4pril 25, 1895.]
them as 8840, the bankrupt being unable to ex- plain the discrepancy, and he submitted the not keeping of proper books must be presumed to be intended to conceal the true state of affairs.
His Lordship said he had before him a report by Mr. Bruce Shepherd, and he attached much importance to that report, because Mr. Shepherd must have heard both parties. The Judge could not hope to satisfy both parties and in a con- tested case he must be to a great extent guided by the official report. He could understand Mr. Dennys's client feeling very indignant about the matter.
Mr. Dennys said his client was very indignant. The amount was not very large; still it was some- thing. The bankrupt undertook to sell Mr. Ar. thur's furniture and pay the money into the bank, and the first thing Mr. Arthur knew about the money not being paid was when the bankrupt filed his petition. He submitted that the bank. rupt had offended against section 27 sub-section (e) by continuing to trade after knowing himself to be insolvent. An auctioneer was not in the same position as a merchant with accounts all over the world. An auctioneer could always in a very short time ascertain his position if he con- fined himself, as the bankrupt said he did. to com- mission business. le contended also that the bankrupt had committed an offence under sub- section (d.), as he had contracted a debt, that is, he had appropriated this money, without having any reasonable or probable expectation of being able to pay it. He knew in the previous Decem- ber that he was hopelessly insolvent, and he simply used this money for his own purposes.
His Lordship said he did not see how it could be said the bankrupt had at the time he under- took to sell the furniture no reasonable expeota. tion of being able to pay, because the cash he received would enable him to pay.
Mr. Dennys-Yes; but when he got the money, instead of paying it into Mr. Arthur's soconut, he paid it into his own, although he knew he was insolvent.
His Lordship-It was part of his business to receive goods to sell by auction.
CHINA OVERLAND TRADE RÉPORT.
[
313
there is a sum of $551, which has been appro-his interest. He was then paid $80, which was priated to payment of a dividend fixed at 54 per due to him for salary while he was in the busi- cent.
Mr. Brace Shepherd says the bankrupt ness, He did not make any further application started business in copartnership with another as has not kept proper books of account, and that he for interest, but suddenly took out a writ of sum- commission merchant and auctioneer in January, condition that on failure in the payment of any mous. The promissory notes were subject to the 1893. Now that does not say that in not keep one month's interest the whole amount was to ing books the debtor intended to conceal the true become due and payable. Well, the interest was state of his affairs. extract from the report to the effect that the therefore he had a right to demand paymout of His Lordsbip then read an not paid, there was no application for it, and bankrupt appeared to have been under the the whole amount due to him, which he did by strong impression his trade would improve and writ of summons, and it was in consequence of to pay his debts in full. His business, however, pelled to file bis petition. that by continuing his business he would be able that sudden pressure that the bankrupt was com continned to decrease instead of improving, but Mr. Bruce Shepherd does not attribute the de- Mr. Grist. I have the report of the Official His Lordship-I think you have said enough, crease to the fault of the bankrupt. The bank- Trustee, which shows that the bankrupt kept all rupt bad given every assistance to the Official proper books of account. He states the circum- Trustee in the winding up of his affairs, and the stances and says the bankrupt had given him Official Trustee had no objection to his discharge every assistance in winding up his affairs and subject to such suspension of the order of dis- that he makes no objection to the discharge. charge as the Court might think fit. Now, his The dividend already paid amounts to 6 per cent. lordship continued, to apply the law to this state and it is possible another 3 per cent. may be of facts. When a man comes up for his dis-paid. charge there are four courses open. It is possible cent. takes it out of my power to grant an im- The dividend being less than 50 per to grant it absolutely, to refuse it absolutely, to mediate discharge. It therefore reduces itself grant it subject to conditions with respect to to this, during what period shall I require the any earnings or income which may afterwards discharge to be suspended. become due to the bankrupt, or, in the fourth alternative, it is possible to order that the opera. tion of the discharge should be suspended for a certain period. Now, an immediate absolute discharge is only given in cases where a dividend of 50 per cent. or upwards is paid and the conduct Section 27, sub-sections 3 and 4, require the Court of the bankrupt is in every respect satisfactory. at least to suspend the operations of the dis- charge when a dividend of less than 50 per cont. is paid. It is quite true that there is a if the Trustee had reported to me in this case power to imprison if certain facts are shown, and that the omission to keep the usual books of account had been with intent to conceal the tion 27 of Ordinance 20 of 1891 is amended by true state of his affairs-(in which respect sec-
that intent existed, I should have 6 of 1892, section 10)-and I had been satisfied inclined to consider whether it would not
Mr. Dennys-Of course; but when he got paid for these goods he ought to have paid the money straight into Mr. Arthur's account in-ba stead of his own.
His Lordship-Bat whenever an auctioneer becomes bankrupt it is because he cannot pay his debts; he carries on business up to the date of his bankruptcy, and what you say now might be said in every case.
been
necessary to imprison the bankrupt, will be done by suspending the operation of the but on the whole in this case I think justice discharge. I had grave doubts in my mind when I heard Mr. Dennys whether I ought not to make the suspension longer than I have in one Mr. Dennys-There was no harm in bis tak- conduct in that case of Mr. Arthur's was ex. or two other cases, because I think the bankrupt's ing the goods to sell, but when he got the moneyceedingly unsatisfactory, but I think ou the he ought to have paid it into Mr. Arthur's ac sount.
.
His Lordship—I quite agree with you it is a very rough thing on a man to find that an auctioneer to whom he entrusts his goods for sale has gone bankrupt, but that happens in overy case of an auctioneer's bankruptcy. It would be different if you or I undertook to sell goods for a friend and put the money into our wn pocket, but here what be has done with the money is to pay it to his creditors.
Mr Dennys-Yes, but how much? Five | cents in the dollar!
would suffice if your lordship was satisfied of the Mr. Grist-Yes, but a nominal period hardship, and I submit there has been very great hardship. What confirms that is that there has been absolutely no opposition throughout the proceedings. The creditors have acquiesced in everything.
can.
His Lordship-I will make it as short as I business and the Hongkong public suffers by it Men come here and start a speculative sometimes. I have looked through the file and suspension of four months. I think the justice of the case will be met by a
THE BANK OF CHINA, JAPAN, AND THE STRAITS, LIMITED, v. E. L. LEPISSIER,
recently given by the Court of Appeal in Saigon We subjoin a translation of the judgment in favour of the above Bank in the appeal case ment of a call on 30 shares in the said Bank brought by them against M. Lepissier for pay- registered in his name.
counsel cited the judgment given in June last Among other arguments M. Lepissier's
Court in Shanghai in a similar action, and which against the Bank by the United States Consular was based chiefly on the ground that the Directors whole the justice of the case will be met by had entered into business which was not an- making the suspension for that period I have suspending the certificate for nine months. In thorised by the Articles of Association.
The Court in Saigon decided that this ques- occurring in May last year, that is, just a month affect the point at issue in the present case, and taken into consideratiou the fact that the plaguetion, even if it had been established, would not before the bankrupt filed his petition, must have gave judgment accordingly. deprived him of all reasonable hope of recovering himself in his business, which Mr. Bruce Shep- herd seems to have thought he had reasonable hopes of doing, had it not been for the uptoward circumstances which occurred and forced him to file his petition.
ary.
IN RE SMITH ALLISTON.
JUDGMENT.
ence of 8th February, 1895, in their respective The Court having heard, at the public audi- arguments M. Ternision for the Bank of China, Japan, and the Straits Limited, appellants, and M, Sambuc for M. Lepissier, respondent;
The Crown Advocate having been heard: law;
After having deliberated according to the
Whereas it results from the character of the China, Japan, and the Straits Limited, a joint judgment appealed against, that the Bark of stock company having its head office in London, having claimed from M. Lepissier a sum of £15 shares, in consequence of a call decided upon by sterling, in bis position as proprietor of 30 the Board of Directors at a meeting hold on the 3rd August, 1893, Lepissier declared first of all that he was no longer a shareholder, having sold his shares through the Hongkong and Shanghai Bank on the 11th June, 1892.
His Lordship-I know it is very hard; but Mr. Grist (of Mr. Wilkinson's office) appeared you would not expect him to keep a series of for the bankrupt, who made application for his accounts in the names of all his different clients. order of discharge. There was no opposition.
Mr. Denuys-Yes, my lord, when he knew he was insolvent,
If he had had any grounds was filed on the 20th November last, the receiv. Mr. Grist said that in this case the petition for believing he was solvent in April, 1894, it ing order was made on the 3rd December, and would have been a different thing; but in De-
the adjudication took place on the 15th Febru. cember, 1893, he knew he was hopelessly insol- vent. He kept no books, but he knew what this bankruptcy were, he submitted, those of The circumstances which brought about his expenses were, what his capital was, and great hardship. The bankrup started business what he had to repay to the principal people in October, 1893, with two partners, Chinese, who lont him money. Your lordship has the they finding the capital of $5,000. In December, power under the Ordinance of punishing the 1893, one of the partners retired and was bought bankrupt; that I leave to your lordship; but out by the other Chinese partner, Ng Pak To. with reference to the discharge, your lordship Then in June, 1894. Ng Pak To wished to has no power to grant an immediate discharge retire, as he did not wish to be connected with a shareholder Lepissier filed a cross demand Whereas, in pretending that he was no longer and I think the Court ought to show its business of any kind any longer, and he re-that it would please the Court sense of the way the bankrupt has acted by requested the debtor to pay him the amount of fusing his discharge, at any rate for a term.
1.-To order au enquiry into the actions of the His Lordship-I have before me the report was then about $7,000. He did not wish then to charged to take in band the affairs of the Com- capital he had furnished. The amount of capital Bank of China and to nominate an administrator of the Official Trustee and from that report it receive immediate payment; he saw he could pany, to find out its exact position, and to proceed appears the petition was filed on the 7th June, not, as the capital was being used in the busi-to its liquidation, 1894, and that Mr. Skeels was adjudicated on ness, and therefore promissory notes were given the 2nd February, 1885; that the amount of payable, $2,000 the first year, $2,000 the tors of the Bank civilly and personally respon- 2.-To declare the Administrators and Direc- Masecured debts was $7,467, that the assets second year, and $3,000 afterward-, with interest,sible for having illegally removed its head offend available for unsecured creditors amounted al- which was to be paid every month. Ng Pak Tó | from China (where it was originally) to London together to $1,323, and that after making the then went away-his lordship would remember and for the disaster brought about by this change varions payments that have to be made in the plague was then on-and did not return of the direction away from the control of the these matters, preferential payments and so on, until September, when he came and applied for shareholders,
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