Q&As

Is there anything to prevent a bankrupt from giving a guarantee?

read titleRead full title
Published on LexisPSL on 26/01/2018

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

  • Is there anything to prevent a bankrupt from giving a guarantee?

Is there anything to prevent a bankrupt from giving a guarantee?

Where an individual is an undischarged bankrupt (or a discharged bankrupt subject to a bankruptcy restrictions order or undertaking), they are subject to a number of restrictions, including not to act as a director of a company. If a bankrupt acts contrary to one of these restrictions, they are likely to be committing a bankruptcy offence, and liable to be punished accordingly. For further reading, see Practice Notes: The immediate effects of a bankruptcy order on the bankrupt and Obtaining credit without disclosure of status.

From our limited researches, we are not aware of any restriction specifically on the giving of a guarantee by a bankrupt.

However, we wonder whether the giving of a guarantee might be caught under section 360 of the Insolvency Act 1986 (IA 1986). Under that section it is an offence for a bankrupt to obtain

Popular documents