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LAWS OF FIJI

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BACK


CHAPTER 48

BANKRUPTCY
_______

ARRANGEMENT OF SECTIONS

PART I—PRELIMINARY

SECTION
1. Short title.
2. Interpretation.

PART II—PROCEEDINGS FROM ACT OF BANKRUPTCY
TO DISCHARGE

ACTS OF BANKRUPTCY
3. Acts of bankruptcy.
4. Bankruptcy notices.
RECEIVING ORDER
5. Jurisdiction to make receiving order.
6. Conditions on which creditor may petition.
7. Proceedings and order on creditor's petition.
8. Debtor's petition and order thereon.
9. Effect of receiving order.
10. Power to appoint interim receiver.
11. Power to stay pending proceedings.
12. Power to appoint special manager.
13. Advertisement of receiving order.

PROCEEDINGS CONSEQUENT ON ORDER
14. First meeting of creditors.
15. Meetings to be governed by rules.
16. Debtor's statement of affairs.

PUBLIC EXAMINATION OF THE DEBTOR
17. Public examination of debtor.

COMPOSITION OR SCHEME OF ARRANGEMENT
18. Compositions and schemes of arrangement.
19. Effect of composition or scheme.
ADJUDICATION OF BANKRUPTCY
20. Adjudication of bankruptcy where composition not accepted or approved.
21. Appointment of trustee.
22. Committee of inspection.
23. Power to accept composition or scheme after bankruptcy adjudication.

CONTROL OVER PERSON AND PROPERTY
OF DEBTOR
24. Duties of debtor as to discovery and realization of property.
25. Arrest of debtor under certain circumstances.
26. Re-direction of debtor's letters.
27. Inquiry as to debtor's conduct, dealings and property.
28. Discharge of bankrupt.
29. Fraudulent settlements.
30. Effect of order of discharge.
31. Power for court to annul adjudication in certain cases.

PART III—ADMINISTRATION OF PROPERTY
PROOF OF DEBTS

32. Description of debts provable in bankruptcy.
33. Mutual credit and set-off.
34. Rules as to proof of debts.
35. Priority of debts.
36. Preferential claim in case of apprenticeship.
37. Landlord's power of distress in case of bankruptcy.
38. Postponement of husband's and wife's claims.

PROPERTY AVAILABLE FOR PAYMENT OF
DEBTS
39. Relation back to trustee's title.
40. Description of bankrupt's property divisible amongst creditors.
41. Provisions as to second bankruptcy.

EFFECT OF BANKRUPTCY ON ANTECEDENT
AND OTHER TRANSACTIONS
42. Restriction of rights of creditor under execution or attachment.
43. Duties of sheriff as to goods taken in execution.
44. Avoidance of certain settlements.
45 Avoidance of general assignments of book debts unless registered.
46 Avoidance of preference in certain cases.
47 Protection of bona fide transactions without notice.
48 Validity of certain payments to bankrupt and assignee.
49 Dealings with undischarged bankrupt.

REALIZATION OF PROPERTY
50. Possession of property by trustee.
51. Seizure of property of bankrupt.
52. Appropriation of proportion of pay or salary to creditors.
53. Appropriation of income of property restrained from anticipation.
54. Vesting and transfer of property.
55. Disclaimer of onerous property.
56. Powers of trustee to deal with property.
57. Powers exercisable by trustee with permission of committee of inspection
58. Power to allow bankrupt to manage property.
59. Allowance to bankrupt for maintenance or service.
60. Right of trustee to inspect goods pawned, etc.
61. Limitation of trustee's powers in relation to copyright.
62. Protection of official receiver and trustee from personal liability in certain cases.

DISTRIBUTION OF PROPERTY
63. Declaration and distribution of dividends.
64. Joint and separate dividends.
65. Provisions for creditors residing at a distance, etc.
66. Right of creditor who has not proved debt before declaration of a dividend.
67. Interest on debts.
68. Final dividend.
69. No action for dividend.
70. Right of bankrupt to surplus.

PART IV—OFFICIAL RECEIVER AND STAFF
71. Appointment of official receiver and deputy official receivers.
72. Status of official receiver.
73. Duties of official receiver as regards the debtor's conduct.
74. Duties of official receiver as to debtor's estate.

PART V—TRUSTEES IN BANKRUPTCY
OFFICIAL NAME
75. Official name of trustee.
APPOINTMENT
76. Power to appoint joint or successive trustees.
77. Proceedings in case of vacancy in office of trustee.

CONTROL OVER TRUSTEE
78. Discretionary powers of trustee and control thereof.
79. Appeal to court against trustee.
80. Control of official receiver over trustees.

REMUNERATION AND COSTS
81. Remuneration of trustee.
82. Allowance and taxation of costs.
RECEIPTS, PAYMENTS, ACCOUNTS, AUDIT
83. Trustee to furnish list of creditors.
84. Trustee to furnish statement of accounts.
85. Books to be kept by trustee.
86. Annual statement of proceedings.
87. Trustee not to pay into private account.
88. Payment of money into bank.
89. Investment of surplus funds.
90. Audit of trustee's account.

VACATION OF OFFICE BY TRUSTEE
91. Release of trustee.
92. Office of trustee vacated by insolvency.
93. Removal of trustee.

PART VI—CONSTITUTION, PROCEDURE AND POWERS OF COURT
JURISDICTION
94. Jurisdiction in bankruptcy.
95. Judge may exercise his powers in chambers.
96. Official receiver to make payments in accordance with directions of court
97. General powers of the court.
98. Disqualifications of bankrupt.

JUDGMENT DEBTORS
99. Power to make receiving order in lieu of committal order

APPEALS
100. Appeals in bankruptcy.
PROCEDURE
101. Discretionary power of court.
102. Consolidation of petitions.
103. Power to change carriage of proceedings.
104. Continuance of proceedings on death of debtor.
105. Power to stay proceedings.
106. Power to present petition against one partner.
107. Power to dismiss petition against some respondents only.
108. Property of partners to be vested in same trustee.
109. Actions by trustee and bankrupt's partners.
110. Actions on joint contracts.
111. Proceedings in partnership name.
112. Court to be auxiliary to other British courts.
113. Commitment to prison.

PART VII—SUPPLEMENTAL PROVISIONS
APPLICATION OF ACT
114. Married women.
115. Exclusion of companies.
116. Application of Act in case of small estates.
117. Administration in bankruptcy of estate of person dying insolvent.

GENERAL RULES
118 Power to make general rules.


FEES. ETC

119 Fees. etc.

EVIDENCE

120 Gazette to be evidence.
121 Evidence of proceedings at meetings of creditors.
122 Evidence of proceedings in bankruptcy.
123 Swearing of affidavits.
124 Death of debtor or witness.
125 Certificate of appointment of trustee.

MISCELLANEOUS
126 Computation of time.
127 Service of notices.
128 Formal defect not to invalidate proceedings.
129 Exemption of deeds, etc., from stamp duty.
130 Acting of corporations, partners, etc.
131 Certain provisions to bind Crown.

UNCLAIMED FUNDS OR DIVIDENDS
132 Unclaimed and indistributed dividends or funds under this Act.

PART VIII— BANKRUPTCY OFFENCES
133 Fraudulent debtors.
134 Undischarged bankrupt obtaining credit.
135 Frauds by bankrupts, etc.
136 Bankrupt guilty of gambling, etc.
137 Bankrupt failing to keep proper accounts.
138 Bankrupt absconding with property.
139 False claim, etc.
140 Order by court for prosecution on report of trustee.
141 Criminal liability after discharge or composition.
142 Trial and punishment of offences.
143 Form of charge.
144 Director of Public Prosecutions to act in certain cases.
145 Evidence as to frauds by agents.
146 Application of Bankruptcy Rules, 1915.


_______

BANKRUPTCY
_______

Ordinances Nos. 22 of 1944, 39 of 1965, 37 of 1966. Order 7th October, 1970. Act No. 14 of 1975

AN ACT RELATING TO BANKRUPTCY
[1st May, 1945.]

PART I—PRELIMINARY

Short title
1. This Act may be cited as the Bankruptcy Act.

Interpretation
2. In this Act, unless the context otherwise requires—
    1. "affidavit" includes statutory declaration, affirmation and attestation on honour;
    2. "available act of bankruptcy" means any act of bankruptcy available for a bankruptcy petition at the date of the presentation of the petition on which the receiving order is made;
    3. court" means the court having jurisdiction in bankruptcy under this Act;
    4. provable in bankruptcy" or "provable debt" includes any debt or liability by this Act made provable in bankruptcy;
    5. "gazetted" means published in the Gazette;
    6. "general rules" includes forms;
    7. "goods" includes all chattels personal;
    8. "local bank" means any bank in Fiji;
    9. "ordinary resolution" means a resolution decided by a majority in value of the creditors present, personally or by proxy, at a meeting of creditors and voting on the resolution;
    10. "prescribed" means prescribed by general rules within the meaning of this Act;
    11. "property" includes money, goods, things in action, land and every description of property whether real or personal and whether situate in Fiji or elsewhere; also obligations, easements, and every description of estate, interest, and profit, present or future, vested or contingent, arising out of or incidental to property as above defined;
    12. "resolution" means ordinary resolution;
    13. "secured creditor" means a person holding a mortgage, charge or lien on the property of the debtor, or any part thereof, as a security for a debt due to him from the debtor;
    14. "sheriff" includes any person charged with the execution of any process;
    15. "special resolution" means a resolution decided by a majority in number and three-fourths in value of the creditors present, personally or by proxy, at a meeting of creditors and voting on the resolution;
    16. "trustee" means the trustee in bankruptcy of a debtor's estate.

PART II—PROCEEDINGS FROM ACT OF BANKRUPTCY
TO DISCHARGE

ACTS OF BANKRUPTCY
Acts of bankruptcy
3.—(1) A debtor commits an act of bankruptcy in each of the following cases:—
    1. if in Fiji or elsewhere he makes a conveyance or assignment of his property to a trustee or trustees for the benefit of his creditors generally;
    2. if in Fiji or elsewhere he makes a fraudulent conveyance, gift, delivery or transfer of his property, or of any part thereof;
    3. if in Fiji or elsewhere he makes any conveyance or transfer of his property, or any part thereof, or creates any charge thereon, which would under this or any other Act be void as a fraudulent preference if he were adjudged bankrupt;
    4. if with intent to defeat or delay his creditors he does any of the following things, namely, departs out of Fiji, or being out of Fiji remains out of Fiji, or departs from his dwelling-house, or otherwise absents himself, or begins to keep house, or removes his property or any part thereof beyond the jurisdiction of the court;
    5. if execution against him has been levied by seizure of his goods in any civil proceedings in any court, and the goods have been either sold or held by the sheriff for twenty-one days:
      1. Provided that, where an interpleader summons has been taken out in regard to the goods seized, the time elapsing between the date at which such summons is taken out and the date at which the proceedings on such summons are finally disposed of, settled or abandoned, shall not be taken into account in calculating such period of twenty-one days;
    6. if he files in the court a declaration of his inability to pay his debts or presents a bankruptcy petition against himself;
    7. if a creditor has obtained a final judgment or final order against him for any amount, and, execution thereon not having been stayed, has served on him in Fiji, or, by leave of the court, elsewhere, a bankruptcy notice under this Act, and he does not within seven days after service of the notice, in case the service is effected in Fiji, and in case the service is effected elsewhere, then within the time limited in that behalf by the order giving leave to effect the service, either comply with the requirements of the notice or satisfy the court that he has a counter-claim, set-off or cross-demand which equals or exceeds the amount of the judgment debt or sum ordered to be paid, and which he could not set up in the action in which the judgment was obtained, or the proceedings in which the order was obtained:
      1. the purposes of this paragraph and section 4, any person who is, for the time being, entitled to enforce a final judgment or final order, shall be deemed to be a creditor who has obtained a final judgment or final order;
    8. if the debtor gives notice to any of his creditors that he has suspended, or that he is about to suspend, payment of his debts.
  1. In this Act the expression "a debtor", unless the context otherwise implies, includes any person, whether domiciled in Fiji or not, who, at the time when any act of bankruptcy was done or suffered by him—
    1. was personally present in Fiji; or
    2. ordinarily resided or had a place of residence in Fiji; or
    3. was carrying on business in Fiji, personally, or by means of an agent or manager; or
    4. was a member of a firm or partnership which carried on business in Fiji,

Bankruptcy notices
4. A bankruptcy notice under this Act shall be in the prescribed form, and shall require the debtor to pay the judgment debt or sum ordered to be paid in accordance with the terms of the judgment or order, or to secure or compound for it to the satisfaction of the creditor or the court, and shall state the consequences of non-compliance with the notice, and shall be served in the prescribed manner:
Provided that a bankruptcy notice—
    1. may specify an agent to act on behalf of the creditor in respect of any payment or other thing required by the notice to be made to, or done to the satisfaction of, the creditor;
    2. shall not be invalidated by reason only that the sum specified in the notice as the amount due exceeds the amount actually due, unless the debtor within the time allowed for payment gives notice to the creditor that he disputes the validity of the notice on the ground of such misstatement; but, if the debtor does not give such notice, he shall be deemed to have complied with the bankruptcy notice if within the time allowed he takes such steps as would have constituted a compliance with the notice had the actual amount due been correctly specified therein.

RECEIVING ORDER
Jurisdiction to make receiving order
5. Subject to the conditions hereinafter specified if a debtor commits an act of bankruptcy the court may, on a bankruptcy petition being presented either by a creditor or by the debtor, make an order, in this Act called a receiving order, for the protection of the estate.

Conditions on which creditor may petition
6.—(1) A creditor shall not be entitled to present a bankruptcy petition against a debtor unless—
    1. the debt owing by the debtor to the petitioning creditor, or, if two or more creditors joint in the petition, the aggregate amount of debts owing to the several petitioning creditors, amounts to one hundred dollars; and
    2. the debt is a liquidated sum, payable either immediately or at some certain future time; and
    3. the act of bankruptcy on which the petition is grounded has occurred within three months before the presentation of the petition; and
    4. the debtor is domiciled in Fiji, or within a year before the date of the presentation of the petition has ordinarily resided, or had a dwelling- house or place of business, or has carried on business, in Fiji, personally or by means of an agent or manager, or is or within the said period has been a member of a firm or partnership of persons which has carried on business in Fiji by means of a partner or partners, or an agent or manager,
nor, where a deed of arrangement has been executed, shall a creditor be entitled to present a bankruptcy petition founded on the execution of the deed, or on any other act committed by the debtor in the course or for the purpose of the proceedings preliminary to the execution of the deed, in cases where he is prohibited from so doing by any law for the time being in force relating to deeds of arrangement.
(2) If the petitioning creditor is a secured creditor, he must in his petition either state that he is willing to give up his security for the benefit of the creditors in the event of the debtor being adjudged bankrupt, or give an estimate of the value of his security. In the latter case, he may be admitted as a petitioning creditor to the extent of the balance of the debt due to him, after deducting the value so estimated, in the same manner as if he were an unsecured creditor.

Proceedings and order on creditor's petition
7.—(1) A creditor's petition shall be verified by affidavit of the creditor, or of some person on his behalf having knowledge of the facts, and served in the prescribed manner.
(2) At the hearing the court shall require proof of the debt of the petitioning creditor, of the service of the petition, and of the act of bankruptcy, or, if more than one act of bankruptcy is alleged in the petition, of some one of the alleged acts of bankruptcy and, if satisfied with the proof, may make a receiving order in pursuance of the petition.
(3) If the court is not satisfied with the proof of the petitioning creditor's debt, or of the act of bankruptcy, or of the service of the petition, or is satisfied by the debtor that he is able to pay his debts, or that for other sufficient cause no order ought to be made, the court may dismiss the petition.
(4) When the act of bankruptcy relied on is non-compliance with a bankruptcy notice to pay, secure or compound for a judgment debt, or sum ordered to be paid, the court may, if it thinks fit, stay or dismiss the petition on the ground that an appeal is pending from the judgment or order.
(5) Where the debtor appears on the petition, and denies that he is indebted to the petitioner, or that he is indebted to such an amount as would justify the petitioner in presenting a petition against him, the court, on such security (if any) being given as the court may require for payment to the petitioner of any debt which may be established against him in due course of law, and of the costs of establishing the debt, may, instead of dismissing the petition, stay all proceedings on the petition for such time as may be required for trial of the question relating to the debt.
(6) Where proceedings are stayed, the court may, if by reason of the delay caused by the stay of proceedings or for any other cause it thinks just, make a receiving order on the petition of some other creditor, and shall thereupon dismiss, on such terms as it thinks just, the petition in which proceedings have been stayed as aforesaid.
(7) A creditor's petition shall not, after presentation, be withdrawn without the leave of the court.

Debtor's petition and order thereon
8.—(1) A debtor's petition shall allege that the debtor is unable to pay his debts, and the presentation thereof shall be deemed an act of bankruptcy without the previous filing by the debtor of any declaration of inability to pay his debts, and the court shall thereupon make a receiving order.
(2) A debtor's petition shall not, after presentation, be withdrawn without the leave of the court.

Effect of receiving order
9.—(1) On the making of a receiving order the official receiver shall be thereby constituted receiver of the property of the debtor, and thereafter, except as directed by this Act, no creditor to whom the debtor is indebted in respect of any debt provable in bankruptcy shall have any remedy against the property or person of the debtor in respect of the debt, or shall commence any action or other legal proceedings, unless with the leave of the court and on such terms as the court may impose.
(2) But this section shall not affect the power of any secured creditor to realize or otherwise deal with his security in the same manner as he would have been entitled to realize or deal with it if this section had not been passed.

Power to appoint interim receiver
10. The court may, if it is shown to be necessary for the protection of the estate, at any time after the presentation of a bankruptcy petition, and before a receiving order is made, appoint the official receiver to be interim receiver of the property of the debtor, or of any part thereof, and direct him to take immediate possession thereof or of any part thereof.

Power to stay pending proceedings
11.—(1) The court may, at any time after the presentation of a bankruptcy petition, stay any action, execution or other legal process against the property or person of the debtor, and any court in which proceedings are pending against a debtor may, on proof that a bankruptcy petition has been presented by or against the debtor, either stay the proceedings or allow them to continue on such terms as it may think just.
(2) Where the court makes an order staying any action or proceedings, or staying proceedings generally, the order may be served by sending a copy thereof, under the seal of the court, by post to the address for service of the plaintiff or other party prosecuting such proceeding.

Power to appoint special manager
12.—(1) The official receiver of a debtor's estate may, on the application of any creditor or creditors, and if satisfied that the nature of the debtor's estate or business or the interests of the creditors generally require the appointment of a special manager of the estate or business other than the official receiver, appoint a manager thereof accordingly to act until a trustee is appointed, and with such powers (including any of the powers of a receiver) as may be entrusted to him by the official receiver.
(2) The special manager shall give security and account in such manner as the official receiver may direct.
(3) The special manager shall receive such remuneration as the creditors may, by resolution at an ordinary meeting, determine, or, in default of any such resolution, as may be prescribed.

Advertisement of receiving order
13. Notice of every receiving order, stating the name, address and description of the debtor, the date of the order, the court by which the order is made, and the date of the petition, shall be gazetted in the prescribed manner.

PROCEEDINGS CONSEQUENT ON ORDER
First meetings of creditors
14. As soon as may be after the making of a receiving order against a debtor a general meeting of his creditors (in this Act referred to as the first meeting of creditors) shall be held for the purpose of considering whether a proposal for a composition or scheme of arrangement shall be accepted or whether it is expedient that the debtor shall be adjudged bankrupt, and generally as to the mode of dealing with the debtor's property.

Meetings to be governed by rules
15. With respect to the summoning of and proceedings at the first and other meetings of creditors, the rules in the First Schedule shall be observed.

Debtor's statement of affairs
16.—(1) Where a receiving order is made against a debtor, he shall make out and submit to the official receiver a statement of and in relation to his affairs in the prescribed form, verified by affidavit, and showing the particulars of the debtor's assets, debts and liabilities, the names, residences and occupations of his creditors, the securities held by them respectively, the dates when the securities were respectively given, and such further or other information as may be prescribed or as the official receiver may require.
(2) The statement shall be so submitted within the following times, namely:—
    1. if the order is made on the petition of the debtor, within three days from the date of the order;
    2. if the order is made on the petition of a creditor, within seven days from the date of the order;
but the court may, in either case for special reasons, extend the time.
(3) If the debtor fails without reasonable excuse to comply with the requirements of this section, the court may, on the application of the official receiver, or of any creditor, adjudge him bankrupt.
(4) Any person stating himself in writing to be a creditor of the bankrupt may, personally or by agent, inspect the statement at all reasonable times, and take any copy thereof or extract therefrom, but any person untruthfully so stating himself to be a creditor shall be guilty of a contempt of court, and shall be punishable accordingly on the application of the trustee or official receiver.

PUBLIC EXAMINATION OF THE DEBTOR
Public examination of debtor
17.—(1) Where the court makes a receiving order, it shall, save as in this Act provided, hold a public sitting, on a day to be appointed by the court, for the examination of the debtor, and the debtor shall attend thereat, and shall be examined as to his conduct, dealings, and property.
(2) The examination shall be held as soon as conveniently may be after the expiration of the time for the submission of the debtor's statement of affairs.
(3) The court may adjourn the examination from time to time.
(4) Any creditor who has tendered a proof, or his representative authorised in writing, may question the debtor concerning his affairs and the causes of his failure.
(5) The official receiver shall take part in the examination of the debtor, and for the purpose may employ a barrister and solicitor if he so desires.
(6) If a trustee is appointed before the conclusion of the examination, he may take part therein.
(7) The court may put such questions to the debtor as it may think expedient.
(8) The debtor shall be examined upon oath, and it shall be his duty to answer all such questions as the court may put or allow to be put to him. Such notes of the examination as the court thinks proper shall be taken down in writing, and shall be read over either to or by the debtor and signed by him, and may thereafter, save as
(8) The court shall, before approving the proposal, hear a report of the official receiver as to the terms thereof, and as to the conduct of the debtor, and any objections which may be made by or on behalf of any creditor.
(9) If the court is of opinion that the terms of the proposal are not reasonable, or are not calculated to benefit the general body of creditors, the court shall refuse to approve the proposal.
(10) If any facts are proved on proof of which the court would be required either to refuse, suspend or attach conditions to the debtor's discharge, were he adjudged bankrupt, the court shall refuse to approve the proposal, unless it provides reasonable security for the payment of not less than twenty-five cents in the dollar on all the unsecured debts provable against the debtor's estate.
11. In any other case the court may either approve or refuse to approve the proposal.
(12) If the court approves the proposal, the approval may be testified by the seal of the court being attached to the instrument containing the terms of the proposed composition or scheme, or by the terms being embodied in an order of the court.
(13) A composition or scheme accepted and approved in pursuance of this section shall be binding on all the creditors so far as relates to any debts due to them from the debtor or provable in bankruptcy, but shall not release the debtor from any liability under a judgment against him in an action for seduction, or under an affiliation order, or under a judgment against him as a co-respondent in a matrimonial cause, except to such an extent and under such conditions as the court expressly orders in respect of such liability.
(14) A certificate of the official receiver that a composition or scheme has been duly accepted and approved shall, in the absence of fraud, be conclusive as to its validity.
(15) The provisions of a composition or scheme under this section may be enforced by the court on application by any person interested, and any disobedience of an order of the court made on the application shall be deemed a contempt of court.
(16) If default is made in payment of any instalment due in pursuance of the composition or scheme, or if it appears to the court, on satisfactory evidence, that the composition or scheme cannot, in consequence of legal difficulties, or for any sufficient cause, proceed without injustice or undue delay to the creditors or to the debtor, or that the approval of the court was obtained by fraud, the court may, if it thinks fit, on application by the official receiver or the trustee or by any creditor, adjudge the debtor bankrupt, and annul the composition or scheme, but without prejudice to the validity of any sale, disposition or payment duly made or things duly done, under or in pursuance of the composition or scheme.
Where a debtor is adjudged bankrupt under this subsection any debt provable in other respects, which has been contracted before the adjudication, shall be provable in the bankruptcy.
(17) If under or in pursuance of a composition or scheme a trustee is appointed to administer the debtor's property or manage his business, or to distribute the composition, section 27 and Part V shall apply as if the trustee were a trustee in a bankruptcy, and as if the terms "bankruptcy", "bankrupt", and "order of adjudication" included respectively a composition or scheme of arrangement, a compounding or arranging debtor, and an order approving the composition or scheme.
(18) Part III shall, so far as the nature of the case and the terms of the composition or scheme admit, apply thereto, the same interpretation being given to the words "trustee", "bankruptcy", "bankrupt", and "order of adjudication" as in subsection (17).
(19) No composition or scheme shall be approved by the court which does not provide for the payment in priority to other debts of all debts directed to be so paid in the distribution of the property of a bankrupt.
(20) The acceptance by a creditor of a composition or scheme shall not release any person who under this Act would not be released by an order of discharge if the debtor had been adjudged bankrupt.

Effect of composition or scheme
19. Notwithstanding the acceptance and approval of a composition or scheme, the composition or scheme shall not be binding on any creditor so far as regards a debt or liability from which, under the provisions of this Act, the debtor would not be released by an order of discharge in bankruptcy, unless the creditor assents to the composition or scheme.

ADJUDICATION OF BANKRUPTCY
Adjudication of bankruptcy where composition not accepted or approved
20.—(1) Where a receiving order is made against a debtor, then, if the creditors at the first meeting or any adjournment thereof by ordinary resolution resolve that the debtor be adjudged bankrupt, or pass no resolution, or if the creditors do not meet, or if a composition or scheme is not approved in pursuance of this Act within fourteen days after the conclusion of the examination of the debtor or such further time as the court may allow, the court shall adjudge the debtor bankrupt; and thereupon the property of the bankrupt shall become divisible among his creditors, and shall vest in a trustee.
(2) Notice of every order adjudging a debtor bankrupt, staling the name, address and description of the bankrupt, and the date of the adjudication, shall be gazetted and advertised in a local paper in the prescribed manner, and the date of the order shall, for the purposes of this Act, be the date of the adjudication.

Appointment of trustee
21.—(1) Where a debtor is adjudged bankrupt, or the creditors have resolved that he be adjudged bankrupt, the creditors may by ordinary resolution appoint some fit person, whether a creditor or not, to fill the office of trustee of the property of the bankrupt; or they may resolve to leave his appointment to the committee of inspection hereinafter mentioned.
A person shall be deemed not fit to act as trustee of the property of a bankrupt where he has been previously removed from the office of trustee of a bankrupt's property for misconduct or neglect of duty.
(2) The person so appointed shall give security in manner prescribed to the satisfaction of the court, and the court, if satisfied with the security, shall certify that his appointment has been duly made, unless the court objects to the appointment on the ground that it has not been made in good faith by a majority in value of the creditors voting, or that the person appointed is not fit to act as trustee, or that his connexion with or relation to the bankrupt, or his estate or any particular creditor makes it difficult for him to act with impartiality in the interests of the creditors generally.
(3) The appointment of a trustee shall take effect as from the date of the certificate.
(4) The official receiver may be appointed the trustee by the creditors and in such case there shall be no committee of inspection, but the official receiver may do with the permission of the court all things which may be done by a trustee with the permission of the committee of inspection.
(5) If a trustee is not appointed by the creditors within four weeks from the date of the adjudication, or in the event of there being negotiations for a composition or scheme pending at the expiration of those four weeks, then within seven days from the close of those negotiations by the refusal of the creditors to accept, or of the court to approve, the composition or scheme, the official receiver shall report the matter to the court, and thereupon the court shall appoint some fit person to be trustee of the bankrupt's property, and shall certify the appointment:
Provided that the creditors or the committee of inspection (if so authorised by resolution of the creditors) may, at any subsequent time, if they think fit, appoint a trustee, and, on the appointment being made and certified, the person appointed shall become trustee in the place of the person appointed by the court.
(6) When a debtor is adjudged bankrupt after the first meeting of creditors has been held, and a trustee has not been appointed prior to the adjudication, the official receiver shall forthwith summon a meeting of creditors for the purpose of appointing a trustee.

Committee of inspection
22.—(1) The creditors qualified to vote may, at their first or any subsequent meeting, by resolution, appoint a committee of inspection for the purpose of superintending the administration of the bankrupt's property by the trustee.

Qualifications of committee
(2) The committee of inspection shall consist of not more than five nor less than three persons, possessing one or other of the following qualifications:—
    1. that of being a creditor or the holder of a general proxy or general,power of attorney from a creditor:
      1. Provided that no creditor and no holder of a general proxy or general power of attorney from a creditor shall be qualified to act as a member of the committee of inspection until the creditor has proved his debt and the proof has been admitted; or
    2. that of being a person to whom a creditor intends to give a general proxy or general power of attorney:
      1. Provided that no such person shall be qualified to act as a member of the committee of inspection until he holds such a proxy or power of attorney, and until the creditor has proved his debt and the proof has been admitted.
Meetings of committee
(3) The committee of inspection shall meet at such times as they shall from time to time appoint, and, failing such appointment, at least once a month; and the trustee or any member of the committee may also call a meeting of the committee as and when he thinks necessary.

Quorum
(4) The committee may act by a majority of their members present at a meeting, but shall not act unless a majority of the committee are present at the meeting.

Resignation of office
(5) Any member of the committee may resign his office by notice in writing signed by him, and delivered to the trustee.

Vacation of office
(6) If a member of the committee becomes bankrupt or compounds or arranges with his creditors, or is absent from five consecutive meetings of the committee, his office shall thereupon become vacant.

Removal
(7) Any member of the committee may be removed by an ordinary resolution at any meeting of creditors of which seven days' notice has been given stating the object of the meeting.

Filling a vacancy
(8) On a vacancy occurring in the office of a member of the committee, the trustee shall forthwith summon a meeting of creditors for the purpose of filling the vacancy, and the meeting may by resolution appoint another creditor, or other person eligible as above, to fill the vacancy.

Continuing members may act
(9) The continuing members of the committee, provided there be not less than two such continuing members, may act notwithstanding any vacancy in their body; and, where the number of members of the committee of inspection is for the time being less than five, the creditors may increase that number so that it does not exceed five.

If no committee court gives consent
(10) If there be no committee of inspection, any act or thing or any direction or permission by this Act authorised or required to be done or given by the committee may be done or given by the court on the application of the trustee, or by the official receiver, save in the case where he himself is acting as trustee.

Power to accept composition or scheme after bankruptcy adjudication
23.—(1) Where a debtor is adjudged bankrupt the creditors may, if they think fit, at any time after the adjudication, by a majority in number and three-fourths in value of all the creditors who have proved, resolve to accept a proposal for a composition in satisfaction of the debts due to them under the bankruptcy, or for a scheme of arrangement of the bankrupt's affairs; and thereupon the same proceedings shall be taken and the same consequences shall ensue as in the case of a composition or scheme accepted before adjudication.

If court approves
(2) If the court approves the composition or scheme, it may make an order annulling the bankruptcy and vesting the property of the bankrupt in him or in such other person as the court may appoint, on such terms, and subject to such other person as the court may appoint, on such terms, and subject to such conditions, if any, as the court may declare.

Default, etc.
(3) If default is made in payment of any instalment due in pursuance of the composition or scheme or if it appears to the court that the composition or scheme cannot proceed without injustice or undue delay, or that the approval of the court was obtained by fraud, the court may, if it thinks fit, on application by any person interested, adjudge the debtor bankrupt, and annul the composition or scheme, but without prejudice to the validity of any sale, disposition or payment duly made, or thing duly done, under or in pursuance of the composition or scheme. Where a debtor is adjudged bankrupt under this subsection all debts, provable in other respects, which have been contracted before the date of such adjudication, shall be provable in the bankruptcy.

CONTROL OVER PERSON AND PROPERTY OF DEBTOR
Duties of debtor as to discovery and realization of property
24.—(1) Every debtor against whom a receiving order is made, shall, unless
prevented by sickness or other sufficient cause, attend the first meeting of his
creditors, and shall submit to such examination and give such information as the
meeting may require.

To discover property
(2) He shall give such inventory of his property, such list of his creditors and debtors, and of the debts due to and from them respectively, submit to such examination in respect of his property or his creditors, attend such other meeting of his creditors, wait at such times on the official receiver, special manager, or trustee, execute such powers of attorney, conveyances, deeds, and instruments and generally do all such acts and things in relation to his property and the distribution of the proceeds amongst his creditors, as may be reasonably required by the official receiver, special manager or trustee, or may be prescribed by general rules, or be directed by the court by any special order or orders made in reference to any particular case, or made on the occasion of any special application by the official receiver, special manager, trustee or any creditor or person interested.

To aid in realization
(3) He shall, if adjudged bankrupt, aid, to the utmost of his power, in the realization of his property and the distribution of the proceeds among his creditors.

Committal
(4) If a debtor wilfully fails to perform the duties imposed on him by this section, or to deliver up possession of any part of his property which is divisible amongst his creditors under this Act, and which is for the time being in his possession or under his control, to the official receiver or to the trustee, or to any person authorised by the court to take possession of it, he shall, in addition to any other punishment to which he may be subject, be guilty of a contempt of court, and may be punished accordingly.

Arrest of debtor under certain circumstances
25.—(1) The court may, by warrant addressed to any police officer or prescribed officer of the court, cause a debtor to be arrested, and any books, papers, money and goods in his possession to be seized, and him and them to be safely kept as prescribed until such time as the court may order under the following circumstances: —

After issue of bankruptcy notice
  • if after a bankruptcy notice has been issued under this Act, or after presentation of a bankruptcy petition by or against him, it appears to the court that there is probable reason for believing that he has absconded or is about to abscond, with a view of avoiding payment of the debt in respect of which the bankruptcy notice was issued, or of avoiding service of a bankruptcy petition, or of avoiding appearance to any such petition, or of avoiding examination, in respect of his affairs, or of otherwise avoiding, delaying or embarrassing proceedings in bankruptcy against him;

      1. presentation of petition
  • if, after presentation of a bankruptcy petition by or against him, it appears to the court that there is probable cause for believing that he is about to remove his goods with a view of preventing or delaying possession being taken of them by the official receiver or trustee, or that there is probable ground for believing that he has concealed or is about to conceal or destroy any of his goods, or any books, documents or writings which might be of use to his creditors in the course of his bankruptcy;

    2. service of petition
  • if, after service of a bankruptcy petition on him, or after a receiving order is made against him, he removes any goods in his possession above the value of ten dollars, without the leave of the official receiver or trustee;

    Attend examination
  • if, without good cause shown, he fails to attend any examination order by the court:
  • Provided that no arrest upon a bankruptcy notice shall be valid and protected, unless the debtor before or at the time of his arrest is served with such bankruptcy notice.

    Payment after arrest may be fraudulent preference
    (2) No payment or composition made or security given after arrest made under this section shall be exempt from the provisions of this Act relating to fraudulent preferences.

    Re-direction of debtor's letters
    26. Where a receiving order is made against a debtor, the court, on the application of the official receiver or trustee, may from time to time order that for such time, not exceeding six months, as the court thinks fit, letters, telegrams, cablegrams, and other postal articles, addressed to the debtor at any place or places mentioned in the order for re-direction, shall be re-directed, sent or delivered by the Permanent Secretary for Posts and Telecommunications, or the officers acting under him, or by any other person in charge of the transmission and receipt of telegrams and cablegrams, to the official receiver, or the trustee, or otherwise, as the court directs and the same shall be done accordingly.

    Inquiry as to debtor's conduct, dealings and property
    27.—(1) The court may on the application of the official receiver or trustee, at any time after a receiving order has been made against a debtor, summon before it the debtor or his wife, or any person known or suspected to have in his possession any of the estate or effects belonging to the debtor, or supposed to be indebted to the debtor, or any person whom the court may deem capable of giving information respecting the debtor, his dealings or property, and the court may require any such person to produce any documents in his custody or power relating to the debtor, his dealings or property.

    In case of refusal
    (2) If any person so summoned, after having been tendered a reasonable sum, refuses to come before the court at the time appointed or refuses to produce any such documents having no lawful impediment made known to the court at the time of its sitting and allowed by it, the court may, by warrant, cause him to be apprehended and brought up for examination.

    Examination on oath
    (3) The court may examine on oath, either by word of mouth or by written interrogatories, any person so brought before it concerning the debtor, his dealings or property.

    Order to pay
    (4) If any person on examination before the court admits that he is indebted to the debtor, the court may, on the application of the official receiver or trustee, order him to pay to the official receiver or trustee, at such time and in such manner as to the court seems expedient, the amount admitted, or any part thereof, either in full discharge of the whole amount in question or not, as the court thinks fit, with or without costs of the examination.

    Order to deliver property
    (5) If any person on examination before the court admits that he has in his possession any property belonging to the debtor, the court may, on the application of the official receiver or trustee, order him to deliver to the official receiver or trustee such property or any part thereof, at such time, and in such manner, and on such terms, as to the court may seem just.

    Examination out of Fiji.
    (6) The court, may, if it thinks fit, order that any person who, if in Fiji, would be liable to be brought before it under this section shall be examined in any other place out of Fiji.

    Discharge of bankrupt
    28.—(1) A bankrupt may, at any time after being adjudged bankrupt, apply to the court for an order of discharge, and the court shall appoint a day for hearing the application, but the application shall not be heard until the public examination of the bankrupt is concluded. The application shall, except when the court in accordance with rules under this Act otherwise directs, be heard in open court.

    Powers of court
    (2) On the hearing of the application the court shall take into consideration a report of the official receiver as to the bankrupt's conduct and affairs (including a report as to the bankrupt's conduct during the proceedings under his bankruptcy), and may either grant or refuse an absolute order of discharge, or suspend the operation of the order for a specified time, or grant an order of discharge subject to any conditions with respect to any earnings or income which may afterwards become due to the bankrupt, or with respect to his after-acquired property:
    Provided that where the bankrupt has committed any offence under this Act or any other offence connected with his bankruptcy, or where in any case any of the
    facts specified in subsection (4) are proved, the court shall either—
      1. refuse the discharge; or
      2. suspend the discharge for such period as the court thinks proper; or
      3. suspend the discharge until a dividend of not less than fifty cents in the dollar has been paid to the creditors; or
      4. require the bankrupt as a condition of his discharge to consent to judgment being entered against him by the official receiver or trustee for any balance or part of any balance of the debts provable under the bankruptcy which is not satisfied at the date of the discharge, such balance or part of any balance of the debts to be paid out of the future earnings or after-acquired property of the bankrupt in such manner and subject to such conditions as the court may direct; but execution shall not be issued on the judgment without leave of the court, which leave may be given on proof that the bankrupt has since his discharge acquired property or income available towards payment of his debts.
    1. If at any time after the expiration of two years from the date of any order made under this section the bankrupt satisfies the court that there is no reasonable probability of his being in a position to comply with the terms of such order, the court may modify the terms of the order or of any substituted order, in such manner and upon such conditions as it may think fit.
    2. The facts hereinbefore referred to are—
      1. that the bankrupt's assets are not of a value equal to fifty cents in the dollar on the amount of his unsecured liabilities, unless he satisfies the court that the fact that the assets are not of a value equal to fifty cents in the dollar on the amount of his unsecured liabilities has arisen from circumstances for which he cannot justly be held responsible;
      2. that the bankrupt has contracted any debt provable in the bankruptcy without having at the time of contracting it any reasonable or probable ground of expectation (proof whereof shall lie on him) of being able to pay it;
      3. that the bankrupt has failed to account satisfactorily for any loss of assets or for any deficiency of assets to meet his liabilities;
      4. that the bankrupt has brought on, or contributed to, his bankruptcy by rash and hazardous speculations, or by unjustifiable extravagance in living, or by gambling, or by culpable neglect of his business affairs;
      5. that the bankrupt has put any of his creditors to unnecessary expense by a frivolous or vexatious defence to any action properly brought against him;
      6. that the bankrupt has brought on or contributed to his bankruptcy by incurring unjustifiable expense in bringing any frivolous or vexatious action;
      7. that the bankrupt has, within three months preceding the date of the receiving order, when unable to pay his debts as they became due, given any undue preference to any of his creditors;
      8. that the bankrupt has, within three months preceding the date of the receiving order, incurred liabilities with a view of making his assets equal to fifty cents in the dollar on the amount of his unsecured liabilities;
      9. that the bankrupt has, on any previous occasion, been adjudged bankrupt, or made a composition or arrangement with his creditors;
      10. that the bankrupt has been guilty of any fraud or fraudulent breach of trust.

    Certificate that bankruptcy was caused by misfortune
    (5) With a view to removing any legal disqualification on account of bankruptcy which is removed if the bankrupt obtains from the court his discharge with a certificate to the effect that the bankruptcy was caused by misfortune without any misconduct on his part, the court may, if it thinks fit, grant such certificate, but a refusal to grant such a certificate shall be subject to appeal as provided in section 100.

    When are assets fifty cents in the dollar
    (6) For the purposes of this section, a bankrupt's assets shall be deemed of a value equal to fifty cents in the dollar on the amount of his unsecured liabilities when the court is satisfied that the property of the bankrupt has realized, or is likely to realize, or with due care in realization might have realized, an amount equal to fifty cents in the dollar on his unsecured liabilities, and a report by the official receiver or the trustee shall be prima facie evidence of the amount of such liabilities.

    Report of official receiver
    (7) For the purpose of this section, the report of the official receiver shall be prima facie evidence of the statements therein contained.

    Notice of application for discharge
    (8) Notice of the appointment by the court of the day for hearing the application for discharge shall be published in the prescribed manner, and sent fourteen days at least before the day so appointed to each creditor who has proved, and the court may hear the official receiver and the trustee, and may also hear any creditor. At the hearing the court may put such questions to the debtor and receive such evidence as it may think fit.
    (9) The powers of suspending and of attaching conditions to a bankrupt's discharge may be exercised concurrently.

    Duties of discharged bankrupt
    (10) A discharged bankrupt shall, notwithstanding his discharge, give such assistance as the trustee may require in the realization and distribution of such of his property as is vested in the trustee, and, if he fails to do so, he shall be guilty of a contempt of court; and the court may also, if it thinks fit, revoke his discharge, but without prejudice to the validity of any sale, disposition or payment duly made or thing duly done subsequent to the discharge but before its revocation.

    Fraudulent settlements
    29. In either or the following cases, that is to say:—
      1. in the case of a settlement made before and in consideration of marriage where the settlor is not at the time of making the settlement able to pay all his debts without the aid of the property comprised in the settlement; or
      2. in the case of any covenant or contract made in consideration of marriage for the future settlement on or for the settlor's wife or children of any money or property wherein he had not at the date of his marriage any estate or interest (not being money or property of or in right of his wife),
    if the settlor is adjudged bankrupt or compounds or arranges with his creditors, and it appears to the court that such settlement, covenant or contract was made in order to defeat or delay creditors or was unjustifiable having regard to the state of the settlor's affairs at the time when it was made, the court may refuse or suspend an order of discharge, or grant an order subject to conditions, or refuse to approve a composition or arrangement, as the case may be, in like manner as in cases where the debtor has been guilty of fraud.

    Effect of order of discharge
    30.—(1) An order of discharge shall not release the bankrupt—
      1. from any debt on a recognizance nor from any debt with which the bankrupt may be chargable at the suit of the Crown or of any person for any offence against any law relating to any branch of the general revenue of Fiji, or at the suit of the sheriff or other public officer on a bail bond entered into for the appearance of any person prosecuted for any such offence; and he shall not be discharged from such excepted debts unless the Chief Accountant shall certify in writing his consent to the bankrupt being discharged therefrom; or
      2. from any debt or liability incurred by means of any fraud or fraudulent breach of trust to which he was a party, nor from any debt or liability whereof he has obtained forbearance by any fraud to which he was a party; or
      3. from any liability under a judgment against him in an action for seduction, or under an affiliation order, or under a judgment against him as a co-respondent in a matrimonial cause, except to such an extent and under such conditions as the court expressly orders in respect of such liability.
    1. An order of discharge shall release the bankrupt from all other debts provable in bankruptcy.
    2. An order of discharge shall be conclusive evidence of the bankruptcy, and of the validity of the proceedings therein, and in any proceedings that may be instituted against a bankrupt who has obtained an order of discharge in respect of any debt from which he is released by the order, the bankrupt may plead that the cause of action occurred before his discharge.
    3. An order of discharge shall not release any person who at the date of the receiving order was a partner or co-trustee with the bankrupt, or was jointly bound or had made any joint contract with him, or any person who was surety or in the nature of a surety for him.

    Power for court to annul adjudication in certain cases
    31.—(1) Where in the opinion of the court a debtor ought not to have been adjudged bankrupt, or where it is proved to the satisfaction of the court that the debts of the bankrupt are paid in full, the court may, on the application of any person interested, by order annul the adjudication.

    Effect of annulment
    (2) Where an adjudication is annulled under this section all sales and dispositions of property and payments duly made, and all acts theretofore done, by the official receiver, trustee, or other person acting under their authority, or by the court, shall be valid, but the property of the debtor who was adjudged bankrupt, shall vest in. such persons as the court may appoint, or, in default of any such appointment, revert to the debtor for all his estate or interest therein on such terms and subject to such conditions, if any, as the court may declare by order.

    Advertisement of order
    (3) Notice of the order annulling an adjudication shall be forthwith gazetted and published in a newspaper published and circulating in Fiji.
    (Amended by 37 of 1966, s. 17.)

    Meaning of "payment in full"
    (4) For the purpose of this section, any debt disputed by a debtor shall be considered as paid in full if the debtor enters into a bond, in such sum and with such sureties as the court approves, to pay the amount to be recovered in any proceedings for the recovery of or concerning the debt, with costs, and any debt due to a creditor who cannot be found or cannot be identified shall be considered as paid in full if paid into court.

    PART III—ADMINISTRATION OF PROPERTY

    PROOF OF DEBTS
    Description of debts provable in bankruptcy
    32.—(1) Demands in the nature of unliquidated damages arising otherwise than by reason of a contract, promise or breach of trust shall not be provable in bankruptcy.

    Creditor with notice of act of bankruptcy
    (2) A person having notice of any act of bankruptcy available against the debtor shall not prove under the order for any debt or liability contracted by the debtor subsequently to the date of his so having notice.

    What may be proved
    (3) Save as aforesaid, all debts and liabilities, present or future, certain or contingent, to which the debtor is subject at the date of the receiving order, or to which he may become subject before his discharge by reason of any obligation incurred before the date of the receiving order, shall be deemed to be debts provable in bankruptcy.

    Estimate of uncertain debts
    (4) An estimate shall be made by the trustee of the value of any debt or liability provable as aforesaid, which by reason of its being subject to any contingency or contingencies, or for any other reason, does not bear a certain value.

    Appeal from estimate
    (5) Any person aggrieved by any estimate made by the trustee as aforesaid may appeal to the court.

    If not capable of being fairly estimated
    (6) If, in the opinion of the court, the value of the debt or liability is incapable of being fairly estimated, the court may make an order to that effect, and thereupon the debt or liability shall, for the purposes of this Act, be deemed to be a debt not provable in bankruptcy.

    Estimation before court
    (7) If, in the opinion of the court, the value of the debt or liability is capable of being fairly estimated, the court may assess the value, and the amount of the value when assessed shall be deemed to be a debt provable in bankruptcy.

    Meaning of "liability"
    (8) For the purposes of this Act, "liability" shall include—
      1. any compensation for work or labour done;
      2. any obligation or possibility of an obligation to pay money or money's worth on the breach of any express or implied convenant, contract, agreement, or undertaking, whether the breach does or does not occur, or is or is not likely to occur or capable of occurring, before the discharge of the debtor;
      3. generally, any express or implied engagement, agreement, or undertaking, to pay, or capable of resulting in the payment of, money or money's worth; whether the payment is, as respects amount, fixed or unliquidated, as respects time, present or future, certain or dependent on any one contingency or on two or more contingencies; as to mode of valuation, capable of being ascertained by fixed rules or as matter of opinion.

    Mutual credit and set-off
    33. Where there have been mutual credits, mutual debts or other mutual dealings, between a debtor against whom a receiving order shall be made under this Act and any other person proving or claiming to prove a debt under the receiving order, an account shall be taken of what is due from the one party to the other in respect of such mutual dealings, and the sum due from the one party shall be set off against any sum due from the other party, and the balance of the account, and no more, shall be claimed or paid on either side respectively; but a person shall not be entitled under this section to claim the benefit of any set-off against the property of a debtor in any case where he had, at the time of giving credit to the debtor, notice of an act of bankruptcy committed by the debtor and available against him.

    Rules as to proof of debts
    34. With respect to the mode of proving debts, the right of proof by secured and other creditors, the admission and rejection of proofs, and the other matters referred to in the Second Schedule, the rules in that Schedule shall be observed.

    Priority of debts
    35.—(1) In the distribution of the property of a bankrupt there shall be paid in priority to all other debts—
    One year's rates and taxes
      1. all Crown taxes and local rates due from the bankrupt at the date of the receiving order, and having become due and payable within twelve months next before that date not exceeding in the whole one year's assessment;

    Crown rents
  • all Crown rents not more than twelve months in arrears;

    Clerk's or servant's wages
  • all wages or salary, whether or not earned wholly or in part by way of commission, of any clerk or servant in respect of service rendered to the bankrupt during four months before the date of the receiving order, not exceeding one hundred dollars;

    Labourer's wages
  • all wages of any labourer or workman not exceeding fifty dollars, whether payable for time or for piecework, in respect of services rendered to the bankrupt during two months before the date of the receiving order:
    1. Provided that where any labourer in husbandry has entered into a contract for the payment of a portion of his wages in a lump sum at the end of the period of hiring, the priority under this section shall extend to the whole of such sum, or a part thereof, as the court may decide to be due under the contract, proportionate to the time of service up to the date of the receiving order;

    Workmen's Compensation
     (e) unless the bankrupt has at the date of the receiving order, under such a contract with insurers as is mentioned in section 27 of the Workmen's Compensation Act, rights capable of being transferred to and vested in the workmen, all amounts due in respect of any compensation or liability for compensation under the said Act accrued before the date of the receiving order.
    (Cap. 94.)
    (2) Where any compensation under the Workmen's Compensation Act is a weekly payment, the amount due in respect thereof shall, for the purposes of paragraph (e) of subsection (1) be taken to be the amount of the lump sum for which the weekly payment could, if redeemable, be redeemed if the employer made an application for that purpose under the said Act.
    (Cap. 94.)

    They rank equally inter se
    (3) The foregoing debts shall rank equally between themselves, and shall be paid in full, unless the property of the bankrupt is insufficient to meet them, in which case they shall abate in equal proportions between themselves.

    To be paid forthwith
    (4) Subject to the retention of such sums as may be necessary for the costs of administration or otherwise, the foregoing debts shall be discharged forthwith as far as the property of the debtor is sufficient to meet them.

    First charge on distress
    (5) In the event of a landlord or other person distraining or having distrained on any goods or effects of a bankrupt within three months next before the date of the receiving order the debts to which priority is given by this section shall be a first charge on the goods or effects so distrained on, or the proceeds of the sale thereof:
    Provided that in respect of any money paid under any such charge the landlord or other person shall have the same rights of priority as the person to whom such payment is made.

    Insolvent estate of deceased person
    (6) This section shall apply, in the case of a deceased person who dies insolvent, as if he were a bankrupt, and as if the date of his death were substituted for the date of the receiving order.

    Application of joint and separate estates in partnership bankruptcies
    (7) In the case of partners the joint estate shall be applicable in the first instance in payment of their joint debts, and the separate estate of each partner shall be applicable in the first instance in payment of his separate debts. If there is a surplus of the separate estates, it shall be dealt with as part of the joint estate. If there is a surplus of the joint estate, it shall be dealt with as part of the respective separate estates in proportion to the right and interest of each partner in the joint estate.


    All other debts pari passu
    (8) Subject to the provisions of this Act, all debts proved in the bankruptcy shall be paid pari passu.

    Surplus
    (9) If there is any surplus after payment of the foregoing debts it shall be applied in payment of interest from the date of the receiving order at the rate of four per cent per annum on all debts proved in the bankruptcy.

    Savings
    (10) Nothing in this section shall prejudice the provisions of any enactment relating to deeds of arrangement respecting the payment of expenses incurred by the trustee under a deed of arrangement which has been avoided by the bankruptcy of the debtor.

    Preferential claim in case of apprenticeship
    36.—(1) Where at the time of the presentation of the bankruptcy petition any person is apprenticed or is an articled clerk to the bankrupt, the adjudication of bankruptcy shall, if either the bankrupt or apprentice or clerk gives notice in writing to the trustee to that effect, be a complete discharge of the indenture of apprenticeship or articles of agreement; and, if any money has been paid by or on behalf of the apprentice or clerk to the bankrupt as a fee, the trustee may, on the application of the apprentice or clerk, or of some person on his behalf, pay such sum as the trustee, subject to an appeal to the court, thinks reasonable, out of the bankrupt's property, to or for the use of the apprentice or clerk, regard being had to the amount paid by him or on his behalf, and to the time during which he served with the bankrupt under the indenture or articles before the commencement of the bankruptcy, and to the other circumstances of the case.


    Alternative power of trustee
     (2) Where it appears expedient to a trustee, he may, subject to the provisions of section 22 (2) of the Fiji National Training Act, on the application of any apprentice or articled clerk to the bankrupt, or any person acting on behalf of such apprentice or articled clerk, instead of acting under the preceding provisions of this section, transfer the indenture of apprenticeship or articles of agreement to some other person. (Section amended by 39 of 1965, s. 33.)
    (Cap. 93.)

    Landlord's power of distress in case of bankruptcy
    37. The landlord or other person to whom any rent is due from the bankrupt may at any time, either before or after the commencement of the bankruptcy, distrain upon the goods or effects of the bankrupt for the rent due to him from the bankrupt, with this limitation, that, if such distress for rent be levied after the commencement of the bankruptcy, it shall be available only for six month's rent accrued due prior to the date of the order of adjudication and shall not be available for rent payable in respect of any period subsequent to the date when the distress was levied, but the landlord or other person to whom the rent may be due from the bankrupt may prove under the bankruptcy for the surplus due for which the distress may not have been available.

    Postponement of husband's and wife's claims
    38.—(1) Where a married woman has been adjudged bankrupt, her husband shall not be entitled to claim any dividend as a creditor in respect of any money or other estate lent or entrusted by him to his wife for the purposes of her trade or business, until all claims of the other creditors of his wife or valuable consideration in money or money's worth have been satisfied.
    (2) Where the husband of a married woman has been adjudged bankrupt, any money or other estate of such woman lent or entrusted by her to her husband for the purpose of any trade or business carried on by him or otherwise, shall be treated as assets of his estate, and the wife shall not be entitled to claim any dividend as a creditor in respect of any such money or other estate until all claims of the other creditors of her husband for valuable consideration in money or money's worth have been satisfied.

    PROPERTY AVAILABLE FOR PAYMENT OF DEBTS
    Relation back to trustee's title
    39.—(1) The bankruptcy of a debtor, whether it takes place on the debtor's own petition or upon that of a creditor or creditors, shall be deemed to have relation back to, and to commence at, the time of the act of bankruptcy being committed on which a receiving order is made against him, or, if the bankrupt is proved to have committed more acts of bankruptcy than one, to have relation back to, and commence at, the time of the first of the acts of bankruptcy proved to have been committed by the bankrupt within three months next preceding the date of the presentation of the bankruptcy petition; but no bankruptcy petition, receiving order or adjudication shall be rendered invalid by reason of an act of bankruptcy anterior to the debt of the petitioning creditor.
    (2) Where a receiving order is made against the judgment debtor in pursuance of section 99, the bankruptcy of the debtor shall be deemed to have relation back to, and to commence at, the time of the order, or if the bankrupt is proved to have committed any previous act of bankruptcy, then to have relation back to, and to commence at, the time of the first of the acts of bankruptcy proved to have been committed by the debtor within three months next preceding the date of the order,

    Description of bankrupt's property divisible amongst creditors
    40. The property of the bankrupt divisible amongst his creditors, and in this Act referred to as the property of the bankrupt, shall not comprise the following particulars:—
      1. property held by the bankrupt on trust for any other person; and
      2. the tools (if any) of his trade and the necessary wearing apparel and bedding of himself, his wife and children, to a value, inclusive of tools and apparel and bedding, not exceeding forty dollars in the whole;
    1. it shall comprise the following particulars:—
      1. all such property as may belong to or be vested in the bankrupt at the commencement of the bankruptcy, or may be acquired by or devolve on him before his discharge; and
      2. the capacity to exercise and to take proceedings for exercising all such powers in or over or in respect of property as might have been exercised by the bankrupt for his own benefit at the commencement of his bankruptcy or before his discharge; and
      3. all goods, being at the commencement of the bankruptcy in the possession, order or disposition of the bankrupt, in his trade or business by the consent and permission of the true owner, under such" circumstances that he is the reputed owner thereof:
    2. Provided that things in action other than debts due or growing due to the bankrupt in the course of his trade or business shall not be deemed goods within the meaning of this section.

    Provisions as to second bankruptcy
    41.—(1) Where a second or subsequent receiving order is made against a bankrupt, or where an order is made for the administration in bankruptcy of the estate of a deceased bankrupt, then for the purposes of any proceedings consequent upon any such order, the trustee in the last preceding bankruptcy shall be deemed to be a creditor in respect of any unsatisfied balance of the debts provable against the property of the bankrupt in that bankruptcy.
    (2) In the event of a second or subsequent receiving order made against a bankrupt being followed by an order adjudging him bankrupt, or in the event of an order being made for the administration in bankruptcy of the estate of a deceased bankrupt, any property acquired by him since he was last adjudged bankrupt, which at the date when the subsequent petition was presented had not been distributed amongst the creditors in such last preceding bankruptcy, shall (subject to any disposition thereof made by the official receiver or trustee in that bankruptcy, without knowledge of the presentation of the subsequent petition, and subject to the provisions of section 49) vest in the trustee in the subsequent bankruptcy or administration in bankruptcy as the case may be.
    (3) Where the trustee in any bankruptcy receives notice of a subsequent petition in bankruptcy against the bankrupt or after his decease of a petition for the administration of his estate in bankruptcy, the trustee shall hold any property then in his possession which has been acquired by the bankrupt since he was adjudged bankrupt until the subsequent petition has been disposed of, and, if on the subsequent petition an order of adjudication or an order for the administration of the estate in bankruptcy is made, he shall transfer all such property or the proceeds thereof (after deducting his costs and expenses) to the trustee in the subsequent bankruptcy or administration in bankruptcy, as the case may be.

    EFFECT OF BANKRUPTCY ON ANTECEDENT AND OTHER TRANSACTIONS
    Restriction of rights of creditor under execution or attachment
    42.—(1) Where a creditor has issued execution against the goods or lands of a debtor, or has attached any debt due to him, he shall not be entitled to retain the benefit of the execution or attachment against the trustee in bankruptcy of the debtor, unless he has completed the execution or attachment before the date of the receiving order, and before notice of the presentation of any bankruptcy petition by or against the debtor or of the commission of any available act of bankruptcy by the debtor.
    (2) For the purposes of this Act, an execution against goods is completed by seizure and sale; an attachment of a debt is completed by receipt of the debt; and an execution against land is completed by seizure, or, in the case of an equitable interest, by the appointment of a receiver.
    (3) An execution levied by seizure and sale on the goods of a debtor is not invalid by reason only of its being an act of bankruptcy, and a person who purchases the goods in good faith under a sale by the sheriff shall, in all cases, acquire a good title to them against the trustee in bankruptcy.

    Duties of sheriff as to goods taken in execution
    43.—(1) Where any goods of a debtor are taken in execution, and before the sale thereof, or the completion of the execution by the receipt or recovery of the full amount of the levy, notice is served on the sheriff that a receiving order has been made against the debtor, the sheriff shall, on request, deliver the goods and any money seized or received in part satisfaction of the execution to the official receiver, but the costs of the execution shall be a first charge on the goods or money so delivered, and the official receiver or trustee may sell the goods, or an adequate part thereof, for the purpose of satisfying the charge.
    (2) Where, under an execution in respect of a judgment for a sum exceeding forty dollars, the goods of a debtor are sold or money is paid in order to avoid sale, the sheriff shall deduct his costs of the execution from the proceeds of sale or the money paid, and retain the balance for fourteen days, and, if within that time notice is served on him of a bankruptcy petition having been presented by or against the debtor, and a receiving order is made against the debtor thereon or on any other petition of which the sheriff has notice, the sheriff shall pay the balance to the official receiver, or, as the case may be, to the trustee, who shall be entitled to retain it as against the execution creditor.
    (3) Where any goods in the possession of an execution debtor at the time of seizure by a sheriff are sold by such sheriff without any claim having been made to the same, the purchaser of the goods so sold shall acquire a good title to such goods, and no person shall be entitled to recover against such sheriff or any other person lawfully acting under his authority, for any sale of such goods or for paying over the proceeds thereof prior to the receipt of a claim to such goods, unless it is proved that the person from whom recovery is sought had notice, or might by making reasonable inquiry have ascertained that such goods were not the property of the execution debtor:
    Provided that nothing in this subsection contained shall affect the right of any claimant, who may prove that at the time of sale he had a title to such goods, to any remedy to which he may be entitled against any person other than such sheriff.

    Avoidance of certain settlements
    44.—(1) Any settlement of property, not being a settlement made before, and in consideration of, marriage, or made in favour of a purchaser or incumbrancer in good faith and for valuable consideration, or a settlement made on or for the wife or children of the settlor of property which has accrued to the settlor after marriage in right of his wife, shall, if the settlor becomes bankrupt within two years after the date of the settlement, be void against the trustee in the bankruptcy, and shall, if the settlor becomes bankrupt at any subsequent time within ten years after the date of the settlement, be void against the trustee in the bankruptcy, unless the parties claiming under the settlement can prove that the settlor was, at the time of making the settlement, able to pay all his debts without the aid of the property comprised in the settlement, and that the interest of the settlor in such property passed to the trustee of such settlement on the execution thereof.

    Covenants in marriage settlements to settle after-acquired property
    (2) Any covenant or contract made by any person (hereinafter called the settlor) in consideration of his or her marriage, either for the future payment of money for the benefit of the settlor's wife or husband, or children, or for the future settlement on or for the settlor's wife or husband or children, of property, wherein the settlor had not at the date of the marriage any estate or interest, whether vested or contingent, in possession or remainder, and not being money or property in right of the settlor's wife or husband, shall, if the settlor is adjudged bankrupt and the covenant or contract has not been executed at the date of the commencement of his bankruptcy, be void against the trustee in the bankruptcy, except so far as it enables the persons entitled under the covenant or contract to claim for dividend in the settlor's bankruptcy, under or in respect of the covenant or contract, but any such claim to dividend shall be postponed until all claims of the other creditors for valuable consideration in money or money's worth have been satisfied.

    Transfers and payments under such covenants
    (3) Any payment of money (not being payment of premiums on a policy of life assurance) or any transfer of property made by the settlor in pursuance of such a covenant or contract as aforesaid shall be void against the trustee in the settlor's bankruptcy unless the persons to whom the payment or transfer was made prove either—
      1. that the payment or transfer was made more than two years before the date of the commencement of the bankruptcy; or
      2. that at the date of the payment or transfer the settlor was able to pay all his debts without the aid of the money so paid or the property so transferred; or
      3. that the payment or transfer was made in pursuance of a covenant or contract to pay or transfer money or property expected to come to the settlor from or on the death of a particular person named in the covenant or contract, and was made within three months after the money or property came into the possession or under the control of the settlor;
    But, in the event of any such payment or transfer being declared void, the persons to whom it was made shall be entitled to claim for dividend under or in respect of the covenant or contract in like manner as if it had not been executed at the commencement of the bankruptcy.
    (4) For the purposes of this section "settlement" includes any conveyance or transfer of property.

    Avoidance of general assignments of book debts unless registered
    45.—(1) Where a person engaged in any trade or business makes an assignment to any other person of his existing or future book debts or any class thereof, and is subsequently adjudicated bankrupt, the assignment shall be void against the trustee as regards any book debts which have not been paid at the commencement of the bankruptcy, unless the assignment has been registered as if the assignment were a bill of sale given otherwise than by way of security for the payment of a sum of money, and the provisions of the law with respect to the registration of bills of sale shall apply accordingly:
    Provided that nothing in this section shall have effect so as to render void any assignment of book debts due at the date of the assignment from specified debtors, or of debts growing due under specified contracts, or any assignment of book debts included in a transfer of a business made bonafide and for value, or any assignment of assets for the benefit of creditors generally.
    (2) For the purposes of this section "assignment" includes assignment by way of security and other charges on book debts.

    Avoidance of preference in certain cases
    46.—(1) Every conveyance or transfer of property, or charge thereon made, every payment made, every obligation incurred, and every judicial proceeding taken or suffered by any person unable to pay his debts as they become due from his own money in favour of any creditor, or of any person in trust for any creditor, with a view of giving such creditor, or any surety or guarantor for the debt due to such creditor, a preference over the other creditors, shall, if the person making, taking, paying or suffering the same is adjudged bankrupt on a bankruptcy petition presented within three months after the date of making, taking, paying or suffering the same, be deemed fraudulent and void as against the trustee in the bankruptcy.
    (2) This section shall not affect the rights of any person making title in good faith and for valuable consideration through or under a creditor of the bankrupt.

    Receiving order in lieu of committal
    (3) Where a receiving order is made against a judgment debtor in pursuance of section 99, this section shall apply as if the debtor had been adjudged bankrupt on a bankruptcy petition presented at the date of the receiving order.

    Protection of bona fide transactions without notice
    47. Subject to the foregoing provisions of this Act with respect to the effect of ankruptcy on an execution or attachment, and with respect to the avoidance of ertain settlements, assignments and preferences, nothing in this Act shall nvalidate, in the case of a bankruptcy—
      1. any payment by the bankrupt to any of his creditors;
      2. any payment or delivery to the bankrupt;
      3. any conveyance or assignment by the bankrupt for valuable consideration;
      4. any contract, dealing or transaction by or with the bankrupt for valuable consideration:
    1. Provided that both the following conditions are complied with, namely:—
        1. that the payment, delivery, conveyance, assignment, contract, dealing, or transaction, as the case may be, takes place before the date of the receiving order; and
        2. that the person (other than the debtor) to, by, or with whom the payment, delivery, conveyance, assignment, contract, dealing or transaction was made executed, or entered into, has not at the time of the payment, delivery, conveyance, assignment, contract, dealing or transaction, notice of any available act of bankruptcy committed by the bankrupt before that time.

    Validity of certain payments to bankrupt and assignee
    48. A payment of money or delivery of property to a person subsequently adjudged bankrupt, or to a person claiming by assignment from him, shall, notwithstanding anything in this Act, be a good discharge to the person paying the money or delivering the property, if the payment or delivery is made before the actual date on which the receiving order is made and without notice of the presentation of a bankruptcy petition, and is either pursuant to the ordinary course of business or otherwise bona fide.

    Dealings with undischarged bankrupt
    49.—(1) All transactions by a bankrupt with any person dealing with him bona fide and for value, in respect of property, whether real or personal, acquired by the bankrupt after the adjudication, shall, if completed before any intervention by the trustee, be valid against the trustee, and any estate or interest in such property which by virtue of this Act is vested in the trustee shall determine and pass in such manner and to such extent as may be required for giving effect to any such transaction.
    For the purposes of this subsection, the receipt of any money, security or negotiable instrument from, or by the order or direction of, a bankrupt by his banker, and any payment and any delivery of any security or negotiable instrument made to, or by the order or direction of, a bankrupt by his banker, shall be deemed to be a transaction by the bankrupt with such banker dealing with him for value.
    (Amended by 37 of 1966, s. 14.)

    Duties of bankers
    (2) Where a banker has ascertained that a person having an account with him is an undischarged bankrupt, then, unless the banker is satisfied that the account is on behalf of some other person, it shall be his duty forthwith to inform the trustee in the bankruptcy or the official receiver of the existence of the account, and thereafter he shall not make any payments out of the account, except under an order of the court or in accordance with instructions from the trustee in the bankruptcy, unless by the expiration of one month from the date of giving the information no instructions have been received from the trustee or the official receiver.

    REALIZATION OF PROPERTY
    Possession of property by trustee
    50.—(1) The trustee shall, as soon as may be, take possession of the deeds, books, and documents of the bankrupt, and all other parts of his property capable of manual delivery.
    (2) The trustee shall, in relation to and for the purpose of acquiring or retaining possession of the property of the bankrupt, be in the same position as if he were a receiver of the property appointed by the court, and the court may, on his application, enforce such acquisition or retention accordingly.
    (3) Where any part of the property of the bankrupt consists of stock, shares in ships, shares, or any other property transferable in the books of any company, office, or person, the trustee may exercise the right to transfer the property to the same extent as the bankrupt might have exercised if he had not become bankrupt.
    (4) Where any part of the property of the bankrupt consists of things in action, such things shall be deemed to have been duly assigned to the trustee.
    (5) Subject to the provisions of this Act with respect to property acquired by a bankrupt after adjudication, any treasurer or other officer, or any banker, attorney, or agent of a bankrupt, shall pay and deliver to the trustee all money and securities in his possession or power, as such officer, banker, attorney, or agent, which he is not by law entitled to retain as against the bankrupt or the trustee. If he does not, he shall be guilty of a contempt of court and may be punished accordingly on the application of the trustee.

    Seizure of property of bankrupt
    51. Any person acting under warrant of the court may seize any part of the property of a bankrupt, or of a debtor against whom a receiving order has been made, in the custody or possession of the bankrupt or the debtor, or of any other person, and with a view to such seizure may break open any house, building or room of the bankrupt or the debtor where the bankrupt or the debtor is supposed to be, or any building or receptacle of the bankrupt or the debtor where any of his property is supposed to be; and where the court is satisfied that there is reason to believe that property of a bankrupt, or of a debtor against whom a receiving order has been made, is concealed in a house or place not belonging to him, the court may, if it thinks fit, grant a search warrant to any police officer or officer of the court, who may execute it according to its tenor.

    Appropriation of proportion of pay or salary to creditors
    52.—(1) Where a bankrupt is an officer of the army, navy or air force or an officer or clerk or otherwise employed or engaged in the civil service of Fiji, the trustee shall receive for distribution amongst the creditors so much of the bankrupt's pay or salary, as the court, on the application of the trustee and with the consent of the Minister charged with responsibility for the armed forces, or the Judicial and Legal Services Commission, the Public Service Commission or the Police Service Commission, as the case may be, may direct. Before making any order under this subsection, the court shall communicate with such Minister or Commission, as to the amount, time and manner of payment to the trustee and shall obtain the written consent of the Minister or the Commission to the terms of such payment.
    (2) Where a bankrupt is in receipt of a salary or income other than as aforesaid, the court, on the application of the trustee, shall from time to time make such order as it thinks just for the payment of the salary or income, or of any part thereof, to the trustee, to be applied by him in such manner as the court may direct.
    (3) Nothing in this section shall take away or abridge any power contained in any written law to dismiss a bankrupt. (Amended by Order 7th October, 1970)

    Appropriation of income of property restrained from anticipation
    53. Where a married woman who has been adjudged bankrupt has separate property the income of which is subject to a restraint on anticipation, the court shall have power, on the application of the trustee, to order that, during such time as the court may order, the whole or some part of such income be paid to the trustee for distribution amongst the creditors, and in the exercise of such power the court shall have regard to the means of subsistence available for the woman and her children.

    Vesting and transfer of property
    54.—(1) Until a trustee is appointed, the official receiver shall be the trustee for the purposes of this Act, and, immediately on a debtor being adjudged bankrupt, the property of the bankrupt shall vest in the trustee.
    (2) On the appointment of a trustee, the property shall forthwith pass to and vest in the trustee appointed.
    (3) The property of the bankrupt shall pass from trustee to trustee, including under that term the official receiver when he fills the office of trustee, and shall vest in the trustee for the time being during his continuance in office, without any conveyance, assignment or transfer whatsoever.
    (4) The certificate of appointment of a trustee shall for all purposes of any law in force in any part of Fiji requiring registration or recording of conveyances or assignments of property, be deemed to be a conveyance or assignment of property, and may be registered and recorded accordingly.

    Disclaimer of onerous property
    55.—(1) Where any part of the property of the bankrupt consists of land of any tenure burdened with onerous covenants, of shares or stock in companies, of unprofitable contracts, or of any other property that is unsaleable, or not readily saleable, by reason of its binding the possessor thereof to the performance of any onerous act, or to the payment of any sum of money, the trustee, notwithstanding that he has endeavoured to sell or has taken possession of the property, or exercised any act of ownership in relation thereto, but subject to the provisions of this section, may, by writing signed by him, at any time within twelve months after the first appointment of a trustee or such extended period as may be allowed by the court, disclaim the property:
    Provided that, where any such property has not come to the knowledge of the trustee within one month after such appointment, he may disclaim such property at any time within twelve months after he has become aware thereof or such extended period as may be allowed by the court.
    Effect of disclaimer
    (2) The disclaimer shall operate to determine, as from the date of disclaimer, the rights, interests, and liabilities of the bankrupt and his property in or in respect of the property disclaimed, and shall also discharge the trustee from all personal liability in respect of the property disclaimed as from the date when the property vested in him, but shall not, except so far as is necessary for the purpose of releasing the bankrupt and his property and the trustee from liability, affect the rights or liabilities of any other person.

    Disclaimer of leases
    (3) A trustee shall not be entitled to disclaim a lease without the leave of the court, except in any cases which may be prescribed by general rules, and the court may, before or on granting such leave, require such notices to be given to persons interested, and impose such terms as a condition of granting leave, and make such orders with respect to fixtures, tenant's improvements, and other matters arising out of the tenancy, as the court thinks just.

    Abandonment of right of disclaimer
    (4) The trustee shall not be entitled to disclaim any property in pursuance of this section in any case where an application in writing has been made to the trustee by any person interested in the property requiring him to decide whether he will disclaim or not, and the trustee has for a period of twenty-eight days after the receipt of the application, or such extended period as may be allowed by the court, declined or neglected to give notice whether he disclaims the property or not; and, in the case of a contract, if the trustee, after such application as aforesaid, does not within the said period or extended period disclaim the contract, he shall be deemed to have adopted it.

    Rescission of contracts
    (5) The court may, on the application of any person who is, as against the trustee, entitled to the benefit or subject to the burden of a contract made with the bankrupt, make an order rescinding the contract on such terms as to payment by or to either party of damages for the non-performance of the contract, or otherwise,
    as to the court may seem equitable, and any damages payable under the order to
    any such person may be proved by him, as a debt under the bankruptcy.

    Vesting orders
    (6) The court may, on application by any person either claiming any interest in any disclaimed property or under any liability not discharged by this Act in respect of any disclaimed property, and on hearing such persons as it thinks fit, make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the court thinks just; and on any such vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any conveyance or assignment for the purpose:
    Provided that, where the property disclaimed is of a leasehold nature, the court shall not make a vesting order in favour of any person claiming under the bankrupt, whether as under-lessee or as mortgagee by demise, except upon the terms of making that person—
      1. subject to the same liabilities and obligations as the bankrupt was subject to under the lease in respect of the property at the date when the bankruptcy petition was filed; or
      2. if the court thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date;
    and in either event (if the case so requires) as if the lease had comprised only the property comprised in the vesting order; and any mortgagee or under-lessee declining to accept a vesting order upon such terms shall be excluded from all interest in and security upon the property, and, if there is no person claiming under the bankrupt who is willing to accept an order upon such terms, the court shall have power to vest the bankrupt's estate and interest in the property in any person liable either personally or in a representative character, and either alone or jointly with the bankrupt to perform the lessee's convenants in the lease, freed and discharged from all estates, incumbrances, and interests created therein by the bankrupt.

    Disclaimer by official receiver as interim trustee
    (7) Where, on the release, removal, resignation or death of a trustee in bankruptcy, an official receiver is acting as trustee, he may disclaim any property which might be disclaimed by a trustee under the foregoing provisions, notwithstanding that the time described by this section for such disclaimer has expired, but such power of disclaimer shall be exercisable only within twelve months after the official receiver has become trustee in the circumstances, aforesaid, or has become aware of the existence of such property, whichever period may last expire.
    (8) Any person injured by the operation of a disclaimer under this section shall be deemed to be a creditor of the bankrupt to the extent of the injury, and may accordingly prove the same as a debt under the bankruptcy.

    Powers of trustee to deal with property
    56. Subject to the provisions of this Act, the trustee may do all or any of the following things—
      1. sell all or any part of the property of the bankrupt (including the goodwill of the business, if any, and the book debts due or growing due to the bankrupt), by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels;
      2. give receipts for any money received by him, which receipts shall effectually discharge the person paying the money from all responsibility in respect of the application thereof;
      3. prove, rank, claim and draw a dividend in respect of any debt due to the bankrupt;
      4. exercise any powers, the capacity to exercise which is vested in the trustee under this Act, and execute any powers of attorney, deeds and other instruments, for the purpose of carrying into effect the provisions of this Act;
      5. deal with any property to which the bankrupt is beneficially entitled in the same manner as the bankrupt might have dealt with it.

    Powers exercisable by trustee with permission of committee of inspection
    57. The trustee may, with the permission of the committee of inspection, do all or any of the following things:—
      1. carry on the business of the bankrupt, so far as may be necessary for the beneficial winding up of the same;
      2. bring, institute or defend any action or other legal proceeding relating to the property of the bankrupt;
      3. employ a barrister and solicitor or other agent to take any proceedings or do any business which may be sanctioned by the committee of inspection;
      4. accept as the consideration for the sale of any property of the bankrupt a sum of money payable at a future time subject to such stipulations as to security and otherwise as the committee thinks fit;
      5. mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts;
      6. refer any dispute to arbitration, compromise any debts, claims, and liabilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have incurred any liability to the bankrupt, on the receipt of such sums, payable at such times, and generally on such terms as may be agreed on;
      7. make such compromise or other arrangement as may be thought expedient with creditors, or persons claiming to be creditors, in respect of any debts provable under the bankruptcy;
      8. make such compromise or other arrangement as may be thought expedient with respect to any claim arising out of or incidental to the property of the bankrupt, made or capable of being made on the trustee by any person or by the trustee on any person;
      9. divide in its existing form amongst the creditors, according to its estimated value, any property which from its peculiar nature or other special circumstances cannot be readily or advantageously sold.
    1. permission given for the purposes of this section shall not be a general permission to do all or any of the abovementioned things, but shall only be a permission to do the particular thing or things for which permission is sought in the specified case or cases.

    Power to allow bankrupt to manage property
    58. The trustee, with the permission of the committee of inspection, may appoint the bankrupt himself to superintend the management of the property of the bankrupt or of any part thereof, or to carry on the trade (if any) of the bankrupt for the benefit of his creditors, and in any other respect to aid in administering the property, in such manner and on such terms as the trustee may direct.

    Allowance to bankrupt for maintenance or service
    59. The trustee may from time to time, with the permission of the committee of inspection, make such allowance as he may think just to the bankrupt out of his property for the support of the bankrupt and his family, or in consideration of his services if he is engaged in winding up his estate, but any such allowance may be reduced by the court.

    Right of trustee to inspect goods pawned, etc.
    60. Where any goods of a debtor against whom a receiving order has been made are held by any person by way of pledge, pawn or other security, it shall be lawful for the official receiver or trustee, after giving notice in writing of his intention to do so, to inspect the goods, and where such notice has been given, such person as aforesaid shall not be entitled to realize his security until he has given the trustee a reasonable opportunity of inspecting the goods and of exercising his right of redemption if he thinks fit to do so.

    Limitation of trustee's powers in relation to copyright
    61. Where the property of a bankrupt comprises the copyright in any work or any interest in such copyright, and he is liable to pay to the author of the work royalties or a share of the profits in respect thereof, the trustee shall not be entitled to sell, or authorise the sale of, any copies of the work, or to perform or authorise the performance of the work, except on the terms of paying to the author such sums by way of royalty or share of the profits as would have been payable by the bankrupt, nor shall he, without the consent of the author or of the court, be entitled to assign the right or transfer the interest or to grant any interest in the right by licence, except upon terms which will secure to the author payments by way of royalty or share of the profits at a rate not less than that which the bankrupt was liable to pay.

    Protection of official receiver and trustee from personal liability in certain cases
    62. Where the official receiver or trustee has seized or disposed of any goods, chattels, property or other effects in the possession or on the premises of a debtor against whom a receiving order has been made, without notice of any claim by any person in respect of the same, and it is thereafter made to appear that the said goods, chattels, property or other effects were not, at the date of the receiving order, the property of the debtor, the official receiver or trustee shall not be personally liable for any loss or damage arising from such seizure or disposal sustained by any person claiming such propety, nor for the costs of any proceedings taken to establish a claim thereto, unless the court is of opinion that the official receiver or trustee has been guilty of negligence in respect of the same.

    DISTRIBUTION OF PROPERTY
    Declaration and distribution of dividends
    63.—(1) Subject to the retention of such sums as may be necessary for the cost of administration, or otherwise, the trustee shall, with all convenient speed, declare and distribute dividends amongst the creditors who have proved their debts.

    First dividend
    (2) The first dividend, if any, shall be declared and distributed within four months after the conclusion of the first meeting of creditors unless the trustee satisfies the committee of inspection that there is sufficient reason for postponing the declaration to a later date.

    Subsequent dividends
    (3) Subsequent dividends shall, in the absence of sufficient reason to the contrary, be declared and distributed at intervals of not more than six months.

    Notice of intention to declare
    (4) Before declaring a dividend, the trustee shall cause notice of his intention to do so to be gazetted in the prescribed manner, and shall also send reasonable notice thereof to each creditor mentioned in the bankrupt's statement who has not proved his debt.

    Notice of dividend
    (5) When the trustee has declared a dividend he shall send to each creditor who has proved, a notice showing the amount of the dividend and when and how it is payable, and a statement in the prescribed form as to the particulars of the estate.

    Joint and separate dividends
    64.—(1) Where one partner of a firm is adjudged bankrupt, a creditor to whom the bankrupt is indebted jointly with the other partners of the firm, or any of them, shall not receive any dividend out of the separate property of the bankrupt until all the separate creditors have received the full amount of their respective debts.
    (2) Where joint and separate properties are being administered, dividends of the joint and separate properties shall, unless otherwise directed by the court on the application of any person interested, be declared together, and the expenses of and incidental to such dividends shall be fairly apportioned by the trustee between the joint and separate properties, regard being had to the work done for and the benefit received by each property.

    Provisions for creditors residing at a distance, etc.
    65.—(1) In the calculation and distribution of a dividend the trustee shall make provision for debts provable in bankruptcy appearing from the bankrupt's statements, or otherwise, to be due to persons resident in places so distant from the place where the trustee is acting that in the ordinary course of communication they have not had sufficient time to tender their proofs, or to establish them, if disputed, and also for debts provable in bankruptcy the subject of claims not yet determined.
    (2) The trustee shall also make provision for any disputed proofs or claims, and for the expenses necessary for the administration of the estate or otherwise.
    (3) Subject to the other provisions of this section, the trustee shall distribute as dividend all money in hand.

    Right of creditor who has not proved debt before declaration of a dividend
    66. Any creditor who has not proved his debt before the declaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in the hands of the trustee any dividend or dividends he may have failed to receive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend declared before his debt was proved by reason that he has not participated therein.

    Interest on debts