- Bankruptcy Law
- Bankruptcy proceedings are started by a bankruptcy petition, which may be presented to the court by(1) a creditor or creditors;(2) a person affected by a voluntary arrangement to pay debts set up by the debtor under the Insolvency Act (1986);(3) the Director of Public Prosecutions; or(4) the debtor.The grounds for a creditors' petition are that the debtor appears to be unable to pay a debt for which a statutory demand has been made or that a court has ordered him or her to pay. The debt must amount to at least £750. The grounds for a petition by a person bound by a voluntary arrangement are that the debtor has not complied with the terms of the arrangement or has withheld material information. The Director of Public Prosecutions may present a petition in the public interest under the Powers of Criminal Courts Act (1973). The debtor may also present a petition on the grounds of being unable to pay his or her debts.Once a petition has been presented, the debtor may not dispose of any property. The court may halt any other legal proceedings against the debtor. An interim receiver may be appointed. This will usually be the official receiver, who will take any necessary action to protect the debtor's estate. A special manager may be appointed if the nature of the debtor's business requires it.The court may make a bankruptcy order at its discretion. Once this has happened, the debtor is an undischarged bankrupt, who is deprived of the ownership of all property and must assist the official receiver in listing it, recovering it, protecting it, etc. The official receiver becomes manager and receiver of the estate until the appointment of a trustee in bankruptcy. The bankrupt must prepare a statement of affairs for the official receiver within 21 days of the bankruptcy order. A public examination of the bankrupt may be ordered on the application of the official receiver or the creditors, in which the bankrupt will be required to answer questions about his or her affairs in court.Within 12 weeks the official receiver must decide whether to call a meeting of creditors to appoint a trustee in bankruptcy. The trustee's duties are to collect, realize, and distribute the bankrupt's estate. The trustee may be appointed by the creditors, the court, or the Secretary of State and must be a qualified insolvency practitioner or the official receiver. All the property of the bankrupt is available to pay the creditors, except for the following:• equipment necessary for him or her to continue in employment or business;• necessary domestic equipment;• income required for the reasonable domestic needs of the bankrupt and his or her family.The court has discretion whether to order sale of a house in which a spouse or children are living.All creditors must prove their claims to the trustee. Only unsecured claims can be proved in bankruptcy. When all expenses have been paid, the trustee will divide the estate. Legislation sets out the order in which creditors will be paid (see preferential creditor).The bankruptcy may end automatically after two or three years, but in some cases a court order is required. The bankrupt is discharged and receives a certificate of discharge from the court.
Big dictionary of business and management. 2014.
Look at other dictionaries:
bankruptcy law — The area of federal law dealing with the handling of bankrupt persons or businesses. Short Dictionary of (mostly American) Legal Terms and Abbreviations … Law dictionary
China bankruptcy law — The Enterprise Bankruptcy Law of the People s Republic of China (trial Implementation) was first passed in 1986. Twenty years later, the Enterprise Bankruptcy Law of the PRC was introduced on 27 August, 2006. It contains 136 articles, almost 100… … Wikipedia
bankruptcy — bank·rupt·cy / baŋ ˌkrəp sē/ n pl cies 1: the quality or state of a bankrupt filed for bankruptcy 2: the administration of an insolvent debtor s property by the court for the benefit of the debtor s creditors the debt was discharged in bankruptcy … Law dictionary
Bankruptcy Code — the name given to the statutory body of bankruptcy laws after the Bankruptcy Reform Act of 1978 (Glossary of Common Bankruptcy Terms) The common name given to title 11 of the United States Code. The Bankruptcy Code is a set of federal statutes… … Glossary of Bankruptcy
bankruptcy proceedings — The way a bankruptcy case wends its way through the court system, from the time the bankruptcy petition is filed until the debtor receives a bankruptcy discharge. Category: Bankruptcy, Foreclosure & Debt → Bankruptcy Nolo’s Plain English Law… … Law dictionary
Bankruptcy Code — USA The informal name for the body of federal bankruptcy law, embodied in Title 11 of the United States Code (11 U.S.C. §§ 101 1532). Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010 … Law dictionary
Bankruptcy Reform Act of 1994 — the most comprehensive piece of bankruptcy legislation since the Bankruptcy Reform Act of 1978; signed into law on October 22, 1994 with most provisions effective immediately; included in the 1994 Act are: provisions to expedite bankruptcy… … Glossary of Bankruptcy
bankruptcy petition — the document filed with the court to initiate a bankruptcy proceeding (Glossary of Common Bankruptcy Terms) A formal request for the protection of the federal bankruptcy laws. (There is an official form for bankruptcy petitions.)… … Glossary of Bankruptcy
law — / lȯ/ n [Old English lagu, of Scandinavian origin] 1: a rule of conduct or action prescribed or formally recognized as binding or enforced by a controlling authority: as a: a command or provision enacted by a legislature see also statute 1 b:… … Law dictionary
bankruptcy court — n: a court that is a unit of a federal District Court and has original jurisdiction over bankruptcy cases ◇ Bankruptcy courts were created by Congress as part of the 1898 Bankruptcy Act. Article I, Section 8 of the U.S. Constitution gives… … Law dictionary