1. Editing blackstone together ?

suggesting that legislative fears rooted in the crises caused by such banks in 1792-93 had subsided.1 (CHECK REFERNCES AT FN 30 of THOMAS: Which book? The New Monthly Magazine and Literary Jounral (London 1823) vol 9, 131) , also see Alfred P Wadsworth and Julia de Lacy Mann Cotton Trade and Industrial Lancashire 16001780 (Reprint Manchester 1965, first ed. 1931) 307. The point was restated in section 24 of the Bankrupts Act 1731 (5 Geo 2 c 30), which stated that a Bankrupts Creditors shall be on an equal foot, and not one preferred before another, or paid more than another in respect of his or her debt.2 Section 51 uses identical wording in relation to the right of a future debtor to prove, but not open a commission, and section 56 provided the same in relation to contingent debts. Further, the reforms empowered the commissioners to compel the attendance of any witness capable of giving information about the bankrupt, his dealings, or estate. Further sections 24, 33, and 34 increased the power of commissioners, allowing them to summon the bankrupt at any time, as well as anyone suspected to have information material to the bankruptcy.

Section 36 gave commissioners the power to summon the bankrupt and examine him at any time, while sections 24, 33, 34 and 36 empowered the commissioners to order different parties to deliver up books, papers etc. Bankruptcy Court Act 1821 (1&2 Geo 4 c 115) made provision to provide new offices for commissioners meetings in London Section 24 provided for the ability to summon and examine witnesses to the act of bankruptcy and trading, section 33 and gives then powers regards anyone suspected to have information material about the bankrupts dealings, and section 34 gives them such powers in relation to anyone summoned or present at any meeting of the commissioners (presumably aimed at rooting out professional bankruptcy fraudsters?). Section 4 of the 1825 Act provided that entering into a compromise would not be an act of bankruptcy if no commission issued within 6 months of the date of the deed. Section 6 allowed a trader to declare bankruptcy by filing a declaration in writing signed by him and attested by an attorney/solicitor. Eldon here is referring to the fact that bills of exchange always used to be drawn on, and accepted by, parties indebted to the drawer. Accordingly there used to be a requirement that notice be given
1 2

Canaan (n Error! Bookmark not defined.) ix The Act made the granting of preferences/security to a petitioning creditor after the issue of a commission an act of bankruptcy, as above at n Error! Bookmark not defined..

to the payee of the bill where the acceptor was not really indebted to the drawer, to alert him to the fact that the bill did not in fact amount to the assignment of a valuable debt owed by the drawee/acceptor to the drawer. Presumably as the practice of drawing accommodation bills became more common, this requirement disappeared. Buck, in a footnote to his report, says that the doctrine to which Eldon refers was first applied in Bickerdike v Bollman (1786) 1 TR 405, 99 ER 1164 (cited as Boleman by Buck). This was known as the doctrine of reputed ownership, and meant that the bankrupts estate would include all goods left in his possession as reputed owner. The Bankrupts Act 1731 (5 Geo 2 c 30), s 24 specifically made the giving of securities or preferences to a petitioning creditor, after a commission had issued, an act of bankruptcy. The latter section is aimed at creditors who pressured bankrupts into giving security or paying their debts by issuing commissions and threatening to sue them out. relating to bills of exchange were made in the period 1820-1827 Even the Bills of Exchange Acts of 1821 and 1827 only made minor amendments to the law. 3 The 1821 Act modified the circumstances when the acceptance of a bill was to be treated as specific as opposed to general, and required acceptances to be written on the body of bills of exchange, while the 1827 Act dealt with. 4
Similarly, in the period 1801-1827 the law relating to bills of exchange was largely unaffected by legislative 5 change. Most of the legislation concerning bills in this period relates to taxation, regulating bills which are 6 7 improperly stamped, renewal of older legislation restraining the negotiability of bills worth less than 5, or 8 punishment for those who forge bills.

This is evident from the very first page of the Minutes of Evidence 1817, the trader Patrick Galway explained that insolvent traders prefer to avoid bankruptcy proceedings, because of the expense of prosecuting a commission which swallows up nearly the entire property. . Montagus views are less radical than Sweets; Montagu suggests that the holders of accommodation bills should only have their right to sign the certificate of discharge delayed rather than extinguished.
3 4

Eg the Negotiation of BiIls and Notes Act 1822 (3 Geo 4 c70), and the Bank Notes Act 1826 (7 Geo 4 c 6) That is whether the liability of the acceptor arises when the bill becomes payable or on some other contingency. OR FULL VALUE oF BILL OR NOT 5 Eg the Stamp Act 1803 (43 Geo 3 c 21); Postage Act 1803 (43 Geo 3 c 28), s 4. 6 For example, the Stamp Act 1815 (55 Geo 3 c184) regulated bills and notes improperly stamped. 7 JUST SAY EG AND KEEP ONES FROM RELEVANT PERIOD CUT!? LAW BOD The Original Act which did this was (15 G 3 c 51) for bills worth less than 1 (later increased to 1 and 1 shilling), this was renewed the Negotiation of Notes and Bills Act YEAR (43 Geo4 c 1) and repealed by the Bills of Exchange Act 1808 (48 Geo 3 c 88) which declared all promissory notes worth less than 1 void. It appears to have stayed in force until section 96 of the Bills of Exchange Act 1882. There was a separate set of rules for bills worth between 1 and 5, set out by (17 Geo c 30), was made perpetual by (27 Geo 3 c 16), and suspended by the Negotiation of Notes and Bills Act 1814 (55 Geo 3 c 6); Negotiation of Notes and Bills Act 1816 (56 Geo 3 c 21), and Negotiation of BiIls and Notes Act 1822 (3 Geo 4 c70), and reinstated by the Bank Notes Act 1826 (7 Geo 4 c 6). 8 For example, the Bank Notes Forgery Act 1801 (41 Geo 3 c 39), the Forgery of Foreign Bills Act 1803 (43 Geo 3 c 139)

9 SEPARATE REFEREnCE FoR FIRST PART OF THE SENTENCE Minutes of Evidence (1818), 9. Here Montagu states In the Spring of 1809, a bankrupt, for whom I was retained as counsel, info/rmed me, that he could obtain the signature of any number of persons to his certificate, and that nothing was more easy than to obtain the proof of fictitious debts, and that there were persons who lived by proving debts, and signing certificates. Bankrupt Law Select Committee, Report from the Select Committee on the Bankrupt Laws (1818, HC 276-VI), Only two Bankruptcy Acts were passed during this period. The first was the Members of Parliament (Bankruptcy) Act 1812 (52 Geo 3 c 144), which suspended bankrupt MPs from voting in Parliament. The second was the Bankrupts (England) Act 1816 (56 Geo 3 c 137), which provided that no-one who received delivery of goods from a bankrupt without knowledge of his bankruptcy, would be endangered by this. Lord Romilly in Re Joint Stock Discount Company v Loders case (1868) LR 6 Eq 491, at 494, defined the rule as follows that where there is a double and there are bills which one bankrupt is entitled to claim against the other, that must be set right as between the two estates, the consequence of which is, that the bill holders, tthough they get the benefit of any security that has been given for the bills, as Lord Eldon says, indirectly, have no species of right to the security itself. . A Bond Creditor shall, in this Court have the Benefit of all Counter-Bonds or collateral Security given by the Principal to the Surety; and if A. owes B. Money, and he and C. are bound for it, and A. gives C. a Mortgage or Bond to indemnify him, B. shall have the Benefit of it to recover his Debt. Christian disagreed with Eldons conclusion on the basis that he does not see what the ruling achieved, in that practically speaking saying Ps estate had a claim, but that Ws had an indemnity, gave no real protection to Ps estate. The ruling also did not affect Ws other creditors. . Although the issue of whether the bill was transferred by B to A constituted security for the debt or satisfaction of it was one of fact, it is one the Bankruptcy Court was empowered to resolve, and would 9 generally do so in the way described. Confirming Blackburne 9. The ruling was affirmed in Ex p Reader (n Error! Bookmark not defined.), and in Ex p Kirby (1819) 1 Buck 511 Chitty says this is already the law in the sense that the holder of a cross bill can prove it in full where he has discharged his own acceptance, but as above his authority for this proposition is weak CROSS REFERENCE CHECK/CUT

As stated above, when determining whether a holder of a bill was entitled to prove it, bona fide generally 10 meant without genuine fraud, without mala fides. Leach V-C rejects this idea here. In light of the above it is important to note that the term bona fide is used in the bankruptcy cases and textbooks written in the early 1800s whilst discussing the law in this area, and does not bear its standard modern meaning in that it can refer to a third party with notice of the lack of accommodation: it simple refers to the absence of fraud. See Chitty 240 and Smith v Knox (1799) 3 Esp 46, 170 ER 553 where Eldon makes clear that a party who takes an accommodation bill with notice can bring an action on the bill

This rule was itself an example of the principle that only debts contracted for valuable consideration could be proved against a bankrupts estate.11
It should be noted that in these sorts of situations the principal debtor and the suretys estates had no contribution remedies between them as the payments made to the bill holders occurred after their
9 10 11

n Error! Bookmark not defined. move it here? n Error! Bookmark not defined.-2

bankruptcies. For the actions of such parties against one another when solvent see X, and where they have exchanged bills and gone bankrupt see Y.

Chitty cites Rolfe v Caslon as authority for this proposition, erroneously. Rolfe v Caslon, as explored above (text to n Error! Bookmark not defined.ff), provides that where the holder of the bill is paid in full by any combination of payments from the drawer and acceptor Chitty does acknowledge limitations to this rule though. Chitty acknowledges the Walker judgment (See below) and that mutual sureties cannot prove against one another in respect of dividends each pays on his own acceptance, where the holders of those accepted bills have already proved (Cowley v Dunlop 7 Term Rep 565). The fact that he is forced to acknowledge this exceptions to his basic rule, without giving any justification for them, suggests that his argument is a weak one. For his textbooks see for instance Basil Montagu, A Digest of the Bankrupt Law, (London 1819) and Basil Montagu and Francis Gregg, A Digest of the Bankrupt Laws as Altered By The New Statutes (London 1827). Bankrupts Act 1731 (13 Eliz 1 c 7), s 2. This stated that creditors of just and due debts are entitled to be paid a portion, rate like, according to the quantity of his or their debts. This is expanded upon by the Bankrupts Act 1623 (21 J 1 c 19), s 9, which provided that no creditor to get more than this regardless of the type of security they hold. His exact position on whether the holder of a bill who has paid less than its value can prove is not entirely clear. His general argument suggests that such a holder should only be able to prove for value, but his own practice as commissioner suggests a slightly wider approach (whereby proof is allowed as long as value has been given for the bill at some stage). See Christian i 420. While James Rogers in The Early History of the Law of Bills and Notes, A Study of the Origins of AngloAmerican Commercial Law (Cambridge 1995) ADD PAGE argues that the courts did not fully accept accommodation bills until the 1820s-1830s, Bloxham makes it clear that Lord Eldons allowed them to be proved in bankruptcy from the earliest years of the 1800s. while Christian himself decried the fact that not properly inquiring into a bankrupts acceptances allowed debts provable against his estate to be manufactured to easily.12 52(3?) Geo III c.163 (1812) established the court for the relief of insolvent debtors. It was extended in 1816 by 56 Geo. III c.102. It underwent further reforms in the 1820s to make its procedures more akin to those in bankruptcy. 3 Geo IV c.123 (1822) allowed the court to specify that the detained debtor was to be kept within the walls of the prison, rather than within the liberties. The original act was kept in force and altered by 1 Geo IV c119. Further 5 Geo IV c.61 (1824) empowered the insolvency commissioners to go on circuit, and made a petition to the court an act of bankruptcy. Also 7 Geo IV c.57 (1826), consolidated the previous legislation on the court and defined its jurisdiction. See for the instance Taxation Act 1801 (41 Geo 3 c 10), Stamp Act 1803 (43Geo 3 c 21, Ireland), Postage Act 1803 43 Geo III c 28, section 4(Ireland)
12

Christian Bankrupt Laws (n Error! Bookmark not defined.) vol 2, 384

The type of action the payee could bring would depend on the substance of the transaction rather than the form, and would particularly depend upon what value was given and between which parties. See Bailey 285-286.
An acceptance could be a general, and therefore be an undertaking to pay the according to the terms of the bill, or specify the terms on which the acceptor was to pay. Bayley 132.

The drawee would be a bank or debtor of the drawer. See for instance Ex parte Rathbone (1818) 1 Buck 215 It should be note that, in theory at least, the contractual incidents of a bill of exchange between the initial parties to it could be fully imitated using other means of contracting, in particular a deed. See Christian Bankrupt Laws (n Error! Bookmark not defined.) vol 2, 364-5. For set-off see Bayley 359-363 and Chitty 607-617 In light of the above it is important to note that the term bona fide is used in the bankruptcy cases and textbooks written in the early 1800s whilst discussing the law in this area, and does not bear its standard modern meaning in that it can refer to a third party with notice of the lack of accommodation: it simple refers to the absence of fraud. See Chitty 240 and Smith v Knox (1799) 3 Esp 46, 170 ER 553 where Eldon makes clear that a party who takes an accommodation bill with notice can bring an action on the bill. Bayley 393, citing Darnell v Williams [1817] 2 Stark 166, 71 ER 608
It should be noted that while Christian argued that proof of gratuitous debts against bankrupt estates should not be allowed, he did not claim that the debt was entirely void. The creditor retained his action against the bankrupt in spite of a certificate of discharge.

See for instance Christian ii 386, The requirement that the debt be due at the time of bankruptcy was modified by Bankrupts Act 1806, (46 Geo 3 c 135), s 9, which provided that all debts contracted by the bankrupt, if taken by the creditor bona fide, two months before the date of the commission, were valid and could be proved in the commission. Cf Chitty (n Error! Bookmark not defined.) 589

This is made clear by the wording of the Bankruptcy Act 1623 (21 Jac 1 c 19), s9, and the Bankruptcy Act 1731 (5 Geo 2 c 30), s 24, text to n Error! Bookmark not defined. and 2