Personal Insolvency Flashcards
(6 cards)
1
Q
**Personal Insolvency **
Bankruptcy Level
1
A
£5,000
2
Q
Personal Insolvency
Which assets don’t pass into the insolvency process?
3
A
- Tools of the Trade
- Household Items- required for basic domestic needs
- Home- Court Order required. Court weigh interests of the creditor against bankrupt/family. Bankrupt takes precedence until after 1yr passes then creditors take precedence.
If home not sold in 3yrs it re-vests in bankrupt.
3
Q
Personal Insolvency
Legal Disabilities of being bankrupt
5
A
- Cannot act as a Director
- Can’t obtain credit for more than £500 without informing lender of your status
- Can’t trade under a different name (as bankrupt one)
- Can’t practise as a solicitor without SRA approval
- If bankrupt is a partner check if s33 PA 1890 is overridden or not- partnership may have automatically dissolved.
4
Q
Personal Insolvency
Order of Distribution for the assets
4
A
- Cost of bankruptcy
- Preferential debts
- Ordinary unsecured creditors
- Postponed creditors (bankrupts spouse)
5
Q
Personal Insolvency
Timeline for Discharge
1
A
1 year (usually)
6
Q
Personal Insolvency
Bankruptcy Restriction Order (BRO)
2
A
Under IA 1986 gives power to impose restrictions for 2-15 years where legal disabilities continue to apply.
