Husband of sole

trader not liable for debts.

1821.

The husband of a sole trader is not liable for any debts contracted by her in the course of her sole trader's business, unless contracted upon his written consent.

NOTE.-Stats. 1852, p. 101, Sec. 6.

Statutes in relation to, continued in force.

TITLE XIII.

OF PROCEEDINGS IN INSOLVENCY.

SECTION 1822. Statutes in relation to, continued in force.

1822. Nothing in this Code affects any of the provisions of "An Act for the relief of insolvent debtors and protection of creditors," approved May fourth, eighteen hundred and fifty-two, or of the Acts amendatory thereof, approved respectively March twelfth, eighteen hundred and fifty-eight, April twenty-seventh, eighteen hundred and sixty, and April twenty-seventh, eighteen hundred and sixty-three, but such Acts are recognized as continuing in force notwithstanding the provisions of this Code.

NOTE.-The only question presented for our consideration is as to the effect of the Act of Congress entitled "An Act to establish a uniform system of bankruptcy throughout the United States," of the 2d of March, 1867, upon the statute of this State, under which the defendant obtained his discharge. By the eighth section of the first Article of the Federal Constitution power is granted to Congress "to establish uniform laws upon the subject of bankruptcies throughout the United States." In respect to this and cognate provisions there was at first some conflict of opinion upon the question whether the power thereby granted was exclusive, but it was finally settled that it was not, upon the ground that there was nothing in the language itself, or in the nature of the power, which required that it should be exercised exclusively by Congress. The question arose in the case of Sturges vs. Crowninshield, 4 Wheaton, p. 122. The case was an action of assumpsit, brought in the Circuit Court of Massachu

setts, upon two promissory notes. The defendant pleaded a discharge under "An Act for the benefit of insolvent debtors and their creditors," passed by the Legislature of New York at a time when there was no Act of Congress upon the subject of bankruptcies. And it was held that the statute of New York was not repugnant to the Constitution of the United Statesor, in other words, that the power over that subject was concurrent, and the several States might exercise the power so long as there was no conflicting legislation by Congress. The question arose again in the case of Ogden vs. Saunders, 12 Wheaton, p. 213. That, also, was an action of assumpsit, brought by a citizen of Kentucky against a citizen of Louisiana. Among the defenses pleaded was a certificate of discharge under an Act of the Legislature of the State of New York, of which State the defendant was a resident at the date of his acceptance of the bills of exchange in suit. One of the questions was, whether the law of New York was invalid as being repugnant to the Constitution of the United States. It was elaborately argued by very able counsel upon both sides, and it was again declared that the States were not prohibited from passing insotvent or bankrupt laws except when Congress has actually exercised its power upon the same subject, and the State laws conflict with those of Congress. See, also, Blanchard vs. Russell, 13 Mass., p. 12; Adams vs. Story, 1 Paine's C. C., p. 79. This corollary follows: That all the State laws upon the subject become inoperative or suspended the moment the law of Congress takes effect, so far as all persons and cases which are within the purview of the latter are concerned. While there was some difference of opinion between the members of the Court in the case of Sturges vs. Crowninshield, upon other points they were all agreed, as stated by Mr. Justice Story, in Ex Parte Eames, 2 Story, p. 326: "That when Congress did pass a Bankrupt Act, it was supreme, and that the State laws must yield to it, and could no longer operate upon persons or cases within the purview of such Act. The enactment of such an Act suspended the State laws on the same subject, and created a disability in the States to exercise powers of the like nature." It is claimed, however, on the part of the defendant, that his proceedings under the State law were commenced prior to the date at which the Act of Congress took effect, and are, therefore, unaffected by the latter Act, although the assignment was not made, and his discharge was not decreed until after

it had taken effect. If a State Court has acquired jurisdiction, under a State law, of a case in insolvency, and is engaged in settling the debts and distributing the assets of the insolvent before or at the date at which the Act of Congress upon the same subject takes effect, the State Court may, nevertheless, proceed with the case to its final conclusion, and its action in the matter will be as valid as if no law upon the subject had been passed by Congress. This question arose in the case of Judd vs. Ives, 4 Metcalf, p. 401, and was determined as just stated. Martin vs. Berry, 37 Cal., p. 209. The insolvent law of our State is somewhat different from that of Massachusetts. Under it the insolvent Court is not authorized to seize the property of the insolvent upon the filing of the petition. It can only make an order, requiring his creditors to show cause against his discharge, at a time and place of which they are to be notified by the Clerk; and a further order, staying all proceedings against the insolvent, unless it afterwards appears, by the oath of a creditor, that there is reason to apprehend that the insolvent will take advantage of the stay to make some disposition of his property to the prejudice of his creditors, in which case the Court may appoint a receiver, to take possession of the insolvent's property and hold it for the benefit of the creditors. If this is not done, the debtor may remain in the undisturbed possession of all of his property until the meeting of his creditors, at or before which time he is required to deposit with the Clerk of the Court his books, notes, securities, and the like. He may also transfer property and collect debts due him, in the meantime, without prejudice to his application, provided he accounts therefor to his assignee within ten days after his appointment.-Id. The Acts continued in force by this section are upon the same subject with "assignments for the benefit of creditors," Civil Code, Vol. II, pp. 454–474, Secs. 3449–3473, there thoroughly annotated. The provisions of these continuing Acts, and those of the Civil Code, must be construed together the Civil Code as to the rights and relation of the parties, those here named as to the method of their application.-See Hastings vs. Cunningham, 39 Cal., p. 142. Without publication of notice, made as required on a valid order, the assignment is invalid.McDonald vs. Kotz, 31 Cal., p. 167. See, also, criticism on "proceedings according to the course of the common law.”—Hahn vs. Kelly, 34 Cal., p. 391. Nothing passes under an invalid assignment.-Hill vs. Keyes, 10 Allen, p. 258. What is a substantial compliance

with the Act, in making the order for the notice, see Flint vs. Wilson, 36 Cal., p. 24. Judgment rendered in an action commenced before proceedings in insolvency were instituted, is not void, but the discharge should be set up in a supplemental answer to avail the insolvent.-Rahm vs. Minis, 40 Cal., p. 422. If insolvent applicant fails or refuses to answer an allegation of fraud his petition should be dismissed.-Sanborn vs. His Creditors, 37 Cal., p. 609; see cases cited in note to Sec. 3449, et seq., Civil Code.

46-VOL. II.