Commons Sitting of 15 October 1831

MINUTES.
Returns ordered. on the Motion of Mr. HUME, the revenues collected in each Post Office in the United Kingdom, with all the expenses of each, for the year ending
814
the 5th of July, 1831; of the Money in the hands of each Stamp Distributor in the United Kingdom upon the 1st of each month, for the year ending 5th July, 1831; and of the amount of Money in the hands of each Collector of Assessed Taxes in the United Kingdom upon the 1st of each Month, for the year ending 5th July, 1831.

BANKRUPTCY COURT BILL—COMMITTEE—THIRD DAY.
Lord Althorp Lord Althorp moved the Order of the Day for the Committee on this Bill.
House in Committee. On the question to agree to the clause appointing official assignees,
Mr. Warburtonwished for some explanation as to the manner in which the duties hitherto performed by the provisional assignee would in future be executed. Would it still be necessary to appoint a provisional assignee, or would the duties of that office be performed by one of the official assignees, and, if so, would, any additional expense be thrown upon the bankrupt's estate thereby?
Mr. Serjeant Wildesaid, that the provisional assignee would have no existence after the passing of the Bill. The official assignees would discharge all the duties which had heretofore been executed by the provisional assignee and the messenger. He apprehended that they would discharge those duties without any other remuneration than the usual per centage fee. The Bill contained a clause which prohibited the officers employed under it from taking any fees except those prescribed in the Bill. Although they were accustomed to speak of the provisional assignee, no such officer was mentioned in the Bankruptcy Statutes.
Sir Charles Wetherellsaid, he must object to the wording of the clause, which would create a doubt us to whether the official assignees could act previously to the appointment of the creditors' assignees. The official assignee, as it appeared to him, could have no power to act in the time between the period when the docket was first struck, and the appointment of regular assignees by the creditors.
Mr. Serjeant Wildetook a wholly different view of the case. He was of opinion, the official assignee would have the same authority as was now held by the provisional assignee, after the passing of this Bill. There would then be no necessity for a provisional assignee.
Sir Charles Wetherellsaid, if the observation of the hon. and learned Serjeant was good for anything, it went a little too far, for until the creditors had chosen their

815
own assignee, the Commissioners or the Court must appoint some person to take care of the assets.
The Solicitor-Generalobserved, that there must be an assignee at law to protect the property in the first instance, and this was one of the purposes effected by the Bill, which said, there shall be an official assignee instanter to every bankrupt, in whom the property should vest. It was of no consequence whether he was called a provisional or official assignee. The office would be filled, and the duty done.
Mr. John Campbellsaid, that nothing could be clearer to his mind than that, under this Bill, the assignees chosen by the creditors, would have a co-extensive power with the official assignee, so soon as they were elected, but that all the bankrupt's property would vest in the official assignee until the regular assignees were chosen by the creditors. There was no necessity, therefore, for a provisional assignee.
Mr. Freshfieldwas of opinion, the objection was well founded. He thought that, by the words of the Bill, the official assignee had no power to act but in conjunction with the assignee chosen by the creditors. Surely, if there was any doubt upon the point, as they were all agreed, it was desirable the property should vest in the official assignee, it was better to remove such doubts, by altering the construction of the clause.
Sir Charles Wetherellsaid, he should not now prolong the present discussion any further, as it was his intention at the end of the clause to move a proviso, empowering the official assignee to act as sole assignee, previous to the appointment of the creditors' assignee.
The Attorney-Generalwas sorry to differ from his hon. and learned friend, but with all due deference for his judgment, he saw nothing in the clause which would prevent the official assignee acting alone.
Sir John Newportwas of opinion, that the remuneration of the assignees should be made dependent on the amount of the sums they might collect, as such a condition would be the best guarantee for the zealous and effectual performance of their duty.
Mr. Warburtonsaid, it was well understood that a practice obtained, the machinery of which could not well be traced, by which the attornies for the Commission chose what set of Commissioners the case should go before for settlement. He hoped
816
the Bill before them provided against this evil effectually. It was forbidden by the present law, but yet it was of frequent occurrence.
Mr. Serjeant Wildesaid, the practice arose from solicitors being compelled to select particular lists of Commissioners, because they knew that some of the lists were not very competent to manage the business; but under this Bill it would be impossible that any such selection could be desired, because the persons to be appointed would be fully competent to the duties of the office. Unless they were more competent persons than the present, the power of selection was an advantage.
Mr. Freshfieldsaid, as the Bill contained no particular direction that the Commissioners should appoint the official assignee, and as it was allowed generally that there was a necessity for such an appointment as soon as possible, he would beg leave to move, that the following proviso should be added to the clause, viz. "That nothing herein contained shall prevent the Commissioners from appointing the official assignee immediately."
Mr. Burgethought, the appointment of official assignees altogether unnecessary; and would subject the bankrupt estates to a needless charge. Besides, the Bill would only act partially; the real title, as applicable to it, was "An Act to amend the Administration of Bankrupts Estates in London," yet he thought the great commercial emporiums of Manchester, Liverpool, and other places, required an amendment of the administration of the Bankrupt Laws as much as London, but they, it appeared, were to be wholly neglected. With respect to the assignees, he saw no reason why creditors' assignees might not be made subject to the same rules, and perform all the duties required of official assignees. In some cases there could be no doubt they would perform them much better. For instance, in cases of West-Indian bankruptcy, where, as in a late case, the bankrupts had creditors in almost every island, and produce to an enormous amount remitted on their accounts. An official assignee appointed to receive the assets of such a concern, would almost make a fortune out of it. Besides, he might turn his situation to account, particularly if he was a mercantile man, by calculating the effect of great sales of sugar in the market. He understood such an assignee was not only to have a percentage

817
upon the amount of debts collected, but also upon all produce sold belonging to the estate. He considered that such an appointment was not necessary, for all the onerous duties must be performed by the creditors' assignees, and thus the estate would be burthened with the charges and per centage of the official assignee without its deriving an adequate advantage from the appointment. Again, it was provided by the Bill, that such parties were to give security to the Lord Chancellor. Was it intended that the security was to be in proportion to the sum vested in their hands? if so, half the mercantile world in London would be under bond to his Lordship, and all this was done to guard against any fraud in the creditors' assignee. He thought adequate security could be obtained without all this expensive machinery, which would entail a heavy charge upon every bankrupt's estate. He should, therefore, propose, that the whole of this clause relating to official assignees be left out of the Bill.
Mr. Warburtonsaid, that if there was any part of the Bill which he approved of, it was that which related to the appointment of official assignees. The only part of the clause he objected to was, the compensation to be allowed them. It was stated that five per cent was to be the maximum, but he feared, if the Court of Chancery had to manage this matter, that this per centage would turn out to be the minimum. He had also considerable doubts whether the resources that were to be relied on to defray the charges of the Court, would be found adequate to the purpose. Again, who were to look after the official assignees—to whom were they to be responsible? He should most likely be told that, the control would rest with the Court of Chancery, which was tantamount to there being no control at all. He, therefore, thought it would be an improvement to refer the proceedings of these officers to the Court they were attached to particularly, but he would not move an amendment to that effect. Certainly, he was of opinion, that the collecting into one fund the whole effects of bankrupts, would be the means of effecting a considerable saving.
Sir Charles Wetherellsaid, he must enter his decided protest against the Bill being hurried through the House, on the false assumption that the mercantile classes approved of it. This he denied to be the
818
fact. To say the least, the opinions of practical men were equally divided on the subject. He objected to the selection of official assignees being intrusted to the Lord Chancellor. That noble and learned Lord might be a very good judge of the persons most proper to fill judicial situations, but he doubted his capability of knowing who were the fittest persons to be made official assignees. It was his firm belief that this patronage would be made use of for political purposes. He called the particular attention of the Committee to this extraordinary fact—that to the lucrative situation of official assignee the Lord Chancellor appointed; but that to the barren office of joint assignees the creditors appointed. Now, from the constitution of human nature, it was quite clear, that unpaid and unsalaried assignees would not perform their duties properly; and that was another objection which he had to this clause. He likewise objected to the mode of remunerating the official assignees, the official assignees being appointed nolen volens the body of creditors.
Sir George Warrcnderobserved, that he supported this Bill from the confidence which he placed in the present Lord Chancellor, whose conduct, in his opinion, richly deserved it. He deprecated the comparisons which had been made between the character of the Lord Chancellor and of Cardinal Wolsey. Such comparisons appeared to him to be perfectly unjustifiable. He considered that more patronage was relinquished than would be acquired by the Lord Chancellor, in consequence of this Bill. To impute such unworthy motives as those which had been imputed to the Lord Chancellor was imitating the conduct of those men who were now placarding the streets with lists imputing to Members of the other House of Parliament, salaries, places, and pensions far exceeding the amount of all the salaries, places and pensions held by the Peerage.
Sir Charles Wetherellwas certain that the hon. Member who had just sat down, either could not have been present, or if present, could not have attended to his observations on a former occasion. So far had he been from attacking the Lord Chancellor on the score of his patronage, that the hon. Baronet, if he had heard him, or if he had been present, would have known that he had

819
not said anything which could lead any rational man to suppose that he intended any personal imputation on the Lord Chancellor. What he had said was this—that if the Lord Chancellor was surrendering patronage by this Bill, he had a right to compensation for it in his retiring allowance. In the observations which he had made upon the Lord Chancellor, he had spoken politically, not personally. To make unjust imputations against another, was in his opinion, not merely wrong, it was also a crime. The tone which he had taken upon this Bill was political, not personal. The hon. Baronet had complained that it was unjustifiable that the Lord Chancellor should be placarded as the Peers were about the streets. In that he fully agreed with the hon. Baronet; but at the same time he thought, that it would be quite as well if some persons, who were not quite so high in dignity as Peers, were not placarded daily in the Press. He should be glad if the system of crimination and recrimination was withdrawn on both sides.
Mr. Warburtonsaid, the creditors ought certainly to have the exclusive right of choosing the assignees by whom debts were to be collected, and he very much doubted if they would ever be satisfied with having debts compromised by any others than persons of their own choice. He had not yet understood whether there had been any arrangements made with the Bank of England, for receiving deposits from the Court, for it was well known that it was the practice of that establishment to receive only bills of a particular description.
Mr. Freshfieldsaid, he could give no official information on that subject; he knew of no arrangement with the Bank.
Lord Althorpadmitted that there might be an increase of patronage just at present thrown into the hands of the Lord Chancellor by this Bill; but after the first appointments were made, there would be a great diminution of patronage. As the disposal of that patronage must be placed somewhere, he thought that the hands of the Lord Chancellor were those in which it could be most safely deposited. With respect to the observations that the assignees who received no salaries would not perform their duty properly, he had only to reply, that those assignees must be creditors, and that circumstance would in itself be sufficient to give them an interest
820
in collecting and distributing as speedily as possible the assets of the bankrupt. As to remunerating the assignees, he thought that the Bill provided in the best possible way for that. The settlement of the amount of remuneration was left to the discretion of the Court, and it was impossible to vest the matter in more satisfactory hands. With regard to the objection respecting the Bank of England, an arrangement was in progress with the Bank.
Amendment negatived without a division, and clause agreed to
A proviso was then proposed as follows, viz. "Provided always, and be it enacted, that nothing herein contained, shall extend to authorize any official assignee, to interfere with the assignees chosen by the creditors in the appointment or removal of a solicitor or attorney, or in directing the time or manner of effecting any sale of the bankrupt's estates or effects."
Sir Charles Wetherellsaid, he did not see what way disputes were to be settled. He feared the assignee, he meant the official one, would interfere some way or other.
Mr. John Campbellsaid, the official assignee's business would be to see that no waste was committed, but he would not have the power of compelling the foreclosure of a mortgage without the consent of the assignee appointed by the creditors.
The Proviso agreed to.
On the question for vesting the personal estate in assignees.
Sir Charles Wetherellobserved, there was in all former Acts a formulary of the conveyance of the bankrupt's effects; he wished to know if there was one in this Act?
The Solicitor Generalsaid, it was not wanted; for the hon. and learned Gentleman would find in another clause, that the certificate of the appointment of the assignees was declared to be evidence of their title to the property.
Mr. Warburtonsaid, this and the following clause he considered very great improvements upon the existing administration of the law.
Mr. Burgesaid, the Bankrupt Laws did not extend to any of our colonies. When the property of a bankrupt was sued for there, the bankrupt himself was obliged to join with the assignees in giving a power of attorney to some person there to bring

821
the action, which was brought in the name of the bankrupt; he therefore, wished the hon. and learned Gentleman (the Solicitor General) would inform him, whether the fiat would enable the assignees to transfer due authority to the party in the colonies, for suing, not in their own names, but in that of the bankrupt, and whether they gave the fiat the effect of the assignment.
The Solicitor Generalsaid, the same law that existed in the colonies would continue. The Bill before them made no alterations in it, and the fiat would stand in the place of the assignment.
The Clause was agreed to, as was the registration Clause. House resumed.