Chairman

ing of creditors, and is entitled to vote thereat. (1st Sch. r. 13.)

(32.) What are the powers of the chairman of a of meeting, meeting as to admitting and rejecting proofs ?

power of.

Proxies.

General rules relating to proxies.

The chairman of a meeting has power to admit or reject a proof for the purpose of voting, . but his decision is subject to appeal to the Court. If he is in doubt whether a proof should be admitted or rejected, he should mark the proof as objected to, and should allow the creditor to vote, subject to the vote being declared invalid in the event of the objection being sustained. (1st Sch. r. 14.)

(33.) How many kinds of proxies are there, and distinguish them ?

Two general and special. A general proxy is one given by a creditor to his manager or clerk, or any other person in his regular employment. A special proxy is one given by a creditor to any person to vote at any specified meeting or adjournment thereof, for or against any specific resolution, or for or against any specified person as trustee, or member of a committee of inspection. (1st Sch. rr. 17, 18.) (34.) Give some general rules relating to proxies?

Every instrument of proxy must be in the prescribed form, and be issued by the official receiver, or, after the appointment of a trustee, by the trustee; and every insertion therein must be in the handwriting of the person giving the proxy. A proxy is not to be used unless it

is deposited with the official receiver or trustee before the meeting at which it is to be used.

A creditor may appoint the official receiver of the bankrupt's estate to act as his general or special proxy.

The instrument appointing a general proxy must state the relation in which the person to act thereunder stands to the creditor. (1st Sch. rr. 16, 19, 21, 17.)

(35.) What provision does the Bankruptcy Act Abuse of contain for preventing the abuse of the proxy proxy system?

Where it appears to the satisfaction of the Court that any solicitation has been used by or on behalf of a trustee or receiver in obtaining proxies, or in procuring the trusteeship or receivership, except by the direction of a meeting of creditors, the Court has power, if it think fit, to order that no remuneration shall be allowed to the person by whom or on whose behalf such solicitation may have been exercised, notwithstanding any resolution of the Committee of Inspection or of the creditors to the contrary. And no person acting either under a general or a special proxy, is to vote in favour of any resolution which would directly or indirectly place himself, his partner or employer, in a position to receive any remuneration out of the estate of the debtor, otherwise than as a creditor rateably with the other creditors of the debtor. But a person holding special proxies to vote for the appointment of himself as trustee may do so. (1st Sch. rr. 20, 26.) (36.) What is a quorum for a meeting of creditors? A meeting is not competent to act for any purpose, except the election of a chairman, the proving of debts, and the adjournment of the meeting, unless there are present or represented thereat, at least three creditors, or all the creditors, if their number does not exceed three. (1st Sch. r. 23.)

system.

Quorum for creditors. meeting of

If quorum not

present.

Power or adjourn

ment.

Record of proceedings at meetings.

Public examina

tion of

debtor.

(37.) What is the result if a quorum is not present at a meeting?

If within half an hour from the time appointed for the meeting, a quorum of creditors is not present or represented, the meeting is to be adjourned to the same day in the following week at the same time and place, or to such other day as the chairman may appoint, not being less than seven or more than twenty-one days. (1st Sch. r. 24.)

(38.) Is there any general power of adjourning a meeting?

Yes, the chairman of a meeting may, with the consent of the meeting, adjourn the meeting from time to time, and from place to place. (1st Sch. r. 21.)

(39.) How is a record of the proceedings at meetings kept?

The chairman of every meeting is to cause minutes of the proceedings at the meeting to be drawn up, and fairly entered in a book kept for that purpose, and the minutes are to be signed by him or by the chairman of the next ensuing meeting. (1st Sch. r. 25.)

Public Examination of Debtor.

(40.) What provision is made by the Bankruptcy Act, 1883, for the public examination of the debtor?

Where the Court makes a receiving order, it is to hold a public sitting as soon as conveniently may be after the expiration of the time for the submission of the debtors' statement of affairs, on a day to be appointed by the Court, for the examination of the debtor, and the debtor is to attend thereat and be examined

as to his conduct, dealings, and property. Any
creditor who has tendered a proof, or his re-
presentative authorised in writing, may question
the debtor concerning his affairs and the causes
of his failure. The official receiver is to take
part in the examination; and for the purposes
thereof, if specially authorised by the Board of
Trade, may employ a solicitor with or without
counsel. The debtor is to be examined upon
oath, and to answer all questions the Court may
put or allow to be put to him. Such notes of the
examination as the Court thinks proper are to
be taken down in writing, and signed by the
debtor, and may thereafter be used in evidence
against him. They are also to be open to the
inspection of any creditor at all reasonable
times. If a trustee is appointed before the
conclusion of the examination, he may take
part therein. When the Court is of opinion

that the affairs of the debtor have been suffi-
ciently investigated, it is, by order, to declare
that his examination is concluded: but such
order is not to be made until after the day
appointed for the first meeting of creditors
(s. 17).

Composition or Scheme of Arrangement.
(41.) In what manner may a composition or
scheme of arrangement be effected in lieu
bankruptcy?

of

The creditors may at the first meeting or any adjournment thereof, by special resolution, resolve to entertain a proposal for a composition in satisfaction of the debts due to them from the debtor, or a proposal for a scheme of arrangement of the debtor's affairs; and on the composition or

scheme being accepted by a resolution passed by a majority in number representing three-fourths in value of all the creditors of the bankrupt who have proved at a subsequent meeting, and approved by the Court, it will be binding on all the creditors, so far as relates to any debts due to them from the debtor, and provable in bankruptcy; but it will not be binding on any creditor as far as regards a debt or liability, from which, under the provisions of the Act, the debtor would not be discharged by an order of discharge in bankruptcy, unless the creditor assents to the composition or scheme, nor will it release any person who, under the Act, would not be released by an order of discharge of the debtor had he been adjudged bankrupt (ss. 18, 19).

Meeting for (42.) How and by whom is a meeting for the acceptance acceptance of a composition or scheme called? of composition.

The creditors having at the first meeting resolved to entertain a proposal for a composition or scheme, a subsequent meeting to accept such composition or scheme is to be summoned by the official receiver by not less than seven days' notice, but is not to be held until after the public examination of the debtor is concluded. (a) The notice must state generally the terms of the proposal, and be accompanied by a report of the official receiver thereon. Any creditor who has proved his debt may assent or dissent from such composition or scheme by a letter addressed to the official receiver in the prescribed form, and

(a) For the purpose of approving a composition or scheme by joint debtors, the Court may, however, if it thinks fit, and on the report of the official receiver, that it is expedient so to do, dispense with the public examination of one of such joint debtors, if he is unavoidably prevented from attending the examination by illness or absence abroad (s. 105).