Hitherto the question had been dealt with as one of legal Act of 1883. procedure; it was now treated as an act of commercial legislation, the main object of which, while providing by carefully framed regulations for the equitable distribution of a debtor's assets, was to promote and enforce the principles of commercial morality in the general interests of the trading community. One of the chief features of the act of 1883 is the separation which it has effected between the judicial and the administrative functions which had previously been exercised by the court, and the transfer of the latter to the Board of Trade as a public department of the state directly responsible to parliament. Under the powers conferred by the act a new department was subsequently created under the title of the bankruptcy department of the Board of Trade, with an officer at its head called the inspector-general in bankruptcy. This department exercises, under the direction of the Board of Trade, a general supervision over all the administrative work arising under the act. It has extensive powers of control over the appointment of trustees, and conducts an audit of their accounts; and it may, subject to appeal to the court, remove them from office for misconduct, neglect or unfitness.
A report upon the proceedings under the act is annually presented to parliament by the Board of Trade, and although the department is practically self-supporting, a nominal vote is each year placed upon the public estimates, thus bringing the administration under direct parliamentary criticism and control. The act also provides for the appointment and removal by the Board of Trade of a body of officers entitled official receivers, with certain prescribed duties having relation both to the conduct of bankrupts and to administration of their estates, including the interim management of the latter until the creditors can be consulted. These officers act in their respective districts under the general authority and directions of the Board of Trade, being also clothed with the status of officers of the courts to which they are attached. While effecting this supervision and control by a public department directly responsible to parliament, the main objects of the measure were to secure - (1) An independent and public investigation of the debtor's conduct; (2) The punishment of commercial misconduct and fraud in the interests of public morality; (3) The summary and inexpensive administration of small estates where the assets do not exceed £300 by the official receiver, unless a majority in number and three-fourths in value of the creditors voting resolve to appoint a trustee; (4) Full control in other cases by a majority in value, over the appointment of a trustee and a committee of inspection; (5) Strict investigation of proofs of debt, with regulations as to proxies and votes of creditors; (6) An independent audit and general supervision of the proceedings and control of the funds in all cases.
Besides amending and consolidating previous bankruptcy legislation, the measure also contains special provisions for the administration under bankruptcy law of the estates of persons dying insolvent (§ 125); and for enabling county courts to make administration orders for payment by instalments in lieu of immediate committal to prison, in the case of judgment debtors whose total indebtedness does not exceed £50 (§ 122). It also provides for the getting in and administration by the Board of Trade of unclaimed dividends and undistributed balances on estates wound up under previous bankruptcy acts (§ 162). Lastly, it amends the procedure under the Debtors Act of 1869, dealing with criminal offences committed by bankrupts (which, prior to 1869, had been treated as part of the bankruptcy law), by enacting that when the court orders a prosecution of any person for an offence under that act, it shall be the duty of the director of public prosecutions to institute and carry on the prosecution.
An amending act, under the title of the Bankruptcy Act Act of 1890. 1890 was passed in that year, mainly with the view of supplementing and strengthening some of the provisions of the act of 1883, more particularly with regard to the conditions under which a bankrupt should be discharged or schemes of arrangement or composition be approved by the court. It also dealt with a variety of matters of detail which experience had shown to require amendment, with the view of more fully carrying out the intentions of the legislature as embodied in the principal act. These two acts are to be construed as one and may be cited collectively as the Bankruptcy Acts 1883 and 1890. They are further supplemented by a large body of general rules made by the lord chancellor with the concurrence of the president of the Board of Trade, which may be added to, revoked or altered from time to time by the same authority. These rules are laid before parliament and have the force of law.
Besides these general acts, various measures dealing with Special Acts. special interests connected with bankruptcy procedure have from time to time been passed since 1883, the chief of which are as follows, viz., the Bankruptcy Appeals (County Courts) Act 1884; the Preferential Payments in Bankruptcy Act 1888, regulating the priority of the claims of workmen and clerks, etc. for wages and salaries; and the Bankruptcy (Discharge and Closure) Act 1887, dealing with unclosed bankruptcies under previous acts.
It would be out of place in this article to attempt to answer Inquiry of 1906. the question how far later legislation has solved the difficult problems which prior to 1883 were found so intractable, but it may be mentioned that in 1906 the Board of Trade appointed a committee to inquire into and report upon the effect of the provisions of the laws in force at the time in the United Kingdom in relation to bankruptcy, deeds of arrangement and composition by insolvent debtors with their creditors, and the prevention and punishment of frauds by debtors on their creditors, and any points and matters upon which the existing laws seemed to require amendment. The committee received a vast amount of evidence as well as documents and memoranda from chambers of commerce, trade protection societies and influential public bodies. The scope of the inquiry was not limited to English law and procedure, but also embraced that of Germany, France, Australia, Scotland and Ireland. The report of the committee was issued in 1908 (Cd. 4068), and reference may be made to it for much valuable information. The committee reported that the result of their inquiry did not disclose any dissatisfaction on the part of the commercial community with the main features of the existing law and procedure.