i e AT 1 of 1892 THE BANKRUPTCY CODE 1892

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1 i e AT 1 of 1892 THE BANKRUPTCY CODE 1892

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3 The Bankrupty Code 1892 Index i e THE BANKRUPTCY CODE 1892 Index Setion Page PREAMBLE 9 Preliminary 10 1 Short title Commenement of At [Repealed] Interpretation PART I 11 ACTS OF BANKRUPTCY AND PROCEEDINGS CONSEQUENT ON ADJUDICATION 11 Ats of bankrupty 11 5 Ats of bankrupty A Notie under s 5(ee) Bankrupty proeedings to ommene by petition Adjudiation of Bankrupty 13 7 Property of a bankrupt to vest in a trustee Reeiving order Stay of proeedings against a debtor on presentation of a bankrupty petition No priority under exeution after presentation of a bankrupty petition Disharge of Bankrupt Disharge of bankrupt Fraudulent settlements Effet of order of disharge Disharge may be annulled if obtained by fraud Composition or Sheme of Arrangement Composition or sheme of arrangement in substitution of bankrupty AT 1 of 1892 Page 3

4 Index The Bankrupty Code 1892 PART II 20 DISQUALIFICATIONS OF BANKRUPT Disqualifiation of bankrupts and 18 [Repealed] Power for Court to annul adjudiation in ertain ases Meaning of payment of debts in full PART III 22 ADMINISTRATION OF PROPERTY 22 Proof of Debts Desription of debts provable in bankrupty Mutual redit and set-off Partners and supplementary provisions Preferential laim in ase of apprentieship Power to landlord to distrain for rent Property available for Payment of Debts Relation bak of trustee s title Desription of bankrupt s property divisible amongst reditors Effet of Bankrupty on Anteedent Transations and 29 Restrition of rights of reditors under exeution Duties of Coroner as to property taken in exeution Avoidane of voluntary settlements Avoidane of preferenes in ertain ases Protetion of bona fide transations without notie Realisation of Property Possession of property by trustee Seizure of property of bankrupt Sequestration of elesiastial benefie Appropriation of portion of pay or salary Ations by trustee and bankrupt s partners Ations on joint ontrats Proeedings in partnership name Dislaimer of onerous property Powers of trustee to deal with property Powers exerisable by trustee with permission of Court Distribution of Property Delaration and distribution of dividends Joint and separate dividends Provisions for reditors residing at a distane, et Right of reditor who has not proved debt before delaration of dividend Final dividend No ation for dividend Power to allow bankrupt to manage property Page 4 AT 1 of 1892

5 The Bankrupty Code 1892 Index 50 Right of bankrupt to surplus Trustee to furnish list of reditors Statement of aounts to be furnished if required PART IV 37 Trustees in Bankrupty Clerk of the Rolls to appoint offiial trustees Deputy for offiial reeiver Duties of offiial trustee as regards the debtor s ondut Remuneration of Trustee Remuneration of trustee Costs Allowane and taxation of osts Reeipts, Payments, Aounts, Audit Payment of money into bank Trustee not to pay into private aount Aounts of trustee to be filed and audited The trustee to furnish list of reditors Books to be kept by trustees Annual statement of proeedings Release of Trustee Release of trustee Offiial Name Offiial name of trustee Control over Trustee Disretionary powers of trustee and ontrol thereof Appeal to Court against trustee Court may remove a trustee Appeals, et Appeals in bankrupty PART V 43 General Rules, Et General rules to be made A Fees and ommissions Formal Defets Formal defet not to invalidate proeedings The Crown Certain proeedings to bind the Crown Transitory Provisions Transfer of estates on vaany of offie of trustee in liquidation under the Bankrupty At, AT 1 of 1892 Page 5

6 Index The Bankrupty Code Transfer of outstanding property on lose of bankrupty or liquidation Transfer of estates from registrars of Court to offiial reeiver Proeedings under Bankrupty At, 1872, ss 95 and PART VI 44 Relief of Imprisoned Debtors An imprisoned debtor may be disharged on aounting for and surrendering his property PART VII 46 DEED OF ARRANGEMENT Deed of arrangement to whih At applies Registration of deed of arrangement Extension of time for registration Time for registration Deed of arrangement to be onfirmed by the Court Jurisdition of Court as to deed of arrangement Provisions as to trustee in Part IV to be appliable to trustees of deeds of arrangement Part III as to administration of property to apply to property administered under a deed of arrangement PART VIII 48 FRAUDULENT DEBTORS Offenes by debtors Undisharged bankrupt obtaining redit to extent of 20 to be guilty of misdemeanour Penalty for fraudulently obtaining redit, et [Repealed] Debts inurred by fraud Criminal liability after disharge or omposition Form of inditment A magistrate before whom a person is harged may onsider evidene as to guilty intent Power for Court to ommit for trial Punishments under this At umulative SCHEDULE 53 ENDNOTES 55 TABLE OF LEGISLATION HISTORY 55 TABLE OF RENUMBERED PROVISIONS 55 TABLE OF ENDNOTE REFERENCES 55 Page 6 AT 1 of 1892

7 The Bankrupty Code 1892 Index AT 1 of 1892 Page 7

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9 The Bankrupty Code 1892 Setion 1 i e THE BANKRUPTCY CODE 1892 Reeived Royal Assent: 28 June 1892 Promulgated: 5 July 1892 Commened: 5 January 1893 AN ACT to amend the Law of Bankrupty and Insolveny. GENERAL NOTES 1. Referenes to the High Court of Justie or any Division thereof are to be onstrued in aordane with the High Court At 1991 Sh Referenes to the Rolls Offie or offie for registry of deeds are to be onstrued in aordane with the General Registry At Referenes to hard labour are to be onstrued in aordane with the Custody At 1995 Sh 3 para See SD352/09 Rules of the High Court of Justie 2009 Sh 15.1 para 2 reprodued below: 2 In any statutory provision a referene (however expressed) to (a) (b) the superior jurisdition or summary jurisdition of the ourt or of the Common Law Division, or the ourt or the Common Law Division exerising superior jurisdition or summary jurisdition, shall be onstrued as a referene to the Civil Division. PREAMBLE Whereas, it is advisable to make general provisions appliable to the administration of the law in bankrupty and insolveny, and to amend suh law. AT 1 of 1892 Page 9

10 Setion 1 The Bankrupty Code 1892 Preliminary 1 Short title This At may be ited as The Bankrupty Code Commenement of At This At shall, exept as therein otherwise provided, ommene and ome into operation on the expiration of six months after the promulgation thereof. 3 [Repealed] 1 4 Interpretation In this At, and the general rules to be made under the authority thereof, unless the ontext otherwise requires The High Court means the High Court of Justie: The Court means the Court for the time being having jurisdition in bankrupty: The Appellate Court means the Staff of Government Division of the High Court: Treasury means the Commissioners of Her Majesty s Treasury: Affidavit inludes statutory delarations and affirmations: The Bank means the bank for the time being having the ustody of moneys paid into the High Court under or subjet to the rules or orders of suh Court: Bankrupt means a person who may be adjudged a bankrupt, and also any debtor, by or against whom a bankrupty petition having been presented, in respet of whose estate a reeiving order under this At may be made, or who has pursuant to this At made a omposition with his reditors in satisfation of the debts due to them by suh debtor, or a sheme of arrangement of his affairs: Bankrupty inludes insolveny, and also any suh omposition and sheme of arrangement: Available At of Bankrupty means any at of bankrupty available for a bankrupty petition, at the date of the presentation of the bankrupty petition: Bankrupty petition means a petition praying that a debtor may be adjudged a bankrupt: Order of adjudiation means an order by whih a debtor is adjudged a bankrupt, whether made by the Court, or by the Appellate Court: Page 10 AT 1 of 1892

11 The Bankrupty Code 1892 Setion 5 Debt provable in bankrupty or provable debt inludes any debt or liability by this At made provable in bankrupty: Creditor inludes any person who is for the time being entitled to enfore a judgment for the payment of money, and also the personal representative of a deeased reditor: Deed of arrangement means a deed or instrument made in respet of the affairs of a debtor for the benefit of the reditors generally as desribed in Part VII of this At: Goods inlude all hattels personal: Property inludes money, goods, things in ation, land, and every desription of property, whether real or personal, and whether situate in this Isle or elsewhere; also, obligations, and every desription of estate, interest, and profit, present or future, vested or ontingent, arising out of or inident to property, as herein defined: Seured reditor means a person holding a mortgage, harge, or lien on the property of the debtor, or any part thereof, as a seurity for a debt due to him from the debtor: Trustee means the trustee in bankrupty of a debtor s estate, and inludes an offiial trustee and a reeiver, or manager of the estate, pending the appointment of a trustee: Coroner inludes lokman and any offier harged with the enforement of any exeution, or with the exeution of any proess: Inditment inludes information: Presribed means presribed by general rules to be made as in this At provided; but where no suh rules apply, as may be presribed by order of the Court. PART I ACTS OF BANKRUPTCY AND PROCEEDINGS CONSEQUENT ON ADJUDICATION Ats of bankrupty 5 Ats of bankrupty [P1914/59/1(g), 2 and 5(4)] A debtor ommits an at of bankrupty in eah of the following ases: (a) If, in this Isle or elsewhere, he makes a deed of arrangement: AT 1 of 1892 Page 11

12 Setion 5 The Bankrupty Code 1892 (b) () (d) (e) (ee) (f) (g) (h) (i) If, in this Isle of elsewhere, he makes a fraudulent onveyane, gift, delivery, or transfer of his property, or of any part thereof, or if he fraudulently reates a harge upon his property: If, in this Isle or elsewhere, he makes any onveyane or transfer of his property or any part thereof, or reates any harge thereon whih would under this or any other At be void as a fraudulent preferene if he were adjudged bankrupt: If, with intent to defeat or delay his reditors, he does any of the following things, namely, departs out of this Isle, or, being out of this Isle, remains out of the same, or departs from his dwellinghouse, or otherwise absents himself, or begins to keep house, or evades the proess of any of the Courts thereof: If, under exeution issued against him, his goods have been seized, and have been either sold or held by the Coroner for fourteen days, without any proeeding having been taken to rehear the ause or appeal from the judgment in respet of whih suh exeution was issued: If a reditor has obtained a final judgment or final order against him for any amount, and, exeution thereon not having been stayed, has served on him in the Isle of Man, or, by leave of the Court, elsewhere, a notie under setion 5A of this At, and he does not within 14 days after servie of the notie, in ase the servie is effeted in the Isle of Man, and in ase the servie is effeted elsewhere, then within the time limited in that behalf by the order giving leave to effet the servie, either omply with the requirements of the notie or satisfy the Court that he has a ounterlaim, set-off or ross-demand whih equals or exeeds the amount of the judgment debt or sum ordered to be paid, and whih he ould not set up in the ation in whih the judgment was obtained. For the purposes of this paragraph and of setion 5A of this At, any person who is, for the time being, entitled to enfore a final judgment or final order, shall be deemed to be a reditor who has obtained a final judgment or final order. 2 If, being a prisoner for debt, he presents a petition to any Court having jurisdition in the matter seeking to be disharged from imprisonment, by reason of his inability to maintain himself or pay the debt: If he presents a petition to the Court to have himself adjudged a bankrupt, or files in the Court a delaration of his inability to pay his debts: If the debtor gives notie to any of his reditors that he has suspended, or that he is about to suspend, payment of his debts: If the debtor be adjudged bankrupt in the United Kingdom. Page 12 AT 1 of 1892

13 The Bankrupty Code 1892 Setion 6 5A Notie under s 5(ee) 3 (1) A notie under setion 5(ee) of this At shall require the debtor to pay the judgment debt or sum ordered to be paid in aordane with the terms of the judgment or order, or to seure or ompound for it to the satisfation of the reditor or the Court, and shall state the onsequenes of nonompliane with the notie. (2) Servie of a notie under setion 5(ee) of this At shall be in aordane with setion 41 of the Interpretation At (3) A notie under setion 5(ee) of this At (a) (b) may speify an agent to at on behalf of the reditor in respet of any payment or other thing required by the notie to be made to, or done to the satisfation of, the reditor, shall not be invalidated by reason only that the sum speified in the notie as the amount due exeeds the amount atually due, unless the debtor within the time allowed for payment gives notie to the reditor that he disputes the validity of the notie on the ground of suh misstatement; but, if the debtor does not give suh notie, he shall be deemed to have omplied with the notie if within the time allowed he takes suh steps as would have onstituted a ompliane with the notie had the atual amount due been orretly speified therein. 6 Bankrupty proeedings to ommene by petition Proeedings in bankrupty shall, exept where otherwise direted by this At, be ommened by petition, in this At referred to as a bankrupty petition. Adjudiation of Bankrupty 7 Property of a bankrupt to vest in a trustee (1) Where the debtor is adjudged bankrupt, the property of the bankrupt shall beome divisible among his reditors and shall vest in a trustee, to be appointed by the Court; but, until a trustee is appointed, an offiial trustee shall be nominated by the Court to at as the trustee for the purposes of the bankrupty. A person shall be deemed not fit to at as trustee where he has been previously removed from the offie of trustee of a bankrupt for misondut or neglet of duty. (2) The property of the bankrupt shall pass from trustee to trustee, and shall vest in the trustee for the time being during his ontinuane in offie, without any onveyane, assignment, or transfer whatever. (3) An offie opy of the appointment of the trustee shall, as to the law for the time being in fore as to registration or reording of onveyanes or AT 1 of 1892 Page 13

14 Setion 8 The Bankrupty Code 1892 assignments of property, be deemed to be a onveyane or assignment of property, and may be registered and reorded aordingly. 8 Reeiving order The Court may, if it be shown to be neessary for the protetion of the estate, at any time after the presentation of a bankrupty petition, and before an order of adjudiation be made, by order (in this At referred to as a reeiving order), appoint an offiial trustee to be interim reeiver of the property of the debtor, or of any part thereof, and diret him to take immediate possession thereof, or of any part thereof. 9 Stay of proeedings against a debtor on presentation of a bankrupty petition (1) On the making of an order of adjudiation, no reditor to whom the debtor is indebted in respet of any debt provable shall have any remedy against the person or property of the debtor in respet of the debt, or shall ommene any ation or other legal proeedings with respet to the debt, unless with the leave of the Court, and on suh terms as the Court may impose. (2) The ourt may, at any time after the presentation of a bankrupty petition, and before an order of adjudiation be made, stay any ation, judgment, exeution, or other legal proess against the person or property of the debtor, and any Court in whih proeedings are pending against a debtor may, on proof that a bankrupty petition has been presented by or against the debtor, either stay the proeedings, or allow them to ontinue on suh terms as it may think just: (3) But this setion shall not affet the power of any seured reditor to realise, or otherwise deal with his seurity in the same manner as he would have been entitled to realise or deal with it if this setion had not been passed. 10 No priority under exeution after presentation of a bankrupty petition 4 From the time of the presentation of a bankrupty petition no reditor shall thereafter, so long as the bankrupty proeedings under suh petition be pending, gain any priority by reason of his exeution having been in the hands of the oroner of lokman to be exeuted; and in ase the petition be dismissed, the interval of time between the presentation and dismissal of suh petition shall not be inluded in the twenty-one days for the purposes of setion four of an At of Tynwald promulgated upon the 1st day of November 1820, and intituled An At for the better enforing of ommon judgments and exeutions, and for altering and amending the law relative to bail to ations of debt or damage, and for the relief of insolvent debtors in the said Island. Page 14 AT 1 of 1892

15 The Bankrupty Code 1892 Setion 11 Disharge of Bankrupt 11 Disharge of bankrupt (1) A bankrupt may, at any time after being adjudged bankrupt, apply to the Court for an order of disharge, and the Court shall appointed a day for hearing the appliation. The appliation shall be heard in open Court. (2) On the hearing of the appliation the Court shall take into onsideration the bankrupt s ondut and affairs, and may either grant or refuse an absolute order of disharge, or suspend the operation of the order for a speified time, or grant an order of disharge subjet to any onditions with respet to any earnings or inome whih may afterwards beome due to the bankrupt, or with respet to his after-aquired property, or grant an order limited to the release of the bankrupt from imprisonment and liability to imprisonment for any debt provable in bankrupty, save any debt or liability from with the bankrupt is not released by an order of disharge under the provisions in this At ontained: Provided that the Court shall refuse the disharge in all ases where the bankrupt has ommitted any felony or misdemeanour onneted with his bankrupty under this At, or any At for the punishment of fraudulent debtors for the time being in fore; and shall, on proof of any of the fats hereinafter mentioned, either (i) (ii) (iii) (iv) Refuse the disharge; or Suspend the disharge for a period of not less than two years; or Suspend the disharge until a dividend of not less than 50p in the pound has been paid to the reditors; or 5 Require the bankrupt, as a ondition of his disharge, to onsent to a judgment being entered against him by the trustee for any balane or part of any balane of the debts provable under the bankrupty whih is not satisfied at the date of the disharge, suh balane or part of any balane of the debts to be paid out of the future earnings or afteraquired property of the bankrupt, in suh manner and subjet to suh onditions as the Court may diret; but exeution shall not be issued on the judgment without leave of the Court, suh leave may be given on proof that the bankrupt has sine his disharge aquired property or inome available towards payment of his debts: Provided, that if at any time after the expiration of two years from the date of any order made under this setion, the bankrupt shall satisfy the Court that there is no reasonable probability of his being in a position to omply with the terms of suh order, the Court may modify the terms of the order, or of any substituted order, in suh manner and upon suh onditions as it may think fit. AT 1 of 1892 Page 15

16 Setion 11 The Bankrupty Code 1892 (3) The fats hereinbefore referred to are (a) (b) () (d) (e) (f) (g) (h) (i) (j) (k) (l) That the bankrupt s assets are not of a value equal to 50p in the pound on the amount of his unseured liabilities, unless he satisfies the Court that the fat that the assets are not of a value equal to 50p in the pound on the amount of his unseured liabilities has arisen from irumstanes for whih he annot justly be held responsible: 6 That the bankrupt has omitted to keep suh books of aount as are usual and proper in the business arried on by him, and as suffiiently dislose his business transations and finanial position within the three years immediately preeding his bankrupty: That the bankrupt has ontinued to trade after knowing himself to be insolvent: That the bankrupt has ontrated any debt provable in the bankrupty, without having at the time of ontrating it any reasonable or probable ground of expetation (proof whereof shall lie on him) of being able to pay it: That the bankrupt has failed to aount satisfatorily for any loss of assets, or for any defiieny of assets to meet his liabilities: That the bankrupt has brought on or ontributed to his bankrupty by rash and hazardous speulations, or by unjustifiable extravagane in living, or by gambling, or by ulpable neglet of his business affairs: That the bankrupt has put any of his reditors to unneessary expense by a frivolous or vexatious defene to any ation properly brought against him: That the bankrupt has, within three months preeding the date of the reeiving order, or order of adjudiation, inurred unjustifiable expense by bringing a frivolous or vexatious ation: That the bankrupt has, within three months preeding the date of the reeiving order, or order of adjudiation, when unable to pay his debts as they beome due, given an undue preferene to any of his reditors: That the bankrupt has, within three months preeding the date of the reeiving order, or order of adjudiation, inurred liabilities with the view of making his assets equal to 50p in the pound on the amount of his unseured liabilities: 7 That the bankrupt has on any previous oasion been adjudged bankrupt, or made a omposition or arrangement with his reditors: That the bankrupt has been guilty of any fraud or fraudulent breah of trust. Page 16 AT 1 of 1892

17 The Bankrupty Code 1892 Setion 12 (4) For the purpose of this setion, a bankrupt s assets shall be deemed of a value equal to 50p in the pound on the amount of his unseured liabilities, when the Court is satisfied that the property of the bankrupt has realized, or is likely to realize, or with due are in realization might have realized, an amount equal to 50p in the pound of his unseured liabilities. 8 (5) The powers of suspending and of attahing onditions to a bankrupt s disharge may be exerised onurrently. (6) A disharged bankrupt shall, notwithstanding his disharge, give suh assistane as the trustee may require in the realization and distribution of suh of his property as is vested in the trustee, and if he fails to do so he shall be guilty of a ontempt of Court, and for suh ontempt, on the appliation of the trustee, shall be liable to imprisonment for a term not exeeding three months; and, in addition thereto, the Court may, if it thinks fit, revoke his disharge, but without prejudie to the validity of any sale, disposition, or payment duly made or thing duly done subsequent to the disharge, but before its revoation. 12 Fraudulent settlements In either of the following ases (that is to say): (1) In the ase of a settlement made before and in onsideration of marriage or the formation of a ivil partnership where the settlor is not at the time of making the settlement able to pay all his debts without the aid of the property omprised in the settlement; or 9 (2) In the ase of any ovenant or ontrat made in onsideration of marriage or the formation of a ivil partnership for the future settlement on or for the settlor s spouse, ivil partner or hildren of any money or property wherein he had not at the date of his marriage any estate or interest (not being money or property of or in right of his or her spouse or ivil partner); 10 if the settlor is adjudged bankrupt or ompounds or arranges with his reditors, and it appears to the Court that suh settlement, ovenant, or ontrat was made in order to defeat or delay reditors, or was unjustifiable having regard to the state of the settlor s affairs at the time when it was made, the Court may refuse or suspend an order of disharge, or grant an order subjet to onditions, or refuse to approve a omposition or arrangement, as the ase may be, in like manner as in ases where the debtor has been guilty of fraud. 13 Effet of order of disharge (1) An order of disharge shall not release the bankrupt from any debt on a bond or a reognizane to, or to a person on behalf of, or in trust for, the Crown, nor from any debt with whih the bankrupt may be hargeable at the suit of the Crown or of any person for any offene against a statute AT 1 of 1892 Page 17

18 Setion 14 The Bankrupty Code 1892 relating to any branh of the publi revenue; and he shall not be disharged from suh exepted debts unless the Treasury ertify in writing their onsent to his being disharged therefrom; neither shall an order of disharge release the bankrupt from any liability under a judgment against him in an ation for sedution, or under an affiliation order. An order of disharge shall not release the bankrupt from any debt or liability inurred by means of any fraud or breah of trust to whih he was a party, nor from any debt or liability whereof he has obtained forbearane by any fraud to whih he was a party. (1A) Subsetion (1) of this setion shall have effet as if amounts payable under onfisation orders made under Part 2 of the Proeeds of Crime At 2008 were debts exepted under the first sentene of that subsetion. 11 (2) An order of disharge shall release the bankrupt from all other debts provable in bankrupty. (3) An order of disharge shall be onlusive evidene of the bankrupty, and of the validity of the proeedings therein, and in any proeedings that may be instituted against a bankrupt who has obtained an order of disharge in respet of any debt from whih he is released by the order, the bankrupt may plead that the ause of ation ourred before his disharge, and may give this At and the speial matter in evidene. (4) An order of disharge shall not release any person who at the date of the reeiving order was a partner or o-trustee with the bankrupt or was jointly bound or had made any joint ontrat with him, or any person who was surety or in the nature of a surety for him. 14 Disharge may be annulled if obtained by fraud If, at any time after the disharge of a debtor, it appears to the Court, on the appliation of any person interested, that the disharge was obtained by fraud, the Court may by order annul suh disharge. Composition or Sheme of Arrangement 15 Composition or sheme of arrangement in substitution of bankrupty (1) If the debtor, at any time after a reeiving order or order of adjudiation has been made, submit to the Court a proposal for a omposition in satisfation of the debts due to the reditors from the debtor, or a proposal for a sheme of arrangement of the debtor s affairs, the Court may, if it think fit, diret the trustee to summon, in suh manner as the Court may diret, a meeting of the reditors to onsider suh proposal. (2) The omposition or sheme shall not be binding on the reditors unless it is onfirmed by a resolution passed by reditors representing three- Page 18 AT 1 of 1892

19 The Bankrupty Code 1892 Setion 15 fourths in value of all those who have proved their laims, nor unless it be approved by the Court. Any reditor who has proved his laim may assent or dissent from suh omposition or sheme by a letter addressed to the trustee in the presribed form, and attested by a witness, so as to be reeived by the trustee not later than the day preeding suh meeting, and suh reditor shall be taken as being present and voting thereat. (3) If the omposition or sheme of arrangement is aepted by the reditors at suh meeting, or any adjournment thereof (suh aeptane being embodied in a resolution of the meeting, verified by the trustee), the trustee or the debtor may apply to the Court to approve it, and notie of the time appointed for hearing the appliation shall be given in the presribed manner, or, if no manner be presribed, as the Court may diret. (4) The Court shall, before approving a omposition or sheme, onsider the terms thereof, and the ondut of the debtor, and also any objetions whih may be made by and on behalf of any reditor. (5) If the Court is of opinion that the terms of the omposition or sheme are not reasonable, or are not alulated to benefit the general body of reditors, or in any ase in whih the Court is required under this At where the debtor is adjudged bankrupt to refuse his disharge, the Court shall, or if any suh fats are proved as would under this At justify the Court in refusing, qualifying, or suspending the debtor s disharge, the Court may, in its disretion, refuse to approve the omposition or sheme. (6) If the Court approve the omposition or sheme, the approval shall be testified by an order of the Court, and, if the debtor has been previously adjudged bankrupt, the Court may make an order annulling the bankrupty, and vesting the property in the debtor, or suh other person as the Court may appoint, on suh terms and subjet to suh onditions, if any, as the Court may delare. (7) A omposition or sheme aepted and approved in pursuane of this setion shall be binding on all the reditors so far as relates to any debts due to them from the debtor and provable in the bankrupty. (8) The provisions of a omposition or sheme under this setion may be enfored by the Court on appliation by any person interested, and any disobediene of an order of the Court made on suh appliation shall be deemed a ontempt of ourt, and shall be punishable, on further appliation by suh person, with imprisonment for any period not exeeding three months. (9) If default is made in the payment of any sum of money, or instalment, due in pursuane of the omposition or sheme, or if it appears to the Court on satisfatory evidene that the omposition or sheme annot, in AT 1 of 1892 Page 19

20 Setion 16 The Bankrupty Code 1892 onsequene of legal diffiulties, or for any suffiient ause, proeed without injustie or undue delay to the reditors or to the debtor, or that the approval of the Court was obtained by fraud, the Court may, if it thinks fit, on appliation by any reditor, adjudge the debtor bankrupt, and annul the omposition or sheme, but without prejudie to the validity of any sale, disposition, or payment duly made, or thing duly done under or in pursuane of the omposition or sheme. Where a debtor is adjudged bankrupt under this subsetion any debt provable in other respets, whih has been ontrated before the date of the adjudiation, shall be provable in the bankrupty. (10) If under or in pursuane of a omposition or sheme, a trustee is appointed to administer the debtor s property or manage his business, Part IV of this At shall apply to the trustee as if he were a trustee in the bankrupty, and as if the terms bankrupty, bankrupt, and order of adjudiation inluded respetively a omposition or sheme of arrangement, a ompounding or arranging debtor, and order approving the omposition or sheme. (11) Part III of this At shall, so far as the nature of the ase and the terms of the omposition or sheme admit, apply thereto, the same interpretation being given to the words trustee, bankrupty, bankrupt, and order of adjudiation, as in the last preeding sub-setion. (12) No omposition or sheme shall be approved by the Court whih does not provide for the payment in priority to other debts of all debts direted to be so paid in the distribution of the property of a bankrupt. (13) Notwithstanding the aeptane and approval of a omposition or sheme suh omposition or sheme shall not be binding on any reditor so far as regards a debt or liability from whih, under the provisions of this At, the debtor would not be disharged by an order of disharge in bankrupty, unless the reditor assents to the omposition or sheme. (14) The order of the Court approving of a omposition or sheme shall be onlusive evidene of the meeting of the reditors having been duly held, and of the resolution of suh meeting having been duly arried and passed thereat. PART II DISQUALIFICATIONS OF BANKRUPT 16 Disqualifiation of bankrupts (1) Where a debtor is adjudged bankrupt he shall, subjet to the provisions of this At, be disqualified for (a) [Repealed] 12 Page 20 AT 1 of 1892

21 The Bankrupty Code 1892 Setion 19 (b) Being appointed, or ating, as a justie of the peae; () [Repealed] 13 (d) [Repealed] 14 (2) The disqualifiations to whih a bankrupt is subjet under this setion shall be removed and ease if and when (a) (b) () the adjudiation of bankrupty against him is annulled; or he obtains from the Court his disharge, with a ertifiate to the effet that his bankrupty was aused by misfortune without any misondut on his part; or on the expiration of five years from the date of his disharge. The Court may grant or withhold a ertifiate under this setion as it thinks fit, but any refusal of suh ertifiate shall be subjet to appeal. 17 and 18 [Repealed] Power for Court to annul adjudiation in ertain ases (1) Where, in the opinion of the Court, a debtor ought not to have been adjudged bankrupt, or where it is proved to the satisfation of the Court that the debts of the bankrupt are paid in full, the Court may, on the appliation of any person interested, by order annul the adjudiation. (2) When an adjudiation is annulled under this setion, all sales and dispositions of property and payments duly made, and all ats theretofore done, by the trustee, or other person ating under his authority, or by the Court, shall be valid; but the property of the debtor who was adjudged bankrupt shall vest in suh person as the Court may appoint, or in default of any suh appointment revert to the debtor for all his estate, or interest therein, on suh terms and subjet to suh onditions, if any, as the Court may delare by order. 20 Meaning of payment of debts in full For the purposes of the last preeding setion, any debt disputed by a debtor shall be onsidered as paid in full, if the debtor enters into a bond, in suh sum and with suh sureties as the Court approves, to pay the amount to be reovered in any proeeding for the reovery of or onerning the debt, with osts, and any debt due to a reditor who annot be identified shall be onsidered as paid in full if paid into Court. AT 1 of 1892 Page 21

22 Setion 21 The Bankrupty Code 1892 PART III ADMINISTRATION OF PROPERTY Proof of Debts 21 Desription of debts provable in bankrupty (1) Demands in the nature of unliquidated damages arising otherwise than by reason of a ontrat, promise, or breah of trust, shall not be provable in bankrupty. (2) A person having notie of any at of bankrupty available against the debtor shall not prove under the order for any debt or liability ontrated by the debtor subsequently to the date of his so having notie. (3) Save as aforesaid, all debts and liabilities, present or future, ertain or ontingent, to whih the debtor is subjet at the date of the order of adjudiation, or to whih he may beome subjet before his disharge, by reason of any obligation inurred before the date of suh order, shall be deemed to be debts provable in bankrupty. (4) An estimate shall be made by the trustee, or as the Court may diret, of the value of any debt or liability provable as aforesaid whih, by reason of its being subjet to any ontingeny or ontingenies, or for any other reason, does not bear a ertain value. (5) If, in the opinion of the Court, the value of the debt or liability is inapable of being fairly estimated, the Court may make an order to that effet, and thereupon the debt or liability shall, for the purposes of this At, be deemed to be a debt not provable in bankrupty. (6) If, in the opinion of the Court, the value of the debt or liability is apable of being fairly estimated, the Court may diret the value to be assessed before the Court itself, without the intervention of a jury, and may give all neessary diretions for this purpose and the amount of the value when assessed shall be deemed to be a debt provable in bankrupty. (7) Liability shall, for the purposes of this At, inlude any ompensation for work or labour done, any obligation, or possibility of an obligation, to pay money or money s worth on the breah of any express or implied ovenant, ontrat, agreement, or undertaking, whether the breah does or does not our, or is or is not likely to our, or apable of ourring, before the disharge of the debtor, and generally it shall inlude any express or implied engagement, agreement, or undertaking, to pay, or apable of resulting in the payment of, money, or money s worth, whether the payment is, as respets amount, fixed or unliquidated; as respets time, present or future, ertain or dependent on any one ontingeny, or on two or more ontingenies; as to mode of valuation apable of being asertained by fixed rules, or as matter of opinion. Page 22 AT 1 of 1892

23 The Bankrupty Code 1892 Setion Mutual redit and set-off Where there have been mutual redits, mutual debts, or other mutual dealings between a debtor against whom an order of adjudiation shall be made under this At, and any other person proving or laiming to prove a debt under suh order, an aount shall be taken of what is due from the one party to the other in respet of suh mutual dealings, and the sum due from the one party shall be set off against any sum due from the other party, and the balane of the aount, and no more, shall be laimed or paid on either side respetively; but a person shall not be entitled under this setion to laim the benefit of any set-off against the property of a debtor in any ase where he had, at the time of giving redit to the debtor, notie of an at of bankrupty ommitted by the debtor, and available against him. 23 Partners and supplementary provisions (1) [Repealed] 16 (2) In the ase of partners the joint estate shall be appliable in the first instane in payment of their joint debts, and the separate estate of eah partner shall be appliable in the first instane in payment of his separate debts. If there is a surplus of the separate estates it shall be dealt with as part of the joint estate. If there is a surplus of the joint estate it shall be dealt with as part of the respetive separate estates in proportion to the right and interest of eah partner in the joint estate. (3) Where a debt inludes interest, or any peuniary onsideration in lieu of interest, suh interest or onsideration, shall, for the purposes of dividend, be alulated at a rate not exeeding five per entum per annum, without prejudie to the right of a reditor to reeive out of the estate any higher rate of interest to whih he may be entitled after all the debts proved in the estate have been paid in full. (4) If there is any surplus after payment of the debts, it shall be applied in payment of interest from the date of the reeiving order at the rate of four pounds per entum per annum on all debts proved in the bankrupty. 24 Preferential laim in ase of apprentieship (1) Where, at the time of the presentation of the bankrupty petition, any person is apprentied or is an artiled lerk to the bankrupt, the adjudiation of bankrupty shall, if either the bankrupt or apprentie or lerk gives notie in writing to the trustee to that effet, be a omplete disharge of the indenture of apprentieship or artiles of agreement; and if any money has been paid by or on behalf of the apprentie or lerk to the bankrupt as a fee, the trustee may, on the appliation of the apprentie or lerk, or of some other person on his behalf, pay suh sum as the trustee, subjet to an appeal to the Court, thinks reasonable, out of AT 1 of 1892 Page 23

24 Setion 25 The Bankrupty Code 1892 the bankrupt s property, to or for the use of the apprentie or lerk, regard being had to the amount paid by him or on his behalf, and to the time during whih he served with the bankrupt under the indenture or artiles before the ommenement of the bankrupty, and to the other irumstanes of the ase. (2) Where it appears expedient to a trustee, he may, on the appliation of any apprentie or artiled lerk to the bankrupt, or any person ating on behalf of suh apprentie or artiled lerk, instead of ating under the preeding provisions of this setion, transfer the indenture of apprentieship or artiles of agreement to some other person. 25 Power to landlord to distrain for rent Nothing in this At ontained, nor any dislaimer under the 39th setion of this At, shall affet the right of any landlord under the provisions of the At intituled An At to indemnify Landlords in their Rents, promulgated in 1753, to arrest goods and effets for rent, or his right of preferene to payment of the whole of the urrent year s rent. Property available for Payment of Debts 26 Relation bak of trustee s title The bankrupty of a debtor, whether the same takes plae on the debtor s own petition or upon that of a reditor or reditors, shall be deemed to have relation bak to, and to ommene at, the time of the at of bankrupty being ommitted on whih an order of adjudiation is made against him, or, if the bankrupt is proved to have ommitted more ats of bankrupty than one, the bankrupty shall be deemed to have relation bak to, and to ommene at, the time of the first of the ats of bankrupty proved to have been ommitted by the bankrupt within three months next preeding the date of the presentation of the bankrupty petition; but no bankrupty petition or adjudiation shall be rendered invalid by reason of any at of bankrupty anterior to the debt of the petitioning reditor. 27 Desription of bankrupt s property divisible amongst reditors The property of the bankrupt divisible amongst his reditors, and in this At referred to as the property of the bankrupt, shall not omprise the following partiulars (1) Suh wearing apparel, furniture, bedding and household equipment of the bankrupt as appear to the trustee to be essential for the domesti purposes of the bankrupt, his spouse, his ivil partner and his dependents residing with him, or any of them: 17 Page 24 AT 1 of 1892

25 The Bankrupty Code 1892 Setion 27 (2) The tools and implements of the bankrupt s trade to the value of 100, or of suh greater amount as may be presribed in enforement rules made under Part II of the Administration of Justie At 1981: 18 (3) Any property held by the bankrupt in trust for, or on behalf of, any other person or body: 19 But it shall omprise the following partiulars: (i) (ii) (iii) All suh property as may belong to or be vested in the bankrupt at the ommenement of the bankrupty, or may be aquired by or devolve on him before his disharge; and The apaity to exerise and to take proeedings for exerising all suh powers in or over or in respet of property as might have been exerised by the bankrupt for his own benefit at the ommenement of his bankrupty or before his disharge, exept the right of nomination to a vaant elesiastial benefie; and All goods being, at the ommenement of the bankrupty, in the possession, order, or disposition of the bankrupt, in his trade or business, by the onsent and permission of the true owner, under suh irumstanes that he is the reputed owner thereof: Provided that things in ation, other than debts due or growing due to the bankrupt in the ourse of his trade or business, shall not be deemed goods within the meaning of this setion. Effet of Bankrupty on Anteedent Transations 28 and 29 Restrition of rights of reditors under exeution (a) (b) Where a reditor has obtained exeution whih an be enfored against the property of a debtor, he shall not be entitled to retain the benefit of the exeution against the trustee unless the exeution has been ompleted by seizure and sale, or by the reeipt or reovery by the oroner or lokman of the full amount of the levy, and unless suh exeution has obtained priority in law before the date of the order of adjudiation and before notie of the presentation of any bankrupty petition by or against the debtor or of the ommission of any available at of bankrupty by the debtor. Where any property of a debtor is taken in exeution, and before suh exeution has been ompleted by the sale of suh property, or by the reeipt or reovery of the full amount of the levy, or when, before suh exeution has obtained priority in law, notie is served on the oroner or lokman holding the exeution that an order of adjudiation has been made against the debtor, or a AT 1 of 1892 Page 25

26 Setion 30 The Bankrupty Code 1892 () (d) bankrupty petition presented by or against the debtor, suh oroner or lokman shall, on request, deliver to the trustee the property seized, or any money reeived in part satisfation of the exeution; but the osts of enforing the exeution shall be a first harge on the property seized or money delivered, and the trustee may sell the property, or an adequate part thereof, for the purpose of satisfying the harge. Where, under an exeution in respet of a judgment for a sum exeeding twenty pounds, the property of a debtor is sold or money is paid in order to avoid sale, the oroner or lokman shall dedut his osts of the exeution from the proeeds of sale or the money paid, and retain the balane for fourteen days, and if within that time notie is served on him of a bankrupty petition having been presented against or by the debtor, and an order of adjudiation is made against the debtor thereon, or on any other petition of whih suh oroner or lokman has notie, suh oroner or lokman shall pay the balane to the trustee, who shall be entitled to retain the same as against the exeution reditor. An exeution levied by seizure and sale on the property of a debtor shall not be invalid by reason only of its being an at of bankrupty, and a person who purhases the goods in good faith under a sale by the oroner or lokman shall in all ases aquire a good title to them against the trustee in bankrupty. (e) In paragraphs (a) to (d) above (a) (b) exeution shall have the meaning assigned to exeution order in setion 26(1) of the Administration of Justie At 1981; and referenes to seizure and sale shall be onstrued as referenes to arrest and sale pursuant to Part II of, and Shedules 1 and 2 to, that At. 20 Duties of Coroner as to property taken in exeution 30 Avoidane of voluntary settlements (1) Any settlement of property, not being a settlement made before and in onsideration of marriage or the formation of a ivil partnership, or made in favour of a purhaser or enumbraner in good faith and for valuable onsideration, or a settlement made on or for the spouse or ivil partner and hildren of the settlor of property whih has arued to the settlor after marriage or the formation of a ivil partnership in right of his spouse or ivil partner, shall, if the settlor beomes bankrupt within two years after the date of the settlement, be void against the trustee, and shall, if the settlor beomes bankrupt at any subsequent time within ten years after the date of the settlement, be void against the trustee unless Page 26 AT 1 of 1892

27 The Bankrupty Code 1892 Setion 31 the parties laiming under the settlement an prove that the settlor was at the time of making the settlement able to pay all his debts without the aid of the property omprised in the settlement, and that the interest of the settlor in suh property had passed to the trustee of suh settlement on the exeution thereof. 21 (2) Any ovenant or ontrat made in onsideration of marriage or the formation of a ivil partnership, for the future settlement on or for the settlor s spouse or ivil partner or hildren, of any money or property wherein he had not at the date of his marriage or ivil partnership any estate or interest, whether vested or ontingent in possession or remainder, and not being money or property of or in right of his spouse or ivil partner, shall, on his beoming bankrupt before the property or money has been atually transferred or paid pursuant to the ontrat or ovenant, be void against the trustee. 22 (3) Settlement shall, for the purposes of this setion, inlude any onveyane or transfer of property. 31 Avoidane of preferenes in ertain ases (1) Every onveyane or transfer of property, or harge thereon made, every payment made, every obligation inurred and every judiial proeeding taken or suffered by any person unable to pay his debts as they beome due from his own money in favour of any reditor, or any person in trust for any reditor, with a view of giving suh reditor a preferene over the other reditors, shall, if the person making, taking, paying, or suffering the same is adjudged bankrupt on a bankrupty petition, presented within four months after the date of making, taking, paying, or suffering the same, be deemed fraudulent and void as against the trustee; and, for the purposes of this setion, any suh onveyane, transfer, or harge, shall be deemed to have been made on the day of the atual delivery thereof to the reditor, or a person in trust for him; or on the day of the same being reorded, if there has been no previous atual delivery, it being hereby delared that, as against the trustee, no suh onveyane, transfer, or harge shall be valid by reason only of it being stated in the attesting lause that suh onveyane, transfer, or harge had been delivered, or of the same having been aptioned, or of onstrutive delivery merely. (2) This setion shall not affet the rights of a purhaser, payee, or inumbraner, or any person making title in good faith and for valuable onsideration through or under a reditor of the bankrupt. 32 Protetion of bona fide transations without notie Subjet to the foregoing provisions of this At with respet to the effet of bankrupty on an exeution, and with respet to the avoidane of ertain AT 1 of 1892 Page 27

28 Setion 33 The Bankrupty Code 1892 settlements and preferenes, nothing in this At shall invalidate, in the ase of a bankrupty (a) (b) () (d) Any payment by the bankrupt to any of his reditors, Any payment or delivery to the bankrupt, Any onveyane or assignment by the bankrupt for valuable onsideration, Any ontrat, dealing, or transation by or with the bankrupt for valuable onsideration, Provided that both the following onditions are omplied with, namely (1) The payment, delivery, onveyane, assignment, ontrat, dealing, or transation, as the ase may be, takes plae before the date of the order of adjudiation; and (2) The person (other than the debtor) to, by, or with whom the payment, delivery, onveyane, assignment, ontrat, dealing, or transation was made, exeuted, or entered into, has not, at the time of the payment, delivery, onveyane, assignment, ontrat, dealing, or transation, notie of any available at of bankrupty ommitted by the bankrupt before that time. Realisation of Property 33 Possession of property by trustee (1) The trustee shall, as soon as may be, take possession of the deeds, books, and douments of the bankrupt, and all other parts of his property apable of manual delivery. (2) The trustee shall, in relation to and for the purpose of aquiring or retaining possession of the property of the bankrupt, be in the same position as if he were a reeiver of the property appointed by the High Court; and the Court may, on his appliation, enfore suh aquisition or retention aordingly. (3) Where any part of the property of the bankrupt onsists of stok, shares in ships, shares, or any other property transferable in the books of any ompany, offie, or person, the trustee may exerise the right to transfer the property to the same extent as the bankrupt might have exerised it if he had not beome bankrupt. (4) Where any part of the property of the bankrupt onsists of things in ation, suh things shall be deemed to have been duly assigned to the trustee. (5) Any treasurer or other offier, or any banker, attorney, or agent of a bankrupt, shall pay and deliver to the trustee all money and seurities in Page 28 AT 1 of 1892

29 The Bankrupty Code 1892 Setion 34 his possession or power, as suh offier, banker, attorney, or agent, whih he is not by law entitled to retain as against the bankrupt or the trustee. If he does not he shall be guilty of a ontempt of Court, and may be punished, on the appliation of the trustee, with imprisonment for any period not exeeding three months. 34 Seizure of property of bankrupt Any person ating under warrant of the Court may seize any part of the property of a bankrupt in the ustody or possession of the bankrupt or of any other person, and, with a view to suh seizure, may break open any house, building, or room of the bankrupt where the bankrupt is supposed to be, or any building or reeptale of the bankrupt where any of his property is supposed to be; and where the Court is satisfied that there is reason to believe that property of the bankrupt is onealed in a house or plae not belonging to him, the Court may, if it thinks fit, grant a searh warrant to any onstable or offier of the Court, who may exeute it aording to its tenor. 35 Sequestration of elesiastial benefie (1) Where a bankrupt is a benefied lergyman, the trustee may apply for a sequestration of the profits of the benefie, and an offie opy of the appointment of the trustee shall be suffiient authority for the granting of sequestration without any writ or other proeeding, and the same shall aordingly be issued as if founded on a judgment against the bankrupt, and shall have priority over any other sequestration issued after the ommenement of the bankrupty in respet of a debt provable in the bankrupty, exept a sequestration issued before the date of the reeiving order by or on behalf of a person who, at the time of the issue thereof, had not notie of an at of bankrupty ommitted by the bankrupt, and available for grounding a reeiving order against him. (2) The Bishop may, if he think fit, appoint to the bankrupt suh or the like stipend as he might by law have appointed to a urate duly liensed to serve the benefie during a vaany thereof, and the sequestrator shall pay the sum so appointed out of the profits of the benefie to the bankrupt, by quarterly instalments, while he performs the duties of the benefie. (3) The sequestrator shall also pay, out of the profits of the benefie, the salary payable to any duly liensed urate of the hurh of the benefie, in respet of duties performed by him, as suh, during four months before the date of the reeiving order, not exeeding fifty pounds. (4) Nothing in this setion shall prejudie the operation of the Elesiastial Residenes and Dilapidations At 1879 or any mortgage or harge duly reated under any At of Tynwald before the ommenement of the bankrupty on the profits of the benefie. AT 1 of 1892 Page 29

30 Setion 36 The Bankrupty Code Appropriation of portion of pay or salary (1) Where a bankrupt is an offier of the army or navy, or an offier or lerk or otherwise employed or engaged in the ivil servie of the Crown, the trustee shall reeive for distribution amongst the reditors so muh of the bankrupt s pay or salary as the Court, on the appliation of the trustee, with the onsent of the hief offier of the department under whih the pay or salary is enjoyed, may diret. Before making any order under this sub-setion the Court shall ommuniate with the hief offier of the department as to the amount, time, and manner of the payment to the trustee, and shall obtain the written onsent of the hief offier to the terms of suh payment. (2) Where a bankrupt is in the reeipt of a salary or inome other than as aforesaid, or is entitled to any half-pay, or pension, or to any ompensation granted by the Crown, the Court, on the appliation of the trustee, may, from time to time, make suh order as it thinks just for the payment of any part of the salary, inome, half-pay, pension, or ompensation to the trustee, to be applied by him in suh manner as the Court may diret. 23 (3) Nothing in this setion shall take away or abridge any power vested in any authority to dismiss a bankrupt, or to delare the pension, half-pay, or ompensation of any bankrupt to be forfeited. 37 Ations by trustee and bankrupt s partners Where a member of a partnership is adjudged bankrupt, the Court may authorise the trustee to ommene and proseute any ation in the names of the trustee and of the bankrupt s partner; and any release by suh partner of the debt or demand to whih the ation relates, unless given bona fide and before suh authority was given by the Court, shall be void; but notie of the appliation for authority to ommene the ation shall be given to suh partner, and he may show ause against it, and on his appliation the Court may, if it thinks fit, diret that he shall reeive his proper share of the proeeds of the ation, and if he does not laim any benefit therefrom he shall be indemnified against osts in respet thereof as the Court direts. 38 Ations on joint ontrats Where a bankrupt is a ontrator in respet of any ontrat jointly with any person or persons, suh person or persons may sue or be sued in respet of the ontrat without the joinder of the bankrupt. 39 Proeedings in partnership name Any two or more persons, being partners, or any person arrying on business under a partnership name, may take proeedings or be proeeded against under this At in the name of the firm, but in suh ase the Court may, on appliation Page 30 AT 1 of 1892

31 The Bankrupty Code 1892 Setion 40 by any person interested, order the names of the persons who are partners in suh firm or the name of suh person to be dislosed in suh manner, and verified on oath, or otherwise, as the Court may diret. 40 Dislaimer of onerous property (1) Where any part of the property of the bankrupt onsists of land of any tenure burdened with onerous ovenants, of shares or stok in ompanies, of unprofitable ontrats, or of any other property that is unsaleable, or not readily saleable, by reason of its binding the possessor thereof to the performane of any onerous at, or to the payment of any sum of money, the trustee, notwithstanding that he has endeavoured to sell or has taken possession of the property, or exerised any at of ownership in relation thereto, but subjet to the provisions of this setion, may, by writing signed by him, at any time within three months after the first appointment of a trustee, dislaim the property. Provided that where any suh property shall not have ome to the knowledge of the trustee within one month after suh appointment, he may dislaim suh property at any time within three months after he first beame aware thereof. (2) The dislaimer shall operate to determine, as from the date of dislaimer, the rights, interests, and liabilities of the bankrupt and his property in or in respet of the property dislaimed, and shall also disharge the trustee from all personal liability in respet of the property dislaimed as from the date when the property vested in him, but shall not, exept so far as is neessary for the purpose of releasing the bankrupt and his property and the trustee from liability, affet the rights or liabilities of any other person. (3) A trustee shall not be entitled to dislaim a lease without the leave of the Court, exept in any ases whih may be presribed by general rules, and the Court may, before or on granting suh leave, require suh noties to be given to persons interested, and impose suh terms as a ondition of granting leave, and make suh orders with respet to fixtures, suh tenant s improvements, and other matters, arising out of the tenany, as the Court thinks just. (4) The trustee shall not be entitled to dislaim any property in pursuane of this setion in any ase where an appliation in writing has been made to the trustee by any person interested in the property requiring him to deide whether he will dislaim or not, and the trustee has, for a period of twenty-eight days after the reeipt of the appliation, or suh extended period as may be allowed by the Court, delined or negleted to give notie whether he dislaims the property or not; and in the ase of a ontrat, if the trustee, after suh appliation as aforesaid, does not, within the said period or extended period, dislaim the ontrat, he shall be deemed to have adopted it. AT 1 of 1892 Page 31

32 Setion 40 The Bankrupty Code 1892 (5) The Court may, on the appliation of any person who is, as against the trustee, entitled to the benefit or subjet to the burden of a ontrat made with the bankrupt, make an order resinding the ontrat on suh terms as to payment by or to either party of damages for the non-performane of the ontrat, or otherwise, as to the Court may seem equitable, and any damages payable under the order to any suh person may be proved by him as a debt under the bankrupty. (6) The Court may, on appliation by any person either laiming any interest in any dislaimed property, or under any liability not disharged by this At in respet of dislaimed property, and on hearing suh persons as it thinks fit, make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of ompensation for suh liability as aforesaid, or a trustee for him, and on suh terms as the Court thinks just; and on any suh vesting order being made, the property omprised therein shall vest aordingly, in the person therein named in that behalf, without any onveyane or assignment for the purpose. Provided always, that where the property dislaimed is of a leasehold nature, the Court shall not make a vesting order in favour of any person laiming under the bankrupt, whether as under-lessee or as mortgagee by demise, exept upon the terms of making suh person subjet to the same liabilities and obligations as the bankrupt was subjet to under the lease in respet of the property at the date when the bankrupty petition was filed, or the Court may, if it thinks fit, modify suh terms so as to make the person in whose favour the vesting order is made subjet only to the same liabilities and obligations as if the lease had been assigned to him at the date of the presentation of the bankrupty petition; and (if the ase so required) as if the lease had omprised only the property in the vesting order, and any mortgagee or under-lessee delining to aept a vesting order upon suh terms shall be exluded from all interest in seurity upon the property, and if there shall be no person laiming under the bankrupt who is willing to aept an order upon suh terms, the Court shall have power to vest the bankrupt s estate and interest in the property in any person liable either personally or in a representative harater, and either alone or jointly with the bankrupt, to perform the lessee s ovenants in suh lease, freed and disharged from all estates, inumbranes and interests reated therein by the bankrupt. (7) Any person injured by the operation of a dislaimer under this setion shall be deemed to be a reditor of the bankrupt to the extent of the injury, and may aordingly prove the same as a debt under the bankrupty. Page 32 AT 1 of 1892

33 The Bankrupty Code 1892 Setion Powers of trustee to deal with property Subjet to the provisions of this At, the trustee may do all or any of the following things: (1) Sell all or any part of the property of the bankrupt (inluding the goodwill of the business, if any, and the book debts due or growing due to the bankrupt) by publi aution or (with the onsent of the Court) by private ontrat, with power to transfer the whole thereof to any person or ompany, or to sell the same in parels: (2) Give reeipts for any money reeived by him, whih reeipts shall effetually disharge the person paying the money from all responsibility in respet of the appliation thereof: (3) Prove, rank, laim, and draw a dividend in respet of any debt due to the bankrupt: (4) Exerise any powers the apaity to exerise whih is vested in the trustee under this At, and exeute any powers of attorney, deeds, and other instruments for the purpose of arrying into effet the provisions of this At. 42 Powers exerisable by trustee with permission of Court The trustee may, with the permission of the Court, do all or any of the following things (1) Carry on the business of the bankrupt, as far as may be neessary, for the benefiial winding up of the same: (2) Bring, institute, or defend any ation or other legal proeeding relating to the property of the bankrupt: (3) Employ an advoate, soliitor, or other agent to take any proeedings or do any business whih may be santioned by the Court: (4) Aept as the onsideration for the sale of any property of the bankrupt a sum of money payable at a future time, subjet to suh stipulations, as to seurity and otherwise, as the Court thinks fit: (5) Mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts: (6) Refer any dispute to arbitration, ompromise all debts, laims, and liabilities, whether present or future, ertain or ontingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have inurred any liability to the bankrupt, on the reeipt of suh sums, payable at suh times, and generally on suh terms, as may be agreed on: (7) Make suh ompromise or other arrangement as may be thought expedient with reditors, or persons laiming to be reditors, in respet of any debts provable under the bankrupty: AT 1 of 1892 Page 33

34 Setion 43 The Bankrupty Code 1892 (8) Make suh ompromise or other arrangement as may be thought expedient with respet to any laim arising out of or inidental to the property of the bankrupt, made or apable of being made on the trustee by any person or by the trustee on any person: (9) Divide in its existing form amongst the reditors, aording to its estimated value, any property whih, from its peuliar nature or other speial irumstanes, annot be readily or advantageously sold. The permission given for the purposes of this setion shall not be a general permission to do all or any of the above-mentioned things, but shall only be a permission to do the partiular thing or things for whih permission is sought in the speified ase or ases; and the permission given by this setion for the employment of an advoate, soliitor, or other agent must be permission obtained before the employment, exept in ases of urgeny, and in suh ases it must be shown that no undue delay took plae in obtaining the permission. Distribution of Property 43 Delaration and distribution of dividends (1) After making provision for suh sum as may be neessary for the osts of administration or otherwise, the Court shall, on the appliation of the trustee, make an order delaring that a dividend shall be paid to suh reditors who have proved their debts, and in pursuane of any suh order the distribution shall be made, as nearly as may be, aording to the pratie in the Civil Division of the High Court in matters of distribution of estates. 24 (2) The first dividend, if any, shall be delared and distributed within four months after the date of the order of adjudiation, unless the trustee satisfies the Court that there is suffiient reason for postponing the delaration to a later date. (3) Subsequent dividends shall, in the absene of suffiient reason to the ontrary, be, on the appliation of the trustee, delared and distributed at intervals of not more than six months. (4) Before applying for a distribution the trustee shall ause notie of his intention to do so to be advertised in the manner the Court may diret, and shall also send reasonable notie thereof to eah reditor mentioned in the bankrupt s statement who has not proved his debt. (5) When a dividend has been delared the trustee shall send to eah reditor who has proved a notie showing the amount of the dividend and when and how it is payable, and a statement in the presribed form as to the partiulars of the estate. Page 34 AT 1 of 1892

35 The Bankrupty Code 1892 Setion Joint and separate dividends (1) Where one partner of a firm is adjudged bankrupt, a reditor to whom the bankrupt is indebted jointly with the other partners of the firm, or any of them, shall not reeive any dividend out of the separate property of the bankrupt until all the separate reditors have reeived the full amount of their respetive debts. (2) Where joint and separate properties are being administered, dividends of the joint and separate properties shall, subjet to any order to the ontrary that may be made by the Court on the appliation of any person interested, be delared together; and the expenses of and inident to suh dividends shall be fairly apportioned between the joint and separate properties, regard being had to the work done for and the benefit reeived by eah property. 45 Provisions for reditors residing at a distane, et In the alulation and distribution of a dividend provision shall be made for debts provable in bankrupty appearing from the bankrupt s statements, or otherwise, to be due to persons resident in plaes beyond this Isle, that, in the ordinary ourse of ommuniation, they have not had suffiient time to tender their proofs, or to establish them if disputed, and also for debts provable in bankrupty, the subjet of laims not yet determined. Provision shall also be made for any disputed proofs or laims, and for the expenses neessary for the administration of the estate or otherwise, and, subjet to the foregoing provisions, all money in hand should be distributed. 46 Right of reditor who has not proved debt before delaration of dividend Any reditor who has not proved his debt before the delaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in Court to the redit of the bankrupty estate available for dividend, any dividend or dividends he may have failed to reeive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend delared before his debt was proved by reason that he has not partiipated therein. 47 Final dividend When the trustee has realised all the property of the bankrupt, or as muh thereof as an, in the opinion of the Court, be realised without needlessly protrating the trusteeship, he shall apply to the Court for a final dividend to be delared, but before so doing he shall give notie in suh manner as the Court may diret to the persons whose laims to be reditors have been notified to him, but not established to his satisfation, that if they do not establish their laims to the satisfation of the Court within a time limited by the notie, he will AT 1 of 1892 Page 35

36 Setion 48 The Bankrupty Code 1892 apply to have a final dividend made without regard to their laims. After the expiration of the time so limited, or, if the Court on appliation by any suh laimant grant him further time for establishing his laim, then, on the expiration of suh further time, the property of the bankrupt shall be divided among the reditors who have proved their debts, without regard to the laims of any other persons. 48 No ation for dividend Where money is paid out of Court to the trustee for the payment of dividends, no ation for a dividend shall lie against the trustee, but if the trustee refuses to pay any dividend the Court may, if it thinks fit, order him to pay it, and also to pay, out of his own money, interest thereon for the time that it is withheld, and the osts of the appliation. Suh order shall be enfored by exeution. 49 Power to allow bankrupt to manage property Allowane to bankrupt for maintenane or servie (1) The trustee, with the permission of the Court, may appoint the bankrupt himself to superintend the management of the property of the bankrupt or of any part thereof, or to arry on the trade (if any) of the bankrupt for the benefit of his reditors, and in any other respet to aid in administering the property in suh manner and on suh terms as the trustee may diret. (2) The trustee may, from time to time, with the permission of the Court, make suh allowane as he may think just to the bankrupt out of his property for the support of the bankrupt and his family, or in onsideration of his servies if he is engaged in winding up his estate. 50 Right of bankrupt to surplus The bankrupt shall be entitled to any surplus remaining after payment in full of his reditors, with interest, as by this At provided, and of the osts, harges, and expenses of the proeedings under the bankrupty petition. 51 Trustee to furnish list of reditors The trustee shall, whenever required by any reditor to do so, furnish and transmit to suh reditor by post a list of the reditors, showing in suh list the amount of the debt due to eah of suh reditors. The trustees shall be entitled to harge for suh list the sum of 1p per page of seventy-two words, together with the ost of the postage thereof Statement of aounts to be furnished if required Any reditor, with the onurrene of one-sixth in number of the reditors (inluding himself) may at any time all upon the trustee to furnish and Page 36 AT 1 of 1892

37 The Bankrupty Code 1892 Setion 53 transmit to the reditors a statement of the aounts up to the date of suh notie, and the trustee shall, upon reeipt of suh notie, furnish and transmit suh statement of aounts. Provided that the person at whose instane the aounts are furnished shall deposit with the trustees a sum suffiient to pay the osts of furnishing and transmitting the aounts, suh sum to be repaid him out of the estate if the Court so diret. PART IV Trustees in Bankrupty 53 Clerk of the Rolls to appoint offiial trustees (1) The Clerk of the Rolls shall, at any time before the ommenement of this At, and from time to time, appoint suh persons as he may think fit to be offiial trustees of debtors estates, and may remove any person so appointed from suh offie. Any appointment or removal hereunder shall be in writing, and shall be filed in the Rolls Offie. 26 (2) The offiial trustees shall be offiers of the Court, and shall at under its diretions. (3) Any offiial trustee may be appointed as offiial reeiver, or manager, or trustee in any bankrupty, and he shall give suh seurity to the Crown as the Court may diret. 54 Deputy for offiial reeiver The Court may, from time to time, by order, diret that any offiial trustee shall be apable of disharging the duties of trustee during any temporary vaany in the offie, or during the temporary absene of any offiial trustee through illness or otherwise. 55 Duties of offiial trustee as regards the debtor s ondut As regards the debtor and his estate, it shall be the duty of the trustee (1) To investigate the ondut of the debtor and to report to the Court, stating whether there is reason to believe that the debtor has ommitted any offene under this or any At for the punishment of fraudulent debtors for the time being in fore, or whih would justify the Court in refusing, suspending, or qualifying an order for his disharge: (2) To make suh other reports onerning the ondut of the debtor as the Court may diret: (3) To take suh part, and give suh assistane, in relation to the proseution of any fraudulent debtor as the Court may diret: AT 1 of 1892 Page 37

38 Setion 56 The Bankrupty Code 1892 (4) For the purpose of his duties as interim reeiver or manager, the offiial reeiver shall have the same powers as if he were a reeiver or manager appointed by the High Court, and shall not, unless the Court otherwise order, inur any expense beyond suh as is requisite for the protetion of the debtor s property or the disposing of perishable goods: (5) Provided that, when the debtor annot, in the opinion of the Court, himself prepare a proper statement of affairs, the offiial reeiver may, under the diretion of the Court, and at the expense of the estate, employ some person or persons to assist in the preparation of the statement of affairs: (6) Every offiial reeiver shall aount to the Court and pay over all moneys and deal with all seurities in suh manner as the Court from time to time diret. Remuneration of Trustee 56 Remuneration of trustee (1) The remuneration of a trustee in bankrupty shall be fixed by the Court by order, and shall be payable out of the amount realised after deduting any sums paid to seured reditors out of the proeeds of their seurities. (2) The order shall express what expenses the remuneration is to over, and no liability shall attah to the bankrupt s estate, or to the reditors, in respet of any expenses whih the remuneration is expressed to over. (3) A trustee shall not, under any irumstanes whatever, make any arrangements for or aept from the bankrupt, or any advoate, soliitor, autioneer, or any other person that may be employed about a bankrupty, any gift, remuneration, or peuniary or other onsideration or benefit whatever beyond the remuneration fixed by the Court and payable out of the estate, nor shall he make any arrangement for giving up, or give up, any part of his remuneration, either as reeiver, manager, or trustee either to the bankrupt, or any soliitor, or other person that may be employed about a bankrupty. (4) Where a trustee ats without remuneration he shall be allowed out of the bankrupt s estate suh proper expenses inurred by him in or about the proeedings of the bankrupty as the Court may approve. Costs 57 Allowane and taxation of osts (1) Where a trustee or manager reeives remuneration for his servies as suh no payment shall be allowed in his aounts in respet of the performane by any other person of the ordinary duties whih are Page 38 AT 1 of 1892

39 The Bankrupty Code 1892 Setion 58 required by statute or rules, or what in the opinion of the Court ought to be performed by himself. (2) Where the trustee is an advoate he may arrange with the Court that the remuneration for his servies as trustee shall inlude all professional servies, and suh arrangement shall be set out in the order of the Court. (3) All bills and harges of advoates shall be taxed in like manner as bills of osts of advoates are now taxed, and those of trustees, managers, aountants, autioneers, brokers, and other persons shall be taxed by the Court, and no payments in respet thereof shall be allowed in the trustee s aounts without proof of suh taxation having been made. The Court shall satisfy itself before passing suh bills and harges that the employment of suh advoates and other persons, in respet of the partiular matters out of whih suh harges arise, has been duly santioned; and, in the ase of bills and harges of advoates to be taxed as aforesaid, the Court shall in eah ase ertify that suh bills are referred for taxation, and whether as osts of a superior or summary Court, and whether as between attorney and lient or party and party. 27 (4) Every suh person shall, on request by the trustee (whih request the trustee shall make a suffiient time before delaring a dividend), deliver his bill of osts or harges to the proper offier for taxation, and if he fails to do so within seven days after reeipt of the request, or suh further time as the Court, on appliation, may grant, the trustee shall delare and distribute the dividend without regard to any laim by him, and thereupon any suh laim shall be forfeited as well against the trustee personally as against the estate. Reeipts, Payments, Aounts, Audit 58 Payment of money into bank (1) Every trustee in bankrupty shall, in suh manner and at suh times as may be presribed or as the Court may diret, pay, with the privity of a judge of the Court, the money reeived by him into the bank to the redit of an aount to be alled The Bankrupty Aount of, inserting the name of the bankrupt. (2) If a trustee at any time retains for more than ten days a sum exeeding twenty pounds, or suh other amount as the Court in any partiular ase authorises him to retain, then, unless he explains the retention to the satisfation of the Court, he shall pay interest on the amount so retained in exess at the rate of twenty pounds per entum per annum, and shall have no laim for remuneration, and may be removed from his offie by the Court, and shall be liable to pay any expenses oasioned by reason of his default. AT 1 of 1892 Page 39

40 Setion 59 The Bankrupty Code 1892 (3) The aounts of moneys paid into Court shall be kept at the Rolls Offie, in like manner as in the ase of other moneys paid into the High Court; but as to the payment of money into Court in bankrupty proeedings, a ertifiate of the judge of the Court shall be substituted for that of the Clerk of the Rolls, a dupliate of suh ertifiate being in eah ase forwarded by the Court to the Rolls Offie, and a payment of money under any suh ertifiate into the bank, shall be deemed to be a payment made with the privity of the judge. 59 Trustee not to pay into private aount No trustee in a bankrupty or under any omposition or sheme of arrangement shall pay sums reeived by him as trustee into his private banking aount. 60 Aounts of trustee to be filed and audited (1) Every trustee shall, at suh times as may be presribed, but not less than twie in eah year during his tenure of offie, return to the Court an aount of his reeipts and payments as suh trustee. (2) The aounts shall be in a presribed form, and shall be verified by a statutory delaration in the presribed form. (3) The Court may ause the aounts so sent to be audited, and for the purposes of the audit the trustee shall furnish the Court with suh vouhers and information as the Court may require, and the Court may, at any time, require the prodution of and inspet any books or aounts kept by the trustee. 61 The trustee to furnish list of reditors The trustee shall, whenever required by any reditor so to do, and on payment by suh reditor of the presribed fee, furnish and transmit to suh reditor by post a list of the reditors, showing in suh list the amount of the debt due to eah of suh reditors. 62 Books to be kept by trustees The trustee shall keep, in manner presribed, proper books, in whih he shall from time to time ause to be made entries or minutes of proeedings at meetings, and of suh other matters as may be presribed, and any reditor of the bankrupt may, subjet to the ontrol of the Court, personally or by his agent inspet any suh books. 63 Annual statement of proeedings (1) Every trustee in a bankrupty shall, from time to time, as may be presribed, and not less than one in every year during the ontinuane of the bankrupty, transmit to the Court a statement showing the Page 40 AT 1 of 1892

41 The Bankrupty Code 1892 Setion 64 proeedings in the bankrupty up to the date of the statement, ontaining the presribed partiulars, and made out in the presribed form. (2) The Court may ause the statements so transmitted to be examined, and shall all the trustee to aount for any misfeasane, neglet, or omission whih may appear on the said statements or in his aounts or otherwise, and may require the trustee to make good any loss whih the estate of the bankrupt may have sustained by the misfeasane, neglet, or omission. (3) All expenses onneted with the audit and examination under this setion and setion 60 shall be paid out of the bankrupt s estate. Release of Trustee 64 Release of trustee (1) When the trustee has realised all the property of the bankrupt, or as muh thereof as an, in his opinion, be realised without needlessly protrating the trusteeship, or has eased to at by reason of a omposition having been approved, or has resigned, or has been removed from his offie, the Court shall, on his appliation, and after suh notie to reditors, or any of them, as the Court may diret, ause a report on his aounts to be prepared, and, on his omplying with all the requirements of the Court, shall take into onsideration the report, and any objetion whih may be urged by any reditor or person interested against the release of the trustee, and shall either grant or withhold the release aordingly. (2) Where the release of a trustee is withheld the Court may, on the appliation of any reditor or person interested, make suh order as it thinks just, harging the trustee with the onsequenes of any at or default he may have done or made ontrary to his duty. (3) Any order of the Court releasing the trustee shall disharge him from all liability in respet of any at done or default made by him in the administration of the affairs of the bankrupt, or otherwise in relation to his ondut as trustee, but any suh order may be revoked on proof that it was obtained by fraud or by suppression or onealment of any material fat. Offiial Name 65 Offiial name of trustee The trustee may sue and be sued by the offiial name of the trustee of......a bankrupt, inserting the name of the bankrupt, and by that name may hold property of every desription, make ontrats, sue and be sued, AT 1 of 1892 Page 41

42 Setion 66 The Bankrupty Code 1892 enter into any engagements binding on himself and his suessors in offie, and do all other ats neessary or expedient to be done in the exeution of his offie. Control over Trustee 66 Disretionary powers of trustee and ontrol thereof (1) Subjet to the provisions of this At, the trustee shall, in the administration of the property of the bankrupt and in the distribution thereof amongst his reditors, have regard to any diretions that may be given by the Court. (2) The trustee may apply to the Court in manner presribed for diretions in relation to any partiular matter arising under the bankrupty. (3) Subjet to the provisions of this At the trustee shall use his own disretion in the management of the estate and its distribution among the reditors. 67 Appeal to Court against trustee If the bankrupt or any of the reditors, or any other person, is aggrieved by any at or deision of the trustee, he may apply to the Court, and the Court may onfirm, reverse, or modify the at or deision omplained of, and make suh order in the premises as it thinks just. 68 Court may remove a trustee The Court shall have power, on the appliation of any reditor, and on ause shown, to remove a trustee of a bankrupty estate, and to appoint another trustee in his plae. Appeals, et. 69 Appeals in bankrupty (1) The Court may review, resind, or vary any order made by it under its bankrupty jurisdition. (2) Orders in bankrupty matters shall, at the instane of any person aggrieved, be subjet to appeal as follows: (a) (b) An appeal shall lie from the order of the Court to the Appellate Court: An appeal shall, with the leave of the Appellate Court, but not otherwise, lie from the order of that Court to Her Majesty in Counil: Page 42 AT 1 of 1892

43 The Bankrupty Code 1892 Setion 70 () No appeal shall be entertained exept in onformity with suh general rules as may be for the time being in fore in relation to appeals. PART V General Rules, Et. 70 General rules to be made (1) Subjet to the provisions of this At, the Deemsters may, from time to time, make, revoke, or alter general rules for arrying into effet the purposes of this At, for regulating the pratie and proeedings of the Court in bankrupty. 28 (2) Part III of the High Court At 1991, shall be appliable to the general rules to be made under this At A Fees and ommissions (1) The Treasury shall by order presribe the fees and perentages to be harged for or in respet of proeedings in bankrupty. (2) An order under this setion shall not have effet unless it is approved by Tynwald. 30 Formal Defets 71 Formal defet not to invalidate proeedings (1) No proeeding in bankrupty shall be invalidated by any formal defet or by any irregularity, unless the Court before whih an objetion is made to the proeeding is of opinion that substantial injustie has been aused by the defet or irregularity, and that the injustie annot be remedied by any order of the Court. (2) No defet or irregularity in the appointment of the trustee shall vitiate any at done by him in good faith. The Crown 72 Certain proeedings to bind the Crown Save as herein provided, the provisions of this At relating to the remedies against the property of a debtor, the effet of a omposition or sheme of arrangement, and the effet of a disharge shall bind the Crown; but otherwise AT 1 of 1892 Page 43

44 Setion 73 The Bankrupty Code 1892 nothing in this At ontained shall affet the rights of the Crown, save as they are by this At expressly affeted. Transitory Provisions 73 Transfer of estates on vaany of offie of trustee in liquidation under the Bankrupty At, 1872 [Spent.] 74 Transfer of outstanding property on lose of bankrupty or liquidation [Spent.] 75 Transfer of estates from registrars of Court to offiial reeiver [Spent.] 76 Proeedings under Bankrupty At, 1872, ss 95 and 96 [Spent.] PART VI Relief of Imprisoned Debtors 77 An imprisoned debtor may be disharged on aounting for and surrendering his property Any imprisoned debtor may, without taking proeedings in bankrupty, by petition to the Court, seek to be disharged from imprisonment under any order by reason of his inability to pay or seure the debt for whih he may be imprisoned, whih petition shall be heard in the usual way with all onvenient speed; and, on the hearing of suh petition, or after due notie to the reditors at whose instane the orders have been made in ase they do not appear at suh hearing, the Court may, on being satisfied that the debtor has fully aounted for all his property of every desription, and if the Court so require, on the debtor exeuting to the satisfation of the Court suh deed or deeds of assignment of all property to whih he may be entitled in possession or otherwise in favour of any trustee or trustees to be approved by the Court in trust for the benefit of the reditors of the debtor aording to their respetive rights, order the debtor s disharge from suh his imprisonment. Provided always (1) That on the hearing of any suh petition the Court may, on onsideration of the irumstanes of the debtor, instead of ordering his absolute Page 44 AT 1 of 1892

45 The Bankrupty Code 1892 Setion 77 disharge from imprisonment under any order, suspend the enforement of suh order on ondition that the debtor pay periodially, and in suh manner as the Court may diret, suh instalments of the debt as may be agreed upon by the parties, or fixed by the Court. In ase the debtor fail to pay any suh instalment, it shall be lawful again from time to time to enfore suh order, if for a judgment debt, for the amount or balane due under suh order, or where judgment has not been obtained for the debt, and the order be still in fore, to enfore suh order for the amount laimed or for whih the debtor might be liable to imprisonment thereunder had he not been disharged. Where judgment for the debt has not been obtained, the said instalments shall be paid or seured in suh manner as may be agreed upon by the parties, or as the Court may diret: (2) That a general assignment of the debtor s property, without speifiation thereof, made under this setion shall be suffiient in law to vest in the trustee or trustees of suh assignment all property of the debtor apable of being sold or transferred by him: (3) That, notwithstanding any suh assignment, the future property of the debtor shall, at all times thereafter, be liable to be taken under exeution then or thereafter to be granted for the debt for whih he may have been imprisoned, or for so muh as may remain unsatisfied; but, exept as hereinbefore mentioned, he shall not be again liable to imprisonment for the same debt: (4) That nothing in this setion ontained shall prejudie or affet the proeedings whih may be taken by or against a debtor under the law for the time being in fore in relation to bankrupty or insolveny, or the right of a debtor to obtain under any suh law an absolute disharge of his future property from liability to his debts; but no assignment of a debtor s property under this setion shall be in anywise affeted or rendered void or voidable by reason of bankrupty proeedings being taken subsequently against the debtor, or of the debtor being subsequently adjudiated a bankrupt: (5) That in any ase of a debtor seeking relief under this setion in respet of a judgment debt for whih exeution has not been awarded, the said Court shall, as heretofore austomed, on the hearing of the petition award exeution for the amount of the debt and osts, but in this ase the judgment debtor shall not be liable to imprisonment again for the same debt by reason of the judgment reditor obtaining a return of no effets to disharge the exeution whih may be so awarded: (6) That for the purposes of this setion, debt shall inlude damages and osts whether payable under judgment or laimed in a suit, and also the amount for whih seurity may be required in an ation of arrest in the High Court against the putative father of a bastard hild to obtain seurity for unasertained or unliquidated expenses, past or future, in AT 1 of 1892 Page 45

46 Setion 78 The Bankrupty Code 1892 onnetion with the birth, maintenane, lothing, eduation, or death of suh hild; debtor shall inlude the defendant in an ation or suit for debt, and any person imprisoned for debt, and although judgment for the debt has not been given; order shall mean and inlude an order of imprisonment, a writ of ontempt for non-payment of a debt under a judgment, and mesne proess of arrest for debt; and exeution shall mean an order or proess under whih the property of a debtor is liable to be attahed and sold. But provided also, that a person imprisoned for (a) (b) () (d) default in payment of a penalty, or sum in the nature of a penalty, other than a penalty in respet of any ontrat, or of any sum of money for non-payment whereof a fixed term of imprisonment is awarded: default by suh person as a trustee or ating in a fiduiary apaity, and ordered to pay any sum in his possession or under his ontrol: default by suh person as an advoate or soliitor in payment of osts when ordered to pay osts for misondut as suh, or in payment of a sum of money when ordered by a Court in his harater of an advoate or soliitor: default in payment for the benefit of reditors of any portion of a salary or other inome in respet of the payment of whih any Court having jurisdition in bankrupty is authorised to make an order: shall not be deemed a debtor for the purposes of this setion. PART VII DEED OF ARRANGEMENT 78 Deed of arrangement to whih At applies A deed of arrangement shall inlude any of the following instruments, made by, for, or in respet of the affairs of a debtor for the benefit of the reditors generally, otherwise than in pursuane of the provisions of this At relating to bankrupty or any other At for the time being in fore relating to bankrupty (that is to say) (a) (b) Assignment of property; A deed of or agreement for a omposition; and in ases where reditors of a debtor obtain any ontrol over his property or business () A deed of inspetorship entered into for the purpose of arrying on or winding up a business; Page 46 AT 1 of 1892

47 The Bankrupty Code 1892 Setion 79 (d) (e) A letter of liene authorising the debtor or any other person to arrange, arry on, realise, or dispose of a business, with a view to the payment of debts; and Any agreement or instrument entered into for the purpose of arrying on or winding up the debtor s business, or authorising the debtor or any other person to manage, arry on, realise, or dispose of the debtor s business, with a view to the payment of his debts. 79 Registration of deed of arrangement A deed of arrangement shall be void unless the same shall have been registered in the offie for registry of deeds within seven lear days after the first exeution thereof by the debtor or any reditor, or if it is exeuted in any plae out of this Isle within seven lear days after the time at whih it would, in the opinion of the registrar, in the ordinary ourse of post, arrive in this Isle, if posted one week after the exeution thereof; and in the latter ase there shall be added to the ertifiate or memorandum of registration by the registrar a statement that in his opinion the deed has been duly registered pursuant to this At. 80 Extension of time for registration The Court, upon being satisfied that the omission to register a deed of assignment within the time required by this At was aidental, or due to inadvertene, or to some ause beyond the ontrol of the debtor, may, on the appliation of any person interested, and on suh terms as are just and expedient, extend the time for suh registration. 81 Time for registration When the time for registering a deed of arrangement expires on a Sunday, or other day on whih the registration offie is losed, the registration shall be valid if made on the next following day on whih the offie is open. 82 Deed of arrangement to be onfirmed by the Court The trustees appointed by a deed of arrangement shall ease to be trustees unless their appointment is onfirmed by the Court on an appliation by petition for suh onfirmation, to be presented within three days after the registration of the deed, and on the hearing of suh petition the Court shall have power to appoint trustees other than those named in the deed. Notie of the hearing of suh petition shall be given to the debtor and trustees, if not petitioners, and to some of the prinipal reditors, and otherwise if the Court see fit. If it appear to the Court, on the hearing of the petition, that, in onsequene of diffiulties as to the appointment of trustees, or for any suffiient ause, the deed of arrangement annot, without injustie or undue AT 1 of 1892 Page 47

48 Setion 83 The Bankrupty Code 1892 delay to the reditors or to the debtor, be arried into effet, the Court may adjudge the debtor a bankrupt, and proeedings may be had aordingly. 83 Jurisdition of Court as to deed of arrangement The Court shall have the like jurisdition with respet to a deed of arrangement and the trustees thereof, as the High Court has with respet to the exeution of trusts under any deed or will, and the administration of trust property; and the Court shall have power summarily, on the appliation of any trustee of a deed of arrangement, or of any reditor of the debtor, or of any person interested in the trust property under suh deed, in order to ensure a fair and just distribution of suh property amongst the reditors aording to their respetive priorities and rights, to vary, amend, or set aside any of the provisions of a deed of arrangement whih it may deem inequitable or unjust; also to remove trustees, and to fill up vaanies in the trust; also, if the Court think it advisable, to order the proeeds of the trust property to be paid into Court for distribution. 84 Provisions as to trustee in Part IV to be appliable to trustees of deeds of arrangement Part IV of this At shall apply to the trustee of a deed of arrangement as if he were a trustee in bankrupty, and as if the term bankrupty and bankrupt inluded respetively a deed of arrangement, and the debtor to whose affairs suh deed relates. 85 Part III as to administration of property to apply to property administered under a deed of arrangement Part III of this At shall, so far as the nature of the ase and the terms of the deed of arrangement admit, apply thereto, the same interpretation being given to the words trustee, bankrupty, and bankrupt, as in the last preeding setion. PART VIII FRAUDULENT DEBTORS 86 Offenes by debtors A bankrupt shall in eah of the ases following be deemed guilty of a misdemeanour, and, on onvition thereof, shall be liable to be imprisoned for any time not exeeding two years, with or without hard labour (that is to say): If, with intent to defraud (1) He does not, to the best of his knowledge and belief, fully and truly disover to the trustee all his property, real and personal, and how, and to whom, and for what onsideration, and when he disposed of any part Page 48 AT 1 of 1892

49 The Bankrupty Code 1892 Setion 86 thereof, exept suh part as has been disposed of in the ordinary way of his trade (if any), or laid out in the ordinary expense of his family: (2) He does not deliver up to the trustee, or as he direts, all suh part of his real and personal property as is in his ustody or under his ontrol, and whih he is required by law to deliver up: (3) He does not deliver up to the trustee, or as he direts, all books, douments, papers, and writings in his ustody or under his ontrol relating to his property or affairs: (4) After the presentation of a bankrupty petition by or against him, or within four months next before suh presentation, he oneals any part of his property to the value of ten pounds or upwards, or oneals any debt due to or from him: (5) After the presentation of a bankrupty petition by or against him, or within four months next before suh presentation, he fraudulently removes any part of his property of the value of ten pounds or upwards: (6) He makes any material omission in any statement relating to his affairs: (7) Knowing or believing that a false debt has been proved by any person under his bankrupty, he fails for the period of a month to inform suh trustee as aforesaid thereof: (8) After the presentation of a bankrupty petition by or against him, he prevents the prodution of any book, doument, paper, or writing, affeting or relating to his property or affairs: (9) After the presentation of a bankrupty petition by or against him, or within four months next before suh presentation, he oneals, destroys, mutilates, or falsifies, or is privy to the onealment, destrution, mutilation, or falsifiation of any book or doument affeting or relating to his property or affairs: (10) After the presentation of a bankrupty petition by or against him, or within four months next before suh presentation, he makes or is privy to the making of any false entry in any book or doument affeting or relating to his property or affairs: (11) After the presentation of a bankrupty petition by or against him, or within four months next before suh presentation, he fraudulently parts with, alters, or makes any omission, or is privy to the fraudulently parting with, altering, or making any omission in any doument affeting or relating to his property or affairs: (12) After the presentation of a bankrupty petition by or against him, or at any meeting of his reditors within four months next before suh presentation, he attempts to aount for any part of his property by fititious losses or expenses: (13 and 14) [Repealed] 31 AT 1 of 1892 Page 49

50 Setion 87 The Bankrupty Code 1892 (15) Within four months next before the presentation of a bankrupty petition by or against him, he pawns, pledges, or disposes of, otherwise than in the ordinary way of his trade, any property whih he has obtained on redit and has not paid for: (16) He is guilty of any false representation, or other fraud for the purpose of obtaining the onsent of his reditors, or any of them, to any agreement with referene to his affairs or his bankrupty: (17) After the presentation of a bankrupty petition by or against him, or within four months before suh presentation, he quits this Isle and takes with him, or attempts or makes preparations for quitting this Isle, and for taking with him, any part of his property to the amount of twenty pounds or upwards, whih ought by law to be divided amongst his reditors. 87 Undisharged bankrupt obtaining redit to extent of 20 to be guilty of misdemeanour Where an undisharged bankrupt who has been adjudged bankrupt obtains redit to the extent of twenty pounds or upwards from any person without informing suh person that he is an undisharged bankrupt, he shall be guilty of a misdemeanour, and on onvition thereof shall be liable to be imprisoned for any time not exeeding two years, with or without hard labour. 88 Penalty for fraudulently obtaining redit, et Any person shall, in eah of the ases following be deemed guilty of misdemeanour, and on onvition thereof shall be liable to be imprisoned for any period not exeeding one year, with or without hard labour (that is to say) (1) [Repealed] 32 (2) If he has, with intent to defraud his reditors, or any of them, made or aused to be made any gift, delivery, or transfer of, or any harge on, his property; (3) If he has, with intent to defraud his reditors, onealed or removed any part of his property sine or within two months before the date of any unsatisfied judgment or order for payment of money obtained against him. 89 [Repealed] Debts inurred by fraud Where a debtor makes any arrangement or omposition with his reditors, he shall remain liable for the unpaid balane of any debt whih he inurred or Page 50 AT 1 of 1892

51 The Bankrupty Code 1892 Setion 91 inreased, or whereof before the date of the arrangement or omposition he obtained forbearane from a reditor by any fraud. 91 Criminal liability after disharge or omposition Where a debtor has been guilty of any riminal offene he shall not be exempt from being proeeded against therefor by reason that he has obtained his disharge, or that a omposition or sheme of arrangement has been aepted or approved. 92 Form of inditment In an inditment for an offene under this At, it shall be suffiient to set forth the substane of the offene harged in the words of this At, speifying or as near thereto as irumstanes admit, without alleging or setting forth any debt, at of bankrupty, trading adjudiation, or any proeeding in, or order, warrant, or doument, of any Court; and it shall be suffiient in any inditment under this At, where it shall be neessary to allege an intent to defraud, to allege that the party aused did the at harged with intent to defraud, without alleging an intent to defraud any partiular person; and on the trial of the inditment it shall not be neessary to prove an intent to defraud any partiular person; but it shall be suffiient to prove that the party aused did the at with an intent to defraud. 93 A magistrate before whom a person is harged may onsider evidene as to guilty intent When any person is harged with any offene under this At before any highbailiff or justie of the peae, suh high-bailiff or justie shall take into onsideration any evidene addued before him to show that the at harged was not ommitted with a guilty intent. 94 Power for Court to ommit for trial Where there is, in the opinion of the Court, ground to believe that the bankrupt or any other person has been guilty of any offene whih is by statute made a misdemeanour in ases of bankrupty, the Court may ommit the bankrupt or suh other person for trial, or may diret that suh bankrupt or other person be taken into ustody and brought before a high-bailiff or a justie of the peae, who shall inquire into the offene harged in like manner as in the ase of other inditable offenes. 95 Punishments under this At umulative Where any person is liable under any other At of Tynwald to any punishment or penalty for any offene made punishable by this At, suh person may be proeeded against under suh other At of Tynwald, or under this At, so that he be not punished twie for the same offene. AT 1 of 1892 Page 51

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53 The Bankrupty Code 1892 Shedule Shedule 34 AT 1 of 1892 Page 53

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55 The Bankrupty Code 1892 Endnotes ENDNOTES Table of Legislation History Legislation Year and No Commenement Table of Renumbered Provisions Original Current Table of Endnote Referenes 1 S 3 repealed by Statute Law Revision At 1983 Sh 2. 2 Para (ee) inserted by Bankrupty At 1988 s 2. 3 S 5A inserted by Bankrupty At 1988 s 2. 4 S 10 substituted by Bankrupty Code Amendment At 1903 s 15. The referene to the At of Tynwald is to the Debtors At Para (iii) amended by Deimal Curreny (Isle of Man) At 1970 s 9. 6 Para (a) amended by Deimal Curreny (Isle of Man) At 1970 s 9. 7 Para (j) amended by Deimal Curreny (Isle of Man) At 1970 s 9. 8 Subs (4) amended by Deimal Curreny (Isle of Man) At 1970 s 9. 9 Para (1) amended by Civil Partnership At 2011 Sh Para (2) amended by Civil Partnership At 2011 Sh Subs (1A) inserted by Criminal Justie At 1990 Sh 2 and amended by the Proeeds of Crime At 2008 Sh Para (a) repealed by Representation of the People At 1995 Sh Para () repealed by Loal Eletions At 1986 Sh Para (d) repealed by Representation of the People At 1995 Sh Ss 17 and 18 repealed by Representation of the People At 1995 Sh Subs (1) repealed by Preferential Payments At 1908 Sh. 17 Para (1) substituted by Bankrupty At 1988 s 3 and amended by Civil Partnership At 2011 Sh Para (2) substituted by Bankrupty At 1988 s Para (3) inserted by Bankrupty At 1988 s 3. AT 1 of 1892 Page 55

56 Endnotes The Bankrupty Code Paras (a) to (d) substituted for ss 28 and 29 by Bankrupty Code Amendment At 1903 s 16. Para (e) added to 1903 At by Administration of Justie At 1981 Sh Subs (1) amended by Civil Partnership At 2011 Sh Subs (2) amended by Civil Partnership At 2011 Sh Subs (2) amended by Bankrupty Code Amendment At 1903 s Subs (1) substituted by Bankrupty Code Amendment At 1903 s 17 and amended by SD352/ S 51 amended by Deimal Curreny (Isle of Man) At 1970 s Subs (1) amended by Governor s General Funtions (Transfer) At 1980 Sh See General Note Subs (1) amended by Governor s Finanial and Judiial Funtions (Transfer) At 1976 Sh 2 and by Transfer of Deemsters Funtions At 2003 Sh. 29 Subs (2) amended by High Court At 1991 Sh S 70A inserted by Transfer of Deemsters Funtions At 2003 s Paras 13 and 14 repealed by Theft At 1981 Sh Para (1) repealed by Theft At 1981 Sh S 89 repealed by Theft At 1981 Sh Sh repealed by Statute Law Revision At 1983 Sh 2. Page 56 AT 1 of 1892