Q&As

Can a creditor claim against a discharged bankrupt for monies due under a contract entered into with the debtor following the date of the bankruptcy order?

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Published on LexisPSL on 24/02/2015

The following Restructuring & Insolvency Q&A provides comprehensive and up to date legal information covering:

  • Can a creditor claim against a discharged bankrupt for monies due under a contract entered into with the debtor following the date of the bankruptcy order?
  • Bankruptcy
  • Has the bankrupt breached any restrictions?
  • Pursuing the debt—practical considerations

Can a creditor claim against a discharged bankrupt for monies due under a contract entered into with the debtor following the date of the bankruptcy order?

Bankruptcy

Immediately upon a bankruptcy order being made against an individual, that individual is described as an ‘undischarged’ bankrupt. They will retain that status until they are discharged from their bankruptcy, which will automatically occur on the first anniversary of the bankruptcy order being made, unless any order is made suspending a bankrupt’s discharge pursuant to section 279 of the Insolvency Act 1986 (IA 1986). See Practice Note: The immediate effects of a bankruptcy order on the bankrupt.

The role of the bankrupt’s trustee in bankruptcy (trustee) is to realise the assets forming the bankruptcy estate and, after payment of the costs and expenses of the bankruptcy process, to distribute any surplus to the bankrupt’s unsecured creditors. See Practice Note: What assets vest in the trustee in bankruptcy and what steps does the official receiver or trustee in bankruptcy need to take? Only those creditors who are owed ‘provable’ debts can participate in such distribution, which are commonly those creditors who were owed debts at the date of the bankruptcy order, or where a liability existed at that date for a debt due in

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