The Manawatu Times. SATURDAY, JUNE 9, 1877.

Manawatu Times, Volume II, Issue 67, 9 June 1877, Page 2

The Manawatu Times. SATURDAY, JUNE 9, 1877.

The numerous bankruptcies which have lately taken place m ihe, colony have already "begun to produce effectsof a very unpleasant nature; It is a bad- tree that brings .forth evilf ruit ; therefore to the tree or source from whence the evils complained ; of m pur bankruptcy system proceed we ■ * • . '•■■■■■-.■ ■ - >

must look if we desire to apply any remedy to the present dis-ease existing m commercial circles. It may be asserted^ and with a fair degree of justice, that more than one cause has operated m producing the many failures and coinpoundings which have occurred during the -past few months. Over speculation m consequence of the large amount of public . money put m circulation, followed ! by panic and depression m trade when that expenditure had partially ceased, have no doubt had their share m forcing men into the Insolvent Court. But whilst^we admit these causes, we do not "think, they are alone to blame, or that either of them is by any means the chief cause which has produced this untoward state of things m our colony. We very much regret those causes, and however blamable tradesmen may be for speculating beyond their means, and not sufficiently counting the cost prior to entering upon ventures of importance, we cannot but feel a degree of commiseration for those who have ventured, and lost, because of circumstances over which they had no direct control, provided' they have afterwards acted honorably by giving- up all they possessed for the benefit of their creditors. But whilst we regret the existence of any cause producing disastrous effects m a community, we cannot look upon those already named as having by any means produced the worst effects. All busiuess is to a greater or lesser extent - a speculation. It is considered reasonable for business men at times to trade upon probabilities, and when failures occur from this cause alone they are not productive of the lasting and damaging effects i which result from fraudulent insolvencies. It is then to the source from which these spring, or m other words to the laws which regulate the Acts of a debtor towards his creditors that we must look for the chief cause which has produced, and is still, alas ! producing fruit of an unwholesome character m our midst. When it is possible for a man to commence business, not only without capital, but - whilst he is involved m debt, live for a few years m a style of princely magnificence, making settlements of property upon relations, &c, and m the end cooly offer to his creditors the remnant of-- an estate to which he never had any- right, and all this without rendering<-himself liable to any penalty, we 'naturally say there is a screw loose somewhere ; the provisions of the Fraudulent Debtors Act are either not sufficiently stringent or those entrusted with carrying , out its provisions are wanting m their duty. As we have already said, to .the present depression m trade may be attributed some of the many failures which have recently occurred ; , but we certainly think — and it is with pain we -make the admission— that if the " whitewashing " facilities offered to debtors were not so great, our commercial circles would not be so" frequently startled • with the announcement that such an oneis unable to meet his engagements. It was said m the House last session, that the laws relating to Bankruptcy were altogether too lax, and that it was necessary for the protection of creditors that certain alterations should be made. After due deliberation, Parliament did" legislate upon the matter, but unfortunately the latest measures have not brought about the desired result ; and judging by their efCect we Bhould say that instead of being an improvement m point of stringency they are more lax than were those which preceded them. In reference to this very subject it has been said that it is preferable to let rogues escape, rather than inflict undue hardship upon honest but , unfortunate men. If it were impossible to punish fraudulent debtors without inflicting injury upon honourable ones,, we would say let the administration of the law remain as at present. We cannot, however, take this view of the subject. It seems ridiculous to entertain the idea that those who administer the law are not possessed of ordinary powers of discrimination. There are few practical men of business, acquainted with the circumstances of any particular ease of insolvency, who could not pass correct judgment as to whethe^fraud did or ■ did not exist m connection with it. And we think, when it is clear to the minds of those administering the laws .relating to~ Bankruptcy that fraud does exist, the law on the' subject should be sufiiciently comprehensive and explicifto secure without difficulty the puuishinent of the fraudulent debtor. Whilst upon this subject, we may state that our attention has been frequently drawn, not only to the apparent ease with which persons can free themselves from the burden of debt in* the Insolvency Court, but to the neglect and annoyances, to which creditors arc too frequently

subjected. Clause 2-l< of the Debtors and Creditors Act provides, " That on the filing of a declaration by any person that lie is unable to meet his engagements with his creditors, the Registrar shall appoint some convenient time and place for holding a meeting of the creditors of the debtor, to be called the first meeting, such meeting to be fixed for a day not less than four days after the filing of such declaration. Notice of the filing of such declaration, and of the time and place appointed for -holding such meeting of creditors, shall be forthwith Gra.zetted by,the debtor." 'Now it sometimes happens thatthenotice referred to m this clause is gazetted m a paper 100 miles or more distant from the residence of one or more of the bankrupt's principal creditors, and where no special notice is se.nt to p. creditor days and even weeks may elapse before he is made aware of the insolvency of his debtor. Such cases have occurred m our own township. A, resident debtor, without saying a word to his locaL creditors, can quietly proceed to Wellington, and whilst there make a show of calling his creditors together. He' may or may not .send to creditors near his own place of abode., The probability is ttat he will send to some, whilst others either through his forgetfulness or carelessness, or fraudulent intention are left to find out as best they can that such meeting has been called. The least creditors can expect is to get proper notice of the first meeting called by their insolvent debtor. Let a man only act honorably, and we think none the less of him for being insolvent, but with the man who simply uses the Insolvent Court as a means to defraud his fellows we have no sympathy. We trust' that next session -this subject may again receive the attention of Parliament, ' and that something will be done toward stamping out dishonest principle, and rendering more secure the position of those who entrust their property to the keeping of others. A feeling, of dissatisfaction and distrust is springing up amongst business men, and until something is done to purge the moral atmosphere we very much fear that the feeling will increase rather *than diminish. - -