on. Any person, trader or non-trader, may avail
himself of the act, but, in the case of a corporation, there is this
peculiarity: it may be petitioned against but cannot petition.

Insolvency is construed in a practical sense; that is, a person is
insolvent where the aggregate of his property, at a fair valuation, is
insufficient to pay his debts; but he is not necessarily insolvent because
his realized assets are insufficient to meet his liabilities.

Involuntary proceedings can only be taken against debtors owing $1000 or
over, with certain exceptions. A petitioning creditor's debt must amount to
$500.

The administration of the law of bankruptcy is entrusted to the district
courts and is exercised through the medium of certain officers appointed by
the courts and called referees. The creditors appoint a trustee or trustees
of the estate.

So soon as his judicial examination is over the bankrupt may offer his
creditors a composition, but to take effect the composition must be
approved by the court after hearing objections.

The discharge is the key to the efficiency of every bankruptcy system. By
the control which the court thus holds, it is enabled to bring its moral
censorship to bear on a debtor's conduct and so maintain a high standard of
commercial integrity. Under the United States system the judge is to
investigate the merits of the application and to discharge the bankrupt,
unless he has (1) committed an offence punishable by imprisonment; (2) with
intent to conceal his financial condition, destroyed, concealed, or failed
to keep books of account or records from which such condition might be
ascertained; or (3) _obtained property on credit from any person upon a
materially false statement in writing made to such person for the purpose
of obtaining such property on credit; or_ (4) _at any time, subsequent to
the first day of the four months immediately preceding the filing of the
petition, transferred, removed, destroyed or concealed any of his property
with intent to hinder, delay or defraud his creditors; or_ (5) _in
voluntary proceedings been granted a discharge in bankruptcy within six
years; or_ (6) _in the course of proceedings in bankruptcy refused to obey
any lawful order of or to answer any material question approved by the
court._

It is significant that the italicized qualifications were added to the act
of 1898 by the experience of five years of its working.

(E. MA.)

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