REMARKS ON THE BANKRUPT-LAWS.

It would engage us in a long digressive discussion were we to inquire how the spirit of the laws in England, so famed for lenity, has been exasperated into such severity against insolvent debtors; and why, among a people so distinguished for generosity and compassion, the gaols should be more filled with prisoners than they are in any other part of Christendom. Perhaps both these deviations from a general character are violent efforts of a wary legislature made in behalf of trade, which cannot be too much cherished in a nation that principally depends upon commerce. The question is, whether this laudable aim may not be more effectually accomplished, without subjecting individuals to oppression, arising from the cruelty and revenge of one another. As the laws are modelled at present, it cannot be denied that the debtor, in some cases, lies in a peculiar manner at the mercy of his creditor. By the original and common law of England, no man could be imprisoned for debt. The plaintiff in any civil action could have no execution upon his judgment, against either the body or the lands of the defendant: even with respect to his goods and chattels, which were subject to execution, he was obliged to leave him such articles as were necessary for agriculture. But, in process of time, this indulgence being found prejudicial to commerce, a law was enacted, in the reign of Edward I. allowing execution on the person of the debtor, provided his goods and chattels were not sufficient to pay the debt which he had contracted. This law was still attended with a very obvious inconvenience: the debtor, who possessed an estate in lands, was tempted to secrete his moveable effects, and live in concealment on the produce of his lands, while the sheriff connived at his retirement. To remove this evil, a second statute was enacted in the same reign, granting immediate execution against the body, lands, and goods of the debtor; yet his effects could not be sold for the benefit of his creditors till the expiration of three months, during which he himself could dispose of them for ready money, in order to discharge his incumbrances. If the creditor was not satisfied in this manner, he continued in possession of the debtor’s lands, and detained the debtor himself in prison, where he was obliged to supply him with bread and water for his support, until the debt was discharged. Other severe regulations were made in the sequel, particularly in the reign of Edward III. which gave rise to the writ of capias ad satisfaciendum. This indeed rendered the preceding laws, called statute-merchant, and statute-staple, altogether unnecessary. Though the liberty of the subject, and the security of the landholder, were thus in some measure sacrificed to the advantage of commerce, an imprisoned debtor was not left entirely at the mercy of an inexorable creditor. If he made all the satisfaction in his power, and could show that his insolvency was owing to real misfortunes, the court of chancery interposed on his petition, and actually ordered him to be discharged from prison, when no good reason for detaining him could be assigned. This interposition, which seems naturally to belong to a court of equity, constituted with a view to mitigate the rigour of the common law, ceased, in all probability after the restoration of Charles the Second, and of consequence the prisons were filled with debtors. Then the legislature charged themselves with the extension of a power, which perhaps a chancellor no longer thought himself safe in exercising; and in the year one thousand six hundred and seventy, passed the first act for the relief of insolvent debtors, granting a release to all prisoners for debt, without distinction or inquiry. By this general indulgence, which has even in a great measure continued in all subsequent acts of the same kind, the lenity of the parliament may be sometimes misapplied, inasmuch as insolvency is often criminal, arising from profligacy and extravagance, which deserve to be severely punished. Yet, even for this species of insolvency, perpetual imprisonment, aggravated by the miseries of extreme indigence, and the danger of perishing through famine, may be deemed a punishment too severe. How cruel then must it be to leave the most innocent bankrupt exposed to this punishment, from the revenge or sinister design of a merciless creditor; a creditor, by whose fraud the prisoner became a bankrupt, and by whoso craft he is detained in gaol, lest by his discharge from prison, he should be enabled to seek that redress in chancery to which he is entitled on a fair account! The severity of the law was certainly intended against fraudulent bankrupts only; and the statute of bankruptcy is, doubtless, favourable to insolvents, as it discharges from all former debts those who obtained their certificates. As British subjects, they are surely entitled to the same indulgence which is granted to other insolvents. They were always included in every act passed for the relief of insolvent debtors, till the sixth year of George I. when they were first excepted from this benefit. By a law enacted in the reign of queen Anne, relating to bankruptcy, any creditor was at liberty to object to the confirmation of the bankrupt’s certificate; but the chancellor had power to judge whether the objection was frivolous or well-founded: yet, by a latter act, the chancellor is obliged to confirm the certificate, if it is agreeable to four-fifths in number and value of the creditors; whereas he cannot confirm it, should he be opposed, even without any reason assigned, by one creditor to whom the greatest part of the debt is owing. It might, therefore, deserve the consideration of parliament, whether, in extending their clemency to the poor, it should not be equally diffused to bankrupts and other insolvents; whether proper distinction ought not to be made between the innocent bankrupt who fails through misfortune in trade, and him who becomes insolvent from fraud or profligacy: and finally, whether the inquiry and trial of all such cases would not properly fall within the province of chancery, a tribunal instituted for the mitigation of common law.