which would have enabled a
bankrupt to pay a composition on his debts, with the consent of a large
proportion of his bona-fide creditors, and subject to the approval of the
court, after hearing the objections of dissenting creditors, would
doubtless have proved a beneficial reform, but the act of 1849 proceeded on
a very different principle. Instead of reforming, it practically abolished
judicial control. By avoiding Scylla it fell into Charybdis. To give _any_
majority of creditors the power to release a debtor from his obligations to
non-assenting creditors without full disclosure of his affairs, and without
any exercise of judicial discretion or any investigation into the causes of
the failure, or the conduct of the debtor, would in any circumstances have
been to introduce a new and mischievous principle into legislation, for it
would necessarily destroy the essential feature of such arrangements, that
they are _voluntary_ contracts, the responsibility for which lies solely
with the parties entering into them. But to give such a power to creditors
whose claims were subject to no independent investigation was to invite
inevitable confusion and failure.

[Sidenote: 1861.]

Yet this was the dominating principle of English bankruptcy legislation for
nearly thirty-five years. Its effect under the act of 1849 was, however, to
some extent modified by subsequent decisions of the courts that to make a
composition arrangement binding it must be accompanied by a complete
_cessio bonorum_; but this qualification was removed by the act of 1861
which made such arrangements binding without a _cessio_ and reduced the
majority required to make a deed of arrangement binding on all the
creditors, to a majority in number and three-fourths in value of those
whose claims amounted to L10 and upwards. The result was an enormous
increase in fraudulent arrangements. The then attorney-general, Sir Robert
Collier, in introducing an amending act in 1869, described the abuses which
had grown up under the 1849 and 1861 acts, as having the effect of enabling
a bankrupt to "defraud those to whom he was indebted and to set them at
defiance"; while Lord Cairns, the lord chancellor, in the House of Lords
expressed the opinion that the large increase which had taken place in the
annual insolvency of the country during the preceding years could not "be
attributed to depression of trade but must be traced to the enormous
facilities which are given to deb