§ The House resolved itself into a Committee on this Bill.
§ Lord Wynford
, in addressing their Lordships, could assure them, that he was as free from all political bias as in making any charge he had ever delivered in his judicial character. The state of the House shewed, that the Bill was not considered as a political question. From almost empty benches, he appealed to the candour of his noble and learned friend against his own Bill. He had an objection to the first clause, and to that, perhaps, he ought in strictness to confine himself, but, as he had been prevented by indisposition from opposing the committing of the Bill, their Lordships would allow him, he hoped, to state shortly all his objections at once, instead of waiting till the clauses to which they applied should be read. He objected to the new Court to be created by the first part of the first clause. After hearing what his noble friends had said, as to the very satisfactory manner in which the Commissioners of Bankrupts had done their duty, he was sorry that they should be deprived of their offices, upon the prospect of retaining which many of them had formed their establishments; yet, 496 as a very respectable body of merchants and bankers had petitioned for a different administration of these laws, and as his noble and learned friend had promised to procure for these Commissioners some compensation for their loss, he should not oppose that part of the Bill by which seven new Judges were to be substituted for seventy old Commissioners. As to the petitioners, none had prayed that a Bankrupt Court might be established, the Judges of which must be paid large salaries for doing the business now done by the Chancellor and Vice-Chancellor; on the contrary, many persons in the city, of the first respectability, objected to the establishment of such a Court, thinking with him, that as the business was now done by the Chancellor and Vice-Chancellor; it would be worse than useless to form any other Court to exercise the same superintendence and control over the Commissioners of Bankrupts, as were now exercised by the Chancellor and Vice-Chancellor. It was not said, that this part of the bankrupt business was not satisfactorily done by the present Law Officers. It was done with as little expense to the suitors, as it would be in the new Court. There was no delay, the business was despatched as fast as it came before the Court, and there was no arrear. The Chancellor and Vice-Chancellor did not complain of its being burthensome; it occupied them only about thirty-five days in each year, and so far from having too much to do, his noble friend had told their Lordships, that he should soon be able to dispense with the services of the Vice-Chancellor. With one breath his noble Friend recommended their Lordships to relieve him of bankruptcy cases, in the next he expressed apprehension of want of employment. No case was made out for appointing four new Judges this year, after having last year appointed two more than were wanted. The salaries of these Judges were not, in the first instance, to be paid out of the Consolidated Fund, but out of insolvent estates, taking the funds of creditors, who had already sustained ruinous losses. They would amount to 9,000l. per annum. To this sum must be added, the salaries of their clerks (for each Judge must have a clerk), the salaries of officers attending and taking care of the Court, and the expense of building it and keeping it in repair. The tax, however, which this Bill imposed on the miserable 497 wreck of bankrupts' property, would not be sufficient to defray these charges and some others to be created by It. The Bill made the Suitors' Fund a security for the payment of any deficiency, and against that he protested. The Suitors' Fund might be claimed by those to whom it belonged. The Legislature had no more right to take that Fund for the payment of the expenses of the Bankrupt Court, than to take any other part of the suitors' property. Bankrupt property did not contribute to that Fund, and, therefore, no part of it could, with any colour of justice, be taken for any expenses incurred in cases arising out of bankruptcy. A considerable part of these expenses must ultimately come from the Consolidated Fund, and it was for their Lordships to decide, whether unnecessary burthens ought to be brought on the country. Did the noble Lord, the author of the Bill, think that this Court would do its business with satisfaction to the public? If not, why incur this useless expense? The decision of bankrupt cases required a profound knowledge, not only of the whole system of commercial law, but of all parts of the law that in any manner relates to every description of property. The Judges of this Court would have to direct Juries upon issues of fact, and ought, therefore, to be conversant with the Nisi Prius practice, and be able to explain complicated cases. They ought to be taken from the most eminent leaders in Westminster-Hall. Eminent men had sometimes given up extensive practice, and taken a seat on the Bench, which was a station of high rank, and of great dignity. Men who had made a fortune, were sometimes disposed, whilst possessing the full energy of their minds, to accept the office of Judge. But the Legislature did not purpose to invest these Judges with the dignity that belongs to a Judge of one of the Supreme Courts. No such men, therefore, as he had spoken of, would accept these Judgeships. It would be better, therefore, as well as cheaper, to leave the decision of matters of law and equity in bankruptcy cases, to the Court of Chancery, and allow that Court to send issues of fact to the Supreme Courts of Common Law, than to transfer law, equity, and fact, to one newly-constituted Court. The noble and learned Lord complained that time and money were wasted by appeals from the Vice-Chancellor to himself. Would the decisions of 498 this new Court be respected as much as those of the Vice-Chancellor? No, there would, for a considerable time at least, be appeals in every case. The delay and expense of proceedings in bankruptcies would, therefore, be doubled. All these evils were to be purchased at an expense, of the extent of which few could form an idea, for nothing like a probable statement of what it would amount to had been laid before their Lordships. Connected with this part of the case was the subject of the trial of issues by the Bankrupt Court. An unfortunate bankrupt, ruined by the losses incidental to trade, was an object of commiseration; yet by this Bill he would be in a worse situation than any other person who was forced to appeal to the law of his country. He would be deprived of the right of trying his cause in what Court he thought proper, and of the more important right, of carrying his case to the highest Court of Appeal. The noble and learned Lord, the Chancellor of Ireland, opposing the Fraudulent Debtors' Bill, expressed much anxiety to prevent men from being subjected to all the penal con sequences of the Bankrupt Laws, who fell not within their scope. What would that noble Lord say to a Bill, that took from the man who had the misfortune to be declared a bankrupt, some of the means which the law now afforded him to extricate himself from his ruinous and degrading condition? He might now try the validity of his Commission in any one of the Courts of Westminster that he chose to select, and if he objected to the opinion of the presiding Judge on the law of his case, he might require that Judge to allow his opinion to be reduced to writing, and bring that opinion before their Lordships. This privilege was given to all the parties in civil causes in the Courts of Westminster, by a very ancient Statute, which had contributed more to secure the suitors against the prejudices, the conceits, and the hasty opinions of Judges, than any other law. The poor bankrupt, however, would have no choice of Courts; he would have no bill of exceptions; his fate must depend on the judgment of the Bankrupt Court, and of the Lord Chancellor. He could not bring his case before the last Court of Appeal, unless both parties agreed, a thing not likely; or unless the Lord Chancellor should wish to have his judgment reviewed. He should uniformly oppose the giving discretionary 499 power unnecessarily. He had opposed, and should; oppose, the subjecting the clergy to the arbitrary discretion of the Archbishops or Privy Council; and he would also oppose subjecting any suitor to the arbitrary discretion of any Lord Chancellor. The writ of error was a writ of right To say that a bankrupt should not try his case before that House unless his adversaries or the Lord Chancellor would consent, was to deprive him, without any even specious cause, of an advantage he might now obtain. He objected to the clause which authorized the appointment of two Registrars and eight Deputy-registrars. If their Lordships agreed with him, none of these registrars or deputy-registrars would be required. The business would be done by the solicitors and the assignees, as at present. All the proceedings were filed as regularly under the 6th George 4th as they would be under this new Bill. If a Court of Bankruptcy be established, half the number of Judges appointed by this Bill would be sufficient. The Common Pleas had twenty times the business that ever this Court could have, and had but three Prothonotaries and three Secondaries, the number of which, by a late Act, was to be reduced. If these registrars were not absolutely, necessary, why load the estates of bankrupts with an expense of about 5,600l. per annum to pay their salaries? A single Commissioner might declare a man a Bankrupt under this Bill. Under the present law, a man could not be declared a bankrupt without the concurrence of three Commissioners; and they ought not to adjudge a man a bankrupt until he had been heard in his defence. He must, therefore, protest against the merchants and bankers of this country being rendered liable to be posted in the Gazette as bankrupts, to be divested of all their property, their business stopped, and themselves and their families turned out of their houses, on an ex parte hearing before one Commissioner. The Commissioner might indeed, if he found difficulty, advise with the other Commissioners, but there were some men who never found any difficulty until the answer was heard. He should trouble their Lordships with but one objection more, for if he had not satisfied their Lordships, by what he had already said, that this Bill had been taken up with too much haste, and required more consideration before it passed into a 500 law, he must despair of success upon any other grounds. He could not think it was right that a burthen of at least 22.000l. per annum, a sum exceeding that paid to seventy Commissioners, should be imposed on bankrupts estates, for the remuneration of thirty public or official assignees. This was the part of the Bill to which he himself felt the greatest objection, and against which he was bound to add, the mercantile interest in London entertained the greatest objection. He had had many communications with highly respectable traders in London on this subject, and he knew how adverse their feeling was to the appointment of assignees. They declared that they would give up any benefit which they might expect from the appointment of Commissioners tinder this measure, rather than allow a body of public assignees to be formed. If the modern theory were right, that men can take care of their own interests, and that the less Government interfere with them in the management of their concerns the better, no such officers were necessary. The assignees were at present chosen by the creditors—would they not choose the persons most likely to take care of their property? Why were creditors to be treated as children, and have persons appointed as guardians to manage their affairs? The creditors had a power over the assignees of their choice, which they would not have over those appointed by the Court. If assignees did not pay the money that came to their hands into the Bank, they were liable to a penalty of twenty per cent. But his noble and learned friend said, that they suffered it to remain in the hands of the solicitor to the commission, and then they swore, with a good conscience, that they had no money in their hands. He protested against this doctrine. No assignee who did not inquire whether the solicitor had any money in his hands did his duty. The solicitor to the commission was appointed by the assignees, and was their agent. Money in his hand was money in their hands. If they chose to remain wilfully blind as to what money the solicitor had, that they might swear they had no money, they incurred the guilt of perjury. But that might be guarded against by an order from the Court of Chancery, directing the Commissioners from time to time to examine on oath both assignees and solicitors, as to what money they had in hand, and requiring 501 the Act of Parliament in all cases to be strictly and immediately complied with. The public assignee was, he was aware, to give security; but who that would accept this office would be able to find security for those sums that must come into his hands? Their Lordships might be assured, that the present law had preserved bankrupts' estates better than any security that could be obtained from assignees. His noble and learned friend said, that these assignees would save the expense of accountants. If they did the business of accountants, they would require to be paid as such, and the Commissioner who had the extraordinary power given him of settling in each case what the rate of commission was to be, would pay as much to an assignee who did the business of an accountant, as to another assignee and to an accountant together. A portion of these individuals was, it appeared, to be selected from that class of persons who were in the habit of acting as Special Jurors. He rather feared, as many of those gentlemen were individuals who had retired from business in consequence of the infirmities of age, that little assistance could be received from them. If, however, public assignees were wanted in London, they must be equally wanted in the country; but the country, into which two-thirds of the commissions of bankrupt were issued, was not to have the advantage of public assignees. The Bill had now been for some time before Parliament, but none of the great trading towns had complained that their interests were not protected by public assignees; and not a single petition had been sent up to their Lordships upon the subject. The Bill imposed on the country a great and unnecessary expense, the extent of which their Lordships could not see, for they had no accounts before Athena on which to form any judgment. Besides the charges to which he had alluded, there would be compensations to several officers, and to the discarded Commissioners. Bankrupts' estates would not bear these charges—the Suitors' Fund could not be rendered liable to them—they must, therefore, fall on the Consolidated Fund. He reluctantly gave, up the Commissioners, from deference to the opinion of the petitioners. That, however, was an alteration that might be made without any increase of expense. Indeed, seven or a greater number of Commissioners would not put the bankrupts' estates 502 to the expense that was now occasioned by the seventy Commissioners, which he estimated at about 23,000l. But the expenses of the Court, of the Registrars, and of the public assignees were useless. The new Court would only multiply appeals, and the increasing the number of Judges would tend to lower the character of Judges. It was essential, however, to the due administration of justice that the Judges should be looked up to with the greatest respect, and why were the Judges in England held in greater estimation than those on the continent, amongst whom were many persons highly distinguished for learning and abilities? Because the number of Judges here was so much less than in other countries. He could only entreat their Lordships to pause—to inquire before they made such an extensive alteration in the law as was proposed by the Bill under consideration. Let them not look at bankruptcy only—the whole law of debtor and creditor was a disgrace to the country. Upon the whole, the Bill only substituted a bad system for a good one, and he moved that the words appointing the new Court should be left out.
The Lord Chancellor
did not complain that his noble and learned friend had entered improperly into the whole of this question on the present occasion. It was most desirable to have the benefit of his observations on the subject; and, as he had not before had an opportunity of going into the question at length, he had now, very properly, stated his objections altogether, instead of separating them, and confining them to different clauses and different parts of the Bill; but his noble friend having done so, he should be under the necessity, although he troubled their Lordships at some length the other night, of again trespassing on their attention. He should, however, confine himself strictly and exclusively to the parts to which his noble and learned friend had adverted. The first objection taken by his noble and learned friend extended to the first clause of the Bill, to the appointing some Commissioners and abolishing others; but his noble friend seemed to have mistaken the object of the clause. His noble and learned friend seemed to think that the principle of the Bill, was to substitute for the present number of Commissioners only seven, and then to substitute, in the place of the Great Seal and the Vice-Chancellor's 503 Court, the Court of Review, which it was proposed to establish: but this was not the strict nor the correct mode of stating the principle of the Bill. The fundamental principle of the Bill was not the substitution of a Court of Review for the purpose of exercising the functions which the Great Seal, and the Vice-Chancellor, representing the Great Seal, at present exercised, by way of appeal, from the Commissioners, but it was proposed that that Court should exercise other functions which the Vice Chancellor and the Lord Chancellor, hearing appeals from the Commissioners, did not exercise unless their decisions upon disputed testimony, and upon conflicting testimony on affidavit, were taken to be the same as a Trial by Jury in matters of fact, which they clearly and manifestly were not. It might be right or wrong, that the Court of Review should, from time to time, try questions instead of their being tried in Westminster Hall; and that part of the Bill might or might not be liable to objection on the part of his noble and learned friend, he having an inclination, as he admitted all members of the profession had, in favour of Trial by Jury in Westminster Hall, in preference to anew Court. The institution or exclusion of that Court might or might not be necessary; though presently he hoped to shew their Lordships, that it was necessary; but the other objection of his noble friend appeared to him to be totally inconsistent. It was impossible to say that the Court of Review was substituted for the Chancellor and the Vice-Chancellor sitting to hear appeals in bankruptcy cases, because the Chancellor and the Vice Chancellor never try issues; they could not try issues; some men had doubted, indeed, whether they could not; but the experiment had never been brought to the test; and he doubted whether the equity side was enabled to do so at all. Was it therefore correct to say, that when a tribunal was established in the bosom as it were of the Court of Chancery—was it a correct representation of the powers of the Court of Review, which was to have delegated to it the important functions of trying facts by a jury—to say that it was merely a substitution for the jurisdiction at present exercised by the Lord Chancellor and the Vice-Chancellor, who never try issues at all? One of his great objections to the present course of proceeding was this, Every Chancellor and 504 every man practised in Chancery, knew that the cases least of all fit to be tried on affidavit were those which involved questions of fact—the questions whether a man owes a certain sum of money, whether he has committed an act of bankruptcy, whether he has denied himself, whether he has left his home with intent to avoid his creditors, are all questions of fact more fit to be tried by a Jury than by a single Judge on affidavit; the question whether a man was in trade, was not so much a question of fact—or whether he was in trade within a certain time; all these questions were at present tried by the Great Seal or the Vice-Chancellor on affidavit. In the very last case of this description which came before him, he was between eight and nine hours engaged in hearing a mass of affidavits, of which from sixty to seventy had been filed, affidavit meeting affidavit, containing all kinds of denials, explanations, contradictions, and admissions, new facts, and again, denials of these new facts—witnesses swearing three, four, and five deep, and the whole of this mass of evidence was brought in and flung at his head—to use a Westminster-Hall phrase—and with the assistance of counsel who threw them at his head, he had to decide upon this mass of evidence. It used to be the case in the Courts of King's Bench and Common Pleas, that a man got up and read, not giving the Court the essence and substance of the affidavits, but reading, school-boy like, affidavits, first one, then the other, and then on both sides, made a few observations, and sat down, giving place to another man not a whit better than his predecessor. In Chancery, however, a counsel went through the case, and opened it at great length—then came another counsel—the junior, and read the greater part of the affidavits, and then four or five counsel got up, one after another, and addressed the Court, it being the practice in Chancery to open every possible door for the admission of counsel, and any number of counsel was allowed; but in the Courts of Common Law, as his noble and learned friend knew, cases were always, or, at least generally, discussed by one counsel on each side, with the assistance of a junior: in them there was a limit, but in the Court of Chancery there was no limit, and ten counsel might speak on each side. That, however, was not all; cases perpetually occurred in which there might 505 be ten different parties, each of whom might have the shadow of a separate interest. In ninety-nine cases out of 100, these interests were substantially, though not legally the same; and the Court had to hear the same argument repeated over and over again with equal prolixity, before it could arrive at the question of fact respecting which the parties were at issue. This might be good for many purposes—it might be excellent for counsel and excellent for attornies, who expended their client's money in the shape of fees—it might be admirable for loss of time, too—a part of the surplus population might die off, and there might not be so many parties to receive the property; but there was one thing it was not very well adapted for, and that was, for arriving at the merits of the case. He did not complain of the length of time occupied, but the system was not a good one for ascertaining facts. His noble and learned friend knew, from long experience of able advocates—himself being one of the ablest of his day—that it was quite sufficient for a man to get up and state the case succinctly and clearly. He would do Common Lawyers the justice to say, that nine times out of ten, they did not occupy the attention of the Court for a longer time than was necessary; indeed, they were careful not to enter into the subject too much at length, because, not having the matter before them in detail in the affidavits, they were always afraid the witnesses should not come up to their statement; and, therefore, they said what was necessary for the purpose of making the Judge and Jury understand the case. There never was a better system of getting at facts than Trial by Jury, under which a counsel rose up in his place, and gave a clear and succinct account of the whole case, as was done in our Courts of law; he then called his witnesses, who stated the facts, instead of exhausting himself as counsel in the Court of Chancery would do, and exhausting the Court by making a speech of four or five hours, and never coming to the facts, as if they were not material; he had then a number of affidavits read; and again he exhausted himself by making another long speech in reply. In the Courts of Law the counsel directed their whole knowledge, their whole experience, and their whole attention, to that which was the most material part of the case—the truth of the matter; 506 the Court also had much better means of judging, from the manner in which a witness gave his evidence in open Court, whether or not he was speaking the truth, than if it were to sit down and read long affidavits. Any man who wished to see great talents called into exercise, would do well to go to a Court of Law—let him omit the speech altogether, and see the play of the counsel during the time the evidence is adduced—how much they are on the alert, straining every nerve—careless of the speech, for experienced counsel, except on very great occasions, rarely detain the Court many minutes—but exerting their whole mind and soul, discharging their duty to their clients, by producing the facts luminously, consistently, and irrefragably before the Jury. The Jury had an opportunity of watching the demeanour of the witnesses while giving their evidence, and when submitted to cross-examination; after which came the counsel again, comforting and restoring, as it were, and setting up the broken credit of the witnesses damaged by the cross-examination. The conflict on both sides being over, the evidence of the witnesses was fairly before the Court. A Juryman, by a single glance of his eye, could frequently tell whether the witness was speaking truth or falsehood; many circumstances and details that could not be taken down in notes could frequently settle at once the credit due to a man's testimony. Was there a man in England who would not at once say, that the decision of twelve men possessing these means of information, must be better than that of one individual excluded from such advantages? His noble and learned friend would agree with him, he was sure, when he said, that the Jury were sometimes right when the Judges were wrong; and Judges sometimes admitted, that they took, what they afterwards found out to be a wrong view of the case, while the Jury took a right one. One man might be an excellent means for deciding a point of law: one experienced Judge for superintending a Jury was excellent; but twelve men were infinitely better for deciding in cases where there was conflicting evidence, and where that evidence was to be brought before them in an uncertain shape, and under a great variety of bearings;—one man took one view and another another, each seizing the case, as it were, by a different handle, until, by reflection and argument, they came to an unanimous and correct decision. 507 These were the advantages which Trial by Jury possessed over every other tribunal. To ascertain facts this system was the best, and one man sitting in Court to decide facts upon a mass of affidavits was the worst that could be devised. The proposition contained in the Bill, therefore, was, that all disputed matters of fact should be tried by a Jury, acting under the superintendence of one of these Judges—so it would not be solely and entirely a Court of Review, but a Court in the first instance for trying difficult and disputed facts. His noble and learned friend justly observed, that there was an advantage in having these offices filled by men of ability and experience, but he also observed, that there would be very few difficult and disputed cases, and very little for these Judges to do. With regard to that objection, the number of disputed cases which came before the Great Seal and the Vice-Chancellor in the course of the year was considerable, and, what was still more material, a considerable number of these cases, perhaps the greater number of them, never obtained a decision at all. Under the present system, too, there was always the expense, trouble, delay, and [...] of appealing to the Vice-Chancellor. The effect of the plan he [...] be, to give a facility for the trial of cases of this description, and for trying them, which was a material consideration, without delay or expense. His noble and learned friend stated, that this Court would be substituted for the Courts of Westminster Hall; that a man might say, "I am made a bankrupt, and I consider it very hard to be denied an appeal from the Court which I dislike, to the Court which I approve of." But if his noble and learned friend would only observe, what he was about to say, he should be enabled to convince him, that his view of this part of the question was not quite correct. Assuming that there would be a sufficiency of business to employ these Judges, which was a conclusion founded on a calculation of the total number of disputed cases, he could see no objection to a man allowing his case to be decided by men continually practised in these cases. Assuming the contrary, it was not correct to say, that you exclude a man from having the benefit of the legal knowledge of the Chief Justices or other Judges, which he agreed with his noble and learned friend, was a very great benefit. The principle of the 508 Bill was, to put a stop to arguing as to disputed facts, as was now done by petition, before the Vice-Chancellor and Chancellor, and to enable the inferior Courts to decide questions of that description by the help of a Jury. It could not be denied, that these inferior Courts would save much expense, and be just as able to form correct decisions as the Vice-Chancellor. But then it should be remembered, that if any point of law or equity was disputed, there was an express saving of the jurisdiction of the Chancellor; therefore, anything which would come into a bill of exception, if the case were tried before my Lord Tenterden, or the Court of Common Pleas, would immediately come, instead of having a bill of exception, which would carry it to the Exchequer Chamber, to the Great Seal at once. There was an express provision too, enabling the Court, should it think fit, instead of sending a case to the Great Seal, to send it directly up to that House; and his noble and learned friend knew, that there were in that House the very best authorities upon the subject, he meant those who had preceded him in office; indeed the difficulties be experienced in coming after such men were among the greatest by which he was embarrassed, although they had left him for his guide a code of sound opinions, and decisions, which rendered it only necessary for him to apply the light which their learning and wisdom, and the doctrines laid down in their decrees, had shed over all the doubtful and difficult points of equity. In particular the noble and learned Lord opposite—who, for so many years filled the judicial seat—had left such a code of equity behind him, that the Judge had only to resort to his authority. But, as he had before stated, there was a provision, that instead of going to the Chancellor, the Court below could pass him by altogether, and send the case up at once for the decision of the House of Lords. It was not correct, therefore, to say, either that the benefit of an appeal to the twelve Judges, or to this House, or to the Chancellor, or the Vice-Chancellor, or their Lordships' House, was to be excluded. It certainly was excluded in matters of fact, but not in matters of law. Another observation of his noble and learned friend which struck him rather forcibly, was, his objection to one man, in a case of bankruptcy, ultimately making another a bankrupt; but that was here provided for. 509 His noble and learned friend also objected to giving the power of making a man a bankrupt into the hands of the new Judges. By the Bill it certainly was provided, that one Judge could enter into the inquiry, but it was also provided, that the moment he found any extraordinary difficulty, either in point of fact or in point of law, he was obliged to call for further assistance. If, however, it was as clear that the man had been a trader, and that he had committed an act of bankruptcy, as that he had a nose on his face, the Commissioner then decided the case. If it were not a clear case, the Commissioner adjourned it for further consideration, and then obtaining the assistance of two other Commissioners, the three, sitting together, would decide upon the facts, and adjudge accordingly. He apprehended, therefore, that a man would never be found a bankrupt by one Commissioner, in any but a straightforward and plain case. At present, in straightforward cases, one Commissioner did the business; and the moment a necessity arose for what was called a private examination, which only took place in cases of difficulty, then the other two came to his assistance, and the whole three took the case into their hands. His object had been, to select whatever was good or worthy of preservation out of the present system, and in this instance he proposed that the new Commissioners should proceed on the principle on which all the Lists now act, but with a great improvement, in consequence of the provision which had been made for cases in which anything like difficulties arose. His noble and learned friend had said, that there ought to be a notice given to a bankrupt, before you take possession of his property, and that he ought, not to be found a bankrupt ex parte. That was a subject, as his noble and learned friend knew well, which had been a question of long, anxious, and difficult inquiry, among legislators and lawyers, ever since the Bankrupt-laws existed. At present, a man might be made a bankrupt, and his goods taken possession of, and he know nothing whatever about it. This might all be done behind his back; it had been long objected to, but it was impossible to say more about it, unless some tolerably easy and safe means of abolishing the practice could be suggested. In Scotland, on a petition for a sequestration, which is a proceeding in the nature of a Commission of Bankrupt, ten days' time 510 is given the party before execution; that is to say a rule nisi was taken out, which expired in ten days, giving the party an opportunity of superseding the Commission. It was one thing, however, to have a system of law long established in a country which had never known a different system, and it was another thing to introduce a practice into a country which had never known anything whatever of it, and therefore it by no means followed, because the system worked well in Glasgow, that it would also be beneficial in Liverpool or London. That was, no doubt, a question well deserving of discussion; and accordingly, he begged to state to their Lordships, and to his noble and learned friend, that it had received a great deal of consideration. He proposed, in the first instance, to introduce this system of the rule nisi, which was one of the principles in the sketch of the Bill which he laid before certain learned individuals for consideration; but he withdrew it, because it was agreed, that although the subject was always open to the modification, which his noble and learned friend's long experience had suggested, yet, that at all events the seizure of goods must be ex parte, though the making a man a bankrupt might take place after a few days' delay: but then there would be this great difficulty, that though you seize the goods, you could not prevent him from tampering with his creditor, unless something like a bodily attachment, or arrest, was introduced. They could not do this, however, without being the cause of as much mischief as would arise from declaring a man a bankrupt at once. On the whole, it was considered better, that the property should be seized as heretofore, and that the point of bankruptcy should be left for the consideration of another tribunal. His noble and learned friend complained of the expense of the system which it was proposed to introduce. His noble and learned friend had stated the expense of the Commissioners at 9,000l., which was only taking so much out of the estate in one way instead of another. There were at present seventy Commissioners of Bankrupt; and one list had returned that their incomes averaged from 300l. to 400l. a-year, so, that instead of 9,000l. this would make about 25,000l. annually, taken out of bankrupts' estates for the fees of the Commissioners. But the profits of Commissioners of Bankrupt did not average 511 so little as 300l. a-year; however, call it more or call it less, it was far above the noble and learned Lord's statement; and if 9,000l. were deducted from his estimate of the present expense, the ultimate saving by the proposed plan, would be at least 22,000l. From calculations he had made, including the expenses of bargain and sale, the salaries of the Commissioners, and various other expenses, there would be a great saving of expense, and there would be a saving of from 11,000l. to 12,000l. by the appointment of official assignees. It was clear, that it was not for their Lordships to go into the amount of salaries; that was to be dealt with elsewhere; nevertheless, he agreed with his noble and learned friend, that if he could not support this part of his case, it would be a very great objection to the introduction of this Bill. He was convinced there would be a saving in the whole of about 24,000l.; but take it at 20,000l. and even then, at all events, the proposed plan was not a measure of extravagance, but one of economy. His noble and learned friend entered more into detail with respect to some other parts of the plan, into which inquiry he should not follow him; but he would detain their Lordships one instant, by saying a word with respect to fees. His noble and learned friend said, that in the Bill it was enacted, "That from and after the passing of this Act, all fees in bankruptcy, &c., or any other matter whatever, shall entirely cease and determine." That was very true—that would be the effect of the clause if it stopped there; but if his learned friend had exercised his power of reading a little longer, he would have found it was different; for, after a comma, it continued thus: "save and except such and such fees as are provided for by this Act, or set forth in any schedule of fees to be settled or allowed from time to time by the said Court of Review, with the approbation of the Lord Chancellor, to be signified by him." Thus there was to be a schedule of fees, which was to be allowed by this Act. He did not know whether their Lordships had taken the trouble to advert to it; as it was quite clear, that it was a subject for the consideration of the other House of Parliament, being a question for them to deal with. He had trespassed a long time on the attention of their Lordships, but he trusted that his anxiety to render the bearing of this measure clear and intelligible to every body would plead 512 his excuse. He had now answered all the objections which had been brought forward against this measure. He did not recollect any requisite explanation; but if any of their Lordships could remind him, he should feel much obliged. He meant to make one or two observations respecting the present Commissioners, which escaped his recollection on the former evening. He thought he had, on a former evening, clearly explained the defects in the selection of the present Commissioners; but there was another point which he omitted on the last evening to state, namely, that in consequence of the number of the present Commissioners, a great number of inferior men were, ex necessitate, appointed by the Great Seal to the situation of Commissioners; but there was another objection: these inferior Commissioners had a salary of but 300l. or 400l. a-year; and consequently they received an inferior portion of this inferior man's time. It was absolutely impossible that any man, in the situation and rank of life of a barrister, with, perhaps, a family to support all the year round, in winter and in summer (for there was no long vacation for a Bankrupt Commissioner), could give up his time for the small pittance of 300l. or 400l. a-year. It was perfectly well known, that they never thought of appearing in their proper places, if they could possibly get better retained elsewhere; so that they acted as Commissioners when they had nothing better to do; or, in other words, in return for the small pittance which was allowed to them, they gave the fag-end of their time. They all attend during Term time to their professional avocations as Barristers, in Westminster Hall, and in the Court of Chancery; and out of Term time they went the circuit. All this resulted from their being ill-paid. This was a great objection to the present system, and one which was effectually removed in the system which he proposed; for they would have ample remuneration, and, by this means, their duty in the Bankruptcy Court might monopolize their time all the year round. It was said, that it was impossible to get good men to surrender their Court-practice (for the new Judges were altogether forbidden from practising in their profession) for such a small sum as the Bill proposed to give to them. On this point he differed. He was sure they should be able to find as good men as any at the Bar, who would not only be willing to 513 give up their practice for the appointment of one of these judgeships, but would be entirely satisfied with their lot. It was very well known, that professional excellence and professional rank did not always go hand in hand. There were many men of first-rate talent at the bar at this moment, making but 3,000l., or even 2,000l. a year: while others, perhaps their inferiors, but certainly not more than their equals, made 8,000l., 9,000l., and 10,000l. It was not, therefore, an absurd speculation to expect to find good and efficient men, whose professional remuneration had not kept pace with their legal acquirements and talents, who would be glad to surrender a doubtful professional income of 3,000l., or 5,000l. a-year, for a secure salary of 2,000l. He could name many men of first-rate professional acquirements, even now in the possession of silk-gowns, who would be extremely glad to make such an exchange—and this was very natural, for the one was permanent, and the other insecure. The one only ceased by death; while the other was of so uncertain a tenure, that a breath of wind might destroy it. The very lawyer at the head of the circuit which his noble and learned friend went when a Barrister, had told him, that he would be glad to get one of the situations: and one of the twelve Judges was at this moment prepared to leave the bench if he could obtain one of the appointments. Now this latter fact was a pretty good argument against his noble and learned friend, and, as an ounce of fact weighed heavier than a stone of argument, he had submitted it to their Lordships' attention. He did not say this from any disrespect for his noble and learned friend; indeed, he should be inclined to admit that, generally, his noble and learned friend's stone of argument might be equivalent to an ounce of sense, but, on the present occasion, he had certainly formed a wrong conclusion. He was a little surprised to hear his noble and learned friend say, that it would be difficult to get competent Barristers to fill these situations, when he, in propria persona furnished him with a strong argument against his own position; for what were the circumstances under which he, his noble and learned friend, left his profession? He was in the receipt of one of the largest professional incomes then made at the Bar; an income, too, which could never sensibly fail him, 514 except in the event of death or continued ill health. And what did he do? His professional income amounted to—he would not say 20,000l, or 30,000l. a-year—but, at all events, to a very large amount, and yet he gave it up to take a small income, with a seat on the Bench? This was not at all strange, but it certainly did surprise him to hear his noble and learned friend express a doubt of their ability to induce competent professional men to surrender good professional incomes for the salary of 2,000l. per annum. Many would be found ready to do so, some from ill-health, others from fatigue arising from professional labour, but all in the prime of life, and with the full possession of their faculties. He did, therefore, entertain no fear of being able to obtain competent candidates for these situations. He did not mean to say, that all of them would be men of equal competence, but they would be all respectably so. His object in filling up the appointments would be to select a portion of the number from Barristers with silk gowns on their backs. He was most anxious that such men should be chosen, because, if they started the Court with a set of men eminent for their professional acquirements, it would stamp it with a name, and effectually prevent the vacancies from being tilled up hereafter with any but eminent and competent men. His noble and learned friend had said, that great embarrassment would attend the filling up of these places, and seemed to recommend that a portion of the seventy Commissioners who were to be disbanded should be selected. Now, on this point, he should only observe, that, in the selection, if he should find a name on any of the lists equally competent with that of any other claimant, he would decide in favour of the present Commissioners. This he would do for two reasons—first, on a principle of justice, and secondly, that by doing so, he should save that compensation to individuals to the public purse. On the subject of compensation, as he had accidentally mentioned it, he would say a few words before he sat down; but first, he was desirous of making one or two observations with respect to the official assignees—a portion of the plan which he was sorry to see did not meet with the approbation of his noble and learned friend. There was no part of the Bill which he liked more than this. It was a common remark, that no persons looked less after 515 their own interests than the honest creditors—and, consequently, it was those whom it should be the duty of a Legislature to protect—of either a bankrupt or an insolvent. The moment a docket was struck, or a declaration of insolvency filed, they became desponding, gave up all for lost, and would take any thing for their chance—indeed, he had known cases where men had taken 100l. for a claim on a bankrupt's estate for 10,000l.; and, in consequence of their despondency and inattention, they became the prey of another class of creditors less careless—he meant one or two jobbing people, the friends of the bankrupt, who, for the sole purpose of jobbing, took great pains to attend to the bankrupt's affairs. Again, if the creditors did not attend, the bankrupt, if he were a rogue (and bankrupts but too frequently were), would manage to create a sufficient number of debts, in order that he might have the majority of his creditors at his disposal, and thereby, in the first place, get better treatment, and secondly, procure a sufficient number of signatures to his certificate. In fact, but few cases were heard in Basinghall-street, in which the bankrupt and fictitious creditor did not join to create debts. This constituted one inducement for the appointment of these official assignees, for they would at once, on the docket being struck, take into their possession the property of the bankrupt. There was another inducement, an important one, and that was, that assignees were generally persons in the interest of the attornies or solicitors to the Commission, and their resistance to perform their duties very often threw the whole property of the bankrupt into a Law Court, by which the Attorney's costs were of course, much increased. Now, when the duties which were at present discharged by Assignees chosen by the creditors, were placed in the hands of proper and responsible persons, who were to have the decision as to the necessity of a legal opinion, all this much complained of collision between assignee and solicitor would be defeated; and as certain rules were to be laid down for the regulation of the conduct of these official assignees, the frequent recourse to the Law Courts would be very much diminished. As to the difficulty which his noble and learned friend seemed to think would be experienced by these individuals in finding sufficient security, all he should say was, that 516 if a man could not get security for 2,500l. for he must give this amount of security—before the Accountant of the Court—two sureties of 1,000l. each, and his own security for 500l., he was not fit to be appointed to the situation of Official Assignee. These were the only remarks which he thought necessary to make, and he trusted they would prove satisfactory to their Lordships, and in particular to his noble and learned friend. The Bill was now fully before their Lordships, and it was for them to decide whether it offered greater advantages than the existing system. He did not mean to say it was perfect—that would be impossible. He maintained, that every measure to alter the existing law must of necessity be imperfect. He knew it would require revision, and if it was to be revised, he would, on that account, take no blame to himself. He was so well convinced of the impossibility of rendering any legal measure perfect, if he might use a medical phrase, by the first intention, that he should feel surprised if, within a year and a-half, the measure which he now looked on as complete as circumstances permitted, would not require amendment. Before he concluded, he would wish to say a very few words on the topic of compensation. This was a topic which more concerned the other House of Parliament to consider than their Lordships; but thus much he would say in reference to it—he would recommend, that if it were the intention of the Legislature to facilitate the completion of this measure, and to pass it in such manner as to entitle it to the satisfaction of the country, they should not haggle with respect to compensation. If they did, they would raise against it a host of interested, and consequently zealous antagonists. But putting this consideration out of the question, justice, as well as policy, demanded of them that they should give compensation to all those whose interests would be affected by the change. He knew that this was a principle of policy concerning which many different opinions existed out of doors, but at the same time he should ever maintain it. Such were his sentiments on this point, and having thus briefly stated them, he would now sit down, thanking their Lordships for the patience and attention with which they had been pleased to hear him.
§ The Duke of Wellington
was very happy to hear the few last words which had fallen 517 from the noble and learned Lord. He confessed that he had felt very strongly on the case which had been stated the other evening of Mr. Thurlow. He understood that an office had been granted by patent to Lord Thurlow's nephew, and that the Bill before the House went to abolish that office. If the patent were legally granted, he was of opinion that Mr. Thurlow was as much entitled to retain that office as any one of their Lordships his estate. He therefore trusted, that the noble and learned Lord, and the King's Ministers, would not permit the Bill to pass into a law, unless compensation was awarded to Mr. Thurlow.
The Lord Chancellor
observed, that Lord Thurlow had gone out of office in 1792, and had lived for twelve or fourteen years after, without any retiring pension, which was not granted to Chancellors when he went out of office. His patents were, therefore, vested rights, not merely as gratuitous grants, but, as having been purchased since, they were only what he had instead of the retired pension. No doubt, therefore, Mr. Thurlow would have an adequate compensation; but that must be settled in the other House. There were other cases in which compensation must be allowed, so that the immediate public saving would not be by any means so large as it would ultimately be.
§ The Earl of Eldon
said, that Lord Thurlow had been Teller of the Exchequer, and it had been proposed in the House of Commons, that if he would state, what income he had when made Lord Chancellor, the House would make it up to him. Lord Thurlow was a man of high spirit, and refused to make any bargain on the subject. Compensation had always been made to patentees, and often even to men who did not hold their offices for life, on the principle that the best men would not accept such offices if they were precarious. He would defer the observations he had to make on the Bill till another opportunity, and there were two points which he should feel called upon especially to notice. The first was, the low rate of salaries would not obtain such persons as ought to hold a judicial situation, and the second was, that the creditors were to pay the official assignee. He must further take the liberty of intimating to the noble and learned Lord, that it would be dangerous to touch the property of suitors in Chancery, except for the 518 purpose for which the fund was raised. The Suitors' Fund was raised for a specific purpose.
The Lord Chancellor
said, that the Suitors' Fund was only to be applied in the event of a deficiency occurring in the other funds, which he thought was very unlikely to happen.
§ Lord Wynford
said, it had been an understanding between him and the noble Duke, that he should make no observations relating to the case of Mr. Thurlow, but the manner in which his noble and learned friend had alluded to the circumstance, had given him very considerable satisfaction. He had laid down a rule which ought to be acted upon in all such cases.
was convinced that an alteration in the present system was expedient, and he entirely concurred, and felt great satisfaction in saying so, in the measure proposed by his noble and learned friend to amend it. He had some experience in bankruptcy cases, and from the situation he had the honour to hold, that experience was daily increasing, and he felt that a great reformation was required. What he rose for, however, was, to notice a circumstance which the delicacy of his noble and learned friend on the Woolsack had not permitted him to mention. He would lose a great deal of patronage by his own measure, and even this very patent place of Mr. Thurlow might, have been at his disposal, had it not been for this Bill. Although his noble and learned friend had not mentioned it, the gratitude and thanks of the public were not the less due to him.
§ Lord Wynford's Amendment negatived without a division.
§ The Lord Chancellor added some verbal amendments, and the House resumed.