MORTGAGE ACTIONS. FAQs. BANKRUPTCY PROCEEDINGS IN THE HIGH COURT Frequently Asked Questions (FAQs)

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1 MORTGAGE ACTIONS BANKRUPTCY PROCEEDINGS IN THE HIGH COURT Frequently Asked Questions (FAQs) FAQs SUPREME COURT 1 Supreme Court Lane Singapore This pamphlet contains only general information. For more information, please access the website. If you require any legal advice, please consult a lawyer.

2 You can obtain samples of these documents from the Insolvency Counter located in the Legal Registry at the Supreme Court (Level 2). BANKRUPTCY PROCEEDINGS IN THE HIGH COURT If you require assistance in completing the Statement of Affairs, you may bring your bank statements and other relevant documents to the Insolvency and Public Trustee s Office (IPTO), located at The URA Centre, East Wing, 45 Maxwell Road, #06-11, for assistance upon payment of the prescribed fee. Step STEP 2 2 You should not sign the affidavits yet, as you must swear or affirm both the Supporting Affidavit (Bankruptcy) and Affidavit Verifying the Statement of Affairs before a Commissioner for Oaths. (A) BANKRUPTCY APPLICATIONS 1. How can bankruptcy proceedings be commenced? Bankruptcy proceedings can be commenced by way of an Originating Summons to the High Court by the debtor, or by a creditor who is owed S$10,000 or more by the debtor. 2. What is the difference between a debtor s bankruptcy application and a creditor s bankruptcy application? A debtor s bankruptcy application is fixed when the debtor applies to make himself/herself a bankrupt. A creditor who is owed S$10,000 or more by a debtor can apply to the High Court to bankrupt the debtor. In both situations, a Bankruptcy Order will be made by the Court against the debtor if the application succeeds. 3. How do I apply to make myself a bankrupt? An individual debtor can take out an originating summons to make himself/herself a bankrupt. The application can be filed with the High Court as follows. STEP 1 Complete the following documents: Originating Summons (Debtor s Bankruptcy Application) Supporting Affidavit (Bankruptcy) Affidavit Verifying the Statement of Affairs Statement of Affairs Supporting Affidavit [Bankruptcy Debt Repayment Scheme (DRS) applies or DRS does not apply (see Section E below on DRS), whichever Affidavit is applicable] STEP 3 Once you have prepared your documents, you will have to go to the IPTO and deposit with the Official Assignee an administrative fee. The IPTO will issue you with a temporary receipt. STEP 4 The temporary receipt and your documents must be brought to the Insolvency Counter located in the Legal Registry at the Supreme Court (Level 2). You should proceed to the Cashier s Counter to make a payment for stamp fees and/or Commissioner for Oaths fees. STEP 5 You must then swear or affirm the Affidavit Verifying the Statement of Affairs and the Supporting Affidavit (Bankruptcy) before a Commissioner for Oaths (CFO). The CFO will then sign and stamp the documents as well. STEP 6 Next, you should go to the LawNet Service Bureau, located at Level 1 of the Supreme Court, to file your documents upon payment of the prescribed fee. The LawNet Service Bureau will inform you of the date of collection of your documents. Upon collection of the documents, the date and time that your application will be heard in court will be printed on your application. STEP 7 You must attend the hearing at the appointed date and time. If you are unable to attend the hearing on the assigned date, you must write to the Registrar of the Supreme Court immediately to request a later hearing date and state the reasons for your request. 2 3

3 4. Can I submit a hand written application? All the above documents must be type-written. Only the Statement of Affairs may be hand-written. 5. If my spouse is the guarantor of my debt, should he/she apply for bankruptcy as well? It would depend on your spouse s financial situation and whether he/she is able to fulfill his/her obligations as a guarantor. The Court will not grant a Bankruptcy Order upon a debtor s application unless it is satisfied that the debtor is unable to pay his/her debts. Your creditor may also decide to file bankruptcy proceedings against your spouse if he/she is unable to repay your debt. 6. How long does it take for a Bankruptcy Order to be issued? A person can be made a bankrupt approximately four to six weeks from the date of the issue of the originating summons. Debtors applying to make themselves a bankrupt may write to the Registrar of the Supreme Court to apply for an earlier hearing date. After filing these documents, you must serve the Originating Summons together with the Supporting Affidavit on the creditor within three days of your court application. You may also apply for more time from the Court, which may decide the application or adjourn it, giving such directions as it thinks appropriate. 9. When will the hearing of the application to set aside the Statutory Demand be fixed? The hearing will usually be fixed within two weeks from the date the application is filed. If the application to set aside the Statutory Demand is dismissed by the Court, the creditor may proceed with bankruptcy proceedings. 10. I have been served with a creditor s bankruptcy application, how can I resist my creditor s attempt to make me a bankrupt? You may approach your creditor s solicitor to negotiate a mutually satisfactory settlement proposal. You may then try to persuade your creditor to withdraw his application for a Bankruptcy Order against you. (B) APPEALS AGAINST BANKRUPTCY ORDERS 7. I have been served with a Statutory Demand, what should I do next? You may wish to contact the creditor or the creditor s counsel and try to arrange for an installment payment scheme or to make voluntary arrangements to settle your debt and ask the creditor not to carry on with bankruptcy proceedings. Alternatively, you may wish to take out an application to court to set aside the Statutory Demand if: i) you have a valid counterclaim equivalent to or exceeding the amount of the debt stated in the Statutory Demand; ii) you dispute the debt; iii) the creditor holds your assets or security in respect of the debt, which has not been taken into account in the Statutory Demand; or iv) the Statutory Demand is defective in its form and contents. 8. How do I set aside a Statutory Demand served on me? To set aside a Statutory Demand, you will need to apply to the High Court by filing an Originating Summons (Bankruptcy To Set Aside Statutory Demand) with an Affidavit (Bankruptcy) within 14 days (or 21 days where the demand is served outside jurisdiction) from the date the Statutory Demand was served on you. The procedure for filing this application is similar to steps 5, 6 and 7 of Question 1. Alternatively, if you have valid reasons to set aside the bankruptcy application, you can object to the application by filing a Notice of Objection at least three days before the bankruptcy application is heard, specifying your reasons for objecting to the bankruptcy application. If you choose to pursue this course of action, please note that you will need to serve a copy of the filed Notice of Objection on your creditor and the Official Assignee. 11. A Bankruptcy Order has been made against me. I was not aware of the bankruptcy proceedings against me. How do I set the Bankruptcy Order aside? To set aside the Bankruptcy Order, two documents are required for filing in court: i) Summons (Bankruptcy); and ii) Affidavit (Bankruptcy). The Affidavit (Bankruptcy) is required to be sworn or affirmed before a Commissioner for Oaths before it can be filed. You can obtain sample documents of the Summons (Bankruptcy) and the Affidavit (Bankruptcy) at the Insolvency Counter of the Supreme Court, located at the Legal Registry on Level 2. The two documents are to be filed at the LawNet Service Bureau located at Level 1 of the Supreme Court. After filing, you have to serve the documents on your creditor and the Official Assignee. At the hearing, the Court will determine whether your application to set aside the Bankruptcy Order should be granted or not. 4 5

4 12. How do I appeal against the Bankruptcy Order? Three documents are required for filing: i) Registrar s Appeal ii) Summons (Bankruptcy) for Stay of Proceeding iii) Affidavit (Bankruptcy) A sample document of the Registrar s Appeal form can be obtained at the Trials Counter, and this form is to be filed within 14 days from the date of the Bankruptcy Order at the counter. A copy of the Summons (Bankruptcy) and the Affidavit (Bankruptcy) can be obtained at the Insolvency Counter. Both counters are located at the Legal Registry, Supreme Court (Level 2). The Affidavit (Bankruptcy) is required to be affirmed before a Commissioner for Oaths before the affidavit can be filed. All three documents are to be filed at the LawNet Service Bureau located at Level 1 of the Supreme Court. After the documents are filed, you have to serve the documents on your creditor and the Official Assignee. At the hearing, the court will determine the merits of your application. (C) BANKRUPTCY HEARINGS 13. What will happen if I do not attend the bankruptcy hearing? If you have filed a debtor s application and do not attend the bankruptcy hearing, the application may be adjourned to a later hearing date or dismissed by the Court. If the application is dismissed and you still wish to have yourself made bankrupt, you will have to re-apply. This will be considered a new application, and a fresh set of filing and administrative fees will be payable. If your creditor has taken out the bankruptcy application against you and you are absent at the hearing, the Court will decide on the appropriate order to make, and may make the Bankruptcy Order against you. 14. I have made an alternative proposal for payment to my creditor but I have not heard from my creditor or their lawyers. Do I need to attend the bankruptcy hearing? Yes. You should attend the hearing and inform the Court that you have tried to contact your creditor but did not receive any response. 15. I have made an alternative proposal for payment to my creditor but the proposal has been rejected. Do I need to attend the bankruptcy hearing? Yes, you should attend the hearing and inform the Court that you have made a repayment proposal to your creditor, who was not agreeable to your proposal. The Court may adjourn the hearing to give you more time to make a better proposal, or the Court may make the Bankruptcy Order against you. 16. Is there a dress code for bankruptcy and related hearings? Litigants and witnesses in all court hearings, as well as visitors to the Court, should not be dressed in singlets, shorts or slippers. (D) AFTER BEING DECLARED A BANKRUPT 17. What happens after a Bankruptcy Order is made? Once a Bankruptcy Order is made by the Court, your case will be referred to the Insolvency & Public Trustee s Office (IPTO) and your financial affairs will be managed by the Official Assignee. You will be required to attend a briefing at the IPTO, where you will be informed of your duties and responsibilities as a bankrupt, as well as matters relating to bankruptcy administration (e.g. how to apply for travel permission, opening of a bank account etc.). You will also be required to submit a statement of your affairs, setting out your assets and liabilities. For further information on the duties and responsibilities of a bankrupt, please visit the IPTO website at What happens to my assets after I am made a bankrupt? Under the Bankruptcy Act (Cap 20), the Official Assignee takes over the title to your assets and has the responsibility to realise them and pay a dividend to your creditors. You cannot sell or deal with any of your assets or items of value. Only the Official Assignee or a secured creditor is able to do so. Assets include anything of value belonging to you at the date of your bankruptcy or obtained by you after that date, including gifts given to you. You must let the Official Assignee have possession of these assets. At the hearing, your creditor s lawyers will inform the Court as to whether For further information, please visit the IPTO website at they are agreeable to your proposal. If they are agreeable, they may either apply for an adjournment to monitor your payments, or ask for leave to withdraw the Originating Summons against you. If they are not agreeable, the Court may adjourn the hearing to give you more time to make a better proposal, or the Court may make the Bankruptcy Order against you. 6 7

5 19. How much is a bankrupt required to pay to the Official Assignee each month? If you are gainfully employed, you must make a monthly contribution to your bankruptcy estate for the benefit of your creditors. Please note that the amount of payments you make is an important factor considered by the Court or the Official Assignee when deciding whether to discharge you from bankruptcy. The Official Assignee will assess the contribution which you will have to pay each month after taking into account what you reasonably need to upkeep yourself and your family. To assist the Official Assignee to make the assessment, you must provide information about your occupation, income and dependants when requested to do so and update this information by lodging returns with the Official Assignee. Failure to comply with this requirement is an offence punishable on conviction with imprisonment up to two years or a fine up to S$10,000, or both. To facilitate easy and regular payments of your income contribution, the Official Assignee will allow you to operate a savings account and your contribution will be deducted periodically through GIRO. 20. How long will it take before I am discharged from bankruptcy? There is no fixed period before a bankrupt can be discharged. At any time after the making of the Bankruptcy Order, you, the Official Assignee, or any person having an interest in the matter may apply to court for your discharge from bankruptcy if there are good reasons to support the application for discharge. (E) DEBT REPAYMENT SCHEME 21. What is the Debt Repayment Scheme? The Bankruptcy Act was amended to provide for the Debt Repayment Scheme (DRS). The new provisions are applicable to all bankruptcy applications filed on or after 18 May The objective of the DRS is to assist debtors who have debts of less than $100,000 to pay their debts by way of a debt repayment plan over a fixed period of time. This seeks to give creditors their rights, and provide debtors the opportunity for a fresh start in their financial matters. After a bankruptcy application has been made and where the Court considers that on the face of the application, the following criteria have been satisfied, the Court will adjourn the application for the Official Assignee to assess if the debtor is suitable for the DRS: (a) the debts do not exceed $100,000; (b) the debtor is not an undischarged bankrupt and has not been a bankrupt within the past five years; (c) a voluntary arrangement in respect of the debtor is not in effect, and was not in effect within the past five years; (d) the debtor is not subject to any debt repayment scheme, and has not been subject to any such scheme within the past five years; and (e) the debtor is not a sole proprietor, a partner of a firm or a partner in a limited liability partnership. If the Official Assignee assesses the debtor to be suitable for the DRS, a debt repayment plan may commence. Upon commencement of this plan, the adjourned bankruptcy application is deemed withdrawn. If the debtor is found to be unsuitable for the DRS, the Court will proceed to hear the bankruptcy application and may order that the debtor be made a bankrupt. 22. Where can I download the forms to apply for an order of bankruptcy against myself and to apply for the DRS? Forms for the use of debtors can be found on the Supreme Court website at They are: i) Debtor s Bankruptcy Application ii) Affidavit Verifying Statement iii) Statement of Affairs iv) Supporting Affidavit (DRS applies or does not apply, whichever is applicable) Please refer to the section on Bankruptcy Proceedings, located under the Civil Proceedings section, in the Supreme Court website. Please see Question 3 above for the steps in making a bankruptcy application. 23. If I already have a pending bankruptcy application filed prior to the implementation of the DRS, can I still be considered for the scheme? You will not be considered for the DRS if the pending application was filed prior to 18 May 2009, i.e. before the implementation of the DRS. 24. Can I apply for the DRS without filing a Debtor s Bankruptcy Application with the High Court? No. You must first file a Debtor s Bankruptcy Application. Thereafter, if the Court is satisfied on the face of your application that you qualify for the DRS, your case will then be adjourned for the Official Assignee to assess your suitability. 8 9

6 25. Can I file the old form of the Affidavit in Support of Debtor s Bankruptcy Application if my application is made after 18 May 2009? No, the old form is no longer valid. If you choose to file a Debtor s Bankruptcy Application using the old form of Supporting Affidavit, we may reject your application upon filing. Alternatively, we may accept the application but require that you file the new form of Supporting Affidavit. 26. How do I complete paragraph 1 of the Affidavit in Support of Debtor s Bankruptcy Application? You have to state which of the relevant limbs below is applicable to you: (a) that you are domiciled in Singapore; (b) that you have property in Singapore; OR (c) that you have, at any time any time within the period of one year immediately before the date of your application (i) been ordinarily resident or have had a place of residence in Singapore; or (ii) conducted business in Singapore. 27. How do I complete paragraph 4 of the Affidavit in Support of Debtor s Bankruptcy Application? You should first ascertain if you satisfy all limbs in paragraph 4(a) to (i) of the Supporting Affidavit (DRS applies) form. If you do satisfy all the criteria, you should then proceed to complete and file the Supporting Affidavit (DRS applies) form together with the rest of the documents. Upon the filing of your Debtor s Bankruptcy Application, the Court will refer your case to the Official Assignee to assess your suitability for the scheme. Please note that if you do not satisfy any one limb in paragraph 4(a) to (i), you cannot be considered for the DRS. In such a situation, you should be completing the Supporting Affidavit (DRS does not apply) form. 28. If the DRS does not apply to me, how should I complete paragraph 4 of the Affidavit in Support of the Debtor s Bankruptcy Application? You should be completing the Supporting Affidavit (DRS does not apply) form. For paragraph 4, you should decide which of the limbs in paragraph 4 (a) to (i) are applicable to you and delete the rest that are not applicable. (F) DISCHARGE FROM BANKRUPTCY 29. After I am discharged from bankruptcy, can the records be deleted? While your desire to delete such records is understandable, historical records of the Supreme Court cannot be deleted or expunged. However, the discharge status will be shown on the record once a discharge is granted. 30. Why did the bank reject my loan application after I was discharged from bankruptcy? You may wish to speak with the relevant bank officers as each bank has its own policy regarding loan applications. (G) LEGAL AID 31. Can I apply for free legal assistance from the Legal Aid Bureau? It may be possible for you to apply for free legal assistance from the Legal Aid Bureau. However, if your income exceeds the limit prescribed by the Legal Aid Bureau, you may be precluded from applying for legal aid. For more information on legal aid, please visit the Legal Aid Bureau s website at or call them at their toll-free hotline: Should I inform all my creditors about the Debtor s Bankruptcy Application? That is a choice which you will have to make. There is no requirement by law for you to do so. 33. What do I do if the bank has frozen my account pending the outcome of my bankruptcy application? You should approach your bank for clarification on why they have done that. You may also wish to clarify whether you have (in the past) agreed that they may take such measures if a bankruptcy application is commenced against you. For more information on bankruptcy and bankruptcy proceedings in the High Court, please visit