Bankruptcy-FS Flashcards
(8 cards)
What is the main legal consequence of a seller being declared bankrupt?
A trustee in bankruptcy takes over their affairs, and the bankrupt seller loses authority to sell property.
Why is it essential to conduct a bankruptcy search before completing a property transaction?
To ensure the seller is not bankrupt, as a bankrupt individual has no legal power to sell the property.
What form is used to conduct a bankruptcy search at the Land Registry?
The K-18 form is used to perform a bankruptcy search under the Land Charges Act 1972.
What could happen if a buyer purchases property from a bankrupt seller?
The transaction would be unlawful, and the buyer may lose their interest, as the trustee in bankruptcy holds the true authority.
Who is legally responsible for selling a bankrupt individual’s property?
The trustee in bankruptcy, who manages the estate for the benefit of creditors.
What is registered against a bankrupt’s property to protect creditors?
A charge at the Land Registry indicating the bankruptcy status.
What does a clean result on a K-18 form indicate?
That no subsisting entries are found, and the seller is not currently bankrupt.
What risk does a buyer face if no bankruptcy search is conducted?
The buyer might unknowingly purchase from a bankrupt seller, resulting in no legal transfer of ownership.
