Bankruptcy
Bankruptcy

The following Property guidance note provides comprehensive and up to date legal information covering:

  • Bankruptcy
  • Petition or application
  • Appointment of trustee
  • Effect of appointment
  • Trustee's powers

STOP PRESS: Since 25 April 2017, it has been mandatory to use electronic filing (e-filing) in all jurisdictions of the Rolls Building, which includes the Insolvency and Companies List (formerly the Bankruptcy and Companies Courts of the Chancery Division). Since that date, it is no longer possible to issue claims or applications, or to file documents, on paper—instead all issuings and filings must be made online using the CE-File website. For further reading, see News Analysis: E-filing at the Rolls Building: some practical considerations for R&I lawyers. The extension of e-filing to the Business and Property Courts outside of London occurs from 25 February 2019, with the issue of all new proceedings becoming mandatory for professional users from 30 April 2019. For further reading, see News Analysis: CE-File extended to Business and Property Courts out of London (LNB News 13/02/2019 34).

Petition or application

Bankruptcy is regulated primarily through Part IX of the Insolvency Act 1986 (IA 1986).

As with liquidation, the effect is to realise the assets of the bankrupt and distribute the proceeds in accordance with the statutory scheme.

Bankruptcy usually arises following:

  1. the presentation to the court of a creditor’s petition, or

  2. an application by the debtor to an adjudicator for a bankruptcy order.

Prior to 6 April 2016, a debtor could present his own bankruptcy petition on the