Failure is purely and simply the suspension of payments resulting from circumstances independent of the will of him who fails. Bankruptcy, on the contrary, is suspension of payments resulting either from imprudence or from mistakes of the bankrupt. Simple bankruptcy occurs in the following cases: 1. If the personal expenses of the merchant or the expenses of his house are judged excessive; 2. If he has spent large sums of money in operations of pure chance either in fictitious operations or extravagant purchases; 3. If with the intention of putting off his failure, he has made purchases to sell again below par; 4. If after cessation of payment, he has paid a creditor to the prejudice of all others. (Code of Commerce.) Bankruptcy is called _fraudulent_, when the bankrupt has abstracted his books, misrepresented a portion of his assets, or declared himself debtor for sums he does not owe. It is useless to say that this third case is but another case of theft and deserves the severest denunciation. Simple bankruptcy is already very culpable; and failure itself should be regarded by all merchants as a very great misfortune, which they must avoid at any cost. =41. The commodate or gratuitous loan.=--The gratuitous loan or commodate is a contract by which one of the parties gives to the other a thing to be made use of, on the condition that it be returned after having served its purpose. (Code Civ., Art. 1875.) As a fundamental principle, the receiver must return to the lender the very thing he has loaned him. But in case of loss or deterioration of the thing loaned, resulting from the use made of it, on whom is to fall the loss? "It cannot be presumed, says Kant (Doctrine of the Law, French translation, p. 146), that the lender should take upon himself all the chances of loss or deterioration of the thing loaned; for it stands to reason that the proprietor, besides granting to the borrower the use of the thing he loans him, would not agree to _insure_ him also against all risks. If, for instance, during a shower, I enter a house, where I borrow a cloak, and this cloak gets to be forever spoiled from coloring matters thrown upon me by mischance, from a window, or if it be stolen from me in a house where I laid it down, it would be considered generally absurd, to say that I had nothing else to do than to send back the cloak, such as it is, or report the theft that has taken place. The case would be very different if, after having asked permission to use a thing, I should insure myself against the loss in case it should suffer any damage at my hands, by begging not to be held responsible for it. No one would think this precaution superfluous and ridiculous, except perhaps the lender, supposing he was a rich and generous man; for it would then be almost an offense not to expect from his generosity the remission of my debt."