The landlord, orAther person to whom any rent is due from the bankrupt, may at any time, either before or after the commencement of the bankruptcy, distrain upon the goods of the bankrupt for the rent due. This power is subject to the limitation that, if the distress be levied after the commence ment of the bankruptcy, it shall be available only for six months' rent accrued due prior to the date of the order of adjudication; but the landlord or other son to whom the rent may be due from the bankrupt may prove under the ruptcy for the surplus due for which the distress may not have been available.
Proof in ordinary cases.—Every creditor is required to prove his debt as soon as possible after the making of a receiving order. The debt may be proved by delivering or sending through the post in a prepaid letter to the officib.1 receiver, or, if a trustee has been appointed, to the trustee an affidavit debt ; an available form of affidavit, which requires a shilling stamp to be affixed by the creditor, being sent to the creditor by the official receiver, with notice of the debtor's statement of affairs and of the first meeting of creditors. The affidavit must be made by the creditor himself, or by some authorised person on his behalf; when, if made by such an authorised person, it should state his authority and means of knowledge. A statement of account, showing particulars of the debt, should be either contained in or referred to by the affidavit, the vouchers, if any, being specified by which the debt can be substantiated. The affidavit should state whether the creditor is or is not secured. A creditor who has lodged a proof is entitled to see and examine the proofs of other creditors before the first meeting, and at all reasonable times. A creditor, when proving his debt, must deduct therefrom all trade discounts ; but he need riot deduct any discount, not exceeding 5 per cent. on the net amount of his claim, which may have been merely an agreed allowance for payment in cash.
Proof by secured creditors.--A secured creditor may either surrender his security to the debtor's estate and prove for his debt as unsecured, or he may realise his security and prove for the balance, or he may submit to valua tion and prove for any balance. In case of realisation, the creditor must deduct the net amount realised in order to find the balance for which he may prove. In case of surrender of security the whole debt is available for proof. A secured creditor who does not either realise or surrender his security is re quired, before he may rank for dividend, to state in his proof the particulars of his security, the date when it was given, and the value at which he assesses it, he being then entitled to receive a dividend only in respect of the balance due to him after deducting the value so assessed. In order that a creditor
may not make too low an assessment, it is provided, in cases of valuation by the creditor, that the official receiver or trustee may at any time redeem it upon payment to the creditor of the assessed value. Moreover, if the official receiver or trustee is dissatisfied with the value at which a security is assessed, he may require that the property comprised in any security so valued be offered for sale at such times and on such terms and conditions as may be agreed upon with the creditor, or in default of such agreement, as the Court may direct. If the sale be by public auction the creditor, or the trustee on behalf of the estate, may bid or purchase. But the creditor has the right at any time, by notice in writing, to require the official receiver or trustee to elect whether he will or will not exercise his power of rcAnerning the security or requiring it to be realised. Should the trustee not, veNthin six months after receiving the notice, signify in writing to the creditor his election to exercise the power, he will not be entitled to exercise it ; and the equity of redemption, or any other interest in the property comprised in the security which is vested in the official receiver or trustee, will vest in the creditor, the amount of his debt being reduced by the amount at which the security has been valued. Subject to the possibilities in the event of the creditor's valuation being thus accepted, no creditor shall in any case receive more than twenty shillings in the pound and interest.
Where a creditor has valued his security as above, he may at any time amend the valuation and proof on showing to the satisfaction of the trustee or the Court that the valuation and proof were made bond file on a mistaken estimate, or that the security has diminished or increased in value since its previous valuation. But unless the trustee will allow the proposed amend ment without application to the Court, it must be made at the cost of the creditor, and upon such terms as the Court may direct. The valuation having been amended, the creditor must forthwith repay any dividend re ceived by him in excess of that to which he would have been entitled on the amended valuation ; or, as the case may be, he will be entitled to be paid any dividend which he may have failed to receive because of the inaccuracy of the original valuation.