Another rule is, that a secured creditor who is also a joint §§ 59, 60. and separate creditor, may split his demand, that is to say, By a secured following the rule as to election but saving his rights, he may creditor. either : (1) Prove for his whole debt against the estate to which the security does not belong and retain and make what he can of his security (r); or, (2) He may give up his security, prove for the whole debt due on it, against the estate to which the security belongs, and then prove for the residue of his debt against the other estate, thus, in fact, splitting his demand and proving for part against the joint estate, and for tho residue against the separate estates of the partners, or vice versâ (s). An individual petitioner, it has been held, who is also a partner must, in his statement of affairs, set forth his own and also the partnership debts and liabilities, and also a list of debtors, otherwise he must submit to bankruptcy (t). distance, &c. s. 42. 60. In the calculation and distribution of a dividend Provision for creditors the trustee shall make provision for debts provable in residing at a bankruptcy appearing from the bankrupt's statements, Bankruptcy or otherwise, to be due to persons resident in places so Act, 1869, distant from the place where the trustee is acting that in the ordinary course of communication they have not had sufficient time to tender their proofs, or to establish them if disputed, and also for debts provable in bankruptcy, the subject of claims not yet determined. He shall also make provision for any disputed proofs or claims, and for the expenses necessary for the administration of the estate or otherwise, and, subject to the foregoing provisions, he shall distribute as dividend all money in hand. The reservation is now to be not only in respect of nonresident creditors and also for debts provable the subject of claims (r) Lindley, p. 1214, and cases cited. (s) Ib., and see Ex parte Ladbroke, 2 Gl. & J. 81; Ex parte Hill, 3 M. & Ayr. 175; and 2 Deac. 249. (t) Ex parte Amor re Amor, 21 Ch. D. 594; and see refusal to register resolutions for same reason, Ex parte Buckley, 16 Ch. D. 513. §§ 60, 61. not determined, as was the case under Sect. 42 of the 1869 Act, but under this section the last clause entitles a creditor whose proof or claim is disputed to have a reservation made also in his favour, but the words do not seem to carry the provisions any further than did the provision in the last Act. The claim of a secured creditor, for instance, who has not had sufficient opportunity of valuing or realising his security, may be said to come within this new provision, and see Sched. 2. Right of has not proved Bankruptcy As to money paid into the Bank of England and local banks (see Sect. 74). As to payment over to the Treasury by the Board of Trade of such cash balance as is in excess of the amounts required to answer the demands in respect of bankrupt's estates (see Sect. 76, Sub-s. 1), and as to payment back by Treasury for such purposes (see Sub-s. 2). 61. Any creditor who has not proved his debt before the declaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in the hands of the trustee any dividend or dividends he may have failed to receive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend declared before his debt was proved by reason that he has not participated therein. This is a re-enactment of Sect. 43 of the 1869 Act. It was however held (u) that Rule 136 of the Act of 1869 applied only to the case of a secured creditor who desired to value instead of realise his security; and even then only gave the trustee a power to compel indirectly such realisation by refusing to admit the creditor's proof till he realised; but that until he either valued or realised his security he had no debt provable in respect of which the trustee was bound to make a reserve. Formerly it seems that a creditor could disturb a dividend at any time before payment, and a creditor could enter a claim, and then, if a dividend was declared, a reserve was made (u) Ex parte Good re Lee, supra. re Lee. for him, but neither under the 1869 Act, nor under this Act, §§ 61, 62. is there any provision for entering a "claim." So it was held in the case of Ex parte Good re Lee cited above, that Ex parte Good the liability of the trustee, who had notice of the particular security, was not a personal liability. In that case the ratio decidendi was based upon the language of Sect. 42, in which it was said the words "the subject of claims not yet determined" could not enlarge the other words preceding "debts provable in bankruptcy." And Brett, L.J., said that, suppos-ing the creditor had sent in all requisite particulars, including the description and value of the security or sum at which it was realised, and if the trustee was advised or was inclined to dispute them, then he might declare a dividend, "but if, after a claim has been made upon him in that form (ie., with every particular required by the Act and Rules), he does declare a dividend, he is bound to make a sufficient reserve in respect of the claim, and if he does not he will have failed of his duty." As observed already, it seems doubtful whether the additional words in Sect. 60 as to making a reserve for disputed debts, &c., will render this case inapplicable. However, the rules in Sched. 2 as to proof by secured creditors are now more specific, and the creditor must either surrender his security and prove for the debt, or realise his security and prove for the balance (x). Act, 1869, 62. When the trustee has realised all the property of Final dividend. the bankrupt, or so much thereof as can, in the joint Bankruptcy opinion of himself and of the committee of inspection, be s. 44. realised without needlessly protracting the trusteeship, he shall declare a final dividend, but before so doing he shall give notice in manner prescribed to the persons whose claims to be creditors have been notified to him, but not established to his satisfaction, that if they do not establish their claims to the satisfaction of the Court within a time limited by the notice, he will proceed to make a final dividend, without regard to their claims. After the expiration of the time so limited, or, if the Court on (x) And see Sched. 2 as to securities. 88 62, 63. application by any such claimant grant him further time Notice to claimants. No action for dividend. Bankruptcy Act, 1869, s. 46. Remedy of creditor. for establishing his claim, then on the expiration of such further time, the property of the bankrupt shall be divided among the creditors who have proved their debts, without regard to the claims of any other persons. Provision is made for express notice to be given to persons "whose claims to be creditors have been notified to him but not established to his satisfaction," requiring them to establish such claims. It will then be necessary for the trustee to make a reserve in respect of all such claims as have been notified to him within the meaning of the concluding words of Sect. 60, notwithstanding such "claims are not proved, or are incapable at the time when made of proof, either from their nature, or on account of his objection to them as not being debts provable in the bankruptcy. And see Sect. 37 as to debts provable in bankruptcy, and contingent and unliquidated demands. The words "joint opinion of himself and the Committee of Inspection" were inserted subsequently to the introduction of the bill. See Sect. 89 as to the opinion of the general creditors overriding the opinion of the committee as to the administration and distribution of the property of the bankrupt. 63. No action for a dividend shall lie against the trustee, but if the trustee refuses to pay any dividend the Court may, if it thinks fit, order him to pay it, and also to pay out of his own money interest thereon for the time that it is withheld, and the costs of the application. The proper course to be pursued by a creditor where improperly excluded from dividend, or where there is no reserve made, is to apply to the Court under its general powers to adjudicate upon the matter and to compel the trustee to make good the loss resulting from his laches (Sect. 102) (y). This section applies to such a dividend the retention of which (but for the provision itself) would have rendered the trustee (y) Ex parte Good re Lee, supra. liable to the creditor so as to be sued for money had and received §§ 63, 64, to and for his, the creditor's, use. A creditor has now the right, under Sect. 91, to complain to the Board of Trade, and the Board may inquire of and examine the trustee. 65. a bankrupt to 64. (1.) The trustee, with the permission of the com- Power to allow mittee of inspection, may appoint the bankrupt himself to manage prosuperintend the management of the property of the bank-perty. rupt or of any part thereof, or to carry on the trade (if any) Act, 1869, Bankrutpcy of the bankrupt for the benefit of his creditors, and in any other respect to aid in administering the property in such manner and on such terms as the trustee may direct. s. 26. (2.) The trustee may from time to time, with the per- Allowance to mission of the committee of inspection, make such allow-maintenance bankrupt for ance as he may think just to the bankrupt out of his or service. Bankruptcy property for the support of the bankrupt and his family, Act, 1869, or in consideration of his services if he is engaged in §. 38. winding up his estate, but any such allowance may be reduced by the Court. As to power of trustee to carry on business, see Sect. 57. Under Sect. 26 of the 1869 Act, the trustee had a discretion in the matter, but Sect. 38 required the resolution of the creditors, passed at a general meeting during the continuance of the bankruptcy, to enable him to make an allowance to the bankrupt. trustee. Where the bankrupt has been authorised to carry on the Liability of business as the agent of the trustees for the benefit of creditors, they will be liable to an action for the price of goods ordered by him which are used in the business, although ordered in the bankrupt's own name (z). surplus. 65. The bankrupt shall be entitled to any surplus Right of remaining after payment in full of his creditors, with in- bankrupt to terest, as by this Act provided, and of the costs, charges, Bankruptcy and expenses of the proceedings under the bankruptcy A petition. (z) Kinder v. Howarth, 2 Stark. N. P. C. 354. Act, 1869, |