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Trustee in Bankruptcy

bankrupt, property, committee, person, creditors, respect and inspection

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TRUSTEE IN BANKRUPTCY. When a debtor is adjudicated bankrupt, his property shall become divisible amongst his creditors, and shall vest in a trustee. (See ADJUDICA TION OF BANKRUPTCY.) Until a trustee is appointed the official receiver acts as trustee.

The trustee may be appointed by the credi tors, or they may leave his appointment to the committee of inspection. The trustee must give security to the satisfaction of the Board of Trade, and the Board, when satis fied, certifies that his appointment has been duly made.

The Bankruptcy Act, 1883, provides : Powers of Trustee to Deal with Property.

" 56. Subject to the provisions of this Act, the trustee may do all or any of the following things : " (1) Sell all or any part of the property of the bankrupt (including the goodwill of the business, if any, and the book debts due or growing due to the bankrupt), by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels : " (2) Give receipts for any money received by him, which receipts shall effectu ally discharge the person paying the money from all responsibility in respect of the application thereof.

" (3) Prove, rank, claim, and draw a divi dend in respect of any debt due to the bankrupt : " (4) Exercise any powers the capacity to exercise which is vested in the trustee under this Act, and execute any powers of attorney, deeds, and other instruments for the purpose of carry ing into effect the provisions of this Act : " (5) Deal with any property to which the bankrupt is beneficially entitled as tenant in tail in the same manner as the bankrupt might have dealt with it.

Powers Exercisable by Trustee with Permission of Committee of Inspection.

" 57. The trustee may, with the permission of the committee of inspection, do all or any of the following things : " (1) Carry on the business of the bankrupt, so far as may be necessary for the beneficial winding up of the same : " (2) Bring, institute, or defend any action or other legal proceeding relating to the property of the bankrupt : " (3) Employ a solicitor or other agent to take any proceedings or do any business which may be sanctioned by the committee of inspection : " (4) Accept as the consideration for the sale of any property of the bankrupt a sum of money payable at a future time subject to such stipulations as to security and otherwise as the committee think fit : " (5) Mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts : " (6) Refer any dispute to arbitration, com promise all debts, claims, and lia bilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have incurred any liability to the bankrupt, on the receipt of such sums, payable at such times, and generally on such terms as may be agreed on : " (7) Make such compromise or other arrangement as may be thought expedient with creditors, or persons claiming to be creditors, in respect of any debts provable under the bankruptcy : " (8) Make such compromise or other ar rangement as may be thought expe dient with respect to any claim arising out of or incidental to the property of the bankrupt, made or capable of being made on the trustee by any person or by the trustee on any person : " (9) Divide in its existing form amongst the creditors, according to its esti mated value, any property which from its peculiar nature or other special circumstances cannot be readily or advantageously sold.

The permission given for the purposes of this Section shall not be a general permission to do all or any of the above-mentioned things, but shall only be a permission to do the particular thing or things for which permis sion is sought in the specified case or cases.

Power to Allow Bankrupt to 411anage Property.

" 64. (1) The trustee, with the of the committee 'of inspection, may appoint the bankrupt himself to. superintend the management of the property of the bankrupt or of any part thereof, or to carry on the trade. (if any) of the bankrupt for the benefit of his creditors, and in any other respect to aid in administering the property in such manner and on such terms as the trustee direct.

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