New Provisions.

The Committee believe that, in order to render the Debtors and Creditors Act an efficient piece of legislation, additions should be made to it, providing for the following matters :—

1. For the appointment of Official Assignees, in whom the Estate of a Debtor should vest immediately on his filing a statement of inability to pay his debts, or upon an order being issued for a meeting of his Creditors, when a Creditor has moved the Court for that purpose, and who should realise and distribute the Estate, if the Creditors neglect or refuse to take other steps for that purpose. The Committee consider this point to be one of primary importance. Under the present system, on the filing of a statement of inability to pay debts, the Estate of the Debtor vests in the Registrar of Court, an officer having other duties, and not likely to have any acquaintance with those now cast upon him. An Official Assignee should be a person selected on account of special qualifications, and, therefore, able to give great assistance to Creditors from the outset of the proceedings, whether the Trusteeship were left in his hands or not. Moreover, under the present system (if the first meeting of Creditors lapses), the Estate vests again in the Debtor, who has no further means of protecting it in the interests of the general body of his Creditors, or of obtaining a release from his liabilities.

2. For permitting the Estates of deceased persons to be administered under the Act, and for vesting the separate Estate of a deceased partner in the Trustee of the Estate of the surviving partner, when it appears that the firm was insolvent at the time of his decease. Mode—by order of Court on motion.

page 2

3. For vesting the joint Estate in the Trustee appointed under a liquidation, when one partner only has filed a statement of his firm's inability to to pay their debts. Mode—by order of Court on motion

4. For authorising the Registrar, in the absence of the Judge from Court, to exercise the power to grant an order under Section 20 of the Act, together with all other powers, except the hearing of appeals.

5. For the public examination in Court, before a Judge or the Registrar, of a Debtor, and of other persons supposed to be able to give evidence touching the affairs of a Debtor. The Committee believe that such public examinations are much more dreaded by dishonest Debtors than the withholding of a certificate, and that without them evidence of fraudulent insolvency will very seldom be secured in a form sufficiently clear to warrant a prosecution.

6. For the issue, by the Registrar (without motion), of order or summons commanding the attendance in Court, or before the Trustee, of the Debtor, or of any other person supposed to be able to give evidence; such summons to issue on the application of the Trustee, the Debtor, or of any Creditor.

7. For the administration of the separate Estates of partners in a firm, whose affairs are placed under liquidation (see Section 214 of Bankruptcy Act), and providing that after payment of the Creditors of such separate Estates, the surplus thereof should vest in the Trustee or the joint Estate; also, providing that the Creditors of separate Estates shall not rank on the joint Estate until the Creditors have been paid in full.

8. For prescribing a limit of time for proofs of debts being lodged with the Trustee, and for rendering it incumbent on a Trustee, when distributing a dividend before the expiration of such limit, to provide for payment of the same to all persons whose names appear in the Debtor's list of his Creditors. The Committee is of opinion that the limit should be, for New Zealand and the Australian Colonies, two months, and for more distant places, six months after the date at which the Trustee shall have posted to the Creditor notice of the liquidation; and that any moneys reserved as dividends for Creditors, or assumed Creditors, who do not lodge proofs of debt with the Trustee within the prescribed time, should be distributed amongst the Creditors of such Estate who have proved their debts.

9. For the issue of search warrants, as provided for in Clauses 157, 158, and 159 of the Bankruptcy Act. In connection with this, power should be given to a Trustee to break open any premises forming part of the Estate, and any box or other package containing assets in the Estate.

10. For obliging a Debtor to quit premises belonging to his Estate on notice from the Trustee, with provision that, if he refuse or neglect to do so, he may be ejected by a constable on a warrant from the Trustee, or may be given into custody on charge of being illegally on the premises. Experience has shown that it is of great importance that this should be provided for.

page 3

11. For authorizing Trustees to administer oaths to persons whom they may require to examine, and to take affidavits or declarations in proof of debts in the Estates of which they are Trustees. At present, although the Act authorizes a Trustee to examine persons on oath, the Trustee has not, by virtue of his office, any right to administer oaths.

12. For exempting from Stamp Duty all declarations and affidavits made by any Creditor, Debtor, or Trustee in connection with any Liquidation under the Act.