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Bankruptcy Law Committee Report
SUMMARY OF RECOMMENDATIONS
The Report of the Bankruptcy Law Committee under
the Chairmanship of Mr. Justice Budd, was published
on the 3rd October 1973.
Among the more important recommendations are the
following.
Section I, Paragraph 15, Sub-section 1
An examination of the existing law contained in the
Bankruptcy Acts of 1857 and 1872 was undertaken. The
general principles were found to be satisfactory and
have been retained. "Where considered suitable, we have
taken some ideas from contemporary bankruptcy, and,
having adapted them to Irish conditions, have included
them in the draft Bill contained in Appendix D. In the
light of decisions of the Irish Courts, we have found it
necessary to introduce a number of new provisions and
to amend some of the existing ones. In doing so, we
have borne in mind the necessity in doing justice to the
creditors and the bankrupts, by keeping a balance be-
tween the harshness of creditors and the fraud of
debtors. Constant reference is also made to reports and
recommendations made by Committees established in
England, relating to Bankruptcy Law. As there are no
modern books available on Irish bankruptcy law, we
have made our Report as extensive as possible."
Chapter 2: Petitions, Acts of Bankruptcy and Adjudi-
cation—
Major
Recommendations
(1)
Petition to
Court
—This
procedure should be re-
tained. Petition and adjudication should be contem-
poraneous. The minimum amount of the petitioning
creditor's debt should be increased to £100. An act of
bankruptcy should be available for three months only.
The debt of the petitioning creditor should be a liqui-
dated sum. A secured creditor should be able to petition
for adjudication.
(2)
Acts of
Bankruptcy
—Levying
of execution by the
seizure of a debtor's goods or a return of no goods made
by the Sheriff or County Registrar, whether by endorse-
ment on the order or otherwise, should be an act of
bankruptcy. A debtor's summons should be renamed a
"Bankruptcy Summons". The giving of a fraudulent
preference should be an act of bankruptcy.
(3)
Adjudication
—Immediate
seizure of a bankrupt's
property should be made on adjudication. Only one
statutory sitting of the Court is necessary. A debtor in
prison under the Enforcement of Court Orders Act 1926
should be released on adjudication. A statement of
affairs should be less complicated. The assets of a
debtor adjudicating himself bankrupt should not be less
than £100.
Chapter 3: Composition after Bank r up t cy—
M a j or
Recommendations
The system of paying compositions after bankruptcy
should be continued. The second composition sitting
should be abolished. In deciding on an offer any creditor
whose debt is below £20 in number and value should be
ignored. An instalment of a composition should not be
secured by a bill, note or other security signed by or
enforceable against the bankrupt alone. The Court
should have discretion to refuse to accept an offer pay-
able by instalments if the final instalment is not payable
within two years from the date of the approval of the
offer. The Court should have full control over compo-
sitions. A bankrupt should be entitled to his discharge
and the revesting of his estate on the lodgment of the
cash and/or the bills with the Official Assignee. A claim
by a creditor having a corrupt agreement with a bank-
rupt should be voia and both should be guilty of an
offence.
Chapter 6: Bankrupt Dying after Adjudication—
Major
Recommendation
If a debtor dies after adjudication the bankruptcy
should continue.
Chapter 7: Summonses, Warrants for Committal and
Examinations—
Major
Recommendations
A person in prison pursuant to an order of the Court
should, if required by its direction, be brought before it.
If he satisfies the Court that he has complied with its
lawful requirements he should be released, otherwise he
should be taken back to prison. While examinations
should normally be held in public the Court may direct
that the whole or any part of any sitting should be held
in camera.
Chapter 8:
Warrants—
Major
Recommendations
A search warrant should be necessary to enter prem-
ises other than the bankrupt's.
Chapter 9: Vesting (including Election and Disclaimer)
—Major
Recommendations
There should be absolute vesting in the Official Assig-
nee only. The dual system of election and disclaimer
should be abolished and a single system of disclaimer
substituted. Power should be given to the Court to make
an order for possession to the person entitled under the
disclaimer and to vest property in him. Notification of a
disclaimer should be given to the Registrar of Titles.
Cahpter 11: Registration of Lands, Deeds, Convey-
ances,
etc.—
Major
Recommendations
A certificate under the seal of the Court should be
issued to the Official Assignee as evidence of the vesting
of a bankrupt's property in him, this certificate to be
registrable as if it were a conveyance.
Chapter 12: Excepted
Articles—
Major
Recommen-
dations
The monetary limit for excepted articles should be
increased from £20 to £100 or such further sum as the
Court may allow.
Chapter 13: Clauses in Agreements or Leases which
(1) Provide for Forfeiture or (2) Prohibit Aliena-
tion—
Major
Recommendations
The Official Assignee should be in a position to dis-
pose of a bankrupt's interest in a lease. Every covenant
or provision for forfeiture in a lease on the bankruptcy
of the lease should be void against the Official Assignee.
A condition in a hire purchase agreement providing for
the termination of the agreement on the bankruptcy of
the hirer should also be void against the Official Assignee.
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