SPROULE ACJ - This was an application to have it declared that a conveyance by the bankrupt to his wife, dated 2nd June, 1926, of the equity of redemption of land and premises No. 121 Beach Street, Penang, was void against the Official Assignee by reason of section 50 of the Bankruptcy Ordinance.

The relevant portions of the sections are:-

50 (1) - "Any settlement of property, not being . . . a settlement made in favour of a purchaser . . . in good faith and for valuable consideration, . . . shall if the settlor becomes bankrupt within two years after the date of the settlement, be absolutely void against the Official Assignee. . . .

(3) - "Settlement" for the purposes of this section includes any conveyance or transfer of property. . . .

The hearing before me was on the 8th and 9th November, 1927, in Penang. At that time a criminal prosecution was pending against the bankrupt on various charges under the Bankruptcy Ordinance. I thought it fair to reserve my judgment on the issue before me lest it should prejudice those proceedings in one way or other.

I was reminded of this matter last week and could not recall it at all. But a perusal of my notes of evidence has brought the scene and my impressions of the witnesses and their testimony clearly back to my recollection, as well as the decision I was then ready to give, but, for the reason stated, preferred to postpone. That decision I now put on record.

At the hearing Mr. Hogan, appearing for the respondent, wife of the bankrupt, accepted the burden of proof upon admitted facts then stated to me, and which I now outline.

The bankrupt purchased the premises 121 Beach Street, Penang, in November, 1919, from Yap Chor Ee, together with vacant land stretching therefrom to Weld Quay, for $35,000. He mortgaged the land and premises to the vendor the same day for $30,000.

Later in 1919 the debtor sold the vacant land for $10,000. This sum was paid to Yap Chor Ee, and the mortgage debt thus reduced to $20,000 secured only upon the land and premises comprised in 121 Beach Street.

On 2nd June, 1926 the debtor conveyed the equity of redemption to his wife Khoo Saw Cheow for a consideration of $5,000 and her assuming, with Yap Chor Ee's consent, the burden of the $20,0000 mortgage.

The debtor committed an act of bankruptcy on 18th May, 1927, and was shortly afterwards adjudicated bankrupt.

Two-thirds of the vacant land was sold by Mr. E.V.C. Thomson as trustee of the estate of Yeoh Paik Kiat on 19th May, 1925, for $5,000.

Prima facie, and apart from the Bankruptcy Ordinance, there was valuable consideration passing from husband to wife, but the Official Assignee attacked the transaction as not being in good faith, and asked me to say that it was absolutely void against him.

I think Mr. Hogan rightly accepted the burden of proof that he came under an excepted case. The section avoids, as against the Official Assignee, all settlements made within two years of a subsequent bankruptcy, with certain exceptions. It was for the respondent to prove that her case was such an exception.

It this section were not both a matter in bankruptcy and also an expression, dictated by the policy of the law, of its suspicion of voluntary settlements, possibly covinous, one might be tempted to comment upon the unusual situation of a person being required, in effect, to prove that she was not fraudulent, in face of the ordinary rule that fraud must be plainly alleged and strictly proved. But I conceive that I am bound to hold that the burden on the respondent is not merely formal, or to be discharged lightly, but that she must satisfy the Court beyond such measure of reasonable doubt as is to be expected in a civil cause or matter, that the transaction impugned was in good faith and was a genuines sale.

That real burden is made more arduous by the facts, which I accept, that her husband was insolvent in June, 1926, and for a long time prior to that, and knew it; and that she was a secondary