that a fraud on this act was intended, or that the debtor was insolvent, and such
creditor shall not be allowed to prove his debt in bankruptcy.
SECTS. 40, 41, 42. Regulate the proceedings under such a peti-
ABSTRACTS OF THE LAW OF BANKRUPTCY. 295
SECT. 43. Relates to the superseding of the proceedings in bank-
ruptcy, by placing the property in the hands of trustees, if three-
fourths in value of the creditors desire it. This section I give iu
Of Superseding the Bankrupt Proceedings by Arrangement.
SECT. 43. And be it further enacted, That if at the first meeting of creditors, or
at any meeting of creditors to be specially called for that purpose, ai.d of which
previous notice shall have been given for such length of time and in such manner
as the court may direct, three-fourths in value of the creditors whose claims have
been proved shall determine and resolve that it is for the interest of the general
body of the creditors that the estate of the bankrupt should be wound up and
settled, and distribution made among the creditors by trustees, under the inspection
and direction of a committee of the creditors, it shall be lawful for the creditors to
certify and report such resolution to the court, and to nominate one or more
trustees to take and hold and distribute the estate, under the direction of such
committee. If it shall appear to the court, after hearing the bankrupt and such
creditors as may desire to be heard, that the resolution was duly passed and that
the interests of the creditors will be promoted thereby, it shall confirm the same ;
and upon the execution and filing, by or on behalf of three-fourths in value of all
the creditors whose claims have been proved, of a consent that the estate of the
bankrupt be wound up and settled by said trustees, according to the terms of such
resolution, the bankrupt, or his assignee in bankruptcy, if appointed, as the case
may be, shall, under the direction of the court, and under oath, convey, transfer,
and deliver all the property and estate of the bankrupt to the said ti ustee or
trustees, who shall, upon such conveyance and transfer, have and hold the same in
the same manner, and with the same powers and rights, in all respects, as the
bankrupt would have had or held the same if no proceedings in bankruptcy had
been taken ; or as the assignee in bankruptcy would have done had such resolution
not been passed ; and such consent and the proceedings thereunder shall be as
binding in all respects on any creditor whose debt is provable, who has not signed
the same, as if he had signed it, and on any creditor whose debt, if provable, is not
proved, as if he had proved it ; and the court, by order, shall direct all acts and
tilings needful to be done to carry into effect such resolution of the creditors ; and
the said trustees shall proceed to wind up and settle the estate under the direction
and inspection of such committee of the creditors, for the equal benefit of all such
creditors, and the winding up and settlement of any estate under the provisions of
this section shall be deemed to be proceedings in bankruptcy under this act ; and
the said trustees shall have all the rights and powers of assignees in bankruptcy.
The court, on the application of such trustees,' shall have power to summon and
examine, on oath or otherwise, the bankrupt, and any creditor, and any person
indebted to the estate, or known or suspected of having any of the estate in his
possession, or any other person whose examination may be material or necessary to
aid the trustees in the execution of their trust, and to compel the attendance of
such persons and the production of books and papers in the same manner as in
other proceedings hi bankruptcy under this act ; and the bankrupt shall have the
like right to apply for and obtain a discharge after the passage of such resolution
and the appointment of such trustees as if such resolution had not been passed,
and as if all the proceedings had continued hi the manner provided in the preced-
ing sections of this act. If the resolution shah 1 not be duly reported, or the consent
of the creditors shah 1 not be duly filed, or if, upon its filing, the court shall not
think fit to approve thereof, the bankruptcy shall proceed as though no resolution
had been passed, and the court may make all necessary orders for resuming the
proceedings. And the period of time which shall have elapsed between the date
of the resolution and the date of the order for resuming the proceedings shall not
be reckoned hi calculating periods of tune prescribed by this act.
SECT. 44. Provides that debtors, who, after the commencement of
proceedings in bankruptcy (which means the filing of the petition),
fraudulently conceal any property, or hinder the assignee from get-
ting hold of it, or spend any part of it in gaming, or, within three
months next before the petition, dispose of any property otherwise
than by honest transactions in his trade, which property was bought
on credit and is unpaid for, shall be punished by imprisonment uot
exceeding three years.
SECT. 45. Provides that defaulting officers shall be punished by a
fine not less than three hundred nor more than five hundred dol-
lars, and imprisonment not more than three years.
SECT. 46. Provides that forgery or counterfeiting of any court
seal, any court paper, or the tendering for use of any document so
forged or counterfeited, shall be punished by a fine not less than
five hundred iior more than five thousand dollars, and imprisonment
not exceeding five years.
SECT. 47. Relates to fees and costs of proceedings.
SECT. 48. Gives the meaning and definition of sundry words used
in the act.
SECT. 49. Gives 'jurisdiction in cases of bankruptcy to the
Supreme Court of the District of Columbia and of the several Terri-
tories, when the bankrupt resides therein.
SECT. 50. Declares that the act goes into force when approved,
but no petition can be filed before 1st of June, 1867. On July 25,
1868, a short amendatory act was passed, as follows:
AMENDATORY ACT. . 297
Amendatory Act of 1868.
A BILL IN AMENDMENT TO AN ACT ENTITLED " AN ACT TO ESTABLISH A
UNIFORM SYSTEM OF BANKRUPTCY THROUGHOUT THE UNIIED STATES,"
APPROVED MARCH 2, 1867.
Be it enacted, $*c., That the provisions of the second clause of the 33d section
of said act shall not apply to cases of proceedings in bankruptcy commenced prior
to the first day of January, 1869, and the time, during which the operation of the
provisions of said clause is postponed, shall be extended until the said first day of
January, 1869, and said clause is so amended as to read as follows :
In all proceedings in bankruptcy commenced after the first day of January,
1869, no discharge shall be granted to a debtor whose assets shall not be equal to
fifty per centum of the claims proved against his estate, upon which he shall be
liable as the principal debtor, unless the assent in writing of a majority hi number
and value of his creditors to whom he shall have become liable as principal debtor,
and who shall have proved their claims, be filed in the case at or before the tune
of the hearing of the application for discharge.
SECT. 2. And be it further enacted, That said act be further amended as follows :
The phrase " presented or defended," hi the 14th section of said act, shall read
" prosecuted or defended." The phrase " nor resident debtors," in line 5, section
22, of the act as printed in the statute at large, shall read " non-resident creditors "
that the word " or," in the next to the last line of the 39th section of the act, shall
read " and ; " that the phrase " section 13," in the 42d section, shall read
" section 11 ;" and the phrase " or spends any part thereof hi gaming," in the
44th section of said act, shall read " or shah 1 spend any part thereof in gaming ; "
and that the words " with the senior register or," and the phrase " to be delivered
to the register," in the 47th section of said act, be stricken out.
SECT. 3. And be it further enacted, That the register in bankruptcy shall have
power to administer oaths in all cases and in relation to all matters in which oaths
may be administered by commissioners of the circuit courts of the United States,
and such commissioners may take proof of debts in bankruptcy in all cases, subject
to the revision of such proofs by the register and by the court, according to the
provisions of said act.
Approved July 25, 1868.
The various forms required are not given heTe, because they have
been issued on the authority of the Supreme Court of the United
States, and are uniform throughout the States, and are supplied by
the Registers of bankruptcy to every applicant ; and to one of them
every person desiring to become a bankrupt, and every person desir-
ing to bring another person into bankruptcy, must apply.
In the -District Court of the United States for the Southern Dis-
trict of New York, the Hon. Judge Blatchford has established cer-
tain rules for practice under the Bankrupt Law. Resting on his
high authority, and the usage of the principal centre of business in
the country, these rules will doubtless be regarded everywhere ; and
the practice in all the States will be in substantial conformity .with
them. These rules are as follows :
Rules in Bankruptcy.
Rule 1. In voluntary bankruptcy, where the petition states that the debtor,
whether an individual, a copartnership, a corporation, or a joint-stock company,
has resided or carried on business for the six months next immediately preceding
the time of filing the petition, or for the longest period during such six months, in
the city and county of New York, the petitions shall be referred, in rotation, by
Form No. 4, to the several registers, appointed in the six Congressional districts
therein, commencing with the fourth, and ending with the ninth, in the order of
the times of filing such petitions ; and where in any other county, the petition shall
be referred, by Form No. 4, to the register appointed in the Congressional district
in which such county is embraced. A petition may be otherwise referred for special
reasons, or in cases not herein provided for. In involuntary bankruptcy, the regis-
ter will be designated with reference to the special circumstances of each case.
The order, Form No. 4, designating the register to act upon the petition, in vol-
untary bankruptcy, shall, in the case of a register in any district in the city and
county of New York, specify as the place where the register shall act upon the
matters arising under the case, and the warrant, Form No. 59, in involuntary bank-
ruptcy, shall, in a like case, specify as the place where the meeting of the creditors
will be held, the office of the register as designated by him, by a writing filed with
the clerk. In the case of a register in any district other than one in the city and
county of New York, the order, Form No. 4, in voluntary bankruptcy, shall specify
as the place where the register shall act upon the matters arising under the case,
an office of the register as designated by him in like manner, in the county in
which is the place of residence of the petitioner, or the place of business of the co-
partnership, corporation, or joint-stock company, as set forth in the petition, having
due regard always to the proximity and convenience of such office to such place of
residence or place of business ; and, in a like case, in the warrant, Form No. 59, in
involuntary bankruptcy, the place will be designated with reference to the special
circumstances of the case.
The day named in the order, Form No. 4, for the attendance of the bankrupt
before the register, in voluntary bankruptcy, and the day named in the warrant,
Form No. 59, for the meeting of creditors, in involuntary bankruptcy, will be fixed
with reference to the convenient and speedy progress of the case.
KTJLES IK BANKRUPTCY. 299
Every register in a district other than the city and county of New York shall,
by a writing filed with the clerk, designate the days on which he will attend at a
place or places within each county in his district.
Every register may, in any case referred to him, fix the times -when he will act
upon the several matters arising under such case, other than the attendance of the
bankrupt, as fixed by the order, Form No. 4, and the meeting of creditors as fixed
by the warrant, Form No. 59 ; but the register shall not, without leave of the court,
be at liberty to change the place specified in the order, Form No. 4, or to act upon
the matters arising under a case in involuntary bankruptcy at any other place than
the one specified in the warrant, Form No. 59, as the place for the meeting of
Rule 2. The adjudication of bankruptcy, Form No. 58, shall contain a pro-
vision that the case be referred to one of the registers, naming him, to take such
proceedings thereon as are required by the act.
Rule 3. Whenever a petition is referred to a register in a voluntary case,
and whenever, in an involuntary case, an order is made on an adjudication of bank-
ruptcy, referring the case to a register, the clerk at the time he sends or delivers to
the register a copy of the order of reference, shall pay to him the sum of fifteen
dollars out of the fifty dollars deposited with the clerk, under Section 47 of the
act, the same to be applied to the payment of such fees of the register as are
chargeable to the petitioner making the deposit. Whenever by a return made to
the court, under oath, by the register, of the fees so chargeable for services ren-
dered by him, it shall appear that the aggregate amount of such fees exceeds the
aggregate payments made thereon to the register out of the fifty dollars, the clerk
shall, if requested by the register, make further payments to him thereon to the
amount of such fees, until the fifty dollars shall all of it be paid out, and thereafter
the fees of the register which are chargeable to such petitioner shall be paid or
secured in like manner with the other fees provided for by Rule 29, of the " Gen-
eral Orders in Bankruptcy."
The foregoing provisions of this rule shall not apply to a case of voluntary
bankruptcy, where under Rule 30 of the " General Orders in Bankruptcy," the
judge shall direct that the fees and costs in the case shall not exceed the sum re-
quired by the act to be deposited with the clerk ; but, in every such case, such of
the disbursements paid out by the register and marshal for the purposes specified
in Rule 12 of the " General Orders in Bankruptcy," and returned by them under
oath, under said Rule 12, as are chargeable to the petitioning debtor, shall be re-
funded to them severally by the clerk out of such sum ; and the clerk, marshal, and
register shall perform the duties required of them by such petitioning debtor with-
out first requiring payment or security for their fees, subject to the application by
the court to such fees, of so much of such sum as shall remain after refunding such
Ordered, That Rule 3 of the Rules, Orders, and Regulations, in Bankruptcy,
prescribed by this court, June 22, 1867, be amended by striking out the word
"fifteen," and inserting the word "twenty-five," and by striking out the words
" under oath," where they first occur in said rule.
Passed July 1, A.D. 1867.
Rule 4. The register shall, under Rule 7 of the " General Orders in Bank-
ruptcy," examine the duplicate copy of the petition and schedules specified in Form
No. 4, and such duplicate copy shall either be a copy of such filed original, cer-
tified by the clerk under the seal of the court, or else a duplicate original, signed
and verified in like manner with the original petition and schedules filed with the
clerk, and shown by evidence satisfactory to the register to be such duplicate origi-
nal ; and the certificate of the register, required by said Rule 7, as to the correct-
ness in form of the petition and schedules, shall be made in writing, and be signed
by him, on the duplicate copy which he so examines ; and he shall not issue any
warrant under Form No. 6, until he shall have so made a certificate, after such ex-
amination, that the petition and schedules are correct in form. No such certificate
shall be made unless the whole eleven of the sheets composing schedules A and B,
in Form No. 1, form part of the schedules to the petition.
Rule 5. The warrant issued under Section 11 or Section 42 of the act, ac-
cording to Form No. 6 or Form No. 59, shall specify two, if there be two, and if
not, then one of the newspapers named in Rule 21, published in the county stated
in the petition as the one in which the debtor, whether an individual, a copartner-
ship, a corporation, or a joint-stock company, has resided or carried on business for
the six months next immediately preceding the time of filing the petition, or for the
longest period during-such six months, the selection of such newspapers to be made
by the petitioner, or his attorney, or, in default thereof, by the register to whom the
petition or case is referred; but in the city and county of New York, one of them
shall be a morning paper, and one an evening paper. The notices to be published
in pursuance of the warrant shall be published twice in each newspaper selected.
The warrant shall designate the creditors on whom personal service is to be
made, and notice shall be served by mail upon all creditors other than those so
designated. No creditor resident out of this district shall be designated for per-
Whenever a debtor shall furnish, at his own expense, to the marshal, printed
copies of the notices required to be served by the warrant, no fee shall be allowed
to the marshal for copying into the notices the names and places of residences of
the creditors, and the amounts of then* debts.
The warrant, Form No. 6, shall oe regarded as process under Rule 2 of the
" General Orders in Bankruptcy," and such warrant shall, before it is issued to the
marshal, in addition to being signed by the clerk, and sealed with the seal of
the court, be signed by the judge or the register at the foot thereof, in the follow-
ing form, with the date : " Issued by me, 18 , District
Judge [or Register in Bankruptcy."']
RULES IN BANKBUPTCY. 301
Whenever the order Form No. 10 is used by a register, the conclusion of said
Form may be varied so that the order may be attested or signed by the register
Ordered, That Rule 5 of said Rules, Orders, and Regulations, be amended by
striking out the words "by the petitioner or his attorney, or in default thereof;"
and also by striking out the words " but in the city and county of New York, one
of them shall be a morning paper, and one an evening paper."
Passed July 1, A.D. 1867.
Rule 6. All proofs of debt which shall be made and verified prior to the elec-
tion or appointment of an assignee shall be delivered or sent to the register to
whom the case is referred. If the register entertains doubts of the validity of any
claim, or of the right of a creditor to prove it, and is of opinion that such validity
or right ought to be investigated by the assignee, he may postpone the proof of the
claim until the assignee is chosen.
Rule 7. In case no choice of an assignee is made by the creditors at then
first meeting, or in case an assignee, chosen by the creditors, fails within five day.
to express in writing his acceptance of the trust, or in case of a vacancy in the
office of an assignee, caused by his removal, resignation, death, or other cause, Johr
Sedgwick, Esquire, of the city of New York, counsellor at law, will be appointed
assignee where the judge is required by the act to appoint the assignee, and also
where the assignee is appointable by the register, subject to the approval of the
judge. In special cases, vacancies in the office of assignee will be filled by an
election by the creditors.
Ordered, That Rule 7 of said Rules, Orders, and Regulations, be amended by
striking out the words " also where the assignee is appointable by the register sub-
ject to the approval of the judge," and inserting instead the following : " where
the said John Sedgwick shall be appointed by any register, such appointment is
hereby approved by the judge ; " and also by striking out the last sentence, and
inserting instead the following : " In special cases, vacancies in the office of as-
signee will be filled by an election by the creditors, or by the appointment of an
assignee other than the one above named."
Passed July 1, A.D. 1867.
Rule 8. Under Rule 9 of the " General Orders in Bankruptcy," an assignee
shall notify the register of his acceptance or rejection of the trust, and the register
shall immediately, on receiving such notice, report it to the clerk of the court.
Rule 9. Every assignee shall, immediately on receiving an assignment of an
estate in bankruptcy, send or deliver such assignment to the clerk of the court, who
shall make a true copy of it, and certify such copy under his hand and the seal of
the court ; and such certified copy shall then be placed by him on file, and the origi-
nal assignment shall be returned to the assignee.
Rule 10. Notice of the appointment of an assignee shall be given by publi-
cation once a week for three successive weeks in two of the newspapers named in
Rule 21, at least one of which shall be a newspaper published in the city and
county of New York ; such newspapers to be selected by the assignee with due
regard to the requirements of Section 14 of the act.
Ordered, That Rule 10 of said Rules, Orders, and Regulations, be amended by
striking out the word " assignee," where it last occurs, and inserting instead tha
word " register."
Passed July 1, A.D. 1867.
Rule 11. Notices of sale by* an assignee under Rule 21 of the " General Or-
ders in Bankruptcy," shall be advertised hi two, if there be two, and if not, then in
one of the newspapers named in Rule 21, published hi the county where the sale
is to take place, the selection of such newspapers to be made by the assignee ; but
in the city and county of New York, one of them shall be a morning paper, and
one an evening paper.
Ordered, That Rule 11 of said Rules, Orders, and Regulations, be amended by
striking out the words " assignee ; but in the city and county of New York, one of
them shall be a morning paper, and one an evening paper," and inserting instead
the word " register."
Passed July 1, A.D. 1867.
Rule 12. The notice to creditors of dividends or meetings required by the
17th, 27th, and 28th Sections of the act, shall be such as is provided for by the
order contained in Form No. 28; and the assignee shall select one newspaper,
in which the notice shall be published, from among the newspapers specified in
Ordered, That Rule 12 of said Rules, Orders, and Regulations, be amended by
striking out the word " assignee," and inserting instead the word " register."
Passed July 1, A.D. 1867.
Rule 13. The list of debts provided for by Section 23 of the act shall be
made and certified by the register to whom the petition or case is referred, and he
shall place thereon all debts which are duly proved.
Rule 14. The assignee shall, under Section 27 of the act, produce and file
vouchers for all payments made by him, except as to items hi regard to which the
court shall, for reasonable cause, dispense with vouchers.
Rule 15. The notice by the assignee, under Section 28 of the act, of the
filing of his account, and of his application for a settlement and discharge, shall
be given by him by sending written or printed notices by mail, prepaid, of such
filing, and of the tune of such application, to all known creditors of the bank-
EULES IN BANKRUPTCY. 303
Hule 16. All questions for trial or hearing, under Sections 31 and 34 of tha
act, shall be tried or heard at a stated session of the court, on four days' notice of
trial or hearing, to be served by either party upon the other party, and upon the
clerk ; and a calendar of the same shall be made.
Rule 16 of this Court in Bankruptcy is hereby amended so as to read as fol-
All questions for trial or hearing under Sections 31 and 34 of the act, and all
questions under Section 41 of the act, which are not ordered to be tried by a jury,
shall be brought on upon testimony taken before a register, a commissioner, or a
referee, and shall be tried or heard by the court, and will be so tried or heard on
any Saturday in term, at a stated session of the court, on four days' notice of trial