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Chapter 5 (8 Act of bankruptcy (Debtor failed to comply with a Bankruptcy…
Chapter 5
8 Act of bankruptcy
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He / She makes fraudulent conveyance, gift, delivery, or transfer of his property
Fraudulent preference that is transfer of any of the debtor's properties to particular creditor with the intention paying that creditor in full preference to other creditor
Makes to any two / more of his creditors, not being partners and offer of composition with his creditors
6 properties involve
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Property over which the bankrupt has capacity to exercise all powers which will exercise for his own benefit
Property which is transferred gratuitously by the bankrupt to another person which is considered as " voluntary settlement "
Property used by the bankrupt to be given as fraudulent preference to a particular creditor within a specified time before bankrupt
Restriction on bankrupt
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Cannot work with spouse, family or relatives company
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Objective
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To investigate the reason for the debtor's insolvency so as to discourage other people from incurring in debts they cannot pay
Properties not involve
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Necessary household property e.g. Beds, fridges
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Bankruptcy - A legal recognition of an individual debtor's inability to meet / pay his debts when they become due
Winding up - a company may wound up compulsorily ( under an order of the court ) / voluntarily ( under a resolution of the company )
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