Re Ball

JurisdictionIreland
CourtKing's Bench Division (Ireland)
Date17 February 1899

Q. B. Div., Bankruptcy

Appeal.

Boyd, J; Lord Ashbourne C

IN RE BALL, A BANKRUPT.

Ashley v. Kell 2 Stra. 1207.

Atkinson's Trusts 2 DeG. M. & G. 140.

Barr's TrustsENR 4 K. & J. 219.

Buchan v. Hill W. N. 1888, p. 233.

Butler v. HobsonENR 4 Bing. (N. C.) 290.

Chippendale v. Tomlinson Cook's Bankrupt Laws, 260.

Clayton & Barclay's ContractELR [1895] 2 Ch. 212.

Cohen v. MitchellELR 25 Q. B. D. 262.

Cook v. WhellockELR 24 Q. B. D. 658.

Drayton v. DaleENR 2 B. & C. 293.

Evans v. Brown Ib. 170.

Ex parte Ansell 19 Ves. 208.

Ex parte Dewhurst; In re VanloheELR L. R. 7 Ch. App. 185.

Ex parte FordELR 1 Ch. D. 521.

Ex parte ProudfootENR 1 Atk. 253.

Ex parte Rabbige: In re PooleyELR 8 Ch. D. 367.

Ex parte WatsonELR 12 Ch. D. 380.

Fowler v. DownUNK 1 B. & P. 44.

Fyson v. ChambersENR 9 M. & W. 460.

Herbert v. Sayer 5 Q. B. 965.

Hunt v. FrippELR [1898] 1 Ch. 675.

In re Bright's SettlementELR 13 Ch. D. 413.

In re Clarke: Ex parte BeardmoreELR [1894] 2 Q. B. 393.

In the Trusts of the Will of Mary CoombeENR 1 Giff. 91.

Jameson v. The Brick and Stone Co., LimitedELR 4 Q. B. D. 208.

Kitchen v. BartschENR 7 East, at p. 61.

Kitchen v. BartschENR 7 East. 53.

Kitson v. HardwickELR L. R. 7 C. P. at p. 479.

La Roche v. WakemanENR Peake, 140.

Lloyd v. BanksELR L. R. 4 Eq. 222.

M'Entire v. PotterELR 22 Q. B. D. 438.

Meggy v. The Imperial Discount Co.ELR 3 Q. B. D. 711.

Morgan v. Knight 33 L. J. (N. S.) C. P. 168.

Morgan v. KnightUNKENR 33 L. J., C. P. 168; 15 C. B. (N. S.) 669.

Palmer v. LockeELR 18 Ch. D. 381.

Re ClarkeELR [1894] 3 Q. B. 393.

Silk v. OsborneENR 1 Esp. 140.

The New Land Corporation v. GrayELR [1892] 2 Ch. 138.

Webb v. FoxENR 7 T. R. 391.

Webb v. FoxENR 7 T. R. 397.

Bankruptcy — After-acquired property — Executor — Payment of legacy to uncertified bankrupt — No intervention by the assignees — Liability of executors —

VOL. II.] QUEEN'S BENCH DIVISION. 313 IN RE BALL, A BANKRUPT. Bankruptcy—After-acquired property—Executor—Payment of legacy to unÂcertified bankrupt—No intervention by the assignees—Liability of executors —Dish Bankrupt and Insolvent Act, 1857, sect. 267. Where a person became entitled to a legacy after he had been adjudicated a bankrupt; and, before he had obtained his discharge, such legacy was paid to him by the testator's executors, acting bona fide, without notice of his bankruptcy, and before any intervention on the part of the assignees in bankÂruptcy to assert title to the legacy for the benefit of the creditors of the bankrupt :— Held, by the Court of Appeal (reversing the decision of Boyd, J.), that the executors were not liable to the assignees for the amount of the legacy, under sect. 267 of the Irish Bankrupt and Insolvent Act, 1857 (20 & 21 Viet. c. 60). Herbert v. Sayer (5 Q. B. 965) applied. Tins was an application on behalf of the assignees for a declaration that the legacies bequeathed to the bankrupt by Dorcas J. Teulon, deceased, had become and were vested in them, and that they were entitled to recover from, and be paid the same by, the executors of her will ; and for an order that the executors should bring into Court the amount of such legacy. On the 26th March, 1888, Edward Ball was adjudicated a bankrupt, but at the date of the present proceedings he had not passed his final examination or obtained his certificate. By her will Mrs. Dorcas J. Teulon, an aunt of the bankrupt, bequeathed to him legacies amounting to £1200. She died on 4th February, 1896, and her will was duly proved by the executors on 15th April, 1896. The legacies were paid by the executors to the bankrupt on 18th May, 1896. Prior to that date, however, it appeared that the executors had advanced a sum of £100 to the bankrupt, and had also paid to certain persons charges created by the bankrupt in their favour on the legacies, so that the actual sum paid to the bankrupt on that date amounted to £1053 17s. 314 THE IRISH REPORTS. [1899. Q. B. Div. It was not until the 2nd April, 1898, that the assignees became 1898' aware of the fact that the bankrupt had become entitled to the In re BALL. Campbell, Q.C., and Samuels, Q.C., for the assignees. Ronan, Q.C., and Illoiphy, for the executors. The authorities cited in argument are referred to by Boyd, J., in giving judgment. Dec. 6. BOYD, J. :— On the 26th March, 1888, Edward Ball, described as of 36 Victoria-street, in the City of Dublin, law clerk, was adjudicated a bankrupt, and notice of such adjudication was duly published in the Dublin Gazette, and two Dublin newspapers. The debts reÂturned in his schedule amounted to £4533 12s. 7d., and his assets to £12, being his household goods, but no sum whatever has been realised. Shortly after his adjudication he left Ireland. No creditor's assignee was appointed in his bankruptcy, and whither he went or what he was doing was unknown to the official assignees. He did not pass his final examination or obtain his certificate. On the 4th of February, 1896, his aunt, Mrs. Dorcas Jane Teulon, died, and by her will she bequeathed to him legacies amounting to £1200. The will was proved on the 15th April, 1896, by her executors, Townley B. B. Ball (who was an uncle of VoL. II.] QUEEN'S BENCH DIVISION. 315 the bankrupt and residuary legatee of the testatrix), Wm. F. St. Q. B. . Leger, a solicitor of Fermoy, and George C. Ball Greene. W. W. 1898. Carruthers, solicitor, of Dublin, was the solicitor who acted for In re the said executors, and procured the probate of the said will. BALL. It appears from the evidence of Mr. Carruthers, given before Boyd, J me, and the correspondence furnished by him, that the said legacies were paid by the executors to the bankrupt on or about the 18th of May, 1896. Prior to this date the executors had advanced to him a sum of £100, and the bankrupt had given charges on the legacies to several persons in England, of which the executors reÂceived notice, and which were paid by them to the said chargeants, and the sum actually paid by them to the bankrupt amounted to £1053 17s. On the 2nd of April, 1898, the assignees in bankÂruptcy first became aware that the bankrupt had been bequeathed the said legacies. This information was communicated to them in a letter from Messrs. D. & T. Fitzgerald, dated 1st April, 1898. The bankrupt had been appointed receiver in several matters in the Land Judge's Court, and having been a defaulter in said matters his sureties, the London Guarantee and Accident Company, were obliged to pay very large sums on his account. Messrs. FitzÂgerald were the solicitors for the said Company, and as such wrote the said letter to the assignees. From inquiries then made the assignees ascertained that it was a fact that said legacies had been paid to the bankrupt on his receipt as before mentioned. The case now comes before me on an application by the assignees " that it may be declared that the legacies bequeathed to the bankrupt by Dorcas Teulon, deceased, became and are now vested in the assignees in bankruptcy, and that the said assignees are entitled to recover from, and be paid the same by, the executors of the said Dorcas J. Teulon, deceased, and for an order that the executors do bring into Court the amount of such legacies." This notice has been treated before me by consent as a charge, and the case has been argued as on charge and discharge. The contention of the assignees has been based upon the 267th section of the Bankruptcy Act of 1857, which is as follows : —" When any person shall be adjudged a bankrupt . . . all the personal 316 THE IRISH REPORTS. [1899. Q. B. Dir. estate and effects of such bankrupt . . . present and future, where 1898. soever the same may be, and all property which he may purchase, In re or which may revert, descend ueath , be devised or be to BALL , or come . him before such bankrupt shall have obtained his certificate .. . Boyd, J. and all debts due or to be due to him shall become absolutely vested in the assignees for the time being for the benefit of the creditors of the bankrupt .. . and no such bankrupt . .. nor any person claiming through or under him shall have power to recover the same, nor to make any release or discharge thereof, neither shall same be attached as the debt of such bankrupt . . . by any person according to the custom of the City of Dublin or otherwise, but such assignees shall have absolute power and remedy to recover the same in their own names." The section also deals with insolvents, but I have omitted the portions dealing with them as not being applicable to the present case. The assignees contend that the words of this section are so explicit that they are clearly entitled to recover from the executors the amount of the legacy. The executors, on the other hand, contend that, as to property in existence at the time of the adjudication, it no doubt vests in the assignees ; but as to property which may be acquired by a bankrupt after his adjudication and before he obtains his certificate, a right exists in the bankrupt to deal with it, and that the assignees acquire no right to it, till they intervene and demand possession of it before it has been parted with by the bankrupt to a bona fide purchaser for value. Prima facie, the wording of the above section 267 seems clear and specific, and apparently sustains the claim of the assignees in this case. But several cases have been decided in the English Courts in which the claims of the assignees to after-acquired property of bankrupts have been defeated. It is therefore necessary to consider the terms of the English Acts in force at the times those decisions were pronounced, and also the grounds on which the decisions were based. The law in bankruptcy has been the subject of several statutes in England, and the wording of the clauses therein relating to the rights of assignees to the property of bankrupts has been considerably altered from time to time. VOL. II.] QUEEN'S...

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