Leases.

Assignees may be compelled to elect.

Extent of

they did not mean to take to the lease, unless it could be advantageously disposed of—and the lease was soon afterwards put up to sale by order of the assignees, but there was no bidder for it, and they even omitted to return the key to the landlord for near four months afterwards, but never took actual possession of the premises,-Lord Ellenborough held, that the assignees were not, under these circumstances, liable to the landlord as assignees of the lease. (1) And so, where the bankrupt had underlet part of the demised premises, and the assignees released the under-tenant, and on being afterwards asked by the lessor to elect, they refused to take the lease, it was held, that the release to the under-tenant did not amount to an acceptance. (2)

But now, in order to prevent any inconvenience to the landlord, from the neglect of the assignees to determine whether they will take to the lease or not, it is by the 75th section of the new act provided, that if the assignees shall not (upon being thereto required) elect, whether they will accept or decline any lease, or agreement for a lease, to which the bankrupt was entitled, the lessor, or person so agreeing to grant a lease, or any person entitled under them, may apply by petition to the Lord Chancellor; who may order them so to elect, and to deliver up such lease, or agreement, (in case they shall decline it,) as well as the possession of the premises, or may make such other order therein as he shall think fit. (3)

The above clause, it has been held, applies only to cases the Chanbetween the lessor and lessee, or the assignee of the lessee; cellor's jurisdiction and not to cases between the lessee and the assignee of the lease. (4) The Lord Chancellor is not empowered under this section to determine the question, whether the assignees have elected to take the lease or not, but can only send such

in this

respect.

(1) Wheeler v. Bramah, 3 Camp.

340.

(2) Hill v. Dobie, 2 Moore, 342. 8 Taunt. 325.

(3) This clause is taken from the 49 G. 3. c. 121. s. 19.

(4) Taylor v. Young, 3 B. & A.

521.

a question to be tried by a jury (1); for he has only autho- Leases. rity, under the above provision, to make an order that the assignees shall elect. It is only, in fact, when assignees will not decide, that jurisdiction is given to the Lord Chancellor; for if they have already accepted, or rejected, he has no jurisdiction. (2) Therefore, where assignees had previously rejected a lease, a petition by the lessor for payment of rent due after the bankruptcy, and for a compensation for hay and straw which the assignees had carried off the premises, was dismissed (3); Lord Eldon concurring with the Vice-Chancellor, that, as between the lessor and the assignees of a bankrupt lessee, the Court had not jurisdiction-except in cases under the statute-and upon petitions for an injunction; for which the petition in this case contained no prayer.

allowed a

time to

elect.

Upon a petition for an order on the assignees to elect, Assignees they will be allowed a reasonable time—such as ten days, reasonable for instance-to consider what will be most beneficial for the creditors. (4) And in a case where there were two commissions, and issues directed which were still undecided, the Court granted an order (under each commission) on the assignees, to make an election to depend on

-

the result. (5)

the covenant of the

lessee, as

hay, straw,

to leaving

Where the assignees declined taking the lease, but in- Bound by sisted that they were entitled to remove from the premises all the hay, straw, &c. (which, by a covenant in the lease, the lessee at the end, or sooner determination of the term, was to leave upon the premises), Lord Eldon determined the lease, and directed a case upon the construction of the covenant. (6) Upon the argument of this case before the Court of King's Bench, it was decided, that the assignees

(5) Ex parte Pomeroy, 1 Rose,

(6) Ex parte Nixon, 1 Rose, 445. This case at first sight appears to clash with the decision in ex parte Warwick, suprà; but the distinction between them is, that in this case there was a prayer for an injunction; in that case there was no such prayer.

&c.

Leases.

When entitled to off-going crops.

Parol

were bound by the covenant of the lessee, and were not entitled to the hay, straw, &c. (1) In all these cases, indeed, where the Lord Chancellor determines the lease upon the petition of the lessor, the assignees are in the same situation, as the tenant would have been in by effluxion of time. Therefore, where a lease contained a covenant, that the lessee" at the expiration, or other sooner determington of the lease," might take the off-going crop — and the lease was determined by the Chancellor after the bankruptcy of the lessee, the assignees were held to be entitled (2) to the off-going crops. Nor does it make any difference, that the lease is only from year to year, determinable on giving half a year's notice, and the covenant is to leave the hay, &c., or take the crops, on quitting the premises (3); for the election of the assignees, not to take the lease, has the same effect (with reference to the covenant), as though the lessee had quitted upon notice."

A parol agreement for a lease, (although brought within agreement the principle, upon which a court of equity would decree a for a lease, not within specific performance, upon acts of part performance) it has been held, is not an agreement within the meaning of the statute, so as to put assignees to elect, or reject, such agreement. (4)

the sta

tute.

Where the

lease in the hands of a

son.

Where the lease had been deposited by the bankrupt with a THIRD PERSON, as a security for a debt, and the third per- assignees refused to take to the term, upon a petition by the landlord that the assignees might deliver it up, as well as the possession of the premises, an order to that effect was made. For though the statute does not in words extend to cases, where the lease is in the hands of a third person, yet it seems that, by an equitable construction of the above section of the act, which is intended for the benefit of landlords, the Chancellor has such a jurisdiction. (5)

83.

(1) In re Gough, Buck, 85.
(2) Ex parte Maundrell, Buck,

(3) Ex parte Whittington, Buck,

(4) Ex parte Sutton, 2 Rose, 148.

(5) Ex parte Clunes, 1 Mad. 76.

property

As the statute enables the commissioners to assign the Personal bankrupt's property, wheresoever the same may be found or abroad known (1), the assignees are entitled to all the personal passes to property, which the bankrupt may possess in any foreign assignees. country, unless there happens to be some positive law of that country to prevent it. For personal property, according to the general principles of all laws, has no visible. locality, but is subject to that particular law, which governs the person of the owner. (2) If the Bankrupt law, indeed, was circumscribed by the local situation of the property, a door would be open to all the partiality of undue preference, which it is framed chiefly to prevent; for it is not very difficult to foresee, how frequently property would be sent abroad with that unjust view, immediately previous to and in contemplation of an act of bankruptcy. But the consequence of the rule, as it at present applies to personal property, is, that a commission of bankruptcy followed by an assignment, defeats all preference attempted to be obtained by any one creditor, through the medium of the law of the country where any of the bankrupt's effects may happen to be placed (as well as by any voluntary conveyance of the bankrupt)-after the period, when the legal effect of the bankruptcy attaches to the general

estate.

Thus, the bankrupt's goods in Ireland will pass to the Property assignees by the assignment from the commissioners, and in Ireland. the Irish courts will also take notice of our laws, so as to prevent a creditor from attaching property there after the commission, and gaining a preference (3) over the assignees. So, the courts in Scotland, and the colonies, Scotland,

(1) Section 63. ante, page 383.
(2) Sill v. Worswick, i H. B.665.

(3) Good, 114. Neale v. Cotting

ham, 1 H. B. 132. in note.

Property recognize the English law in this respect. For, where abroad. bankrupts here had carried on business both in London and in Scotland, under distinct firms, the Court of Session in Scotland held, that the commission here vested in the assignees all the property of the bankrupts wherever situate, precluding creditors in Scotland, from attaching by sequestration such parts of the bankrupts' property, as remained, or was situate, in that country. (1) Whether a commission in England, or a sequestration in Scotland, is to be preferred, as the mode of administering the effects of a bankrupt, depends upon their respective priorities. (2)

Where a

creditor attaching money abroad, liable to

Where, AFTER THE ASSIGNMENT of a bankrupt's estate, a creditor residing in England, who had notice of the bankruptcy and assignment, attached the money of the bankrupt abroad, it was held, that his assignees might refund to recover it against the creditor in an action for money had assignees. and received. (3) And in another case, where the attachment was before the assignment, the same doctrine was held. (4) In one case indeed of this kind, Lord Hardwicke even granted a writ of ne exeat regno against a creditor, who before the bankruptcy had gone into Scotland, and made arrestments on debts due to the bankrupt there, though he had not obtained sentence- saying, that the case was like a foreign attachment, by which a creditor was not suffered to gain a priority. (5)

When not so liable.

--

But in a case, where the bankrupt was one of several partners his partners carrying on a branch of the business in the West Indies and a joint creditor there attached property belonging to the firm abroad,—it was

(1) Bank of Scotland v. Cuthbert, 1 Rose, 462.; and see Selkrig v. Davis, 2 Dow. Rep. 230. 2 Rose, 291. and Odwin v. Forbes, Buck,

57.

(2) Ibid.

(5) Hunter v. Potts, 4 T. R. 182. Philips v. Hunter, 2 H. B. 402. The law upon this subject, however, appears to have been formerly laid

down differently by Lord Mansfield, both at Nisi Prius, and at the Cockpit. (Waring v. Knight, 1C.B.L. 300. Cleve v. Mills, ibid. 297.) See also a powerful judgment of Eyre C. J. on that side the question, in Philips v. Hunter, 2 H. B. 409.

(4) Sill v. Worswick, 1 H.B.665. (5) M'Intosh v. Ogilvie, 4T. R. 187. note (a).