Bankruptcy

2. Debtor's Petition

A debtor's petition may be presented only on the ground that the debtor is unable to pay his debts. It must be accompanied by a statement of his affairs containing prescribed information, including particulars of his creditors, his debts and other liabilities, and his assets.

Except in certain cases, the court must not make a bankruptcy order on the hearing of the petition if it appears to it:

• (a) That if an order were made the aggregate amount of the unsecured bankruptcy debts would be less than the small bankruptcies level (£20,000);
• (b) That if the order where made the value of the bankrupt's estate would be equal to or more than the minimum amount (£2,000);
• (c) That within the previous five years the debtor has not been bankrupt, or made a composition with his creditors in satisfaction of his debts, or a scheme of arrangement of his affairs; and
• (d) That it would be appropriate to appoint a person to prepare a report.

If the above apply then the court will appoint an insolvency practitioner to
inquire into the debtor's affairs and submit a report stating whether the debtor
is prepared to make a voluntary arrangement and, if so, whether a creditor's
meeting should be summoned to consider the debtor's proposal. The court
may then either make an interim order or, if it thinks it would be inappropriate
to do that, make a bankruptcy order.