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every other view but that of constituting an act of bankruptcy.
Shepherd, S. G. contrà.-1. A trader has a right to commit an act of bankruptcy; and no negoz ciation between him and his attorney for that purpose could invalidate the act; provided it were bona fide towards the creditors, and none of them concerted it, or were privy to it. The bankrupts had committed two acts of bankruptcy sufficient to uphold the commission. Smith did not know of the deed of assignment, That deed itself, by which the bankrupts conveyed away all their property, is an act of bankruptcy. The recital did not alter its effect. No matter to whom they convey. They part with all their property by deed. This deed, without question, is revocable by the bankrupt laws; but the fact of such a conveyance constitutes an act of bankruptcy. If Smith had been priyy and assenting, that circumstance would have impeached the deed; but the contrary is in evidence. He did not know of it till the commission was opened.-2. The denial to Smith was a clear act of bankruptcy. This denial was not concerted between Smith and the bankrupts, which circumstance alone it is that makes the act of bankruptcy frandulent. immaterial that Smith went to their respective houses, not expecting money. The denial to creditor is an act of bankruptcy; because it is evidence of a beginning to keep house with a view to delay creditors,
BURROUGH, I am of opinion that these were
fraudulent and concerted acts of bankruptcy, and I shall direct the Jury accordingly.
Laying the deed out of consideration, which was evidently contrived for the purpose, there were three concerted acts of bankruptcy, committed most glaringly in the sight of the petitioning creditor, through the medium of his own, and the bankrupts' solicitor, who goes from house to house for the purpose. The only question then is, was Croom the agent of Smith ? If the Jury, under the circumstances, think he was such agent, the commission cannot stand.
The Jury found a verdict for the plaintiff.
Best and Vaughan, serjeants, and Campbell, for the plaintiff
Shepherd, S. G., Lens, serjeant, and Tindall, for the defendant.
Cases of difficulty have arisen trader in concert with his creupon the question, how far a ditors. commission of bankrupt can be With respect to the first supported, which is founded point: If the act of bankupon an act of bankruptcy, ruptcy, on which the commiseither committed voluntarily sion is sought to be sustained, by the trader, and with the be an act, moving solely intent of making himself a from the bankrupt, as a denial bankrupt by such act, but to a creditor, or an assignment without the privity or con by deed of all his effects, currence of his creditors; or though such denial or assignupon an act committed by the ment should be with the intent
of making himself a bankrupt, and to let in the operation of
manifest the deed is void, and he intends and sufficient grounds; for, in that it should be void at the the first place, it may be the time of execution. Can such only means of rescuing his prodeed, it is said, sustain a com perty from the urgent pressure mission ? Can such deed (which of one particular creditor, and constitutes an act of bank- thereby bringing it within the ruptcy upon these two grounds equitable distribution of the only, 1. Either that it is a bankrupt laws. la the first fraudulent preference of parti- construction of these laws, and cular creditors; or, 2. That it the judgment of the Courts places his property under a upon them, bankruptcy appears distribution different from that to have been regarded in two ordained by the bankrapt laws, points of view; in the first and which deed is not intended place, as criminal insolvency; by the bankrupt to operate in and, secondly, as a condition either of those ways, but to of necessity. Under neither exclude the power of fraudu of these points of view, therelent preference on one hand, fore, could any voluntary aut
of the trader, by which he the law very properly discounconstituted himself a bankrupt, tenances such concerts and pribe regarded as admissible in
vate agreements; and therelaw; or, in other words, as fore, arguing upon the legal not criminal. The bankrupt, nature of bankruptcy as a therefore, was always viewed crime, determines that no cre. in the light of a criminal ; and ditor shall avail himself of a therein the act of making him criorival act which he has self a bankrupt voluntarily caused to be done. was treated as a fraud. But
As respects a creditor usfurther experience has exposed der these circumstances, such the fallacy, and, indeed, the act is no act of bankruptcy: great practical mischief of such
but as such act is still the a doctrine in fact. The Courts, index of that condition of af. therefore, proceeding now upon fairs which the law detera more liberal construction, mines to be insolvency ; such look, not so much to the act act, though insufficient as reitself, as to the act in connec spects the creditor and trader tion with the condition of the who concerted it, is sufficient affairs of the bankrupt, and to uphold a commission by any with the circumstances which other creditor. For example, precede and follow it. If, à concerted assignment of eftherefore, upon such examinu. fects, which is the case put, tion, they find such voluntary cannot be insisted upon as an act of the trader to be a mere act of bankruptcy by any crebona fide declaration of his in ditor, a party to such consolvency; or, as it were, a sur veyance, or privy to such con. render of himself and his pro veyance. Bamford v. Baron, 2 perty to the bankrupt laws, it T. R. 594.
Back v. Gooch, is the practice of the courts of ante, p. 13. and Tappendall v. law and equity to deem sach Burgess, 4 East 230. But act and commission thereon any creditor, not privy nor confounded perfectly sufficient. seating, but arriving at the But as, in cases where the knowledge of it, may of course bankrupt commits this volun. secure his own equity of distary act in concert with one tribution by taking out a comof his creditors, there is a ma mission upon it; or otherwise, nifest presumption that such the trustee of such deed might creditor is to have some pecu become possessed of the whole liar interest above the others,
property, and exclude other
creditors. The act, therefore, an act of bankruptcy, though is evidently an act of bank- the direct and immediate obreptey as affects the other cre- ject is not to delay but to saditors. But it is not so in the tisfy the creditors. But it was case of a concerted denial to held, that a trader had not a one creditor; for such denial right by deed to place his pro. being by concert, is no sign, perty under a distribution dif. symptom, or act of insolvency; ferent from that directed by and nothing can be founded on the bankrupt law; and it was it; which is otherwise in the carried to this extravagant case of the deed.
length, that, though the asIn Hooper v. Smith, 1 Black. signment was intended for the 441. Lord Mansfield says, benefit of all the creditors in" The relation of a commis- cluding that one, yet it was an sion of bankrupt to the time act of bankruptcy. of committing the act, though In the case of Bamford v. useful to prevent frauds, is Baron, 2 T. R. 594, note, in sufficiently hard already upon which I was counsel, an atprivate persons; and ought not tempt to set up such an assigoto be extended farther. An act ment as an act of bankruptcy, of bankruptcy in the eye of the was made by a person who was law is considered as a crime; a party to the transaction; and but where is the crime of de the opinion of the Court was, nying oneself to another by that such person could not reprevious consent and agree. present it as an act of bank. ment."
ruptcy; that, according to the But although a concerted common expression, his mouth act of bankruptcy is not avail. was shut. But the understandable, except for creditors not ing of the bar was, that there privy to it, yet a commission was nothing to prevent another upon a concerted act of bank
creditor, not a party to the ruptcy may be supported upon transaction, from treating that another act. Ex parte Bourne, as an act of bankruptcy; an 16 Vezey Jun. 145. In this inference favoured by the ex
the Lord Chancellor pression, that the mouth of (Eldon) expresses himself as that particular creditor was follows : “ I recollect cases in shut; and I believe many comwhich it was settled upon a
missions have been in fact supsingular ground, that an as ported upon such acts of banksigument of all the property is ruptcy, by persons not parties