the said 
 
 Assignee or person in possession, on the return day of the said 
 Writ, as required 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 
 him, within two months from the date thereof, their claims, spe- 
 cifying 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 ^th 
 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 others in interest in such cases, for examination or extract 
 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 possession 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, shewing the balance thereof 
 in his hands, or under his control, made up to the last day of the 
 preceding month. And no moneys so deposited, shall be with- 
 drawn without a special order of the Court, entered in the docket 
 of proceedings in the case, or upon a dividend sheet prepared and 
 notified, as required by the said Act, or unless otherwise ordered 
 by the Creditors, under the powers conferred upon them by the 
 said Act.
 
 TARIFF OF FEES IN INSOLVENCY. 
 
 IN PROCEEDINGS FOR COMPULSORY LIQUIDATION. 
 
 ON BEHALF OF THE PLAINTIFFS, 
 IF NOT CONTESTED : 
 
 $ cts. 
 
 To the Prolhonolary for Writ of Attachment 1 80 
 
 Do. Copy of Writ 30 
 
 Sheriff for Warrant 2 50 
 
 Copies of Warrant, each 50 
 
 All proceedings by the Sheriff or his Agent or Messenger 
 
 in the seizure and return, exclusive of Mileage. . . 2 00 
 
 Guardian, per day 1 00 
 
 Do Making up Inventory and Statements, to be 
 subject to taxation by the Judge : 
 
 To the Prothonotary on return of Writ 5 00 
 
 Crier's Fee on Return 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 appoint- 
 ing Official Assignee 50 
 
 Attorney's Fee for conducting proceedings to appoint- 
 ment of Official Assignee 30 00 
 
 IF CONTESTED, ADDITIONAL FEES : 
 
 To the Prothonotary on Inscription 2 00 
 
 To the Prothonotary on every Witness examined for 
 
 Plaintiff, exceeding two in number 30 
 
 And for each subsequent deposition exceeding 400 
 
 words in length, for every 100 words 10 
 
 Attorney's Fee, additional 20 00 
 
 Counsel Fee at Enquete 10 00 
 
 ON BEHALF OF THE DEFENDANTS, 
 IF NOT CONTESTED : 
 
 Attorney's Fee for appearance 10 00 
 
 IF CONTESTED, ADDITIONAL FEES : 
 
 To the Prothonotary on filing Petition in contestation. . 6 00 
 On every Witness examined for Defendant, exceeding 
 
 two in number 30 
 
 7
 
 Qg TARIFF OF FEES IN INSOLVENCY. 
 
 $ cts. 
 
 And for each subsequent deposition exceeding 400 
 
 words in length, for every 100 words 10 
 
 Attorney's Fee, additional 20 00 
 
 Counsel Fee at Enquete 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 PROCEEDINGS FOR COMPULSORY 
 LIQUIDATION, OR FOR EXAMINATION OF DEBTOR : 
 
 To the Petitioner's Attorney on every Petition, not 
 
 contested 5 00 
 
 If contested, without Enquete 10 00 
 
 If contested, with Enquete 15 00 
 
 To the Respondent's Attorney — 
 
 If contested, without Enquete 8 00 
 
 If contested, with Enquete 12 00 
 
 To the Prothonotary — 
 
 Filing Petitions 2 00 
 
 Copy of Order 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 
 
 ON PETITIONS IN APPEAL TO A JUDGE : 
 
 To the Assignee for transcript of record and making up 
 
 record and attendance before the Judge 5 00 
 
 To the Prothonotary — 
 
 Filing Petition 2 00 
 
 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 OF OTHER PERSONS RESPECTING 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 chirographary claim, without security 1 00 
 
 For every chirographary claim, with security 2 00 
 
 For every hypothecary claim, if not contested 5 00
 
 TARIFF OF FEES IN INSOLVENCY. 99 
 
 $ cts. 
 
 On every claim contested, without Enquete — 
 
 Additional— To Claimant's Attorney 10 00 
 
 To Contestant's Attorney 10 00 
 
 With Enquete — 
 
 To Claimant's Attorney 20 00 
 
 To Contestant's Attorney .20 00 
 
 To the Assignee — 
 
 On every chirographary claim and hypothecary claim, 
 
 not contested 10 
 
 For every witness examined on the contestation of a 
 
 claim 25 
 
 On inj-cription of contestation for argument 2 00 
 
 On Contestations of Dividend Sheets — 
 
 The same fees and disbursements to Counsel and to 
 Assignee as on Contestation of Claim. 
 On application for discharge by the Court, for confirma- 
 tion of discharge, or for annulling discharge : 
 To the Applicant's Attorney — 
 
 If not contested 15 00 
 
 If contested, without Enquete 25 00 
 
 If contested, with Enquete 35 00 
 
 To the Respondent's Attorney — 
 
 If contested, without Enquete 15 00 
 
 If contested, with Enquete = . 25 00 
 
 To the Prothonotary — Filing Application 2 00 
 
 Every Deposition. 30 
 
 All words over 400 in each 
 
 Deposition, per 100 10 
 
 MISCELLANEOUS. 
 
 To the Attorneys, Prothonotaries and Bailiffs, Fees and 
 disbursements on all Rules, Motions, Copies of 
 Rules, Judgments and Orders, Commissions 
 i'ogatoires, 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.
 
 I IN" D E X. 
 
 Abscokdikg : „ i * . 
 Ov beinsr about to abscond with intent, &c., renders estate 
 of debtor liable to connpulsovy liquidation lo 
 
 ABSE^TEK ; 
 
 Account ; 
 Affidavit ; 
 
 Allowance 
 
 Amount ; 
 
 Remaining out of the Province with intent, &.C., renders 
 estate liable lo compulsory liquidation 1" 
 
 Final by assignee. See Assignee ^9 
 
 For writ of attachment may be made in L. C. by any cre- 
 ditor for $200, or his Clerk or Agent - -. --J 
 
 Upon beino- filed with Proihonotaiy, writ shall issue -i-* 
 
 For writ of attachment in U. C. may be made by any 
 creditor for $200, or any one for him - • ■ • 23 
 
 That debtor's estate has become subject to compulsory 
 liquidation, must be made in U. C. by two credible per- 
 sons to the satisfaction of -the Judge *^ 
 
 May be made by party interested, or by his agent 75 
 
 (See Writ of Attachment. 
 
 For attachment shall set forth particulars, like affidavits to 
 hold bail 95 
 
 Creditors may make allowance to Insolvent 43 
 
 Shall be inserted in the dividend sheet 4d 
 
 Shall be subject to contestation on cer'ain grounds .- 43 
 
 Of appeal mast be applied for within five days oi) 
 
 Due each creditor must be inserted in preliminary sche- 
 dule •--- 10 
 
 Of claim, if disputed at preliminary meeting, how decided, 13 
 
 Of claim, if disputed at meeting to consider Petition for 
 
 suspension, to be decided by the Judge 
 
 Annulling discharge ; 
 
 Creditor may petition to annul, if Insolvent does not apply 
 
 for confirmation !„ 
 
 Notice of such petition must be given, and how 
 
 Reasons for, may be the same al those on which confirma- 
 tion is opposeii ■ ' • ■ , , ■ ■ 
 
 Petition shall be granted, if consent or deed be not filed.. . 
 
 If they be filed, shall be proceeded upon as in applications 
 for conliniiation ^„ 
 
 May be granted, or discharge may be confirmed , 
 
 Permitted from award of assignee, upon the value of debt 
 
 due upon a condilion or contingency . 
 
 Also from a waul upon conte.'-tation of divideii.l .•.•-;-• 
 
 Also from award upon claim lor damages for resiliating 
 
 lea.'.e. . . • • • .•■•••.■•■,■ .(, 
 
 Peniling appeal— assignee to reserve ihvidend as claimed. 40 
 
 To be to the Judge, from award of assignee 49 
 
 To be by summary petition 4^ 
 
 Notice of, to be given -•-.. 4J 
 
 Permitted Irom Judge, to Court of Queen's Bench in Lower 
 Canada ^^ 
 
 Appeal 
 
 28 
 
 68 
 
 68 
 
 68 
 
 69 
 
 40 
 45 
 
 48
 
 INDEX. 
 
 , PAGE-;. 
 
 Appeal — Con. 
 
 Permitted from County JuJge, to Judge of higlier Courts in 
 
 Upper Canada t 50 
 
 But must first be allowed .' 50 
 
 May, in Upper Canada, be referred to the full Court 50 
 
 Application for allowance of, must be made within (ive days 50 
 
 Petition in, must be served within live days from allowance. 50 
 
 Security in, must be given within five days from allowance. 50 
 
 Petition in, when to be presented 51 
 
 Assignee must file record in - 51 
 
 If not proceeded with, record to be remitted 51 
 
 Costs in, to be in the discretion of the Court or Judge 51 
 
 Order of Judge in, to be subject to review in L. C 51 
 
 In matters subject to, duties of assignee regulated. . . 94 
 
 See Award. 
 Appointment of Assignee; 
 
 How proved - SI 
 
 Arrears. See Clerks — Employes. 
 Assignee ; 
 
 May be named by creditors at preliminary meeting 12 
 
 If none be named by creditors, or if one being named refu- 
 ses to act ; may be chosen by Insolvent from among certain 
 
 creditors T. 13 
 
 ^ If competent— assignment to, not to be vitiated by anj' an- 
 tecedent neglect or irregularity 13 
 
 What property vested in, by assignment. 14 
 
 Must forthwith deposit duplicate, or authentic copy, of deed 
 
 of assignment and list of credhors, in the office of the Court . 14 
 
 Shall call meetings of creditors on requisition of five credi- 
 tors 31 
 
 Or of the Judge, on application, with notice to him 31 
 
 Or when he requires instructions from creditors 31 
 
 Shall state purposes of meeting in notices calling it 31 
 
 Shall be subject to such rules as creditors may make, at a 
 
 meeting called for the purpose 32 
 
 Shall deposit money in bank, or bank agency 32 
 
 Shall attend all meetings of creditors and keep minutes of 
 
 them, duly signed and certified 33 
 
 Certified copies of such minutes shall hs prima facie evi- 
 dence of them 33 
 
 Shall keep register of proceedings and of claims 33 
 
 Shall give security in accordance with order of creditors. . . '33 
 
 Shall conform himself to subsequent order in that behalf. . 33 
 
 Securiiy for, in whose name taken 31 
 
 Security shall be deposited in the office of the Court 33 
 
 Security may be enforced by subsequently appointed as- 
 signee 33 
 
 Jr'owers of insolvent lor his own benefit, vested in assignee. 34 
 
 But not powers or property held for die benefit of others. . . 34 
 Shall wind up estate by belling stocks and moveables, and 
 
 coUecling debts 34 
 
 May sue in his own name for debts due insolvent 34 
 
 May lake all such proceedings as the insolvent might have 
 
 taken 34 
 
 May intervene in all ca.ses pending 34 
 
 If appointed to an in>olvent copartner, — may exercise his 
 remedies against his copartners, as if a dissolution had taken 
 
 phn-e T 34 
 
 Ma)^ report to creditors upon uncollected debts 35 
 
 Debt with their sanction may obtain order of the Judge for 
 
 sale of such ilebts 35 
 
 Pending notice of sale, shall keep at his office, for inspection, 
 
 a list of debts to be sold 35
 
 INDEX. 103 
 
 PAGES. 
 
 Assignee — Con. 
 
 Shall also give free access to documents and vouchers ex- ■ 
 
 planatory of them 35 
 
 May sell real estate of insolvent, and how 35 
 
 Must give notice to hypothecary creditors, and how 37 
 
 Shall be subject to the summary jurisdiction of the Court or 
 
 Judge 37 
 
 Performance of duties of, maybe enforced on summary pe- 
 tition 37 
 
 Removal of, by the Judge 37 
 
 Appointment of new assignee by the' Judge _- 37 
 
 Order of Judjre for meeting of creditors, to appoint new 
 
 assignee ^« 
 
 When may be removed by creditors 38 
 
 Appointment of new — by creditors — 38 
 
 Alier removal, remains subject to summary jurisdiction of 
 
 the Court, till he has accounted 38 
 
 Remuneration of, how determined 38 
 
 Death of, does not cause estate to pass to heirs of. 38 
 
 After death of, estate falls under control of Judge. _. -_. 38 
 
 Must prepare final account, after declaration of final divi- 
 dend 38 
 
 Must keep account open for inspection 39 
 
 May theieupon apply for discharge 39 
 
 Must produce Bank certificate ot deposit of dividends and 
 
 balance on hand • 39 
 
 Must prepare accounts and statements of his doings 39 
 
 Must prepare dividend sheets, and when 39 
 
 May be ordered to award upon the value of contingent or 
 
 conditional claims 40 
 
 Must give notice of dividend sheet by advertisement 44 
 
 Must reserve dividends for claimants who have not filed 
 
 claims 44 
 
 Musi notify such claimants of their dividends - . 44 
 
 If such dividends be not claimed, shall include amount in 
 
 final dividend sheet 44 
 
 If dividends are objected to, how to proceed 45 
 
 Shall hear and examine the parties and their witnesses. . . 45 
 
 Shall take notes of evidence. 45 
 
 Shall verify statements by books and accounts 45 
 
 Shall make an award thereon . 45 
 
 Shall reserve dividends pending appeal. 46 
 
 Shall make a report on the value of long leases 47 
 
 Shall award on lessor's claim for damages 48 
 
 Shall attend before Judge on appeal 49 
 
 Shall produce before him all evidence, &c 49 
 
 Shall lile in the otiice of the Court of Appeal the record,&c. 51 
 May recover back etfects given as security or payment, in 
 
 contemplation of Insolvency - - • - 56 
 
 May recover back sums paid thirty days before Insolvency, 
 
 in certain cases ^° 
 
 Shall give notice of depo,sit of deed of composition. . 62 
 
 If deed of composition be not objected to, shall obey its pro- 
 visions 62 
 
 If objected to, shall await its confirmation 62 
 
 Debt due by, not alfected by discharge . 66 
 
 N'or computed in ascertaining proportion of creditors 66 
 
 But sucli debt may rank 66 
 
 Shall call a meeting fur the public examination of Insolvent 70 
 
 Shall reduce exiimiiuition to writing t^ 
 
 Shall attend such examination '0 
 
 May require supplementary oath from claimant 74 
 
 Interpretation of the words '' the Assignee." 80
 
 104 INDEX. 
 
 PAGES, 
 
 Assignee— Cora. 
 
 Is an agent within the meaning of Cap, 92 of Con. Stat, of 
 
 Canada 81 
 
 Provisions of the Act and Resolutions of Creditors, to be 
 
 directions in writing within the meaning of that chapter 81 
 
 Appointment of, how proved 81 
 
 Duties of, in matters subject to appeal 94 
 
 To give notice of deed of assignment 96 
 
 Shall keep minutes of meetings and register of proceedings, 
 
 open for inspection of creditors 96 
 
 Shall fi!e ceitified copies of proceedings and copies of news- 
 papers. 96 
 
 Assigning ; 
 Assignment 
 
 Award 
 
 Bank 
 
 Removing or disposing of estate, or any part of it, with 
 intent, &c., renders it liable to compulsory liquidation 17 
 
 Mode of proceeding preliminary lo 17 
 
 Must be made to assignee chosen by creditors 17 
 
 If no assignee chosen, or if assignee chosen will not act, 
 
 to whom to he made 13 
 
 May be made by insolvent to official assignee, if no avail- 
 able nomination ot assignee be made by creditors 13 
 
 Shall not be vitiated by any antecedent neglect or irregu- 
 larity 13 
 
 Deed of, if in U. C, shall be in duplicate 14 
 
 What shall be held to be by it conveyed and vested in 
 
 assignee 14 
 
 General assignment or conveyance of property, otherwise 
 than as provitled by the Act, renders estate of debtor liable 
 to compulsory liquidation 18 
 
 May be made by assignee, as to the value of a debt payable 
 
 upon a condition or contingency which has not happened.. . . 40 
 
 Such award shall be subject to appeal 40 
 
 May be made by assignee upon contestation of dividend 
 
 and costs 45 
 
 Such award shall be deposited in Court 45 
 
 Such award shall be linal, unless appealed from within 
 
 three days 45 
 
 As to costs may be made e.vecutory, and how 46 
 
 May be made by assignee, on claim for damages for resi- 
 
 liating lease 48 
 
 Such award shall be subject to appeal 48 
 
 May be confirmed, modified, or set aside, on appeal 49 
 
 May be referred back for further evidence 49 
 
 Assignees shall deposit moneys in, weekly 32 
 
 Assignee shall produce certificate of deposit in, of 
 
 unclaimed dividends 39 
 
 Deposits in, shall not be withdrawn by assignee, except in 
 
 a certain manner 96 
 
 Bill of Sale. Sec Debts. 
 Board of Trade ; 
 
 Or its council may name persons to be official assignees 30 
 
 Shall declare what security they must give 30 
 
 Shall transmit copy of resolution appointing them, to the 
 
 proper Prothonotary, or Clerk of Court 30 
 
 See Offical Assignee. 
 Books of Account ; 
 
 Must be produced at preliminary meeting if required 10 
 
 Not keeping cash book, ground for opposing confirmation of 
 
 discharge 67 
 
 So also not keeping books suitable for his trade 67 
 
 So also refusing to produce them 67'
 
 INDEX. 105 
 
 PAGES. 
 
 Building and Jury Fund ; 
 
 One per centum on proceeds of sale of immoveable property, 
 to be retained for • - 81 
 
 Cessation of payment ; 
 
 lin case of, by a trader, any two creditors for an aggregate 
 sum exceeding $500, may demand assignment 18 
 
 Chancery ; 
 Claims ; 
 
 40 
 40 
 40 
 
 Clerk ; 
 
 Appeal to Judoe of Court of, in Upper Canada 50 
 
 Register of, shall be kept by assignee 33 
 
 What debts shall rank upon estate 33 
 
 Surety on paying, may rank either on claim filed by 
 
 credhor or in his own name .... 
 
 Upon contingent or condhional obligations, how to be per- 
 mitted to rank -• 
 
 How adjusted, in certain cases, when dependent on contin- 
 gency or condition - 
 
 Of creditor holding security, how made 41 
 
 Nature and amount of security to be specified in claim. . . 41 
 
 Value of security to be stated on oath ... 41 
 
 Shall rank for the amount due upon each item of, e.xcept 
 
 in cases of security ... . • 42 
 
 Shall not be twice ranked upon -_- - • 42 
 
 May inchide costs incurred previous to notice of assign- 
 ment, or of issue of writ 43 
 
 Costs of contestation of, may be ordered to be paid out of 
 
 estate. . - 46 
 
 For damages for resiliating lease, how adjusted 48 
 
 Shall be in writing . . 74 
 
 Shall specify security, if any, and an estimate of it 74 
 
 Shall be attested uader oath 74 
 
 Secured by hypotheque, shall contain specification thereof. 75 
 Such claim must be filed within six days of sale of real 
 
 estate ■ - • 75 
 
 Otherwise not entitled to dividend unless reserved 75 
 
 How to be intituled, written, and subscribed 94 
 
 Shall have a privilege for not more than three months 
 arrears of salary due at the time of assignment, or issue of writ 
 Clerk in Insolvency ; 
 
 Eoom shall be appropriated for . . 93 
 
 Office of, to be kept open from 9 to 4 93 
 
 To keep a docket of all proceeding's 94 
 
 And also a Keai.ster of proceedings 94 
 
 Shall prepare lists of matters pending 
 
 Shall keep record of proceedings open at his ofiice — . 
 
 43 
 
 96 
 96 
 
 Collocated 
 
 80 
 
 Interpretation of the word " collocated " .... 
 
 Commissions Rogatoires ; 
 
 To be issued and dealt with by Judge, as by ordinary 
 Courts of Record 
 
 Common Law Courts ; 
 
 Appeal to Judge of, in Upper Canada 50 
 
 Compensation : 
 
 By debt of insolvent purchased in contemplation^ of insol- 
 vency, does not take place 59 
 
 Composition and Discharge ; 
 
 EtTect of deed of _ 60 
 
 Proportion in number and vahie of creditors required...-. 60 
 Deed of, to be binding on all parties, if required proportion, 
 
 consent 60 
 
 Deed of, when may be made - 60 
 
 Eftect of discharge comprised in deed of. 60 
 
 75
 
 X06 INDEX. 
 
 PAGES. 
 
 Composition and Discharge — Con. 
 
 Effect of deposit with assignee, of deed of. 62 
 
 If objected to within the proper period, is suspended till 
 
 confirmed 63 
 
 Deed of, may be filed in Court for confirmation 66 
 
 Obtained by fraud or fraudulent preference — void 70 
 
 Or by payment of valuable consideration 70 
 
 Compulsory liq'jfdation ; 
 
 What rendeis estate of debtor subject to: See Con- 
 cealment, Demand of Assignment, Secreting, Impri- 
 sonment, Absconding, Absence, Execution, Assigning, Ne- 
 glect, Cessation of payment. Affidavit. 
 
 No proceedings for compulsory liquidation can be taken 
 
 after three months from the date of the act of insolvency 21 
 
 Nor after voluntary assignment or appointment of assignee 
 
 under the act 21 
 
 Costs of action to compel — to be paid out of estate 77 
 
 Concealment ; 
 
 Of debtor with intent, &c., renders his estate subject to com- 
 pulsory liquidation. 16 
 
 Condition ; 
 
 Debt dependent on, how to rank , . . . . 40 
 
 How to be adjusted as to amount in certain cases 40 
 
 Confirmation of discharge ; 
 
 Consent to discharge may be filed for 67 
 
 Notice of application for, to be given 67 
 
 Creditor may oppose 67 
 
 On what grounds. 67 
 
 If insolvent does not apply for, creditor may petition to 
 
 annul 68 
 
 In what manner and on what grounds 68 
 
 May be granted absolutely, suspensively or conditionally . 69 
 
 Or may be refused and discharge annulled 69 
 
 Order final, unless appealed from . 69 
 
 Until granted — burden of proof of discharge, on insolvent.. 69 
 
 Copy of judgment of, snfficie;it evidence 69 
 
 Costs to be paid out of estate 77 
 
 Consent. See Discharge. 
 Consideration-. See Fraud. 
 Contestation ; 
 
 Of allowance to insolvent. — See Allowance of dividend. 
 See Dividend. 
 
 Costs of, may be paid out of estate ^6 
 
 Contingency ; 
 
 Debt dependent on, how to rank and how to be adjusted 
 
 as to amount in certain cases 40 
 
 Continuing trade ; 
 
 If debtor continues to trade while demand of assignment 
 is pending, his estate becomes subject to compulsory liqui- 
 dation 21 
 
 Contract. See Fraud. 
 
 Conveyance. See Fraud. 
 
 Copartnership. See Copartner — Debts — Ranking. 
 
 Costs ; 
 
 Treble costs may be awarded on order prohibiting pro- 
 ceedings upon demand of assignment 20 
 
 Incurred after notice of assignment, or of writ of attachment 
 
 cannot rank 20 
 
 Previously incurred shall rank like debt 43 
 
 Of contestation of dividend, may be awarded upon by 
 
 assignee • ■ • ^^ 
 
 Award of may be made executory by order of the Judge . . 46
 
 Costs — Con 
 
 Court ; 
 Court Hous 
 
 Creditors ; 
 
 Creditor ; 
 Curator ; 
 
 Damages ; 
 
 Day; 
 
 Death ; 
 
 Debtor ; 
 Debts ; 
 
 INDEX. 
 
 PAGES. 
 
 Of contestation of any claim or dividend may be paid out 
 
 of estate by order of creditors 46 
 
 Security for in appeal 50 
 
 In appeal may be awarded to Respondent, if Appellant 
 
 does not present his petition « 51 
 
 In appeal, to be in the discretion of the Judge appealed 
 
 from 51 
 
 Of action to compel compulsory liquidation to be paid out 
 
 of estate 77 
 
 b'o also costs of judgment of confirmation of discharge 77 
 
 So also co.sts of obtaining discharge from the Court 77 
 
 So also costs of winding up the estate 77 
 
 But shall be taxed by the Judge 77 
 
 TaritT of cotts may be made - 77 
 
 Bills of, may be taxed according to ordinary practice 77 
 
 Rule as to, in actions en separation de biens 79 
 
 Interpretation of the words " the Court " 80 
 
 Es AND Gaols ; 
 
 Power of Governor to impose tax on proceedings, in aid of 
 
 fund to repair. 81 
 
 Schedules of, must be produced by insolvent at preliminary 
 
 meeting - 10 
 
 May name assignee at preliminary meeting 12 
 
 In voting at preliminary meeting, shall only represent direct 
 
 liabilities and indirect liabilities overdue ........._ 12 
 
 Shall decide by vote, disputes at preliminary meeting 13 
 
 But he whose claim is under discussion shall not vote. ... 13 
 Any two for an aggregate sum of over $500, may demand 
 
 assignment if trader debtor stops payment 18 
 
 Any creditor may apply for an order to call the first meet- 
 ing of creditors in compulsory liquidation 25 
 
 Advice of, to be taken by Judge under oath as to appoint- 
 ment of ofhcial assignee. {See Assignee.) 26 
 
 See Security. 
 
 Fraud with regard to. See Fraud. 
 
 Sn-pplementary oath may be required from 74 
 
 Shall not be collocated if they refuse or neglect to produce it. 74 
 
 Interpretation of the word " Creditor.". . ^ 80 
 
 Debt due by, not aiTected by discharge 66 
 
 Nor computed in ascertaining required proportion 66 
 
 But may rank 66 
 
 Measure of, for resilial lug lease 48 
 
 Claimant for, shall rank as ordinary creditor 48 
 
 Debt due as, fur per.-onal wrong>, not aflectcd by discharge 66 
 
 Interpretation of the word " day." 80 
 
 First and last shall not be computed as part of delay 94 
 
 If last day, a Sunday or Holiday, time enlarged till next day. 95 
 
 Of assignee shall not can>e estate to pass to his heirs. ... 38 
 
 Of insolvent shall not alfect or impeile winding up estate. . 77 
 
 Purchased of debt by, to be set olfin compensation is void. 58 
 
 To be collected by assignee 34 
 
 May be sued for in his name 34 
 
 Uncollected may be sold, and how 35 
 
 107
 
 108 INDEX 
 
 Debts — Con. 
 
 When sold may be sued for In the name of the purchaser. 35 
 
 Formof Bill of Sale. (Form L.) 35 
 
 Bill of Sale ^r/Hiayircfe evidence of purchase 35 
 
 No .warranty except of good faith of assignee, created by 
 
 sale of debts 35 
 
 Due by insolvent, how ihey shall rank . . , - 39 
 
 Individual and partnership debts, how they shall rank 43 
 
 See Assignee. 
 Declaration ; 
 
 Shall accompany writ of attachment 22 
 
 Shall be similar in form to ordinary declarations 95 
 
 Deed of Assignment ; 
 
 If in U. C, shall be in duplicate. (Form C.) 14 
 
 Shall have list of creilitors annexed to it 14 
 
 Need not contain particulars of prcrperty assigned 14 
 
 Counterparts may be executed at any time at the request 
 
 of the assignee 14 
 
 If in U. C, duplicate to be deposited in the office of the 
 
 Court * 14 
 
 If in L. C, authentic copy of, to be so deposited 14 
 
 IVIay be enregislered, if insolvent possesses real estate. ... 15 
 
 Eflect of such registration • 15 
 
 How authenticated for registration, when real estate and 
 
 place of execution of deed,, are in different sections of the Pro- 
 vince _ 15 
 
 Effect of, if executed according to the form prevailing at 
 
 the pl^ce of execution 15 
 
 Notarial copies of, if executed in Lswer Canada, constitute 
 
 prima fade proofs of execution and of contents of original. . . 15 
 
 Notice of, to be given by assignee. (Form D.) 96 
 
 Demand ; 
 
 Of assignment, may be made on stoppage of payment by a 
 
 trader, by any two creditors, claim.ing in all more than $500. 18 
 
 May be opposed by debtor by petition 20 
 
 On what grounds proceeding upon, may be prohibited by 
 
 Judge 20 
 
 Pending pethion, trader must n<''t continue his trade 21 
 
 li petition be rejected, or if debtor neglects to assign his 
 
 estate, he becomes subject to compulsory liquidation 21 
 
 Deposit ; 
 
 ■ In contemplation of insolvency, when void 56 
 
 Of deed of composition, how made, and ell'ect of 62 
 
 Direct liabilities ; 
 
 Must be distinguished from indirect in preliminary schedule. 10 
 See Vote. 
 
 Discharge 
 
 Discharge 
 
 All property and assets, real and personal, acquired by 
 
 insolvent previous to, vested in assignee 14 
 
 Of assignee. See .Assignee. 
 
 Effect of, in deed of composition 60 
 
 Consent to by required proportion of creditors, binds the re- 
 mainder . 63 
 
 Effect of : . . . 63 
 
 Shall not change position of persons secondarily liable ... 66 
 
 Nor of partnur or debtor in so/ido 66 
 
 Shall not aJfect any mortgage or lien 66 
 
 Shall not apply, withouf consent gf creditors, to any debt, 
 
 payment of which may be enforced by imprisonment 66 
 
 Nor to any debt due as damages for personal wrongs 66 
 
 Nor to any debt due as a penalty 66 
 
 Nor to any balance of account due as Assignee, Tutor, &c.. 66
 
 INDEX. 
 
 PAGES. 
 
 Discharge — Con. 
 
 Consent to, may be filed in Court for confirmation 76 
 
 Deed of composition and, may also be so filed 67 
 
 ^ee " CONFIRMATION." "ANNULLING DISCHARGE." 
 
 May be granted by Judge alter a year 69 
 
 Notice ot appication for, must be given, and how 69 
 
 Creditor may oppose on same grounds as on application for 
 
 confirmation of. 70 
 
 Court or Judge may grant it, and how, or may refuse it.. . 70 
 
 Order of discharge final, unless appealed from 70 
 
 Discharge, or confirmation of, if obtained by fraud, void. . . 70 
 
 Or by payment of any valuable consideration . . . . " ... 70 
 
 Heirs of deceased insolvent may proceed for discharge ... 77 
 
 Costs of obtaining from Court, to b3 paid out of the estate . , 77 
 Dispute ; 
 
 At preliminary meeting, how decided 13 
 
 Dividends ; 
 
 Unclaimed, to be established by Bank certificate of deposit. 39 
 To be declared after ihe expiry of two months from notice 
 
 of assignment, or of appointment of assignee 39 
 
 And afterwards at intervals of not more than si.x: months . 39 
 To be reserved on the amount of debts, due upon a condi- 
 tion or contingency 40 
 
 To bo allowed upon the amount fixed as the value of such 
 
 debt , 40 
 
 'I'o be prepared with due regard to the rank and privilege 
 
 of creditor 41 
 
 rv'ot to be paid to creditor holding securit)^, until the amount 
 
 for which he is to rank be established 41 
 
 Allowance to insolvent to be inserted in dividend sheet, sub- 
 ject to contestation on ceitain groiuids. 43 
 
 Notice of (Form N) shall be given 44 
 
 If di\fidend sheet be not contested, dividends to be paid 44 
 
 To be reserved in certain cases to meet claims not filed ... 44 
 But amounts reserved to be included in final dividend, if 
 
 not previously claimed 44 
 
 ■ Notice of reservation to be given to the apparent creditor. . 44 
 
 If dividend objected to, how contested and decided 45 
 
 To be reserved, pending appeal 46 
 
 Unclaimed, to be left in Bank for three years 46 
 
 Then to be paid over to Government 47 
 
 If afterwards claimed, to be paid with 3 per cent, interest. 47 
 Before preparation of dividend sheet, assignee may demand 
 
 supplementary oath 74 
 
 Domicile ; 
 
 Of unincorporated Trading^Companiesand Co-partnerships, 
 
 at chief place of business 80 
 
 Double Ranking ; 
 
 Not permitted 42 
 
 Employes ; 
 
 Shall have a special privilege for not more than thiee 
 months' arrears of salary or wages 43 
 
 Endorser. See indirect liabilhies. 
 Escape ; 
 
 Of debtor from imprisonment, or from the limits, renders his 
 estate liable to compulsory liquidation 18 
 
 Evidence ; 
 
 How taken, upon contestation of dividend 45 
 
 To be produced before the Judge on Appeal 49 
 
 Copy of Judgment confirming discharge sutficient 69 
 
 Of appointment of assignee 81 
 
 109
 
 110 
 
 INDEX. 
 
 PAGES. 
 
 Examination of Insolvent ; 
 
 Evasive or false swearing at, ground for opposing confir- 
 mation of discharge - 67 
 
 Meeting for public, shall be held, and when 70 
 
 May be had at such meeting, on oath 70 
 
 Shall be reduced to writing by assignee 70 
 
 How proceeded with 71 
 
 Shall be filed in Court 71 
 
 May also be had on order of Judge _ 71 
 
 Or upon suhptpna in action for compulsory liquidation. ... 71 
 
 May also be had on his application for discharge 72 
 
 Or for confirmation of, or for annulling a discharge 72 
 
 Or upon petition to set aside an attachment 72 
 
 Execution ; 
 
 If debtor, with intent, &c., procures his effects to be seized, 
 levied upon or taken in execution, his estate becomes subject 
 
 to compulsory liquidation. 17 
 
 May issue for costs awarded by assignee, upon order of 
 
 Judge to that eftect 46 
 
 EXEOUTOR ; 
 
 Debt due by, not affected by discharge 66 
 
 Nor computed in ascertahiing required proportion 66 
 
 But may rank 66 
 
 Exemptions ; 
 
 Property exempted from sale under execution, not conveyed 
 
 by assignment 14 
 
 Foreign Judgments ; 
 
 Provisions of Consolidated Statutes respecting, to form 
 
 part of the Act 76 
 
 Forms ; 
 
 Appended to the Act, or their equivalents, to be used 76 
 
 May be made in Upper Canada by certain Judges 77 
 
 Fraud ; 
 
 In procuring allowance to Insolvent, sufficient ground for 
 
 contesting it -• 43 
 
 Gratuitous conveyances presumed to be in fraud of credi- 
 tors, in certain cases 54 
 
 All contracts by which creditors are obstructed, &c. are pre- 
 sumed to be made in fraud of creditors. . 54 
 
 Contracts for consideration, when voidable 55 
 
 What contracts are void, as being in fraud of creditors 55 
 
 Fraudulent preference void 56 
 
 Presumptions of fraud — in what cases 56 
 
 Purchaser of goods held guilty of, in certain cases 59 
 
 Person guilty of, liable to imprisonment 59 
 
 Debtor must be charged with, i.i suit to recover debt 59 
 
 And must be expressly adjudged to be guilty of it 59 
 
 In U. C. Plaintiff must prove it, though Defendant makes 
 
 defauh. 60 
 
 Sufficient ground for opposing confirmation of discharge. . . 67. 
 
 Fraudulent Preference — See Fraud. 
 
 Sufficient ground for opposing confirmation of discharge. . . 67 
 
 Gratuitous Conveyances ; 
 
 Presumed to be made with intent to defraud, in certain 
 
 cases 54 
 
 Guardian— >See Sheriff. 
 
 Official assignee shall make an Inventory of the effects 
 
 seized, and statement of debtor's affairs 21 
 
 Shall file Inventory at return day of writ 24 
 
 Shall produce statement at meeting of creditors 24 
 
 Upon appointment of official assignee, shall deliver estate 
 
 to him 28 
 
 Mode of making and title of, Inventory to be made by 95
 
 INDEX. 
 
 PAGES. 
 
 Heirs ; 
 
 Of assignee deceased, do not take the estate . . 38 
 
 Of insolvent deceased, may continue proceedings to dis- 
 charge 77 
 
 Hypotheque ; 
 
 ^ Not affected by discharge 66 
 
 Claim secured by, to be filed within six days of sale 75 
 
 To be specilied in such claim 75 
 
 If claim be not filed in time, shall not have preferential 
 
 collocation, unless dividend be reserved 75 
 
 Or unless leave to file be granted on special cause shewn. 75 
 Hypothecary Creditors ; 
 
 Shall receive notice of sale of real estate 37 
 
 Imprisonment ; 
 
 Debt enforceable by, not affected by discharge. 66 
 
 Of debtor, or retention of upon gaol limits for 30 days, 
 
 renders his estate liable to compulsory liquidation 18 
 
 Of assignee for neglect in the performance of his duties ... 37 
 
 Of person adjudged guilty of fraud 59 
 
 If to be adjudged, must be by the Judge immediately after 
 verdict 60 
 
 111 
 
 Indictment ; 
 Insolvent ; 
 
 Intent 
 
 Interest 
 
 Property of estate, in whom to be laid in indictment 81 
 
 May make voluntary assignment 12 
 
 Must produce statements of his affairs at preliminary 
 
 meeting 10 
 
 Must swear to preliminary schedule 10 
 
 May correct it under oath .' 10 
 
 Must produce books of accounts, vouchers and documents, 
 
 if required 10 
 
 Must make assignment to assignee, chosen by creditors . . 12 
 Or failing choice by them, to a creditor chosen by himself 
 
 from a certain class 13 
 
 Or to an < flicial assignee . 13 
 
 Shall execute counterparts of deed of assignment, when 
 
 required by assignee ,. 41 
 
 May petition to stay proceedings, under demand of assign- 
 ment 20 
 
 May petition to set aside writ of attachment 24 
 
 ' May petition for discharge after a year 63 
 
 May petition for confirmation of discharge 67 
 
 Must file consent or deed, on petition to annul 68 
 
 May be examined, and when and how 71 
 
 May be examined on application for confirmation, or to 
 
 annul, or to set aside attachment 72 
 
 Must attend meetings of creditors, when summoned by 
 
 assignee 72 
 
 Shall be paid for such attendance 72 
 
 Contracts made with intent to defraud, are void 54 
 
 <See " Fraud." — Compulsory liquidation. 
 
 Interpretation 
 
 Inventory 
 
 Irregularity 
 
 Rebate of, on claims not actually exigible . 40 
 
 Of various terms 80 
 
 See, Guardian — Official assignee. 
 
 Sheriff" shall not make detailed inventory 95 
 
 But assignee or guardian shall do so 95 
 
 No irregularity in proceedings antecedent to appointment 
 of assignee, shall vitiate assignment , 
 
 13
 
 1X2 INDEX. 
 
 1 • PAGES . 
 
 Judge ; 
 
 Interpretation of the words " the Judge " 80 
 
 Where sittings of shall be held 94 
 
 Lease ; 
 
 Of property, of greater annual value than the rent, how 
 
 disposed of 47 
 
 Sale of, to be made subject to the rent ,. — . 47 
 
 Conditions of sale and security, to be settled by the Judge. 47 
 
 Conditions of lease to be binding on purchaser 47 
 
 Long leases, how put an end to '. . 48 
 
 Shall be cancelled in accordance with resolution of 
 
 creditors 48 
 
 Resolution to be notified to creditors 48 
 
 Claim for damage by resilialion, how adjusted 48 
 
 Assignee may make award upon 48 
 
 Award may be appealed from 48 
 
 What shall be the measure of damages for resiliating 
 
 lease 48 
 
 Lessor shall rank for damages awarded 48 
 
 LiAEiLiriES ; 
 
 To be inserted in preliminary schedule 10 
 
 How divided and dislingiushed • 10 
 
 What, are extinguished by a discharge 63 
 
 Lien ; 
 
 Not affected by discharge 66 
 
 List of Creditors ; 
 
 To be sent, with notice of preliminarj' meeting 11 
 
 To be appended to deed of assignment, but not to counter- 
 parts subsequently executed 14 
 
 To be deposited with deed of assignment, in the office of 
 
 the Court 14 
 
 Marriage ; 
 
 No judgment en sej^aration de biens shall be rendered 
 
 unless after one month's advertisement 79 
 
 Nor unless action be brought at domicile of husband 79 
 
 Any credhor may intervene either to examine debtor, or 
 to oppose judgment 79 
 
 Marriage Contract ; 
 
 Must be enregistered, or shall not affect rights of 
 creditors 78 
 
 Meeting of Creditors ; 
 
 Must be called by insolvent preliminary to assignment. ... 10 
 May be called at his place of business, or at any other 
 
 place more convenient for creditors 10 
 
 How called 10 
 
 Assignee may be named at, by creditors 12 
 
 First meeting to be called by order of Judge, in proceedings 
 
 for compulsory liquidation 25 
 
 For examination of insolvent 70 
 
 How called generally 72 
 
 How questions at, shall be decided 73 
 
 Powers of creditors at, how regulated 73 
 
 Minutes ; 
 
 Minutes of meetings of creditors shall be kept by assignee 33 
 
 Copies of and extracts from, prima facie evidence 33 
 
 Shall be accessible to parties in interest 96 
 
 Mortgage ; 
 
 Not affected by discharge 66 
 
 (See Hypotheque, 
 
 Motion ; 
 
 One clear day's notice of, for each fifteen miles, sufficient 75 
 
 How to be intituled, written and subscribed 95
 
 INDEX. I 13 
 
 PAGES. 
 
 Name ; 
 
 01 each creditor mu>t be inserted in preliminary schedule, it) 
 Neulect ; 
 
 No neglect in proceedings antecedent to appointment ot 
 
 assignee shall vitiate assignment 13 
 
 Of debtor to appear for examination, or to obey order or 
 decree for payment, renders his estate liable to compuif-ory 
 
 liquidation * 18 
 
 Negotiable I'aper ; 
 
 Of which holders are unknown, must be particulari^^ed 
 
 in preliminary schedule ..... 10 
 
 And if so mentioned, the debt thereby created will be 
 extinguished by discharge . 63 
 
 Notaries 
 
 Notice 
 
 Notoriety 
 
 Efiect in Upper Canada of deeds of assignment, executed 
 
 in Lower Canada in Notarial form 1.5 
 
 Deeds before, how registered in U. C 15 
 
 Of petition in appeal to be given to respondent and assignee 4L' 
 
 Of application for allowance of appeal 50 
 
 Of presenting petition, in appeal Irom the Judge 50 
 
 Of application for confirmation of discharge 67 
 
 Of petition for annulling discharge . . (JS 
 
 Of meeting of creditors, how given 7:2 
 
 Of petition, motion or rule . . 75 
 
 Rules as to notice how enforced. 91 
 
 But time may be enlarged . 94 
 
 Of deed of assignment to be given by assignee 96 
 
 Of insolvency, effect of 54 
 
 Official Assignee ; 
 
 Assignment may be made to by insolvent, if no avail- 
 able choice of assignee be made by creditors . . .... . . 13 
 
 Shall be guardian under writ of attachment . 24 
 
 To be appointed by Judge at first meeting of creditors in 
 
 compulsory liquidation, after taking their advice under oath . . 26 
 If credhors unanimous, their choice is conclusive. ... 26 
 
 If not, either one of those they recommend, or one of those 
 
 named by the Board of Trade niust be chosen 26 
 
 Guardian must deliver to him, all the estate and effects of 
 
 insolvent 28 
 
 Is vested with the whole of the estate and effects of the , 
 
 debtor up to the date of his discharge .... 29 
 
 Authentic copy or exemplification of Act of appointment, 
 
 may be registered, and shall have'^'same effect as registration 
 
 of deed of assignment 29 
 
 Shall immediately give notice of his appointment 30 
 
 May be named by Board of Trade or Council thereof 30 
 
 Must give security for due performanc^g of duties 31 
 
 Copy of resolution naming, must be transmitted to Pro- 
 
 thonotary or Clerk of Court 30 
 
 Security to be taken in the name, of office of the President 
 
 of the Board of Trade 31 
 
 May be enforced in his own name, by the successor of 
 
 assignee giving it 31 
 
 See Assignee. 
 Oath ; 
 
 Assignee must hear parties and witnesses under oath, on 
 
 contestation of dividend sheet 45 
 
 Assignee may administer, in certain cases 45 
 
 Insolvent may be examined under 70 
 
 May be administered by assignee 70 
 
 Claims must bo attested under 74 
 
 Supplementary, may be required from creditor 74 
 
 8
 
 114 INDEX 
 
 Opposition ; 
 
 Okdkrs : 
 Parti Ks 5 
 
 Pautwek ; 
 
 To deed of composition, must be made within six days after 
 
 last publication of notice - . . 62 
 
 Must be made in writinp^ 62 
 
 If made, c jmpeis assignee to await conliimation. ... .62 
 
 Service of, how made and established 75 
 
 To contestation, may be examined before assignee, under 
 
 oath ^ 45 
 
 Assignee to, may exercise remedies against co-parmers, as 
 in case of dissolution. . . - . ... 34 
 
 See Assignee. 
 
 When Insolvent owes a debt, both individually and as a 
 co-partner, or as a member of two or more co-partaerships, 
 such debt to rank on tlie estate by whicii it was contracted . . 43 
 
 Burden of proof of innocence of fraud, thrown on partner, in 
 
 certain cases . . 59 
 
 I'artnershifs ; 
 
 All provisions respecting traders, shall apply to 80 
 
 Domicile of, at chief place of business ... 80 
 
 Payment 
 
 Pena lty 
 
 Petition 
 
 In goods, in contemplation of Insolvency, void 56 
 
 Within thirty days of Insolvency, void, in certain cases. . . 68 
 
 But if valuable security is given up, it must be returned. . . 58 
 
 Debt d ue as, not affected by discharge 66 
 
 Debtor may petition to restrain creditor from proceeding 
 
 upon a demand of assignment 20 
 
 See Demand of assignment. 
 
 Also to quash writ of attachment .^ 24 
 
 Such Petition to be heard and determined in a summary 
 
 manner , 24 
 
 Debtor may petition for suspension of proceedings 26 
 
 Such Petition to be submitted to a meeting of creditors. ... 26 
 
 See Suspension of Proceedings. 
 
 By Assignee for discharge— *See Assignee. 
 
 Against Assignee — See Assignee. 
 
 In appeal, notice of, must be given within five days from 
 
 allowance 60 
 
 Appeal shall be by summary petition. . . .* 49 
 
 In appeal, what it mnst contain 60 
 
 In appeal, when to be presented 51 
 
 Copy of, in appeal, may bo filed and costs obtained on it . . 51 
 
 For confirmation of discharge 67 
 
 For annulling discharge 68 
 
 One clear day's notice of, for each fifteen miles, sufficient. 75 
 
 How to be intituled, written and subscribed . . . 95 
 
 Place of Bt;siNEss ; 
 
 Insolvent may call preliminary meeting at, or at any 
 
 other place more convenient for the creditors 10 
 
 If ho assigns to official assignee, such assignee must be 
 resident within the District or County in which Insolvent has 
 his place of business , 13 
 
 Pleadings 
 
 Sufllcient as to form, if facts be therein stated in a plain 
 and concise manner 76 
 
 May be amended according to ordinary rules of procedure 76 
 Shall not be void, if susceptible of amendment under the 
 rules and practice of the Court 76 
 
 No allegations held to be insufficiently made, unless oppo- 
 site party be thereby misled, or taken by surprise . . 76
 
 INDEX. 
 
 Pleadings— Con. 
 
 How to be intituled, written and subscribed 95 
 
 To be subject to ordinary rules, as to names of parties, &c. 95 
 
 Pledge ; 
 Preference 
 Privilege ; 
 
 In contemplation of insolvency, when void 
 Unjust, is void 
 
 56 
 56 
 
 Not to be disturbed by the Act 41 
 
 See Clerks, — EMPLOY.'is. 
 
 i\'Iay be contested— (S'ee Award,— Contestation. 
 Privileged debts ; 
 
 Not to be computed in ascertaining required proportion 
 of creditors 
 
 Proceedings. See Judge. Sittings. 
 Order of business in 
 
 Proof 
 
 May be conducted by parties interested, or by attorney 
 ad litem. ... 
 
 How to be intituled 
 
 Not to be void, if susceptible of amendment under the 
 ordinary practice of the Court 76 
 
 66 
 
 94 
 
 94 
 95 
 
 Burden of, of discharge, on insolvent, till discharge is con- 
 firmed 
 
 Proportion of Creditors ; 
 
 In computations for ascertaining the creditor to represent 
 only the amount for which he may rank . . 
 
 Required for deed of composition and discharge 
 
 Insufficiency of, ground for opposing confirmation of dis- 
 charge. 
 
 How to be ascertained ' 
 
 Provincial Government. See Dividends. 
 PoBLic Officer ; 
 
 Debt due by, not affected by discharge 
 
 Nor computed as part of required proportion of creditors . . . 
 
 But may rank on estate 
 
 Queen's Bench ; 
 
 Appeal to Court of, in Lower Canada 
 
 Rank ; 
 
 69 
 
 41 
 60 
 
 67 
 73 
 
 66 
 66 
 66 
 
 50 
 
 41 
 
 Ranking 
 
 Real Estate 
 
 Of creditor not disturbed by the Act 
 
 May be contested. See Award— Contestation. 
 
 What debts shall rank 39 
 
 Surety on paying debt, may rank in the place of the princi- 
 pal, or if he has not proved, then he himself may prove 40 
 
 Shall be pennitted for the amount fixed as the value of any 
 \uv. ^'^'P^"'^'^^^ "Pon a condition or contingency. . . 40 
 
 When collateral security is held for the claim, shall only 
 be allowed upon difference between value of security, and 
 
 amount of claim ... .41 
 
 Shall be for amount due upon each separate item of claim, 
 
 except when security is held 42 
 
 Shall not be allowed to take place twice on the same claim 42 
 Inca8es where the insolvent is interested in different es- 
 tates, shall be first upon the estate which contracted the debt. 43 
 And not upon the others, until their creditors are paid in full 43 
 Shall only be allowed for costs, incurred before notice of 
 
 assignment or of issue of Writ 43 
 
 Purchaser of debt due by insolvent, may rank 58 
 
 15 
 
 Held to be conveyed and vested in assignee by assignment 
 Deed of assignment conveying, may be registered, and 
 
 elfect of registration . I5 
 
 8* 
 
 115
 
 i 1« 
 
 INDEX. 
 
 PAGES. 
 
 Real EsTATE-»-Con. 
 
 Registration of copy, or exemplification of order appointing 
 ofRcial assignee, tc have the same eftect as to real estate, as 
 registration of deed of assignment 29 
 
 JVIay be sold after same advertisement as is required for 
 Slieriif's sale ... 35 
 
 Period of advertisement may be shortened, by resolution of 
 creditors, with sanction of Judge ^. 35 
 
 Property may be withdrawn by assignee, if price too small 36 
 
 May be subsequently sold under directions of creditors. 
 See Assignee .... 36 
 
 Sale by Assignee shall have the same eftect as sale by 
 Sheriti' .. 36 
 
 Deeds of sale shall have same effect as Sheriff's deed ... 36 
 
 May be e.vecuted before witnesses or before notaries, 
 according to the Ze.r loci rei siloe. 36 
 
 Proceedings by assignee with respect to hyporhecary cre- 
 ditors .... 37 
 
 RsFySAL TO ACT, OF PERSON NAMED AS ASSIGNEE ; 
 
 Justifies insolvent in choosing assignee from a particular 
 
 class of his creditors 13 
 
 Of debtor to appear for e.xamination, renders fiis estate 
 
 liable to compulsory liquidation 18 
 
 Of debtor to obey order for payment of his debts, or to com- 
 ply with the order of the Court of Chancery for payment of 
 money, renders his estate liable to compulsory liquidation. . . 18 
 Regis TEH ; 
 
 Of proceedings and of claims, to be kept by the assignee . . 33 
 Registrar's Certificate ; 
 
 Of names and residences of hypothecary creditors to be 
 
 obtained by assignee 37 
 
 Registration ; 
 
 Of deed of assignment, how made, and effect of 15 
 
 How certified. 15 
 
 Removal ; 
 Removing ; 
 
 Ot assignee — See Assignee. 
 
 Or disposing of estate or any part of it with intent, &c., 
 
 renders it liable to compulsory liquidation _ .... 
 
 Remuneration ; 
 
 Of assignee — See Assignee. 
 
 17 
 
 Residence ; 
 
 Review ; 
 
 Rule : 
 
 Of creditor must be inserted in preliminary schedules. ... 10 
 Of official assignee chosen by insolvent, must be within 
 
 the district or county in which his place of business is situate. 13 
 
 Order of Judge on appeal in L. C, subject to 51 
 
 Appeal allowed from Court of 61 
 
 One clear days' notice of, for each fifteen miles, sufficient. 75 
 How to be intituled, written and subscribed. - - 95 
 
 Rules of Practice ; 
 
 By whom to be made 77 
 
 Salary. See Employes — Clerks. 
 
 Sale ; 
 
 In contemplation of insolvency void _ 56 
 
 Vendor's privilege on sale of merchandize to trader in L. 
 
 C, limited 77 
 
 Of debts — See Assignee. 
 
 Schedule ; 
 
 For preliminary meeting ... 10 
 
 Must be sworn to by insolvent ..... 10 
 
 May be corrected 10
 
 INDEX. 
 
 117 
 
 Secreting ; 
 
 Secuaity 
 
 Sheriff 
 
 Schedule — Con. , , i i ,u .„;«v. 
 
 Of the debtor's estate, must be produced under oath, witti 
 
 petitioii for suspension of proceedings 
 
 See Suspension of proceedings. 
 
 Or being about to secrete estate or any part of it, renders it 
 liable to compulsory liquidation - - - 
 
 For claim held by creditor must have a specified value 
 
 affixed to it under oath, by creditor 
 
 To be given by assignee 
 
 In appeal, how given ° 
 
 See " Oflicial Assignee," Assignee. 
 
 Upon receipt of writ of attachment, shall give notice thereof 
 
 by advertisement. . \"Ar' \"' V \i' 
 
 Shall seize and attach all the estate and efiects ot the 
 
 debtor, and return accordingly ... ■ • ^ • _, " " , . r^ " V ' 
 
 If official assignees have been named by Board ot l racie, 
 
 shall make one of them guardian - - - - 
 
 If not, shall appoint solvent and responsible guardian. . 
 Shall not make detailed inventory of effects seized under 
 
 writ of attachment 
 
 Stoppage of Payment. See Cessation of Payment. 
 Suits. See Assignee — Costs. 
 Surety. ,See Indirect Liabilities. 
 
 On paying, may rank in name of creditor if he has proved, 
 
 if not may prove in his own name 
 
 In appe'al. See Securhy. 
 
 Surplus ; . , - , . 
 
 Of estate to be paid over to insolvent 
 
 Suspension of Proceedings ; 
 
 Judge shall preside at meeting tor 
 
 Question to be submitted to creditors - - - . • 
 
 If decision of the majority in number and three fourths m 
 value be in the negative, such decision to be in iorce tor 
 
 three months - - V " Vi ' '/ " ,,,^ 
 
 If decision be in the affirmative. Judge shall at once pro- 
 ceed with appointment of assignee - - - 
 
 If any question arises at such meeting as to the amount ol 
 
 creditor's claim. Judge shall decide it ■ -■ 
 
 Security 
 
 26 
 
 17 
 
 41 
 33 
 
 50 
 
 23 
 
 23 
 
 24 
 24 
 
 95 
 
 40 
 
 47 
 
 28 
 
 28 
 
 28 
 
 28 
 
 28 
 
 56 
 74 
 
 74 
 
 Service 
 
 75 
 
 75 
 
 Given in contemplation of insolvency, is void 
 
 Shall be specified in claim 
 
 Shall be estimated in claim - 
 
 Of notice of petition, motion or rule, how made ■ • - . 
 Of rules, orders and warrants, may be served in a section 
 of the Province, other than that in which they are issued . . 
 
 Of rules, orders and warrants, how made 75 
 
 How established • - - '^1 
 
 By whom to be made •- ^^' 
 
 Return of, what to contain ^ -•• ^^ 
 
 Must be made between 8 A.M. and 7 P. M ^^ 
 
 Sittings of Judge ; ,, , ^ ,. dd 
 
 Shall be in room allotted for the purpose ^* 
 
 Shall commence at 1 1 A. M ' 
 
 Order of business at ... - 
 
 ' Consolidated Statutes regulating service of, to form part of 
 
 the Act '^ 
 
 Tariff of Fees ; -« 
 
 By whom to be made.
 
 118 INDEX 
 
 Title ; 
 
 Of Act 81 
 
 Traders 
 
 Act only applies to, in Lower Canada 1 
 
 But in Upper Canada to all persons 1 
 
 Except in cases of cessation of payment, which only affect 
 
 traders . . 18 
 
 Trading Companies ; 
 
 All provisions respecting traders to apply to 80 
 
 Domicile of, at chief place of business . - . 80 
 
 Transfer 
 Trustee ; 
 
 Tutor : 
 
 In contemplation of Insolvency, when void ... 56 
 
 Of debt due by Insolvent, void, in certain cases .... 53 
 
 Powers or Property held by Insolvent as Trustee, not vested 
 
 in Assignee. . 34 
 
 Debt due by, not affected by discharge 66 
 
 Nor shall be computed in ascertaining required proportion . 66 
 
 But may rank .66 
 
 Balance due by, not affected by discharge . 66 
 
 Nor shall be computed in ascertaining required proportion. 66 
 
 But may rank on estate . 66 
 
 Vendor's Privilege : 
 
 Limited as to sales of merchandise to traders in L. C 77 
 
 Votes ; 
 
 Vouchers 
 
 At preliminary meeting creditors can only vote on direct 
 
 liabilities, and on indirect liabilities overdue 12 
 
 On dispute at preliminary meeting, how taken 12 
 
 Creditor can only vote at subsequent meetings, for the 
 
 amount for which he can rank 41 
 
 At meetings of creditors, how to decide 73 
 
 Insolvent must produce at preliminary meeting, if required. 10 
 
 Wages. See Clerks — Employes. 
 
 Warrants ; 
 
 Service of, how made and established 75 
 
 Warranty. See Debts. 
 
 Witnesses ; 
 
 May be examined before assignee, under oath 45 
 
 Any person may be examined touching estate or effects of 
 
 insolvent... 72 
 
 Upon order of Judge, on petition, without notice 72 
 
 May be punished for non-attendance 72 
 
 And paid lor attendance 72 
 
 See Commissions Kogatoires. 
 
 Writ of attachment; 
 
 To be issued upon affidavit by the Prothonotary in Lower 
 
 Canada 22 
 
 Upon order of the Judge in U. C 23 
 
 To be addressed to Sheriff 23 
 
 To be accompanied by. a declaration 23 
 
 To be subject to the ordinary rules of procedure of Court. . 23 
 Suits. See Affidavit. 
 
 May be set aside by petition . . 24 
 
 To be regularly entered and numbered 95 
 
 Shall describe parties as they are described in affidavit . . 95 
 
 Shall not issue till affidavit has been duly filed 95 
 
 Need not be called in open Court 95 
 
 P>ery juridical day to be return day for 95 
 
 Sherifl charged, with, not to make detailed inventory 95
 
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