s. 17. Public ex debtor. Public Examination of Debtor. 17.-(1.) Where the Court makes a receiving order amination of it shall hold a public sitting, on a day to be appointed by the Court, for the examination of the debtor, and the debtor shall attend thereat, and shall be examined as to his conduct, dealings, and property. The day is to be appointed at the time of making the receiving order (r. 150, (2)), and when fixed must be advertised by the official receiver (s. 70 (1) (ƒ)). If there is probable reason for believing that the debtor is about to abscond with a view of avoiding the examination, or if without good cause shown he fails to attend the examination, he may be arrested (s. 25 (1)(a) and (d)). (2.) The examination shall be held as soon as conveniently may be after the expiration of the time for the submission of the debtor's statement of affairs.1 1i.e., after three days from the date of the receiving order when made in the debtor's petition, and after seven days when made on creditor's petition, or such extended period as the Court may direct (s. 16 (2)). (3.) The Court may adjourn the examination from time to time. (4.) Any creditor who has tendered a proof, or his representative, authorised in writing, may question the debtor concerning his affairs and the causes of his failure. (5.) The official receiver shall take part in the examination of the debtor; and for the purpose thereof, if specially authorised by the Board of Trade, may employ a solicitor with or without counsel. (6.) If a trustee is appointed before the conclusion of the examination he may take part therein. (7.) The Court may put such questions to the debtor as it may think expedient. (8.) The debtor shall be examined upon oath, and it shall be his duty to answer all such questions as the Court may put or allow to be put to him.2 Such notes of the examination as the Court thinks proper shall be taken down in writing, and shall be read over to and signed by the debtor,3 and may thereafter be used in ss. 17, 18. evidence against him; they shall also be open to the in spection of any creditor at all reasonable times. 1 A debtor cannot refuse to answer a question relating to his property on the ground that it may tend to criminate him (Ex pte Schofield, In re Firth, 6 Ch. D., 230). i.e., during the public examination in Court. These words would not, it is submitted, empower the Court to order written requisitions to be delivered to the debtor to be answered by him in writing out of Court (Ex pte Crump, In re Hendrey, 1 Ch. D., 530). 3 Form No. 36 in the Appendix. (9.) When the Court is of opinion that the affairs of the debtor have been sufficiently investigated, it shall, by order, declare that his examination is concluded, but such order shall not be made until after the day appointed for the first meeting of creditors.2 1 Such order should be made absolute in the first instance, when all the conditions prescribed by the Act have been complied with, and should not be conditional on the debtor's subsequently complying therewith (Ex pte Smith, In re Angerstein, L. R. 7, Ch. 662). 'The debtor being bound to attend the first meeting of creditors and to submit to an examination by them (s. 24 (1)), information might be then obtained, upon which it might be expedient to examine him in court, which could not be done if his public examination had been previously closed. Form No. 37 in the Appendix. Composition or Scheme of Arrangement. creditors to accept and 18. (1.) The creditors may at the first meeting1 or any Power for adjournment thereof, by special resolution, resolve to entertain a proposal for a composition in satisfaction of Court to apthe debts due to them from the debtor, or a proposal for position or a scheme of arrangement of the debtor's affairs. 1 To be held not later than fourteen days after the date of the receiving order unless the Court otherwise order (Sch. I., s. 1). The terms of the composition or scheme must be settled at the first meeting or some adjournment thereof (r. 159). (2.) The composition or scheme shall not be binding on the creditors unless it is confirmed by a resolution passed (by a majority in number representing three fourths in value of all the creditors who have proved) at prove com arrangement. s. 18. a subsequent meeting1 of the creditors, and is approved by the Court. Any creditor who has proved his debt may assent to or dissent from such composition or scheme by a letter addressed to the official receiver in the prescribed form,2 and attested by a witness, so as to be received by such official receiver not later than the day preceding such subsequent meeting, and such creditor shall be taken as being present and voting at such meeting. 1 Such subsequent meeting is to be held only for the purpose of confirming or rejecting the composition or scheme, but if rejected the meeting may proceed to appoint a trustee (r. 159). 2 r. 183 (1), and Form No. 56 in the Appendix. (3.) The subsequent meeting shall be summoned by the official receiver by not less than seven days notice, and shall not be held until after the public examination of the debtor is concluded. The notice shall state generally the terms of the proposal, and shall be accompanied by a report of the official receiver thereon. 1 Such meeting should however be held within fourteen days from the conclusion of the debtor's public examination, or such further time as the Court may allow, otherwise the debtor may be adjudged bankrupt (s. 20 (1)). For the purpose of approving a composition or scheme by joint debtors the Court may, under certain circumstances, dispense with the public examination of one of such debtors (s. 105 (6) ). (4.) The debtor or the official receiver may, after the composition or scheme is accepted by the creditors, apply to the Court to approve it, and notice of the time appointed for hearing the application shall be given to each creditor who has proved. 1 Or "sanction" it, the latter being the term employed in the Rules (r r. 160-164). 2 Seven days notice (r. 160). If the official receiver does not make the application, a similar notice must be given to him (r. 160). (5.) The Court shall, before approving a composition or scheme, hear a report of the official receiver as to the terms of the composition or scheme and as to the conduct of the debtor, and any objections which may be made by or on behalf of any creditor. The Court shall, in addition, require proof that the provisions of sub-ss. (1) (2) and (3) have been complied with (r. 161). At the time of sanctioning a composition or scheme the Court may correct or supply any accidental or formal error or omission, but no alteration in the substance of it can be then made (r. 162). When the composition or scheme is sanctioned, the official receiver shall forthwith put the debtor or, as the case may be, the trustee under the composition or scheme, into possession of the debtor's property, and the receiving order shall be rescinded by the Court (r. 163). (6.) If the Court is of opinion that the terms of the composition or scheme are not reasonable, or are not calculated to benefit the general body of creditors, or in any case in which the Court is required under this Act where the debtor is adjudged bankrupt to refuse his discharge, the Court shall, or if any such facts are proved as would under this Act justify the Court in refusing, qualifying, or suspending the debtor's discharge, the Court may, in its discretion, refuse to approve the composition or scheme. 1i.e. where the debtor has committed any misdemeanour under this Act or Part II. of The Debtors Act, 1869, or any amendment thereof, (s. 28 (2)). 2i.e. where the debtor has committed any of the offences specified in s. 28 (3), and s. 29. The Court is also bound to refuse to approve the composition or scheme if it does not provide for the payment in full of debts entitled to priority (sub-s. 14, infrà). I (7.) If the Court approves the composition or scheme, the approval may be testified by the seal of the Court being attached to the instrument containing the terms of the composition or scheme, or by the terms being embodied in an order2 of the Court. 1 Every Court exercising jurisdiction in bankruptcy is to have a seal, of which judicial notice is to be taken (s. 137). 2 Form No. 47 in the Appendix. (8.) A composition or scheme accepted and approved in pursuance of this section shall be binding on all the creditors so far as relates to any debts due to them from the debtor and provable in bankruptcy. By section 126 of the Bankruptcy Act, 1869, it was enacted: " a composition. . . shall be binding on all the creditors whose names and addresses and the amount of the debts due to whom are shown in the s. 18. s. 18. statement of the debtor A promise by a debtor to pay a debt from which he is released is a nudum pactum (Heather v. Webb, 2 C. P. D., 1); but if there is a new consideration to support the promise made, after the composition is at an end, an action would seemingly lie against him (Jakeman v. Cooke, 4 Ex. D., 26); where, however, the promise is made, while the composition proceedings are still pending, to a particular creditor, it is inconsistent with good faith to the other creditors, and on that ground alone the Court might refuse to uphold it (Ex pte Barrow, In re Andrews, i8 Ch. D., 464). (9.) A certificate of the official receiver that a composition or scheme has been duly accepted and approved shall, in the absence of fraud, be conclusive as to its validity. If, therefore, in an action by a creditor, the debtor were to plead the official receiver's certificate of a composition having been accepted and approved by the Court, the creditor might reply by alleging that the composition was obtained by fraud (Eyre v. Smith, 2 C. P. D., 435). (10.) The provisions of a composition or scheme under this section may be enforced by the Court on application by any person interested, and any disobedience of an order of the Court made on the application shall be deemed a contempt of Court. If the terms of a composition are not carried out by the debtor, the creditor's proper remedy would be to apply to the Court of Bankruptcy under this or the next sub-section instead of bringing an action for his original debt, as he would have done under the Act of 1869 (see Ex pte Lopez, In re Lopez, 5 Ch. D., 65; Ex pte King, In re Harper, L. R. 17, Eq. 332, at p. 339). No action will lie for default in making any payment due under a composition or scheme, the Court of Bankruptcy alone being able to enforce such payment (r. 164). Where the claim of a creditor under a composition or scheme in respect of a proof lodged by him is disputed, the Court may direct security to be given until the claim is determined (r. 167). (11.) If default is made in payment of any instalment due in pursuance of the composition or scheme, or if it appears to the Court, on satisfactory evidence, that the composition or scheme cannot in consequence of legal |