Re William Ryan, a Bankrupt v Bankrupt

• Jurisdiction: Ireland
• Judgment Date: 02 June 1853
• Date: 02 June 1853
• Court: Court of Bankruptcy and Insolvency (Ireland)

Bankrupt.

In re WILLIAM RYAN, a Bankrupt.

and

Abell v. DaniellENR 1 M. & M. 370.

Skey v. CarterENRUNK 11 M. & W. 571; S. C. 7 Jur. 427.

Whitmore v. RobertsonENRUNK 8 M. & W. 463; S. C. 5 Jur. 1088.

In re PerrinUNK 4 Ir. Eq. Rep. 89, 362; S. C. 2 Dr. & War. 166.

Atkinson v. Brindall 2 Scott, 369.

Morgan and another v. BrundrettENR 5 B. & Ad. 289.

Gibson v. Boutts 3 Scott, 229.

In re PerrinUNK 4 Ir. Eq. Rep. 362; Ibid, 109.

CHANCERY REPORTS. 33 'the said will, instead of resorting to his rights under the settlement ; declare, that subject to the said life estate of the said Lady Elizabeth Moriarty, the infants defendants, Thomas Moriarty and Clarinda Moriarty, are entitled to the said principal sum of 1500, subject to the power of appointment conferred upon said plaintiff by the said will of Sir Thomas Moriarty, &c. 6 Reg. Lib. Gen. f. 61, 63, 139, 165, 166, 167. 1852. Chancery. MORIARTY V. MARTIN. Judgment. In re WILLIAM RYAN, a Bankrupt., (In Bankruptcy) 1853. Bankrupt Court. May 23, 24. June 2. IN this case, which came before the Court on charge and discharge, In order to constitute a the trustees of the bankrupt's children claimed a statutable mortgage fraudulent preference, it over the bankrupt's landed property, in priority to all the other cre- is not suffi- cient that a payment or ditors, under the following circumstances :- vs On the 23rd of November 1850, Messrs. Kernan and Treacy (the olun was ecurity tary, and madeat a time trustees) obtained from William Ryan, the bankrupt, a bond and when the trr ws warrant for the principal sum of 480, on which they entered judg- insoladevent a cir in cum. ment on ,the same day; and on the 6th of December, Mr. Treacy, It isstances necessary one of the trustees, made an affidavit, for the purpose of converting to show that it was made in contemplation of bankruptcy. A judgment obtained against a bankrupt, and registered as a mortgage, under the 6th and 7th sections of the 13 & 14 Vic., c. 29, before the issuing of the comÂÂmission, is a charge on the bankrupt's lands, in priority to his simple contract debts. The 13 & 14 Vic., c. 29, thus repeals the 126th section of the 6 W. 4, c. 14, the leading Irish Bankrupt Act. Quare.-Whether an affidavit made by one only of several conuzees is a sufficient compliance with the terms of the 6th section ? '* Reported by LESLIE S. itlIoNl'oomERT, Esq. VOL 3. 5 the judgment into a mortgage, under the 6th and 7th sections of the 13 & 14 Vic., c. 29, and on the 11th of December registered that affidavit in the manner required by the Act. On the 29th of August 1851, a commission of bankruptcy issued against Ryan, his trade debts at that time amounting to about 1700. Some of the bankÂÂrupt's landed property was subsequently sold in the Court of Bankruptcy, and realised a sum of 900. The trade assignees charged that, prior to giving the bond, the bankrupt had committed an act of bankruptcy, by keeping out of the way of the service of a writ of summons ; that at the time of executing the bond, the bankrupt was in insolvent circumstances, and that Messrs. Kernan and Treacy were well aware of that fact; that there was no consideration for the bond, but that it had been executed by the bankrupt voluntarily, and as a fraudulent • preÂÂference, and with a view to provide a benefit for his children, in the case of his bankruptcy, to the prejudice of his bond fide creÂÂditors. Messrs. Kernan and Treacy, in their discharge, stated that, even assuming the truth of the allegations as to bankrupt's insolÂÂvency at the time of the execution of the bond, they were wholly ignorant of such facts at the time ; that they had been for many years the bankrupt's solicitors, and (lid, up to November 1850, and for some time subsequently, believe Ryan to be a solvent and wealthy man; and that in the month of December 1850, he appeared to be in good credit, some of his creditors having then taken his acceptances at three and six months.-[The discharge then set forth the circumstances under which the bond was executed, as they appear in the bankrupt's affidavit.]-The bankrupt, in his affidavit stated among other matters that James Ryan, his brother, had by his wilt, bearing date the 16th of March 1837, bequeathed to the bankrupt's children a sum of 40 each, and had died on the 23rd of March in the same year ; that he, the bankrupt, had at that time seven, children, of whom four subsequently died ; that this money had been invested in stock, which he subsequently sold out, and applied to the payment of his trade debts :-" Positively saith that at the time of executing such bond and warrant he believed, himself to be perfectly solvent, and well able to meet all CHANCERY REPORTS. 35 his trade debts, and that he did not at the time of 'giving said bond contemplate bankruptcy or failure in his circumstances, and that he was then in good credit ; and that he did not intend to give his children any undue preference ; that the 480 was then due by deponent to his children, save such portions as may have come to him as next-of-kin to his four deceased children." On the present argument it was contended, on behalf of the trade assignees First-That the judgment was totally void, and not a charge •on the bankrupt's estate, having been given without any valid conÂÂsideration, and as a fraudulent preference. Second-That if the judgment were a charge, it could only be a charge on a level with the bankrupt's simple contract debts. Mr. Fitzgibbon, for the trade assignees. The giving of this bond and warrant was a fraudulent preÂÂference ; they were passed without any consideration, at a time when the bankrupt's affairs were in an insolvent condition, and after the commission of an act of bankruptcy : Abell v. Daniell (a). But even assuming that this was a judgment given for value, and that there could be no impeachment of it, and that the regisÂÂtration was complete, the question then is, was this a mortgage over all the landed property of the bankrupt mentioned in the affidavit ? This is a new question of law, arising upon the construction of the' 7th section of the 13 & 14 Vic. c. 29. In framing that section, the 126th section of the 6 W. 4, c. 14, appears to have been 'overÂÂlooked ; but it would be a great misapplication of this 7th section to apply- it to the case of a trader subject to the bankrupt laws. If the Legislature had meant to repeal the 126th section, they would have said so. The words of the 7th section exclude all cases under the 126th section of 6 W. 4. Can the trader then dispose of all his estate in lands, without accounting for it to his creditors ? The 2 &amp...