Bankruptcy and family financial remedy proceedings

The relationship between bankruptcy and financial remedy proceedings has been analysed in a number of cases in both the bankruptcy and family courts. It is not uncommon for bankruptcy proceedings to be in existence while an application for a financial remedy under the Matrimonial Causes Act 1973 (MCA 1973) or the Civil Partnership Act 2004 (CPA 2004) is ongoing. Concurrent proceedings can create conflict when it comes to the division of assets and impact the financial remedy proceedings. There are also instances of bankruptcy proceedings being commenced with the dominant intention of frustrating financial remedy proceedings.

The three main considerations regarding bankruptcy proceedings in terms of their effect on financial remedy proceedings are:

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the position of each court when there are concurrent bankruptcy and financial remedy proceedings
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the powers the court has to set aside bankruptcy proceedings if they were commenced to defeat the other party’s application for a financial remedy
•
the circumstances in which the bankruptcy court can unwind financial remedy orders, including property adjustment orders

See Practice Note: Dos and don'ts for family lawyers when

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