§ [SECOND READING]
§ Order of the Day for the Second Reading read.
§ THE EARL OF GRANARDMy Lords, this Bill, to which I ask your Lordships to give a Second Reading, is identical, save for a few drafting amendments, with that which I had the honour of introducing last December. It is founded upon the Report of a Departmental Committee appointed in 1906 mainly in consequence of repeated representations from Chambers of Commerce and others to the effect that bankruptcy offences too often went without punishment. A further subject that had been pressed upon the attention of the Board of Trade was the ease with which fraud might be practised under deeds of arrangement. These questions and. certain others suggested by the Law Society and by Departmental experience were specifically commended to the attention of the Committee, who were also asked to report generally upon any matters of bankruptcy law and procedure as to which amendment might appear desirable.
The Committee was a strong and representative one. The Chairman—Mr. Montague Muir Mackenzie, now Referee 900 in the Supreme Court—had had long experience in bankruptcy practice, and had for many years been standing counsel to the Board of Trade on bankruptcy questions. He was assisted by two Members of Parliament (of whom one represented trade, while the other is the present President of the Probate Division), and by representatives of the Law Society, the Trade Protection Societies, the Associated Chambers of Commerce, the Chartered Institute of Accountants, and commercial travellers, while official experience was represented in the person of the late Inspector-General in Bankruptcy. The Committee, after a long and careful inquiry, made their Report, which was a unanimous one, in April, 1908. I should like to say that the Board of Trade feel very greatly indebted to the Committee, and especially to the Chairman, for the painstaking energy and the thoroughness and ability with which they conducted their investigations, and for the admirable Report which they produced. The Committee's report was received with strong approval by representative commercial bodies, who by repeated resolutions and by deputation to the Board of Trade have asked for legislation on the lines recommended.
As the result of their inquiry the Departmental Committee approved generally the present system of bankruptcy administration brought into existence by Mr. Chamberlain's Act of 1883, and in particular they found that the important subject of investigation into a bankrupt's conduct arid the causes of his insolvency is already adequately provided for. They made, however, numerous recommendations for amendment in matters of detail, the chief of which it may be convenient to describe, at the same time explaining such modifications as have been made in certain cases in preparing clauses based upon them.
First, as to criminal offences. Under the present law a bankrupt charged with criminal offences is, after an order for his prosecution has been obtained from the Bankruptcy Court, brought before a magistrate, and, if the charge is not dismissed, he is committed for trial before Quarter Sessions, Assizes, or the Central Criminal Court, as the case may be. The proceedings must be undertaken by the Public Prosecutor. Under this cumbrous procedure there are some forty indictments 901 annually. The Committee recommended that bankruptcy offences should be made capable of being dealt with by Courts of Summary jurisdiction. They further thought that in such cases as could be so disposed of the prosecution might be left in the hands of the Board of Trade or their officers, the Official Receivers. They were also of opinion that certain offences such as at present are only punishable by refusing or delaying the grant of discharge in bankruptcy should be made criminal. These were—(1) the failure on the part of a trader to keep books of account, a fruitful source of bankruptcy and an easy means in many cases of escaping conviction for offences under the Debtors Act; (2) gambling—
§ THE MARQUESS OF SALISBURYWhat is gambling?
§ THE EARL OF GRANARDThat is difficult to construe. Everybody has a different opinion about that. The gambling here referred to is gambling and rash and hazardous speculation outside the scope of the bankrupt's own trade or business where these have brought about or materially contributed to bankruptcy. These two offences appeared to the Committee fit subjects for criminal punishment. With regard to the offence involved in not keeping hooks, although the recommendations of the Committee do not go beyond what is at present the law in France, in Germany, and. in Scotland, it has been thought that the time is perhaps not yet ripe for fully adopting the Committee's recommendations. The offence in question is therefore, as the present Bill runs, to arise only where the delinquent has been insolvent on a previous occasion. As to these new offences the Bill, adopting the recommendations of the Committee, makes them criminal only in the case of bankrupts engaged in trade or business. In such cases, where credit is practically indispensable under modern conditions, it will be admitted that the offences in question are specially grave and serious. There is, further, a period of two years' grace from the commencement of the Act; and, again, prosecutions for these offences are not to be undertaken except upon an Order of the Bankruptcy Court, which will have full knowledge of all the circumstances of the bankruptcy.
The Committee had before them the question of trading on the part of un- 902 discharged bankrupts, whether in their own or in an assumed name. At present, if such a person obtains credit to the extent of£20 without disclosing that he is an undischarged bankrupt, he is guilty of an offence punishable with imprisonment up to twelve months. The Committee recommended that the limit should, be reduced to£10, and this is embodied in the Bill. I may mention that the same recommendation so far as relates to Scotland has recently been made by a Committee which has been inquiring into the bankruptcy law of that country. The Committee also recommended that it should be a criminal offence for a bankrupt to trade under an assumed name without disclosure of his true name and position to those with whom he deals. It has teen thought enough to require disclosure of the true name only.
A further question to which both the legal and mercantile community attach great importance is that of after-acquired property. At present, so long as a bankrupt remains undischarged, all such property vests in the trustee in his bankruptcy, and it may happen that when an undischarged bankrupt after again trading finds himself once more insolvent and is adjudicated bankrupt a second time, his creditors find all his assets claimed by the trustee in the prior bankruptcy for the benefit of the prior creditors. There is, however, under decisions of the Courts, this restriction on the trustee's claim—that where such after-acquired property has been sold by the bankrupt, a purchaser for value, even if he has knowledge of the bankruptcy, has a good title in the case of personal property, though not in the case of real estate. The Committee recommended that both classes of property should be put on the same footing, and this is proposed in the Bill. But in both cases it seems necessary, to avoid, collusive transactions, to confine the protection to innocent purchasers—i.e., those without knowledge of the bankruptcy—save in the case of transactions in the course of the bankrupt's trade or business, which it is proposed to protect even though the purchaser has knowledge of the bankruptcy. With regard to the claims of creditors to whom the bankrupt has incurred debts since his bankruptcy, the Committee recommended that these should be paid out of after-acquired property in priority to outstanding claims for debts provable in the bankruptcy. This appears to the Board of Trade to go 903 too far, and it is thought that on the whole the course which will, on balance of considerations, be the most equitable is that the subsequent creditors' claims should be admitted on equal terms with the unsatisfied claims of the prior creditors.
Again, much hardship has been occasioned to creditors by the restrictions which at present operate to prevent a married woman being made a bankrupt. The Committee recommended, and the Bill provides, that married women who trade, whether with or apart from their husbands, shall in future be subject to the Bankruptcy Laws. The Committee also had before them the question of contracts in marriage settlements for the future payment of money or transfer of property. Under the present law trade creditors may be seriously injured if such property is transferred on the eve of bankruptcy, while if the contract is for the payment of a sum of money (which may be quite unreasonably large) then, even if the contract has not been executed before bankruptcy, the trustees under the settlement, or the wife, can by their voting power control the bankruptcy proceeding in the bankrupt's interest and take a large part of the estate in dividend, really for his benefit. The Committee recommended an amendment to meet this evil, to which substantial effect is given by Clause 13 of the Bill. The Committee, however, proposed to make the execution of such contracts within a period of five years open to attack by the trustee in bankruptcy, but the Board of Trade have thought this perhaps undesirably long, and the Bill shortens the period to two years.
A good deal of evidence was laid before the Committee as to evils arising from assignments of book-debts. Where such assignments are made trade creditors may see assets disappear on which they may reasonably have counted as part of the debtor's estate. The Committee came to the conclusion that, so far as relates to specific debts or debts growing due under specified contracts, there was no sufficient ground for legislative interference, but they recommended that general assignments of debts, existing or future, should be void against a trustee in bankruptcy, unless registered like bills of sale. The Bill adopts their recommendation.
Another subject considered by the Committee was that of deeds of arrange- 904 meat (outside bankruptcy procedure). There is abundant evidence of mischief o and of positive fraud committed under such deeds, and the Committee recommended numerous safeguards, which are included in the Bill, to secure honest administration. It is not desirable, as your Lordships will readily understand, that these arrangements, which may in many cases be advantageous to creditors, should be subject to official control, but it is desirable that the creditors concerned should all be made aware of proposals for such deeds before they become effective. The Bill accordingly provides, as recommended by the Committee, that the express assent of a majority of the creditors must be obtained within the prescribed time. Provision is also made for the giving of security by the trustee; for the periodical rendering of accounts; and for the official audit thereof if asked for by creditors representing one-half in number and value of the total number of creditors affected by the deed.
As to minor matters dealt with by proposals in the Bill which do not find place among the Committee's recommendations but were suggested by the experience of the Department, it may be enough to refer to Clauses 8 and 9, designed to cure a defect in the law which has been pressed upon the attention of the Board of Trade—namely, the facilities that exist for a foreign member of a firm doing business in this country to withdraw his assets from English creditors; and Clause 21, relating to the claims of money lenders. At present such claims, so far as they include interest in excess of five per cent., are postponed to other claims in the bankruptcy; but by various devices, such as a series of transactions in which new promissory notes are successively substituted for the original notes, this provision is largely evaded. The amendments now proposed are meant to meet such evasion. I think I have now touched briefly on the different points raised in this Bill. The Government are anxious that the Bill should receive discussion in your Lordships' House, where there are so many experts on this particular subject of bankruptcy law, and it is therefore with confidence that I submit the Bill to your Lordships' consideration.
§ Moved, That the Bill be now read 2a.—(The Earl of Granard.)
905§ LORD FABERMy Lords, I welcome this Bill. I think it is a good Bill, and one that is desired by the commercial community. It has been very fully touched upon by the noble Earl who moved the Second Reading, and therefore it will not be necessary for me to detain your Lordships for more than a few minutes. The first clause gives Courts of Summary Jurisdiction power to dispose of bankruptcy offences when they are of only small amount. That is very necessary, because at present these small cases clog the wheels of the law and the larger cases are postponed when there is no sufficient reason for that postponement. The next important amendment of the law contained in this Bill has reference to commercial offences which are not now criminal. If a trader who has failed once omits to keep trading accounts it becomes a criminal offence on the second occasion. Personally, I think that where a trader who is trading with other people's money gets into difficulties and it is found that he has not kept any accounts at all, it ought to be made a criminal offence on the first occasion. I see that the Departmental Committee on Bankruptcy Law were in favour of that, but their view has been overruled. Next, failure by a trader to explain the disappearance of assets is to be made a criminal act. I think that is quite right, and that it should be made a criminal offence where a trader trading with other people's money cannot explain where it has gone. The next important amendment makes it a criminal offence where the insolvency is brought about by gambling. I must say I differ from that provision, and I think immense difficulty will be experienced in saying what is gambling in the criminal sense. One man, we will say, is trading in cotton and another in wheat. It seems to me that the very essence of those trades is buying cotton and selling cotton and buying wheat and selling wheat, and if a dealer in either of those commodities fails it is generally because he has bought at the wrong moment, or sold at the wrong moment. That is part of his trade, and I think it would be hard in these conditions to say that he had been guilty of a criminal act—
§ THE EARL OF GRANARDI would point out that the penalty in this Bill only applies to gambling unconnected with the trader's business. The instance which the noble Lord has given would be 906 connected with the business and would not come under the Bill.
§ LORD FABERI am obliged to the noble Earl for correcting me in that respect. If it is possible to designate what is gambling connected with the business and what is gambling outside the business, I shall be satisfied; but I fear that when you come to work the provision it will be extremely difficult. Then under this Bill all married women engaged in trade are made amenable to the laws of this country. Apparently in these days women want to take part in everything. They take part in trade, and. therefore they must expect to be made subject to the laws which govern ordinary traders. Additional restrictions are imposed by the Bill on the power to place property out of the reach of creditors in case of bankruptcy by means of covenants in marriage settlements. That is, to my mind, an important provision. When a single man commences business as a trader things may go well with him at first, and then be gets large credit and has a large amount of the money of the public in his possession, temporarily of course. He trades with that money; and then we will assume that things go wrong. He then says to himself, "How am I to get this money for myself?" and up to now there has been only one way. Being a single man he can get married and settle the whole of the creditors' money as a marriage settlement on his wife, and hitherto that could not be upset. Marriage has been held to be a good consideration, and therefore it is possible for a single man, if he wants to defraud his creditors, to get married and settle the whole of the money on his wife. Under this Bill that defect in the law is going to be taken in hand and put right. To my mind that is one of the good points in the Bill.
Next, general assignments of book debts are to be void against a trustee in bankruptcy unless registered. I think that is a good provision. A charge on book debts ought to be registered just in the same way as bills of sale are now registered. Under this new provision it will be necessary for a register of such charges to be kept, and this register will set out exactly what traders are in a bad position and will give those who deal with them an opportunity of saving their skins. There is a further excellent provision in the Bill extending 907 the control of Bankruptcy Courts over foreigners trading in this country. The City of London will be grateful for that enactment. But whether there will be any assets on this side when the foreigner fails I cannot say. This is, however, a move in the right direction, and this clause should certainly be carried. Noble Lords will be able to judge for themselves of the merits of the Bill when we go into Committee upon it. Personally I am of opinion that it is a good Bill, that it has been well drawn, that expert advice is very clear in every line of it, and I hope the Bill will pass into law in due course.
§ THE EARL OF HALSBURYMy Lords, I have no intention of saying anything which would place any impediment in the way of this Bill, but there are several matters in it of serious importance which will require, when we get into Committee, to be very carefully considered. I only mention them now in order that those who are supporting the Bill may have before their minds the questions that will arise. In the first place, I think the question of whether or not the procedure is to be by Court of Summary Jurisdiction or by indictment is a matter of the greatest importance. Some of these offences are very serious, and the question of whether or not you are to abolish trial by jury in some cases is one which, I think, will require to be very carefully considered. And not only so, but if trial by jury is to be abolished in certain cases the persons to whom power is given to order that the procedure should be by Court of Summary Jurisdiction ought to be defined. Nothing is more unsatisfactory to my mind than leaving it in the position in which it is left in this Bill. My noble friend behind me (Lord Faber) spoke of its being very important that certain cases should be capable of being dealt with at once. But it is more important, I think, when you are dealing with the liberty of the subject to consider who shall determine the question of what tribunal shall have jurisdiction in the matter. That, I think, will have to be seriously considered.
There are one or two matters which I venture to say have not been sufficiently considered in the drafting of this Bill. Your Lordships are aware that at one time the only person who could be made a bankrupt was a trader. The distinction 908 was very marked, and there are a great number of decisions upon it. I observe that in answer to a criticism the noble Earl in charge of the Bill spoke of an offence "connected with a man's business." What is the meaning of the word "business"? The distinction between a trader and an ordinary person becomes of serious importance here, but I do not find that there has been any very definite idea on the point in the mind of the draftsman of this Bill. A criticism made just now across the Table illustrates the importance of this matter. It was pointed out that some businesses are necessarily of a gambling character, and, if gambling is to be made an offence, that question must be dealt with. It must be defined what gambling is in the sense in which it is used in this Bill.
I do not wish to prolong this discussion, but I most strongly object to and shall certainly resist, when this Bill reaches Committee, a Government Department being given power to decide whether persons shall be prosecuted for a minor offence or for a graver offence; because, if the case goes to the minor tribunal the jurisdiction is limited and only certain punishment can be awarded, whereas if it goes to the other tribunal there is a power of inflicting much larger punishment. The power in this matter, if confided to anybody, should be given to the Public Prosecutor, who is the officer responsible for the due administration of the law. I strongly object to leaving it in the uncertain way in which it is left in this Bill, and at all events I object to a Government Department having this power.
Then I would ask those who are responsible for the drafting of this Bill to be good enough to read Clause 2 and then tell me, if they were deciding on the question of what the offence was, whether or not that clause expounds with sufficient clearness to the ordinary intellect what it means. It first says that the person accused shall have the onus of proving that he was not guilty of this, that, or the other. Then it says it shall not be necessary to insert the allegation that it was done with the intent that the clause means to make unlawful, and, having done that, it says it shall neither be necessary to allege it in the indictment nor to prove it. How the onus of proof is to remain on the person accused under those circumstances puzzles me 909 beyond measure. It becomes to my mind a serious thing to say there shall be an offence which it shall not be necessary to allege in the indictment; and that a person should be capable of being convicted on that seems to me to be a sort of thing that requires sonic defence at all events. I do not propose to detain your Lordships longer. I only rose to point out that there are several serious natters in this Bill which must be considered when we reach the Committee stage; and upon one of them, at all events, I certainly should resist this Bill if it were made an essential part of it that a Government Department should have jurisdiction to determine what tribunal should try a man.
§ THE LORD CHANCELLOR (EARL LOREBURN)My Lords, I have no cause to complain of the noble and learned Earl's criticism. He has indicated what must have been apparent to your Lordships, that when you are dealing with Bankruptcy Law you are dealing with a highly technical and difficult subject. The Common Law of the land is difficult; the Statute Law is made more difficult than it need be; Equity Law is difficult; but in the case of the Bankruptcy Law what you have to do is to adjust between rival claims to a denuded property what are the respective rights between the one and the other owing to the insolvency which has arisen, and this is, so to speak, an additional difficulty super-added to the sufficient difficulties that already exist in construing and applying the general law of the land. This Bill is brought forward for the reasons stated by my noble friend Lord Granard. It is unquestionably true that a good many people succeed in cheating by successive insolvencies honest traders who have no means of obtaining proper reparation, and it is necessary to use the Criminal Law as well as the Civil Law in order to make it clear to people that they cannot with impunity perpetrate a series of transactions which are practically, taken altogether, equivalent to fraud and to criminal misconduct, although in each particular instance they may be able to evade the effects of the law as it at present stands.
The criticisms that have been made to which I propose to advert are three in number. One of them is the difficulty of describing gambling. It is, no doubt, a very difficult thing to do. But the fact that you cannot, if you cannot—I do not 910 say that it might rot be practicable to do something to make it clearer—describe a particular offence in language which is exhaustive, so to speak, is not necessarily an objection. All the great Judges in this country have from the very first refused to give any definition of the word "fraud," on the ground that if they gave a definition which would limit the conception of fraud with which they were at liberty to deal, rogues would immediately seize the definition and use it as a means of escaping the consequences of their misconduct. It may be possible to use other language, as well as the word "gambling," for the purpose of preventing a misuse of the enactment. But we must not attempt to be too detailed o too particular, or we shall find that the net is so wide that rascals will be able to escape.
The next point to which the noble and learned Earl referred was that which relates to procedure by summary jurisdiction and to the proposed faculty for a Government Department—the Board of Trade—to avail itself of the power of proceeding by summary prosecution. It is only in minor cases that this could be done, and then only after the Judge had ordered a prosecution. Therefore the Department would not be arraigning people of its own sweet will. The Board of Trade would merely say, This is a small case, the Judge has ordered a prosecution, and we propose that the prosecution should take place, not before a Judge and jury, but before a Court of Summary Jurisdiction. At the same time what the noble and learned Earl has said will be listened to with the greatest respect, and I will consider what he has said with all the deference that one would give to his opinion on this matter.
The other clause to which the noble and learned Earl adverted is Clause 2. His criticism there was as to the drafting. Drafting is a subject which certainly lays itself open to very constant criticism in this and in the other House of Parliament. I feel sure, knowing as I do that this Bill had its origin in the advice given by Mr. Montague Muir Mackenzie and the other gentlemen referred to, that these things have been carefully considered. But all these points will, as I say, deserve to be considered carefully in Committee, and we shall not forget the observations made upon them by the noble and learned Earl.
§ THE MARQUESS OF SALISBURYMy Lords, I rise, not to give my useless opinions upon these most complicated matters of law, but in order to draw the attention of your Lordships to one or two points in connection with this matter. In the first place, I would like to ask the Government to give us a little time before taking the Committee stage of the Bill. Any one who has listened to the short discussion this evening must have been convinced of two things—first, that the matter is intensely complicated; and, secondly, that the most learned members of your Lordships' House are not altogether in agreement with the Government as to the drafting of the Bill. Those two points make it very important that we should have time to consider the Bill. It is quite true, as stated by the noble Earl who represents the Board of Trade, that this Bill was presented last December, but it was not defended then; it was not even explained, and I doubt whether it has attracted the amount of attention outside which is fitting if the Bill is to be properly considered.
The only other matter to which I should like to draw your Lordships' attention is this. Every speech which has been delivered this evening has been directed to bankruptcies arising in trade and commerce. Those are not the only bankruptcies with which the law deals, though they are no doubt the most important. Enough has been said of bankruptcies arising in trade by noble Lords much more qualified to speak upon them than I am. Therefore I will leave them alone. But there are other bankruptcies, and I wonder whether the Government in drafting this Bill have carefully considered its effect upon bankruptcies which do not arise amongst the business community. It is somewhat difficult to construe the Bill when you apply it to bankruptcies which do not arise commercially. Take the gambling provision, to which attention has been called. The gambling which is to be criminal is gambling not connected with the bankrupt's business. But if the bankrupt has no business, how are you to construe that clause? If it is to be construed in its widest sense, is it to be held that a person who becomes bankrupt in consequence of gambling, even of reckless gambling, is to be held guilty of a criminal offence? That may be right, but it is a very serious proposition to make. I do not think it is 912 probably the intention of the clause, neither am I qualified to say that the clause would be right to include it. But it is evident that the words require very careful scrutiny in order that a provision of this kind should not be made too wide.
§ THE LORD CHANCELLORThe noble Marquess is quite right, but already under the existing law gambling may be a ground for refusing a bankrupt his discharge. It is a different thing and has different consequences; but the fact of gambling is now judicial, if I may use the expression, and has to be considered by Courts of Law for another purpose.
§ THE MARQUESS OF SALISBURYThe noble and learned Earl's interruption is really directed towards the criticism of my noble and learned friend behind me, that it is difficult to define what "gambling" is. What I understand the Lord Chancellor now to say is that certain judicial persons already have to form an opinion of what gambling is. The criticism which I made still remains—that it is exceedingly difficult to apply the provision as to gambling to bankruptcies which do not arise commercially without facing a change in the criminal law of a very serious kind which I hardly think the Government intend.
My noble friend Lord Faber approved very much of the provision in this Bill which deals with marriage settlements. I agree with him in principle, because it is sought by the clause to avoid a method of evading the bankruptcy law by a man who is about to become bankrupt. But are the Government quite sure that they have not drawn their net too wide, and that they may not prejudice one of the parties to the marriage in a perfectly bona fide and legitimate transaction—persons not engaged necessarily in commerce at all? Take this case. Provision is made on behalf of a lady about to be married that certain property should be put into settlement. But if the husband within two years became bankrupt, she and those who were responsible for her welfare—her father or her guardian—might suddenly find that the settlement executed on her behalf was rendered null and void, and that the 913 property which was supposed to make her future secure had to be paid away to the creditors of the husband. I hope your Lordships will not think that I am attempting for a moment to accurately interpret the drafting of this most complicated provision, but I give this instance in order to illustrate my point. I hope that His Majesty's Government will see that in legislating for commercial bankruptcies they do not affect adversely a number of comparatively innocent persons who are not engaged in commerce at all. What little I have been able to add to your Lordships' consideration of this Bill leads to the same conclusion with which I begun—namely, that the House is entitled to certain time in which to consider carefully the provisions of this Bill, and I hope His Majesty's Government will not hurry us in taking the Committee stage.
§ THE SECRETARY OF STATE FOR WAR (VISCOUNT HALDANE)My Lords, I think it is very reasonable in the case of a Bill of this complexity that sufficient time should be taken to look into it, and I suggest that the Committee stage should be taken on Tuesday the 14th instant, which will give nearly a fortnight. The noble Marquess has put rather too severe an interpretation upon the clause which deals with marriage settlements. This is not a clause for voiding a settlement of property made in consideration of marriage. It is a clause for the purpose of putting a restriction on what is a very common practice and what sometimes amounts to fraud. I refer to the case in which a man, in. consideration of marriage, covenants that a large debt is to be created out of his assets in prejudice of his creditors. There is no reason why that should be allowed. What happens is that a covenant is entered into to settle on the wife, say,£100,000 by a man who is going into trade. He then finds that his business is not flourishing, and he proceeds, as his bankruptcy approaches, to strip his estate by placing property out of the reach of creditors. What the Bill proposes is to leave the covenant standing, but that it shall not be operative to enable the trustees claiming under the covenant to claim in competition with the ordinary creditors. The covenant is binding, but the trustees cannot claim in competition with ordinary creditors. That is a reasonable thing to do, and certainly this is a case where a remedy 914 is wanted. Where property is conveyed in consideration of marriage, that case is expressly saved and is not touched. As regards the question of gambling, it is extremely difficult to lay down an abstract line between what ought to be prohibited and what ought not, but your Lordships will notice that no prosecution is to be instituted under this clause except by order of the Court which has the whole of the situation before it.
§ THE MARQUESS OF SALISBURYWill that be a Summary Court?
§ VISCOUNT HALDANENo, the Bankruptcy Court which has investigated the circumstances. One sees almost every week in the newspapers bankruptcies where the liabilities are a tremendous amount and the assets nil. The clause provides that in determining for the purposes of this section whether any speculations were rash and hazardous the Court shall take into consideration the financial position of the accused person at the time when he entered into the speculations. If the Court knows that the bankrupt has been a fool or has been misled, it will not order a prosecution. But these tremendous speculations so often result in great misery to other people that some check ought to be put upon them. As my noble and learned friend on the Woolsack has explained, we already deal with gambling for the purpose of suspending the bankrupt's discharge, and the question of what is gambling is one with which the Courts are very familiar. It is a question to which the Courts do not come without experience. There are a great many attempts at a definition, and great light has been cast upon it by the decisions of the Courts. I should say for myself that taking Clause 4 there ought to be no difficulty in deciding what is a right case and what is a wrong case for prosecution. But that, like the other matters referred to, will be open for consideration in Committee. I have only risen to assure the noble Marquess opposite that the complication of the matter has not escaped the attention of the very experienced persons who prepared this Bill.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House on Tuesday the 14th instant.