§ 19.

guilty of a contempt of Court, and may be punished accordingly.

A bankrupt who had not obtained an order of discharge received 2001. as compensation for the loss of a situation. Out of this sum he paid 1307. to his landlord as six months'

rent in advance.

Held (affirming a decision of the Chief Judge in Bankruptcy, who had reversed an order of the County Court Judge), that the landlord could not be ordered to refund what he had thus received. Lord Justice James said: "This uncertificated bankrupt, like many others before him, had had dealings with the world, and this was the first time it had ever been suggested that money paid away by an uncertificated bankrupt could be followed in the hands of the payee. If the trustee had gone to the person by whom this money was payable to the bankrupt, and had given him notice not to part with it, he might have intercepted it before it got into the bankrupt's hands. But where the bankrupt had once received the money and had paid it away in the ordinary course of business, it would be a source of enormous inconvenience if the trustee were then able to lay hold of it in the hands of the payee. If an order to refund could be made in the present case, his lordship did not see where the jurisdiction was to stop. You might compel a butcher or a baker to refund money which had been paid to them by an undischarged bankrupt. This application was a mere experiment, and the appeal must be dismissed with costs." (Law Rep. 7 Ch. app. 185.)

A motion to set aside portion of the pension under s. 89 must not be made at the meeting for public examination, but on a substantive motion, on notice to all parties. (Per Chief Judge, Re Heathcote, MS. note, 27th June, 1870.)

As to the examination of the bankrupt's statement of affairs, &c., the rule laid down by the Chief Judge is, that the trustee, in the first instance, should examine the bankrupt, and then, if the information should not be forthcoming or be insufficient, the trustee may apply for a private meeting, for the examination of the bankrupt and other necessary parties, under s. 96. In re W. Bennett, his lordship said: "It is not for the trustee to wait until the sitting for public examination, and then say that he is not satisfied with the bankrupt's state

ments. It is his duty to send for the bankrupt, and require §§ 19, 20. his verbal explanation as to the position of his affairs, and if that be not satisfactory, to tender him requisitions which the bankrupt is bound to answer. If the bankrupt fails to comply with the requirements of the trustee, he renders himself liable to punishment." See also, Re Lawrence, 22 L. T. R. N. S. 246. No order has been made to commit for not filing the statement of accounts at first meeting or further accounts ordered by the Court to be filed. The practice is to direct the accounts to be filed by a particular day, and then, in default, the committal has been made for disobeying the order so made. (Re Rinnell, 6th May, 1872.)

The order that a bankrupt pass his public examination should be a simple order, and ought to appear so on the file of the Court as a simple order, made when all the conditions precedent prescribed by the Act and by the rules have been complied with. The Court has no power to make an order that a bankrupt do pass his public examination conditional on his doing certain acts. The examination ought to be adjourned until he has done these acts, inter alia, the swearing the affidavit according to form No. 45. (Per the Lords Justices, Ex p. Smith, in re Angerstein, 7 L. R. Ch. 662.)

In re Till, there had been several adjournments to amend accounts, and requisitions for that purpose had been furnished by the trustee, which requisitions had been answered by the bankrupt in a manner which the registrar considered satisfactory. Notwithstanding this, at the adjourned public examination the trustee applied for a further adjournment, to amend the accounts, which application was refused by the registrar, who thereupon allowed the bankrupt to pass his public examination. From this order the trustee appealed. Lord Justice James: "This is one of that class of cases which ought to be discouraged. The registrar had the whole matter before him and exercised his discretion, and his decision ought to have been acquiesced in. It is clear that this is merely an appeal for the purpose of costs, and I am of opinion that it must be dismissed, with costs, the trustee to have no costs out of the estate." (4th July, 1872; MS. note.)

20. The trustee shall, in the administration of the property of the bankrupt and in the distribution thereof

Conduct of trustee, and

appeal to

§ 20.

Court against trustee.

amongst his creditors, have regard to any directions that may be given by resolution of the creditors at any general meeting, or by the committee of inspection, and any directions so given by the creditors at any general meeting shall be deemed to override any directions given by the committee of inspection; the trustee shall call a meeting of the committee of inspection once at least every three months, when they shall audit his accounts, and determine whether any or what dividend is to be paid; he may also call special meetings of the said committee as he thinks necessary.

Subject to the provisions of this Act, and to such directions as aforesaid, the trustee shall exercise his own discretion in the management of the estate, and its distribution amongst the creditors. The trustee may from time to time summon general meetings of the creditors for the purpose of ascertaining their wishes; he may also apply to the Court, in manner prescribed, for directions in relation to any particular matter arising under the bankruptcy.

The bankrupt, or any creditor, debtor, or other person aggrieved by any act of the trustee, may apply to the Court, and the Court may confirm, reverse, or modify the act complained of, and make such order in the premises as it thinks fit. The Court may from time to time, during the continuance of a bankruptcy, summon general meetings of the creditors for the purpose of ascertaining their wishes, and may, if the Court thinks fit, direct the registrar to preside at such meetings.

The trustee shall, in relation to and for the purpose of acquiring or retaining possession of the property of the bankrupt, be in the same position in all respects as if he were a receiver of such property appointed by the Court of Chancery, and the Court may, on his application,

enforce such acquisition or retention of property accordingly. (See G. R. 1871, 14, 15.)

Where the trustee applies to the Court for directions, he is required, by rule 112, to file his application according to form 53. Any person aggrieved by any act of the trustee also files an application, supported by affidavit-(see Ex parte Crossley, re Taylor, referred to in note to s. 96); and as to duties of trustee generally, see note to s. 83.

The trustee, in all matters which may involve the estate in expense, should previously obtain the direction of the committee of inspection, a copy of which, in writing and authenticated, should be filed with the proceedings. The neglect of this preliminary has largely tended to increase costs, and in some cases, where the trustee has acted solely upon his own responsibility, the Court has allowed no costs out of the estate.

In relation to official liquidators, L. J. James said: "An official liquidator stands in the position of a manager or receiver in a partnership suit, and it is his duty to hold an impartial hand between all persons whose interests are involved in the winding up, and to afford every facility to any such person for finding out what documents in his possession are relevant to such person's case; in fact, as an impartial officer of the Court, an official liquidator is bound to give every opportunity to all persons interested in the winding upwhether alleged contributories or creditors, for enabling them to make out their own rights, by the aid of the books and papers of the company." (Per L. J. James, Re Contract Corporation Company, Gooch's case, 52 L. T. 288.) These remarks apply equally to a trustee in bankruptcy.

In re Tibbits, where the trustees had wantonly rejected a proof, the County Court Judge admitted the same. On appeal by the trustees, the Chief Judge affirmed the order of the County Court, with costs, to be paid by the appellants personally, and not out of the estate of the bankrupt. (MS. note, 21st November, 1870.)

In the case of Sutton v. Wilders, 12 L. R. Eq. 373, a trustee was held to be liable for the loss of a trust fund, caused by his solicitor having committed a fraud, on the occasion of the investment of the fund on mortgage.

§ 20.

§§ 20, 21.

Regulations as to general

meetings of

creditors sub

meeting.

Where the assignee of a bankrupt is acting fraudulently the bankrupt should apply to the Court of Bankruptcy, either to have a new assignee appointed, or else for leave to use the name of the existing assignee in any proceedings he may be advised to take for protecting his estate. (Payne v. Dicker, before Lord Chancellor, 19 W. R. 987.)

In many cases trustees engage in litigation without consulting either the committee of inspection, where there is one, or taking the directions of the Court; so with regard to questions of account and applications for further enquiry, trustees constantly act upon their own responsibility. In re Sheffield, where the trustee opposed the bankrupt, there was no resolution or evidence to show that the committee of inspection had been consulted. The case was adjourned, these words being added in the usual memorandum of public examination, the trustee, in the meantime, to consult the committee of inspection, and take their directions as to the sufficiency of the accounts filed, and as to the necessity for further accounts. (MS. note, 16th January, 1872.)

In one case the Chief Judge remarked: "As he had been asked by the trustee, he would remit the case to the County Court; but if it should turn out that a proper value had been put upon the goods, the trustee should not have a single sixpence of costs out of the estate. He would, as far as he was able, put a stop to the pernicious system of litigation in which trustees were constantly engaging, in the expectation of getting costs out of the estate." (Re Lawrie, MS. note, 29th January, 1872.)

21. The provisions of this Act with respect to the first general meeting of creditors shall apply to any subsesequent to first quent general meeting of creditors in a bankruptcy, with this exception, that subsequent meetings of creditors may be summoned by the trustee, or by a member of the committee of inspection, and that such meetings may, unless otherwise directed by the Court in the case of meetings summoned by the Court, be presided over by any person chosen by the creditors assembled at such meeting, and that any creditor whose debt has been proved, or the value of whose debt has been ascertained