The bankruptcy hearing

Bankruptcy hearing

You have issued and served a bankruptcy petition. The debtor may agree to pay to avoid bankruptcy but the court is now involved and legal rules come into play. Alternatively, the debtor may challenge the petition. 

The debtor wants to pay

After service of the bankruptcy petition the debtor may want to pay the debt or offer terms of settlement which are acceptable to you. However the petition cannot be withdrawn without the permission of the court at the hearing. If other creditors have become aware of the petition, they may want it to carry on unless their debts are paid as well.  If you accept money from the debtor between the issue of the bankruptcy petition and the hearing, you may have to repay it.

At the hearing

The petitioner must attend the hearing or be represented.  If this does not happen, even if it is because the petitioner has agreed to an adjournment of the hearing, the petition will be dismissed and another petition may not be issued on the same debt without the permission of the court.

At the hearing you must hand to the court a list of creditors who have notified you by 4pm on the day before the hearing that they will be attending the hearing.  These creditors will have the right to take part in the hearing. Any other creditor attending the hearing will need the court’s permission to be heard.

If the debtor intends to oppose the petition, he or she is required by the rules to file with the court a notice of the grounds of objection and send this to the petitioner.  This must be done 5 business days before the hearing.  However, this rule is not always adhered to by the court and the debtor may well be allowed to put forward grounds of dispute at the hearing, even if notice has not been given.

The court can adjourn the hearing, if more time is needed to consider the debtor’s objections, or if another creditor is taking over the petition.

The court can dismiss the petition or make a bankruptcy order.  The court can also make costs orders depending on the outcome of the petition.

Making of a bankruptcy order

If the court makes a bankruptcy order

  • The court order will be drawn up and a copy sent to the local Official Receiver’s office
  • The Official Receiver’s office will notify the Land Charges Department that the order has been made and this will be added to the public register of writs and orders
  • The order will be advertised in the London Gazette and such local paper as the Official Receiver’s office thinks appropriate

The debtor will be required to attend the Official Receiver’s office for an interview.

Taking legal advice

There can be a number of legal issues that may need to be addressed before the hearing of a bankruptcy petition including:

  • How do you prepare for the hearing?
  • How do you negotiate a settlement with the debtor at this stage
  • How do you deal with other creditors coming on the scene.

Our solicitors are happy to advise on these and other legal issues in connection with making someone bankrupt.

For more information proceed to Appeal from Bankruptcy