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(4.) No plaintiff in any such action as is referred to in sub-section (2) of this section shall be deemed to be a secured creditor by reason ouly of any order or judgment made or given in such action before the commencement of this Ordinance or by reason only of such order or judgment and of any steps taken thereunder.
bind all
3. Every order and judgmeut duly made or given in any Action action brought against any liquidator appointed under the against Principal Ordinance in respect of the trade which such liquidator to liquidator was appointed to wind up shall for all purposes persons and in all respects be as binding on all the persons entitled entitled to to the profits of such trade as if the action had been the profits
of the trade brought, and the order or judgment had been made or which is given, against such persons as well as against the liquida- being
wound up.
tor.
action
4. The Supreme Court shall have power to stay any Court to action brought against any liquidator appointed under the have power Principal Ordinance in respect of the trade which such to stay liquidator was appointed to wind up in any case in which against it shall seem to the Court to be desirable to do so in the liquidator. interests of justice on account of the liquidator being unable to obtain proper instructious from the persons entitled to the profits of such trade.
5. The Supreme Court shall have power to stay any Court to action brought against any alien enemy in any case in have power
to stay which it may seem to the Court to be desirable to do so in action the interests of justice on account of the impossibility of against obtaining proper instructions from such alien enemy owing alien enemy. to the state of war which exists between His Majesty and the State to which such alien enemy belongs.
Objects and Reasons.
One object of this Bill is to prevent actions being brought against liquidators appointed under the Principal Ordinance in respect of claims which are not disputed. It is obviously undesirable that the estate should be saddled with the costs of such unnecessary actions, and it would be unfair to the other creditors, and against the spirit of the Principal Ordinance, if not against its express provi- sions, if the plaintiff in any such action were to obtain any priority thereby.
A somewhat similar provision exists in bankruptcy law, where no action can be commenced or continued except with the leave of the Court and on such terms as the Court may impose. The authority proposed in the Bill is the Governor and not the Court because the general scheme of the Principal Ordinance is a winding up under the control of the Governor while in bankruptcy the winding up is under the supervision of the Court.
It should be remembered that the winding up under the Principal Ordinance differs from the winding up in bankruptcy in one very important point, for the winding up in bankruptcy results eventually in the discharge of the debtor from all claims provable in the bankruptcy, while the winding up under the Principal Ordinance will not result in any such discharge. Accordingly, refusal under the proposed Ordinance to allow an action to be brought would not determine the remedies of the creditor against the alien enemy.
Another object of the Bill is to provide expressly that actions against liquidators shall bind the alien enemies whose affairs are being wound ap.
The Bill also gives the Court power to stay actions against liquidators or against alien euemies where the interests of justice seem to require that such should he done on account of the impossibility of obtaining proper instructions owing to the existence of a state of war.
J. H. KEMP, Attorney General,
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