Boston Apartments

apx bankruptcy
adelphia bankruptcy
assignment for the benefit of creditors
claim bankruptcy
claim bankruptcy



Bankruptcy Order

Bankruptcy Order is the order made by the London High Court or the local county court declaring a person to be Bankrupt either on creditor or on debtors petition and after the Court proceedings (if any). Research studies have shown that there has been an increase in percentage of younger Bankrupts from 8% in 2001 to 19% in 2005.Nearly one thousand graduates were declared Bankrupt last year. It is sad to note that these days Bankruptcy is not something that one would feel ashamed of but viewed as an easy way to wash off their hands from the debts they owe.

Once Bankruptcy Order is made, the same will be published in the London Gazette, local press or national newspaper (or both) for everyone to see. The Onus to get it published is on the Official receiver. Then the Official receiver (an officer of the court / Civil servant) or the Insolvency practitioner takes over the case, acts as the trustee and reports to both court and the creditor/s. There are also cases when the official receiver arranges for a meeting with the creditors who in turn appoint a trustee. If no such meeting is held, then the Official Receiver becomes the Trustee. Here the Creditors meeting guides the trustee.Actually this process is slow and expensive too. A Trustee is usually responsible for realization of assets and to distribute it among the Creditors.

Following are the powers and functions of the official receiver: -

1. To obtain information from the Bankrupt in Form B40.01, Short preliminary questionnaire, details of outstanding assets, debts and to check its genuineness.

2. To investigate about conduct and affairs of the Bankrupt

3. To redirect Bankrupts mails.

4. To Check the Bankrupts premises, prepare an Inspection report and remove valuables that could be sold (This is generally done only with a Corporate).

5. To see if Creditors payment could be made either by the Bankrupt individually or through Income Payment Order. But this is done only after Bankrupts basic needs are catered to.

6. Can apply to the court to postpone the Bankrupts discharge date in case he/she has not carried out the duties properly during the Bankruptcy proceedings.

7. No payment can be made to the court bypassing the official receiver.

Now once you are declared Bankrupt, then the Official receiver must update the following people about your Bankruptcy status: -

1. Mortgage lender (so that they may retain the assets in case you are not able to pay)

2. Banks and Building Societies

3. Utility lenders (Telephone, Electricity)

The official receiver does not send any notice to the Credit reference agencies in this regard. They take assistance from the Individual Insolvency Register, advertisements in the Newspapers, London Gazette and Register of County Court Judgments. But in case where stay against advertisement is obtained, the official receiver informs the credit reference agencies.

Certain privileges are debarred for a Bankrupt like: -

1. A Bankrupt cannot obtain credit of more than GBP500 either individually or jointly without disclosing his Bankruptcy status.

2. A Bankrupt Cannot function as a Managing Director of a Company

3. A Bankrupt cannot start a business in a name different from the one in which he/she was declared Bankrupt

4. Holding certain public offices

Along with the Bankruptcy Order the Court generally issues Certificate of Summary administration. This happens only if Bankruptcy order is issued on debtors petition. If the court does not issue, one must request the court for issuance of it immediately. This simplifies the entire procedure and also reduces the cost. Here the official receiver will administer the case and generally proceed without investigation. In this case, the Bankrupt receives discharge within two years.

A Certificate of Summary administration cannot be issued if debts are more than GBP 20,000.In such case, the official receiver arranges for a meeting with the creditor (if necessary) who in turn appoints the trustee. This procedure is slow and costly. Otherwise the official receiver becomes the trustee.

The official receiver must be kept posted of each and every movement of the Bankrupt. Oh! I dont want my Bankruptcy Order to be published. Can I stop this -The answer is YES.

If one does not want his/her Bankruptcy Order to be published in anticipation that he /she will be able to apply for annulment of same, then the Bankrupt must intimate the court at once over Phone and apply for a stay of advertisement. The Bankrupt must also intimate the official receiver about his move. The Bankrupt must also provide all information needed by the official receiver in this regard. Only on confirmation of receipt of required data from the official receiver, the court will consider the application. A court order can only prevent from such advertisements being published.

Now what does this Annulment mean

Annulment of Bankruptcy Order means cancellation of it. Once an annulment is made, it is tantamount to saying that Bankruptcy Order was never made. So the individual can continue with his/her Pre Bankruptcy status. Any assets already dealt by official receiver/trustee cannot be reversed. Remaining assets may be returned. The individual is also responsible for pending debts during Bankruptcy.

However,Annulment can be made only under following circumstances: -

1. If the Bankruptcy Order was erroneously issued (Or)

2. If the Bankrupt has paid his debts, fees and expenses of the Court to the satisfaction of court (Or)

3. If the Bankrupt has entered into an Individual Voluntary Arrangement with the Creditor.

Let us now have a look at other records that are maintained about a Bankrupt in order to safeguard public welfare.

1. Details regarding Bankruptcy Order and individual Voluntary arrangement made in England and Wales are maintained in Individual Insolvency Register that is updated meticulously.

2. Bankruptcy Petition and Order are registered at Land Charges department of HM Land Registry.

3. If the Bankrupt own property in his/her name alone, then Bankruptcy notice (to protect the right of creditors) and Bankruptcy restriction notice (to prevent further dealing with the property) will be registered against the title .If the property is in Joint names, then Form J will be registered against the title.

Similarly any annulment of the Bankruptcy Order is also updated in the above-mentioned records accordingly. But to do so, the Court has to explicitly mention the same in the annulment order. The court will also mention that who should approach the Land Charges Department to get the court order updated accordingly.

At this Juncture it is also worthwhile to know about Bankruptcy Restriction Search:

It is a database that contains information about misconduct of individuals who are subject to Bankruptcy Restriction order (BRO) and Bankruptcy Restriction Undertaking (BRU) in England and Wales. That is BRO is a new civil regime to safeguard the interest of public against Bankrupts who are irresponsible. Such Bankrupts have extended period of Bankruptcy between 2 to 15 years

Oh! this is quite a bit.Now tell me when will I get discharged

Discharge from Bankruptcy means getting rid of restrictions of Bankruptcy and getting relieved from most of the debt that the Bankrupt owes at the date of Bankruptcy Order. Some exceptions to these are: -

1. Secured Creditors

2. Maintenance orders and family courts

3. Fines

4. Debts obtained through fraud

5. Debts from certain injury claims

6. Debts from other orders of a criminal court.

Generally Bankruptcy ends automatically after one year but if the court order has a Certificate of Summary Administration attached to it, it will be two years.

The trustee has a maximum period of 3 years to deal with Bankrupts interest in home.

The new legislation "The Enterprise Act 2002" has some news for us in this regard.

It says that if one is declared Bankrupt on/after 1st April 2004, then Bankrupt will be automatically discharged after a year. But if a person is declared Bankrupt before then the discharge will take place on 1st April 2005.In case the Bankrupt expects a earlier date of discharge, the discharge will be on that date.

If a person has been undischarged Bankrupt during the last 15 years prior to current Bankruptcy, then his/her discharge will take place automatically on 1st April 2009.The Bankrupt can also apply for a discharge after 5 years but the court can either refuse/extend it.

Once discharged, the Court issues a certificate to the debtor.

There may still be certain assets, which the trustee has not dealt with, that the Bankrupt have acquired before discharge. The trustee still controls these assets and can deal with them in future. But this may not be for a longer time.

And all those assets obtained after discharge remains with the Ex-Bankrupt.

A person has both strengths and weaknesses. When the weaknesses dominate the Strength, he becomes notorious. The Bankruptcy process gives a person ample time and opportunity to tune him with the realities of life. One way of achieving it is if the official receiver does not project himself only as an officer but also as a mentor of the Bankrupt.

Other Articles

1. adelphia bankruptcy
     WHAT IS BANKRUPTCYIt is very important for us to understand what is the meaning of the word bankruptcy. When any...
2. claim bankruptcy
     Why do people claim bankruptcyBankruptcy is considered to be an avenue to relieve oneself from debts, by most p...
3. apx bankruptcy
     WHY A COMPANY FILES FOR BANKRUPTCYThe first question that needs to be answered before we proceed our topic furth..

Loans Bottom   Loans Bottom
Loans Bottom