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Bankruptcy: application for discharge


A debtor may apply at any time after being made bankrupt. The court will appoint a date for the hearing, normally in open given to the official receiver and the given to the official receiver and the trustee. The Official Receiver gives fourteen days' notice to creditors and files a report on the bankrupt seven days before the hearing. The hearing is also published in the London Gazette. The court listens to the Official Receiver, trustee and any creditor; it also considers the report submitted by the Official Receiver, and may question the debtor. If a creditor intends to oppose the discharge he must give two days' notice to the Official Receiver. The court nay: (1) grant an absolute discharge; (2) suspend discharge for a particular time; (3) make it conditional on the payment of some money out of future income; or (4) refuse it. The position is slightly different when the lebtor has committed a felony or misdemeanour, has performed certain acts, or where certain conditions obtain, inter alia: where less than 50p in the £1 has been paid to secured creditors, the debtor has traded knowing he was insolvent, brought forward frivolous defences, made undue preferences within three months before the receiving order, been previously bankrupt, or made composition. etc., with creditors, been guilty of fraud. failed to account for any particular losses, failed within the previous three years to keep proper books of account, speculated rashly, etc. In these instances the court must either refuse the discharge, or suspend it either sine die or until 50p in the £1 has been paid or until judgment has been entered for a certain sum.

Reference: The Penguin Business Dictionary, 3rd edt.