creditor's debt.

3. Petitioning and is not allowed afterwards to proceed at law, though for a demand which is alleged to be distinct from that on which he sued out the commission'.

4. Proof of bills.

IV. OF THE PROOF OF BILLS UNDER A COMMISSION. Previously to the statute 7 Geo. 1. c. 31. no debt, unless it were completely due, and payable at the time of the act of bankruptcy could be proved, though it became due before the issuing of the commission *. This statute contains the following recital and enact

ments :

"Whereas merchants and other traders in goods "have been very often obliged, and more especially "of late years, to sell or dispose of their goods and " merchandizes to such persons as have occasion for "the same, upon trust or credit, and to take bills, "bonds, promissory notes, or other personal secu"rities for their moneys, payable at the end of three, "four, or six months, or other future days of payment; and the buyers of such goods becoming

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bankrupts, and commissions of bankruptcy being "taken out against them, before the money upon "such bonds, notes, or other securities became payable, it hath been a question whether such persons, giving such credit on such securities, should be let "in to prove their debts, or be admitted to have any

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dividend, or other benefit by the commission, be"fore such time as such securities became payable, "which hath been a great discouragement to trade, "and great prejudice to credit within this realm;" for remedy whereof, it is enacted, "That all and 64 every person and persons, who have given credit, "or at any time or times hereafter, shall give credit

'Ex parte Lewis, 1 Atk. 154.-Ex parte Callow, 3 Ves. jun. 1.— Ex parte Ward, 1 Atk. 153.-Cullen, 154.-Cooke, 25.

2 Barnford v. Burrell, 2 Bos. & Pul, 1.

3 The statute says, 66

c. 30. s. 22.

persons," but this is a mistake, see 5 Geo. 2.

"on such securities as aforesaid, to any person or per- 4. Proof of bills. "sons, who is, are, or shall become bankrupts, upon

"a good and valuable consideration, bonâ fide, for

any sum or sums of money, or other matter or "thing whatsoever, which is or shall not be due or payable at or before the time of such person's be"coming bankrupt, shall be admitted to prove his,

her, and their several and respective bills, bonds, "notes, or other securities, promise, or agreements "for the same, in like manner as if they were made "payable presently, and not at a future day; and shall "be entitled unto, and shall have and receive a proportionable part, share, and dividend, of such bankrupt's estate, in proportion to the other creditors of "such bankrupt, deducting only thereout a rebate

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of interest, and discounting such securities, payable "at future times, after the rate of five pounds per "centum per annum, for what he shall so receive, to "be computed from the actual payment thereof, to "the time such debt, duty, or sum of money, should "or would have become due and payable, in and by "such securities as aforesaid." In the second section it is enacted, "That all and every person or persons, "who now are, or shall become bankrupts, shall be discharged of and from all and every such bond, "note, or other security as aforesaid, and shall have "the benefit of the several statutes now in force "against bankrupts, in like manner, to all intents and purposes, as if such sum of money had been due "and payable before the time of his becoming a "bankrupt."

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The subsequent statute, 5 Geo. 2. c. 30. s. 22. is considered as a legislative construction of the 7 Geo. 1. c. 31. and to confine that statute to written securities. But it is provided by the 49 Geo. 3.

'Hoskins v. Duperoy, 9 East. 503. and Parslow v. Dearlove, 4 East. 438. These cases settle the point doubted in Cullen, 74. and 1 Mont. 45.

4. Proof of bills. c. 121. 8. 9. "That all persons who have given credit

1st. What bills proveable,

"to any person who shall become bankrupt, upon

66

good and valuable consideration for any money whatever, which shall not be due or payable at or "before the time of such person's becoming bankrupt, "shall be admitted to prove such their debts, as if the

same were payable presently, or not at a future day; "and shall be entitled to, and shall have and receive "proportional dividends, equally with the other cre

ditors, deducting, in England, £5 per cent., and in "Ireland, £6 per cent. interest, to be computed from "the actual payment, to the time such debts would "become payable, according to the terms upon which

"the same were contracted."

Upon these statutes, the proof of a bill of exchange under a commission, may be considered under the following heads :

1st, What bill, notc, &c. may be proved.

2d, Who may prove.

3d, Against whom, or under what commission. 4th, For what sums, or to what extent, the proof may be made.

5th, The time of proof, and of claims.

6th, The mode and terms of proof, and remedy for the dividend.

7th, The consequence of not proving, and effect of certificate.

1st, What Bills are proveable.

be

From the judgment of Lord Eldon, in the case Ex parte Dewdney, it may be collected, that wherever a bill of exchange, or other negotiable security, would be valid at law, so as to support an action, it may proved under a commission; and, on the other hand, it appears to be a general rule, that a bill, not available at law or in equity, cannot be proved under a com

Ex parte Dewdney, 15 Ves. jun. 495. 15 Ves, jun. 289. and Bayl. 191.

Ex parte Mumford,

proveable.

mission. A bill founded upon an usurious gaming, or 1st. What bills other consideration, rendering it void by some statute, cannot be proved, even by a bona fide holder': and whenever the holder himself has received the bill upon any illegal contract, he cannot, in general, prove such bill in respect of such consideration; and the assignees and creditors have a right to insist, that the whole security is void, and unless they submit to pay what is really due, the court cannot order it, and frequent applications of that sort have been refused 3.

In Ex parte Bulmer, where promissory notes, given by a stock-broker for the balance of an account of money advanced to him to be employed in stockjobbing transactions, contrary to the Stock Jobbing Act, and part of the consideration consisted of the profits upon those transactions, and the residue for money received, which he had applied to his own use, Lord Erskine would not permit the petitioner to prove the promissory notes as binding obligations, as the consideration for them was made up, though in a very small part, of the fruit of the illegal use of the money lodged with the bankrupt, but allowed the petitioner to prove the sum applied by the bankrupt to his own use, as money had and received.

Where the consideration of the bill consisted of two parts, one bad and the other good, and no statute declares that the bill, under such circumstances, shall be absolutely void, the rule in equity, as well as in bankruptcy, is, that the security shall avail as to what was good. And, therefore, where a broker, having been employed to effect some insurances, one of which was illegal, (being on a voyage from Ostend to the East Indies,) the principal, in consideration of the

'Ex parte Skip, 2 Ves. jun. 489.-Ex parte Mather, 3 Ves. jun. 373.-Ex parte Mogridge, Cooke, 233.

2

Ante, 88 to 115. as to illegality of consideration in general. 'Per Lord Hardwicke, in Ex parte Skip, 2 Ves. jun, 489,--Cullen, 89.-9 Ves. jun. 84.

4 13 Ves. jun. 313. and 320.

1st. What bills proveable.

money laid out in effecting them, indorsed to him a bill drawn by himself, and payable to his own order, upon, and accepted by a person, who afterwards became a bankrupt; the broker (the indorsce) was not allowed to prove under the commission issued against the acceptor, in respect of such part of the debt as arose on the illegal insurance; but it was held, he might prove for the rest on the bill itself'. Where there has been an antecedent legal debt, and a bill is afterwards taken, but which turns out to be invalid, on account of usury, or otherwise, the demand for the antecedent debt may be resorted to and proved 2.

In regard to the form of the bill, or the mode of acceptance, or transfer, the same objections which would in general preclude the holder of a bill from suing at law, would equally prevent him from proving under a commission. A bill or note, payable at a certain time, or on demand, is proveable, though the demand be not made till after the act of bankruptcy 3. Thus, if a bill or note be payable on a contingency, it cannot be proved. So with regard to the acceptance, it must be of such a nature, that the party might have supported an action. We have seen, that in the case of Ex parte Dyers, it was held, that a letter, undertaking to accept bills already drawn, is an acceptance, and that the bills may be proved as accepted. The indorsement also is governed by the same rules in bankruptcy, as in an action, and therefore, in re Barrington v. Burton, where B. handed over a negotiable note, for valuable consideration,

Ex parte Mather, 3 Ves. jun. 373.-Cullen, 89.-1 Mont. 115. Ex parte Blackburne, 10 Ves. jun. 206.—Ferrall v. Shaen and others, 1 Saund. 295.-3 Campb. 119.-2 Taunt. 184. 3 Ex parte Beaufoy, Co. B. L. 159.

Ex parte Adney, Cowp. 460.-Ex parte Tootell, 4 Ves. jun. $72. Ex parte Minet, 14 Ves. jun. 189.-Ex parte Barker, 9 Ves. jun. 110. In re Barrington, 2 Scho. & Lef. 112.-1 Mont. 127. n. c.— Instances of contingencies, see ante, 55 to 64.

6

56 Ves. jun 9.—Ante, 230.

2 Scho. & Lef. 112.-And sec Ex parte Harrison, 2 Bro. 615.— Cooke, 209.