BANKRUPT LAWS. Laws relating to bankruptcy.
2. The English Bankrupt Laws, which origin ated with the statute 34 & 35 Henry VIII. c. 4, were first mainly directed against the criminal frauds of traders. The bankrupt was treated as a criminal offender; and, formerly, the not duly sur rendering his property under a commission of bank ruptcy, when summoned, was a capital felony. The bankrupt laws are now, and have for some time past been, regarded as a connected system of oivil legis lation, having the double object of enforcing a com plete discovery and equitable distribution of the property of an insolvent trader, and of conferring on the trader the reciprocal advantage of security of person and a discharge from all claims of his creditors. By the General Bankrupt. Act (6 Geo. IV. c. 16) the former statutes were consolidated and many important alterations introduced. A subse quent statute, 1 & 2 Will. IV. c. 56, changed the mode of proceeding by constituting a Court of Bankruptcy, and removing the jurisdiction of bank rupt cases in the first instance from the Court of Chancery to that of Bankruptcy, reserving only an appeal from that court to the lord chancellor as to matters of law and equity and questions of evi dence; and other important alterations were intro duced. This statute was followed by the 5 & 6 Will. IV. c. 29, and by the 5 & 6 Viet. c. 122, which further modified the law and the organization of the courts. The numerous statutes relating to bank ruptcy were again consolidated by the Bankrupt Law Consolidation Act (1849); and this has been amended in a few particulars by the 15 & 16 Viet. e.
77, and by the Bankruptcy Act, 1854. These three acts embody the actual law applicable directly to bankrupts and to their estates. Eng. Cyc. Div. Arts & Se. h. t.
3. By'the Scotch system, as modified in 1783, the management of the estate is given to the creditors upon sequestration, and it is only where they re quire the aid of the court, or an appeal is taken from their determinations, that resort is bad to ju dicial proceedings. By recent amendments of the law (1856), the remedy is extended to apply to every class of debtors. There is also a remedy given the debtor to obtain a discharge from liability of the person upon relinquishing his property.
The French Bankrupt Law (law of 1838) de clares that all traders who stop payment are in a state of insolvency. Traders are required imme diately to register the fact that they have stopped payment in the Tribunal of Commerce, and file their balance sheet; and a decree of insolvency is de clared by the tribunal upon the trader's declara tion or on application of creditors. Prior volun tary conveyances and mortgages, pledges, &c. for antecedent debts, are void, and all subsequent deeds to those having notice are voidable. The former French law (Code of 1807) is still important, as being the basis of the system in many other conti nental nations. See INSOLVENCY.