Re H., an Arranging Debtor

• Jurisdiction: Ireland
• Judgment Date: 25 May 1877
• Date: 25 May 1877
• Court: Chancery Division (Ireland)

Bankruptcy.

RE H., AN ARRANGING DEBTOR.

Arranging debtor — Refusal to sign composition notes — Comtempt — Attachment.

106 THE IRISH REPORTS. [I. It. V. C. Court. gifts may be made to stand together, the earlier shall not be 1876. • displaced by the later. I think it is not an unreasonable construe INGHAM V. INGHAM. tion to hold that the gift to William J. Ingham was intended to take effect only in the event of Maria Finlay predeceasing the testator, and that this event not having happened, she took an absolute interest in this leasehold. The legacy to Mary Daly, charged on these lands in the event of their passing to W. J. Ingham also fails. This denomination will be liable, in the cause of Ingham v. Ingham, to payment of the costs and debts, and must be there administered. Any surplus of the proceeds will be assets of Maria Finlay, and subject to the trusts of her will. The lands of Carrickgan must be dealt with in the suit of Daly v. Daly. Solicitor for Plaintiff in second cause : .31r. John Thomas Hinds. Solicitors for Joseph Daniel Ingham, Plaintiff in first cause : Messrs. D'Alton Smith. Solicitors for Defendant Hugh John Ingham : Messrs. Maxwell 8 Weldon. Solicitor for A. T. O'Reilly : Mr. Charles D. Ingham. RE H., AN ARRANGING DEBTOR. Arranging debtor-Refusal to sign composition notes-Contempt-Attachment. The proposal of an arranging debtor, by which he undertook to execute certain composition notes for the amount of his liabilities, and which preserved to ail the creditors the full exercise of all their powers and remedies, was finally confirmed by the Court and entered of record, but the debtor refused to sign the notes when tendered to him for his signature :-the Court, on the application of some of the creditors, made an order that he should sign the notes, and, upon his declining to obey the order, issued an attachment against him for contempt. H. FILED his petition for arrangement on the 4th of August, 1876, and, on the 13th of October, the first private sitting was held, at which a proposal was carried to pay twenty shillings in the pound. in four equal instalments at four, eight, twelve, and sixteen months; the first to be secured by the promissory notes of VOL. XI.] EQUITY MIES. 107 the Petitioner, and the other three to be secured by the joint and Bankruptcy. several promissory notes of the Petitioner and M. H. and P. M., 1877. with power to any creditor to apply to the Court to turn the mat- .Re H., AN ter into bankruptcy, or to realize the estate in the event of non- ARRANGING payment of any of the instalments, but without prejudice to the DEBTOR. liabilities of the sureties upon the notes, it being agreed that, under any circumstances, the liability of the sureties should conÂÂtinue upon the notes until they were fully paid. The requisite consent and undertaking of the sureties were signed on the 19th of October, and filed in the Court on the 21st of October. Upon the 3rd of November the Petitioner's proposal was assented to by the requisite majority of the creditors, and was confirmed by and entered of record in the Court. When the notes were preÂÂsented to the debtor for his signature he refused to sign them, upon the ground that since the confirmation of his proposal he had ascertained that his estate could not pay more than twelve shilÂÂlings and sixpence in the pound; whereupon a motion was made on behalf of several of the creditors for an order to compel him to sign the notes. Mr. Houston, in support of the motion.-This debtor, by preÂÂsenting a petition for arrangement and making a proposal to pay twenty shillings in the pound, and thereby getting protection, has prevented his creditors proceeding to realize the estate ; and it is no answer to this application to say that he cannot now carry out the agreement which he solemnly entered into in November last. He should, before he entered into that agreement with his creditors, have ascertained that his estate would not pay more than twelve shillings and sixpence in the pound. The composition deed has been duly executed, and now he seeks to upset the whole arrangeÂÂment. The Court should compel him to fulfil his undertaking, upon the faith of which his creditors assented to his proposition. Mr. Monroe, contra.-The Court should not grant this appliÂÂcation. The Petitioner now finds that his estate cannot pay twenty shillings in the pound, and he has sent a notice to that effect to all his creditors. He has submitted to the Court as constituted by Act of Parliament, and, under the circumstances, the Court cannot 108 THE IRISH REPORTS. [I. IL H., AN ARRANGING be able to pay them when they become due, and the estate would, DEBTOR. consequently, under the Bankrupt and Insolvent Act of 1857, s. 353, be turned into bankruptcy, and greater expense would be incurred. It is really senseless for creditors to come here and ask the Court to compel a man to sign bills which he cannot possibly pay when they become due. The only jurisdiction here is to turn the matter into bankruptcy. The Court could not order him to pay the notes ; it would be absurd, for he could not do so. The application is to compel a man to do what may prove utterly futile, and which must necessarily cause a waste of money. This matter should be dealt with under s. 353 of the Act of 1857, which exÂÂpressly provides for such a case as this. MILLER, J. :- The petition for arrangement in this matter was filed so far back as the 4th of August, 1876, the first private sitting was held on the 13th of October, 1876, and during that interval the arrangÂÂing debtor had the fullest opportunity of considering his position. The proposal made by the arranging debtor at that first sitting was-" An offer of twenty shillings in the pound on all his unÂÂsecured debts and engagements, and on so much of his partly-secured debts and...