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A.S. Roderiques Vs. N.P.R.M.P.R.M. Ramaswami Chettiar and the Official Receiver of Tinnevelly - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Judge
Reported in(1917)ILR40Mad783
AppellantA.S. Roderiques
RespondentN.P.R.M.P.R.M. Ramaswami Chettiar and the Official Receiver of Tinnevelly
Cases ReferredHastings Brothers v. The Stenotyper
Excerpt:
provincial insolvency act (iii of 1907), section 37 - surety for debt of insolvent whether 'creditor.' - .....held following the earlier decision, that a surety being entitled to prove in bankruptcy, must be considered a creditor for the purposes of fraudulent preference, under section 48 of the act of 1883. that decision has not since been questioned in england and may we think be accepted as settled law. this was apparently the view taken when the new consolidated bankruptcy act of 1914 was passed. the defect disclosed in section 48 of the act of 1883 by the decisions in in re mills; ex parte the official receiver (1889) 5 morell, 55 in re warren: ex parte trustees (1900) 2 q.b., 138 and in re the stenotyper, limited, hastings brothers v. the stenotyper, limited (1901) 1 ch. 250 was then remedied by amending the section renumbered 44 so as to include expressly payments made to a creditor with.....
Judgment:

1. This question has been decided in England under the corresponding Section 48 of the Bankruptcy Act of 1883 in 1897 by Vaughan Williams, J., in In re Paine: Ex parte Read (1897) 1 Q.B., 122 and in 1900 by Bockley, J. (now Lord Wrenbury, in In re Blackpool Motor Car Company, Limited: Hamilton v. Blackpool Motor Car Company, Limited (1899) A.C. 419 In the latter case, the learned Judge after considering all the authorities including the dicta in In re Mills; Ex parte The Official Receiver (1888) 5 Morrell, 55 held following the earlier decision, that a surety being entitled to prove in bankruptcy, must be considered a creditor for the purposes of fraudulent preference, under Section 48 of the Act of 1883. That decision has not since been questioned in England and may we think be accepted as settled law. This was apparently the view taken when the new consolidated Bankruptcy Act of 1914 was passed. The defect disclosed in Section 48 of the Act of 1883 by the decisions in In re Mills; Ex parte The Official Receiver (1889) 5 Morell, 55 In re Warren: Ex parte Trustees (1900) 2 Q.B., 138 and In re The Stenotyper, Limited, Hastings Brothers v. The Stenotyper, Limited (1901) 1 Ch. 250 was then remedied by amending the section renumbered 44 so as to include expressly payments made to a creditor with a view to prefer his surety. A similar amendment would no doubt have been made to meet the case of payments to the surety himself with this view, if it had not been considered that they were already within the section as construed in these two cases. Such payments are even more objectionable than payments to the creditor as they do not directly reduce the indebtedness of the estate.

2. We accordingly answer the question in the affirmative.


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