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lates the name of any domestic manufacture, or manufacturer or trader; or of any manufacturer or trader located in any foreign country which, by treaty, convention, or law affords similar privileges to citizens of the United States; or which copies or simulates a trade-mark registered in accordance with the provisions of the Act; or which bears a name or mark calculated to induce the public to believe that the article is manufactured in the United States, or that it is manufactured in any foreign country or locality other than the country or locality in which it is in fact manufactured.

In order to aid the officers of the customs in enforcing this prohibition, it is also provided that such manufacturers or traders as are entitled to its protection may register their names and residences, the names of the localities in which their goods are manufactured, and copies of the certificate of registration of their trade-mark, with the Treasury Department, and may also furnish the Department with facsimiles of such names.

CHAPTER XVII.

BANKRUPTCY.

§1. Constitutional provision. The delegates assembled in the Federal constitutional convention in 1787, evidently realizing the intimate connection with and the importance to commerce of a system of bankruptcy laws, inserted in the Constitution a provision giving Congress power, not only over commerce in general between the states, but power to make uniform laws on the subject of bankruptcies throughout the United States.1 This was the earliest expression on the subject given by the Union.

§ 2. State versus Federal bankruptcy laws. The Constitution gave Congress the power to pass bankruptcy laws. Congress has exercised its power at four different times, but long periods of time have elapsed between the repeal of one law and the passage of another. During these periods state bankruptcy laws are operative and in full force. Some states have what may be deemed modern bankruptcy laws while others are only insolvent or poor debtors' acts and stand midway between the common law and a modern system in their operation and effect. When Congress passes an act it operates to suspend all state bankruptcy laws except as to subjects covered by state laws and not covered by the national Act. By suspension is not meant a repeal but merely causing to be dormant, and when the Federal law is repealed such laws spring again into full force. They are effective then, not only to punish acts done after the repeal but even before the repeal, which were not taken advantage of to institute proceedings under the national Act.

1 U. S. Const., Art. I, sec. 8, § 4.

Section 1. Who May Be Bankrupt.

§3. Voluntary and involuntary bankrupts. The earliest bankruptcy laws both in England and in the United States permitted only involuntary proceedings. By this is meant that a party could be a bankrupt only in the event that he did some act, designated by law, as a consequence of which the creditor or creditors injured could proceed against him, compel him to give up his property, submit to the conditions imposed, and accept the benefits, if any, if not, then the burdens, of the bankruptcy law. Thus, involuntary proceedings are those which creditors take to force a debtor to become a bankrupt. When a debtor, however, found his circumstances such as to make him desirous of going through bankruptcy on his own initiative, he could not do so. It suggested itself at once to shrewd debtors to induce friendly creditors to take the necessary proceedings. In the course of the development of the laws, the voluntary feature was annexed, whereby it became possible for a debtor to make application to a court of bankruptcy on his own motion, without the necessity of resorting to the collusive method mentioned, surrender his property, and be made a bankrupt.

The two methods of becoming a bankrupt exist in the law of 1898, but not all persons, treating corporations as artificial persons, are amenable to the law in involuntary proceedings, nor are all persons capable of instituting voluntary proceedings.

§ 4. Who may be voluntary bankrupts? All natural persons may be voluntary bankrupts.2 Farmers, wage earners, traders, private bankers, in fact, any natural person owing debts may be a voluntary bankrupt, entirely regardless of the amount of his debts, of the relation between the amount of the debts and the value of his assets, or of the question whether he had any assets at all. A person having enough property to pay his debts in full, who desires to discontinue business, may file a petition in the Federal courts and have his property taken by an officer of that court and the proceeds distributed among his creditors, thus re

2 Sec. 4a. Note.-The references herein made to a section, as Sec. 4a, refer to the sections of the law of 1898 as amended in 1903 and 1906. A convenient pamphlet form of the law can be had by applying to Congressmen.

lieving himself from the time, care, and expense of disposing of the assets and paying the debts. A debtor owing but a single debt may take voluntary proceedings. The petitioner must, however, have had his principal place of business, resided, or had his domicile, for the preceding six months or the greater part thereof, within the territorial jurisdiction of the court wherein he files his petition.

That form of business association known as a partnership may be a voluntary bankrupt. One of the partners may make the application and the partnership be adjudged a bankrupt, or both the partnership and all the individuals may join and be made bankrupts. Furthermore, married women (where by the law they may own separate property and incur liabilities) and infants may be voluntary bankrupts. Even aliens may be voluntary bankrupts, if they have property in the court's jurisdiction. A's to them the requirement of domicile, residence, or principal place of business, in the territorial jurisdiction of the court is dispensed with by the provision of the Act.

§ 5. Who may be involuntary bankrupts? As stated, all natural persons may be voluntary bankrupts. The law expressly provides that artificial persons cannot be voluntary bankrupts. All natural persons owing debts amounting to one thousand dollars or over, except wage earners (i. e., those employed for wages, salary, or hire at a rate not exceeding one thousand five hundred dollars a year) and those engaged in farming or the tilling of the soil, may be involuntary bankrupts. Among the natural persons would be classed the business partnership or unincorporated company and those mentioned in the preceding subsection that may be voluntary bankrupts, except the wage earners and farmers. A limited number of artificial persons, i. e., corporations, may be made involuntary bankrupts. Thus, those corporations engaged principally in manufacturing, trading, printing, publishing, mining, or mercantle pursuits may be adjudged involuntary bankrupts, in case they owe at least one thousand dollars in debts. So the classification itself fixes a narrow limit upon the corporations that may be made involuntary bankrupts.

§ 6. Inclusion of corporations strictly construed. The term "mercantile pursuits," as construed by the courts is practically,

no broader than the term "trading," which is given its ordinary signification of buying and selling articles of commerce for profit. Buying and selling real estate is not included, because it is not an article of commerce.

87. Same: Examples. Thus, corporations engaged in a carrying and transportation business, such as railroads, pipe lines for forwarding oil or water, and carriers of electricity, are not subject to the law. Again, those engaged in construction work, manufacturing articles attached to the soil as distinguished from those that are freely moving articles of trade, such as corporations engaged in erecting concrete arches, constructing dams, bridges, and houses, are, according to the interpretation given by the courts, not amenable to the law.

The jurisdictional requirements that the alleged bankrupt have his domicile, residence, or principal place of business in the district where proceedings are instituted are the same for involuntary bankrupts as for voluntary (see § 4, above).

Section 2. Acts of Bankruptcy.

§8. Act of bankruptcy necessary for involuntary proceedings. In the earliest English bankruptcy legislation, creditors could proceed against a debtor only in case he had violated some specific provision of a statute, and had, so to speak, committed a quasi-criminal offense. Such a requirement still persists. Under the present law creditors are required to show that the debtor, either of his own volition or from unavoidable circumstances, has affirmatively perpetrated some act prohibited by it, or by inaction has left something undone which he should have done, before they can subject him to its provisions as to surrender of property, distribution of assets, and other features. To state the same thing more briefly, they are required to show that he has committed one or more of several so-called acts of bankruptcy.

§ 9. Act of bankruptcy not essential in voluntary proceedings. While it is necessary in involuntary proceedings for creditors to establish some act done by a debtor prohibited by the statute, this is not true in cases where a debtor seeks the juris

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