has been examined in open court or at a meeting of his creditors, and has filed in court the schedule of his property and the list of creditors required to be filed by bankrupts.

The application for confirmation of composition must, before filing, be accepted in writing by a majority in number and amount of the creditors; and the consideration to be paid to the creditors. and the amount necessary for payment of debts entitled to priority and the costs of proceedings must be deposited, subject to the order of the judge. After notice to creditors and hearing on any objections, the composition will be confirmed if the judge is satisfied that: "(1) It is for the best interests of the creditors; (2) the bankrupt has not been guilty of any of the acts or failed to perform any of the duties which would be a bar to his discharge; and (3) the offer and its acceptance are in good faith and have not been made or procured except as provided in the Act, or by any means, promises or acts therein forbidden." Upon the confirmation of a composition the consideration is distributed as the judge directs and the case demands. The confirmation of a composition discharges the bankrupt from his debts, other than those agreed to be paid by the terms of the composition and those not affected by a discharge, and the bankrupt's property and estate revest in him.

The bankrupt may apply for his discharge after the expiration of one month and within the next twelve months subsequent to the adjudication, or, if unavoidably prevented, he may do so within, but not after, the next six months. Objection to the discharge may be made by any party in interest on any one or more of the following grounds: "(1) That the bankrupt has committed an offense punishable under the Act by imprisonment," viz: having knowingly concealed while bankrupt, or after his discharge, from his trustee any of the property belonging to his estate in bankruptcy, or having made a false oath or account in, or in relation to, any proceeding in bankruptcy; "or, (2) with intent to conceal his financial condition, destroyed, concealed or failed to keep books of account or records from which such condition might be ascertained; or (3) obtained money or property on credit upon a materially false statement in writing made by him to any person or his representative for the purpose of obtaining credit from such person; or (4) at any time subsequent to the first day of the four months immediately preceding the filing

of the petition transferred, removed, destroyed or concealed, or permitted to be removed, destroyed or concealed, any of his property, with intent to hinder, delay or defraud his creditors; or (5) in voluntary proceedings, been granted a discharge in bankruptcy within six years; or (6) in the course of proceedings in bankruptcy refused to obey the lawful order of, or to answer any material question approved by, a Court."

A discharge may be revoked, on application of any party in interest, within one year if on trial it appears that it was obtained through fraud of the bankrupt, of which the petitioner acquired knowledge after the discharge, and that the discharge was not warranted by the actual facts. A composition may be set aside on like grounds within six months after confirmation.

"A discharge in bankruptcy releases a bankrupt from all of his provable debts, except such as (1) are due as a tax levied by the United States, the State, county, district or municipality in which he resides; (2) are liabilities for obtaining property by false pretenses or false representations, or for wilful and malicious injuries to the person or property of another, or for alimony due or to become due, or for maintenance or support of wife or child, or for seduction of an unmarried female, or for criminal conversation; or (3) have not been duly scheduled in time for proof and allowance, with the name of the creditor, if known to the bankrupt, unless such creditor had notice or actual knowledge of the proceedings in bankruptcy; or (4) were created by his fraud, embezzlement, misappropriation, or defalcation while acting as an officer or in any fiduciary capacity."

VOLUNTARY ASSIGNMENTS.

Voluntary assignments for the benefit of creditors are of common occurrence, and are regulated by statute in many of the States. The terms of these assignments vary greatly. In some States they may provide that certain creditors may be preferred. and their claims paid before others; in other States, as in Massachusetts, all creditors must be placed upon the same footing, and the insolvent's estate must be settled on lines substantially like those of the Bankruptcy Act.

While the making of such an assignment is of itself under the statute an act of bankruptcy, and the assignment is liable to be set aside by bankruptcy proceedings at any time within four

months, it is frequently done to preserve the insolvent's estate, by preventing attachments which would shut down his business, until a meeting of the creditors can be held, and they can decide in what way the debtor's affairs shall be settled. It often happens, also, that by reason of the greater freedom of action permissible under an assignment, an insolvent estate can be settled in this way with less delay and expense than it would in bankruptcy, and so is preferred by the creditors.

A form of assignment will be found at the end of this chapter, which can be modified to suit the circumstances of any particular

case.

(337.)

General Letter of Attorney-in-Fact, When Creditor Is Not Represented by Attorney-at-Law.

In the District Court of the United States for the

District of

do hereby authorize you, or any one of you, to attend the meeting or meetings of creditors of the bankrupt aforesaid at a court of bankruptcy, wherever advertised or directed to be holden, on the day and at the hour appointed ard notified by said court in said matter, or at such other place and time as may be appointed by the court holding such meeting or meetings, or at which such meeting or meetings or any adjournment or adjournments thereof may be held, and then and there from time to time, and as often as there may be occasion, for me and in my name to vote for or against any proposal or resolution that may be then submitted under the acts of Congress relating to bankruptcy; and in the choice of trustee or trustees of the estate of the said bankrupt, and for me to assent to such appointment of trustee; and with like powers to attend and vote at any other meeting or meetings of creditors, or sitting or sittings of the court, which may be held therein for any of the purposes aforesaid; also to accept any composition proposed by said bankrupt in satisfaction of his debts, and to receive payment of dividends and of money due me under any composition, and for any other purpose in my interest whatsoever, with full power of substitution.

In Witness Whereof, I have hereunto signed my name and affixed my seal the A. D. 19

day of

I hereby authorize you, or any one of you, to attend the meeting of creditors in this matter, advertised or directed to be holden at

before

, on the day of or any adjournment thereof, and then and there for me and in my name to vote for or against any proposal or resolution that may be lawfully made or passed at such meeting or adjourned meeting, and in the choice of trustee or trustees of the estate of the said bankrupt.

In Witness Whereof, I have hereunto signed my name and affixed my seal the day of

Signed, sealed and delivered in presence of

(Seal.)

Proof of Unsecured Debt.

In the District Court of the United States for the

In the matter of

Bankrupt.

District of

In Bankruptcy.

the person by [or against] whom a petition for adjudication of bankruptcy has been filed, was at and before the filing of said petition, and still is, justly and truly indebted to said deponent in the sum of dollars;

that the consideration of said debt is as follows: said debt has been paid [except

; that no part of

-]; that there are no set-offs or

-]; and that deponent has not,

counterclaims to the same [except — nor has any person by his order, or to his knowledge or belief, for his use, had or received any manner of security for said debt whatever.

For proof of a secured debt the form is the same, except the last clause, for which substitute:

"and that the only securities held by this deponent for said debt are the following:

(340.)

Proof of Debt Due Corporation.

In the District Court of the United States for the

In the matter of

Bankrupt.

District of

>In Bankruptcy.

day of

A. D. 19, came and State of

officer) of the

of the State of of

in the county of

and made oath and says that he is (president or other
a corporation incorporated by and under the laws
and carrying on business at
in the county
and that he is duly authorized to make
the person by [or

and State of

this proof, and says that the said against] whom a petition for adjudication of bankruptcy has been filed, was at and before the filing of said petition, and still is, justly and truly indebted to said corporation in the sum of eration of said debt is as follows:

been paid [except

the same [except

dollars; that the consid

-; that no part of said debt has

-]; that there are no set-offs or counterclaims to -]; and that said corporation has not, nor has any person by its order, or to the knowledge or belief of said deponent, for its use, had or received any manner of security for said debt whatever.

Subscribed and sworn to before me this

19_.

[President, etc.] of said Corporation. day of

A. D.

[Official character.]