Bankruptcy Order
At the hearing the court can decide one of four things:
- Dismiss the bankruptcy petition;
- Order a ‘stay’ in proceedings, i.e. suspend the proceedings if it feels it requires further information to make a decision;
- Consider referring the application to an Insolvency Practitioner in respect of setting up an IVA if:
- the unsecured debts total £20,000 or less
- assets listed in the Statement of Affairs total £2,000 or more
- the individual petitioner has not been declared bankrupt within the last 5 years
- if the court feels that, given the circumstances, it is appropriate to do so.
- If none of the above apply, the Bankruptcy Order will be made.
If appropriate the court will also issue a Certificate of Summary Administration. One will be issued if:
- the bankrupt has unsecured debts of less than £20,000
- has neither been bankrupted or subject to a IVA in the previous 5 years
- and that the bankruptcy order is a result of a debtor’s petition only.
NOTE: If the court makes no mention at the hearing of issuing a Certificate of Summary Administration, the debtor should ask the court to consider issuing one. This is because it is not possible to raise the matter at a later date.
After the Order is made
Once the order is made, the debtor officially becomes bankrupt and effectively loses ownership of all property/assets, except for those items excluded.