(Schedule II., Rule 7). A partially secured creditor may amend his proof for the unsecured portion of his debt (Schedule II., Rules 14, 15).

The voting rights of bill holders are limited (Schedule I. Rules 11, 12).

Proxies are to be on an official form, and must be filled up in the handwriting of the person giving the proxy. A creditor may only give a general proxy to a person in his regular employment, or holding a general power of attorney from him, or to the official receiver. All proxies must be deposited with the official receiver or trustee before the meeting at which they are to be used (Schedule I., Rules 15-21).

nation of
debtor.

Every debtor against whom a receiving order is Public examimade is to be publicly examined in Court as to his conduct, dealings, and property; the official receiver is to take part in the examination; the creditors, and the trustee, if appointed, may also put questions, and the debtor is to be bound to answer all questions which may be properly put to him (s. 17).

scheme of

At the first meeting the creditors may resolve by Composition or special resolution to entertain a proposal for a composi- arrangement. tion or scheme of arrangement.

For the acceptance of a composition or arrangement there must be a subsequent confirming resolution by a majority in numbers representing three-fourths in value of all the creditors, which must not be passed until the debtor's public examination is concluded, nor until there has been circulated among the creditors a notice stating the terms of the proposal and a report of the official receiver thereon (s. 18 (1–3)).

When a composition or scheme of arrangement has been accepted the Court may approve it after hearing a report of the official receiver, but shall withhold its

Adjudication of
Bankruptcy.

Appointment of
Trustee.

approval if the proposal does not appear to be reasonable or calculated to benefit the general body of creditors, or if the debtor has committed any misdemeanor under the Bankruptcy Law, or under Part II. of the Debtors' Act, 1869. It is also within the discretion of the Court to withhold its approval if the debtor has been guilty of any such misconduct as would justify the Court in withholding, suspending, or qualifying his discharge (s. 18 (5, 6)).

Any trustee appointed under a composition or scheme is to be subject to all the regulations applicable to a trustee in bankruptcy, and the provisions of Part III. of the Bill with reference to administration of property are to apply to a composition or scheme as far as possible (s. 18 (12, 13)).

If a composition or scheme is not accepted and approved, or if the creditors pass a resolution that the debtor be adjudged bankrupt, or pass no resolution, the Court will adjudge the debtor bankrupt, and the property of the bankrupt then becomes divisible amongst his creditors and vests in a trustee (s. 20).

Where a debtor is adjudged bankrupt, or the creditors have resolved in favour of adjudication, they may appoint a trustee (s. 21 (1)). The trustee must give security to the satisfaction of the Board of Trade, and the Board may, subject to an appeal to the High Court, object to his appointment on the ground that it has not been made in good faith by a majority in value of the creditors, or that he is unfit to act, or that he is not likely to act in the interests of the creditors generally. The certificate of appointment is to be given by the Board of Trade (s. 21 (2) (3)).

If the creditors fail to appoint a trustee within four weeks from the date of the adjudication, or within a

longer period if negotiations for composition or arrangement are pending, the Board of Trade may appoint some fit person to be the trustee, subject to the right of the creditors to appoint a trustee at any subsequent time (s. 21 (6, 7)).

During any vacancy the official receiver acts as trustee (s. 70 (1 g.)).

On the appointment of a trustee the duties of the official receiver connected with the management of the property cease, or are suspended, but he continues to watch the case, and to act, if necessary, in the interests of justice (see s. 68 70, 82 (4), &c.).

Inspection.

A committee of inspection may be nominated by the Committee of creditors qualified to vote at their first or any subsequent meeting, and must consist of creditors qualified to vote, or the holders of general proxies or general powers of attorney from such creditors. There are to be not more than five nor less than three members (clause 22 (1)). If a committee is not appointed, the Board of Trade will direct the trustee in the matters in which he is required to have the permission of the committee of inspection (s. 22 (9)).

Scheme after

The creditors may at any time after adjudication Composition or resolve by special resolution to entertain a composition Adjudication.. or scheme, whereupon the same proceedings ensue as in case of composition or scheme before adjudication. If default is made in carrying out the composition the bankruptcy may be revived (s. 23).

Bankrupt.

At any time after being adjudged bankrupt the Discharge of bankrupt may apply to the Court for an order of discharge, but the application is not to be heard until the public examination of the bankrupt is concluded. Notice of the day fixed for the hearing is to be published and sent to the creditors. On the hearing of the

Civil

Disabilities of
Bankrupt.

application the Court is to take into consideration the report of the official receiver as to the bankrupt's conduct and affairs, and may either grant the order unconditionally, or, on proof of certain acts of misconduct by the bankrupt, refuse or suspend it, or qualify it by conditions as to after-acquired property, but the Court is directed to refuse discharge if the debtor has committed any misconduct under the Bankruptcy Law, or under Part II. of the Debtors' Act, 1869 (Clause 28). These proposals are substantially identical with those contained in the Bill of the late AttorneyGeneral (Sir John Holker).

The provisions of the existing Act (s. 54) under which an undischarged bankrupt is protected for three years from the close of his bankruptcy are not reproduced, and provision is made for enabling the Court to make an order under which a bankrupt's after-acquired property may be recovered and applied for the benefit of his creditors (s. 28 (6)). An undischarged bankrupt who obtains credit from any person to the extent of £20 or upwards, without informing such person of his status, is to be held guilty of a misdemeanour (s. 31).

The position of a bankrupt peer is assimilated to that of a member of the House of Commons, by making mere discharge insufficient to rehabilitate him (s. 32).

Adjudication is also made a disqualification for election to the House of Commons, and not only for holding, but for appointment or election to the offices. of justice of the peace, mayor, alderman, councillor, guardian of the poor, overseer of the poor, member of sanitary authority, school board, highway board, burial board, or select vestry. In all cases disqualification continues until it is removed by the annulment of the bankruptcy, or by the discharge of the bankrupt with a

- certificate that the bankruptcy was caused exclusively

by misfortune (s. 32).

Fraudulent

The Court may commit a bankrupt or any other Punishment of person for trial when it has reason to believe that he Debtors. has been guilty of a misdemeanour under the Bankruptcy Acts, and the Public Prosecutor is to carry on the prosecution (ss. 165, 166).

Discharge or composition is to be no defence against a criminal prosecution (s. 167).

An undischarged bankrupt who obtains credit to the extent of £20 without informing the person from whom he gets credit that he is a bankrupt, will be guilty of a misdemeanour.

Bankruptcy.

The Court may annul a bankruptcy on approval of a Annulling of composition or scheme, or where it is of opinion that the debtor ought not to have been adjudged bankrupt, or on proof that the debts of the bankrupt are paid in full (ss. 23, 35).

The first dividend must, except under special circum- Distribution of stances, be declared and distributed within four months Property. from the conclusion of the first meeting of creditors,

and subsequent dividends at intervals of not more than six months (s. 58).

Before declaration of the final dividend, notice is to be given to persons claiming to be creditors, but who had hitherto failed to establish their claims (s. 62).

Staff.

The committee, instead of the general creditors, are to authorise any allowance to the bankrupt (s. 64 (2)). The Board of Trade are to appoint such persons as Administrative they think fit to be official receivers of debtors' estates. These receivers are to be attached to each Court of Bankruptcy, and will act under the general authority of the Board of Trade, but will also be officers of the Court (s. 66).

Their functions include some acts which are done by

b