- Creditor Petition to the Court – some is applying to make you bankrupt.
- Debtor Petition to the Court, ie applying for your own bankruptcy – see DIY bankruptcy.
- IVA Supervisor Petition to the Court in the case where the debtor has defaulted on the IVA and an alternative arrangement can’t be agreed.
For a bankruptcy petition to be presented to the Court, 3 conditions must be satisfied:Two or more creditors may jointly petition. Secured creditors may petition for the part of the debt that is not secured.
- The debtor must usually live in England/Wales or be active in business in England or Wales.
- The debt must be at least £5,000 to the creditor petitioning for bankruptcy.
- The debtor must have no realistic ability to repay the debt, or be refusing to pay the debt. This is proven by the debt being served with a statutory demand, which has not been set aside or complied with; or by an unsatisfied baillif return.
The creditor’s petition must state:If the petition is based upon a Statutory Demand, then only that debt, plus interest accrued since the date of the demand was issued can be included. If the petition is based upon an unsatisfied execution of a previous Court order then full details must be given, including the value of any sum raised by the Court’s sheriffs or Bailiffs.
- The amount owed, and if interest is owed, how it has been calculated and the justification for this.
- That the debt is for a liquidated sum payable now or at a specified future date and that the debtors have no realistic chance of making payment on time.
- That the debt is unsecured.
Statement of Affairs FormThis is an official document which you will be required to complete, detailing your financial circumstances and assets. Assets are items of value that could be sold off to help repay your debts. The form requires detailed and accurate information, including valuation of assets which may not be known without seeking professional help. The Court may refer the case to an Insolvency Practitioner if an IVA or a Debt Relief Order could be more appropriate course of action and needs consideration.
IVA Supervisors’ Petition
If you are currently within an IVA, your supervisor may petition the for your bankruptcy on the grounds that:In this case, the IVA Supervisor can become the Trustee in the bankruptcy.
- You supplied false or misleading information on which the arrangement is based.
- You have failed to maintain the terms to the arrangement.