bankruptcy, for the payment of dividends, are applicable to town fiats only. By General Order, October 31, 1835, First-When a dividend has been or may be declared, the solicitor to the estate shall forthwith make out three lists of the creditors in alphabetical order, and shall state in separate columns, after the name of each creditor, the amount of his debt, and the dividend to which he is entitled, and in two of such lists, the securities exhibited at the time of proof; and shall to each name prefix a number in regular series, together with the date of the order of the dividend, and the date of his signature, according to the form in the schedule (A.), hereunto annexed (see the forms, ii. p. 113); and the solicitor shall cause one of such lists, which specifies such securities, to be filed with the proceedings, and the other of such lists, which specifies the securities, he shall deliver to the assignees chosen by the creditors, or such one or more of the assignees as the commissioners shall direct. Second-When the list is delivered by the solicitor to the creditors' assignees or assignee, such assignees or assignee shall examine such list, and, as far as it is correct, sign and return the same to the solicitor. Third-Upon the receipt of the list from the creditors' assignees, the solicitor shall deliver it to the official assignee, together with the list not specifying the securities, and the official assignee shall examine and sign the list if correct, and shall prepare books at the expense of the estate, containing as many blank drafts as may be necessary, and shall number and fill up a draft for each dividend, and insert in each draft the name of the creditor to which the number of such draft is prefixed in the list, and the dividend payable to him, and shall keep the list specifying the securities in his custody, and shall take the books containing such drafts, together with the list not specifying the securities, to the accountant in bankruptcy, who shall ascertain that the amount of such drafts does not exceed the sum standing in his name to the credit of the bankrupt's estate, and shall compare the drafts with the lists, and as far as they are correct, shall sign the drafts in the books; and he shall keep in his custody the list of creditors, and return the drafts to the official assignee, by whom they shall be countersigned, according to the form in schedule (B.) appended to these orders (see ii. p. 114); and the cashiers of the Bank shall pay such drafts out of the monies standing to the credit of the account intitled "The Bankrupt Dividend Account." Fourth-That if, after such list shall have been so deposited with the said accountant, it shall from any cause seem expedient to the commissioner that such drafts shall be altered, the said commissioner may order such alterations as to him may seem just, or may direct a new list to be made, and new drafts to be drawn, and the old drafts cancelled, and such altered or new drafts shall be filled up and signed, and paid in the manner hereinbefore directed. Fifth-When a dividend has been or may be declared under any fiat or commission, and where any part of the bankrupt's es tate shall have been paid into the Bank of England by any official assignee, any one of the commissioners of the Court of Bankruptcy may, by order under his hand, direct the sum ordered to be divided, or such parts thereof as may be required, to be carried over from the general account standing in the Bank of England in the name of the accountant in bankruptcy, and of such particular estate, to the account kept in the Bank of England, intitled "The Bankrupt Dividend Account;" and it is further ordered, that when it shall appear that any part of the money directed to be applied in payment of any dividend is not called for to make such payment, the commissioner may, by order under his hand, direct such sum to be carried back to the general account, and of the particular estate to which it belongs; and the same shall thereupon be carried back accordingly, and a certificate of such transfer shall be sent to the office of the accountant in bankruptcy. Sixth-Upon the death, sickness, or unavoidable absence of the accountant in bankruptcy, or of any official assignee, any two of the commissioners may, by order under their hands, make such order as to them may seem expedient, to carry the aforesaid orders into effect; provided that such order be confirmed by the Lord Chancellor, Lord Keeper, or Lords Commissioners for the custody of the Great Seal, or by some one judge of the Court of Review. Seventh-When a creditor, or any person duly authorized under his hand to receive his dividend, shall apply for payment, the official assignee shall require the production of such securities, if any, as the creditor exhibited at the time of his proof, and, if satisfied that the amount of the said dividend still remains due, shall fill up the date in the draft and receipt; and upon the creditor or such other person authorized as aforesaid, signing the receipt for such dividend, the official assignee shall mark the securities (if any) with the amounts of that dividend, and shall sign and deliver the draft for the same; provided that no dividend shall be paid to any creditor holding any security for his debt, until such security shall be produced, without the special directions of a commissioner in that behalf. (But as to the production of securities, see further General Order, 14th May, 1836, p. 308, post). And by General Order, 1st July, 1836, when a cheque has been signed by the accountant in bankruptcy, for the payment of a dividend to a deceased creditor of a bankrupt, the indorsement of such cheque by the executor or administrator of such creditor shall be deemed sufficient. Final Dividend.] By stat. 5 Geo. 4, c. 16, s. 109, if the bankrupt's estate shall not have been wholly divided upon the first dividend, the commissioners shall, within eighteen calendar months after the issuing of the commission, appoint a public meeting, (whereof, and of the purport whereof, they shall give twenty-one days' notice in the London Gazette), to make a second dividend of the bankrupt's estate, when all creditors who have not proved their debts may prove the same; and the commissioners at such meeting, after taking such audit as hereinbefore directed, shall order the ba lance in the hands of the assignees to be forthwith divided amongst such creditors as shall have proved their debts; and such second dividend shall be final, unless any action at law or suit in equity be depending, or any part of the estate be standing out, not sold or disposed of, or unless some other estate or effects of the bankrupt shall afterwards come to the assignees, in which case they shall, as soon as may be, convert such estate and effects into money, and within two calendar months after the same shall be so converted, divide the same in manner aforesaid. (See the form for a further Dividend, ii. p. 121; and for a final Dividend, ii. p. 123). As to the interest payable to creditors upon their debts in case there is a surplus, see 6 Geo. 4, c. 16, s. 132, post, in sect. 19. Remedy for Dividends.] By stat. 6 Geo. 4, c. 16, s. 111, no action for any dividend shall be brought against the assignees by any creditor who shall have proved under the commission; but if the assignees shall refuse to pay any such dividend, the Lord Chancellor may, on petition, order payment thereof, with interest for the time that it shall have been withheld, and the costs of the application. The interest is calculated at five per cent (y). This remedy by petition is only as between the assignees and the creditor; and therefore, if the creditor sell his right to a dividend, the purchaser cannot petition, but is left to the ordinary means of enforcing his contract (z). And the assignees may file a bill in equity against the representative of a deceased assignee for an account of dividends misapplied by (a), or that remained in the hands of the deceased assignee, unclaimed (b). This remedy by petition being substituted for the former remedy by action, the application can be resisted by the assignees on those grounds only that they might have availed themselves of as a defence to an action (c). They cannot dispute the debt; they must make that the subject of a distinct petition to be preferred by themselves; and while the proof stands upon the proceedings, it is, of course, to order the payment of the dividend, unless a cross petition impugning the proof is presented within a reasonable time (d); but, under circumstances, the court may direct the creditor's petition to stand over, that a petition by the assignees to impeach the debt may be presented (e). And on the presentation of a cross petition of the assignees, the court sometimes directs an issue to try the validity of the debt; but in such case, if the verdict is in favour of the debt, the assignees will be personally answerable for interest upon the dividends retained, and costs (f). A surviving assignee will be liable for payment of dividends, although there are no assets left for that purpose; and it is for the assignee to prove that the dividends have been paid (g); and where one of three assignees (y) Ex p. Lorley, 1 Glyn & J. 345. (2) Er p. Richards, 4 Dea. & C. 190. (a) Wackerbath v. Povel, 2Glyn & J.151. (b) Green v. Weston, 3 Myl. & C. 385; 3 Mon. & A. 414. (c) Ex p. Hodges, Buck, 524. (d) Ex p. Lees, 3 Dea. 287; 3 Mon. & A. 591. (e) Ex p. Loxley, Buck, 456: and see Ex p. Whiteside, 1 Rose, 319: Er p. Atkinson, 3 V. & B. 13: Erp. Graham, 1 Rose, 456: Er p. Alsop, 1 Mad. 603. (f) Ex p. Harrison, Mon. 250, (g) Ex p. Healey, 1 Dea. & C. 361. pays a dividend to a person not duly authorized to receive it, the other two are responsible to the creditor (h); but where it was stated on the order of dividend that the assets were received by two assignees only, and the third assignee was not included in the order to pay, such third assignee was held not liable for the dividends to the creditor (i). An order of dividend is considered as a separation of the sum to be divided from the bulk of the estate; and therefore, where a dividend was declared and advertised, it was held, that the dividend unclaimed remained in the hands of the bankers at the risk of the creditors, who neglected to apply for payment (k). So also, where, at a meeting to declare a dividend, the claim of a creditor was admitted, and a sum in the hands of the sole assignee was appropriated to the payment of a dividend upon the claim when substantiated, but before the claim was perfected into a proof, the assignee misappropriated the money and became bankrupt it was held, that the creditor was not entitled to recover from the estate of the bankrupt the sum so misappropriated by the assignee (1). Nor is a creditor entitled to dividends accrued on a sum set apart, under 1 & 2 Will. 4, c. 56, s. 31, to answer his claim (m); but where the amount of a dividend upon a particular debt was tendered to the creditor, upon terms to which he refused to accede, and the sum was invested in stock, and after twenty years the creditor accedes to the terms, he is not only entitled to the sum invested, but also to the interest accrued thereon (n). If an assignee signs cheques for a dividend, and deposits them in a desk, from which they are fraudulently taken by a clerk, who obtains payment from the bankers, semble, the assignee is liable to the creditor (0). And where there were four assignees, and upon the choice it was agreed by the assignees and creditors present, that one only should act, and notice was given to the bankers to pay his drafts, a dividend being declared, notice was given to the creditors that they might receive the dividend upon application to "the assignees;" the acting assignee paid the dividends by cheques, which were dishonoured, he having overdrawn his account and absconded: it was held that all the assignees were liable (p). And where an assignee died, having fraudulently received the dividends declared, and applied them to his own use; in a suit by the commissioners and the surviving assignee, his estate was held liable to refund the amount so misapplied, with interest at £5 per cent. (q): and if the solicitor to the fiat receives dividends under a pretended authority from a creditor, the Court of Review has jurisdiction to order him to pay the creditor (r). And if a creditor hold a bill as a collateral security for a debt proved under the fiat, and the bill is afterwards paid in full, he cannot be called upon to refund (h) Er p. Winnall, 3 Dea. & C. 22. (i) Er p. Dawson, 4 Dea. & C. 130; 2 Mon. & A. 94. (k) Er p. Powell, Mon. & M'A. 283. (1) Er p. Grant, Mon. & M'A. 77. (m) Er p. Jamieson, 2 Dea. 6; 3 Mon. & A. 715. (n) Ex p. Holford, 4 Dea. & C. 798; 2 Mon. & A. 289: and see Ex p. Renshaw, 4 Dea. & C. 483. (0) Er p. Griffin, 2 Glyn & J. 114. (p) Er p. Booth, Mon. 248. (9) Wackerbath v. Powell, 2 Glyn & J. 151. (r) Ex p. Storey, 4 Dea. & C. 506; 2 Mon. & A. 54. the dividends received, upon his proof prior to the payment of the bill (s). We have seen (p. 305, ante) that, by General Order, no dividend should be paid to any creditor holding any security for his debt, until such security shall be produced, without the special directions of a commissioner in that behalf; but notwithstanding the power of the commissioners to order payment without production of the securities, applications were made to the Court of Review for orders to pay dividends in cases where securities had been lost (t) but now, by General Order, May 14, 1836, upon the statement by a creditor that he is unable to produce his security, and that the same has not been parted with for any valuable consideration, nor assigned to any person, he shall be examined upon oath before a commissioner as to the cause of such inability, and his examination shall be filed with the proceedings. And the commissioner shall adjudge whether in his opinion the creditor is or is not able to produce the security; and if the commissioner is of opinion that the security cannot for a sufficient cause be produced, the creditor shall give a sufficient indemnity to the official assignee, to be approved by a commissioner; and upon such indemnity being given, the official assignee shall pay the dividend to the creditor. This General Order applies to town fiats only; and in country fiats, if the securities cannot be produced, an order of court must be obtained for payment of the dividend, in cases where the securities cannot be produced; and if the non-production is occasioned by the act of the creditor, as where he has lost the securities, he will have to pay the costs of the application (u). Unclaimed Dividends.] By stat. 6 Geo. 4, c. 16, s. 110, the assignees are to file a certificate in the office of the Lord Chancellor's secretary of bankrupts, containing an account of the names of creditors to whom unclaimed dividends are due, and of the amount of such dividends; and power is thereby given for the investment of such dividends; and after the expiration of three years the Lord Chancellor is empowered to order the same to be divided among and paid to the other creditors in manner therein mentioned: but by 5 & 6 Will. 4, c. 29, s. 5, so much of the said Act (6 Geo. 4, c. 16) as directs the filing the said certificate, and the investment, division, and payment of such unclaimed dividend, is repealed. And by 5 & 6 Will. 4, c. 29, s. 6, all dividends unclaimed as hereinafter mentioned, and also any undivided surplus of a bankrupt's estate over and above the amount finally directed to be divided amongst the creditors of any bankrupt, shall be paid into the Bank of England, to the credit of the Accountant-General of the High Court of Chancery, or of the Accountant in bankruptcy, when such last-mentioned officer shall have been appointed, to be carried to an account to be intitled "The Unclaimed Dividend Account," (s) Ex p. Carr, 2 Dea. 273; 3 Mon. & A. 64. (t) Ex p. Robins, 1 Dea. 587: Ex p. Wallis, 1 Dea. 496; 2 Mon. & A. 586. |