As anyone who’s been through it will know, declaring bankruptcy can be a daunting process – not least because it can involve a court appearance. Here at Bankruptcy Clinic, this is one of the areas that we’re most often asked about, so we’ve prepared this article to give you an idea of what to expect.
Do I have to go to court?
Not always, no. You’ll be told whether or not you’ll need to attend the bankruptcy hearing when you take your bankruptcy documents to the court.
Will the hearing take place straightaway?
This depends on the court. Some courts will arrange for the hearing to take place on the same day as you hand in your documents. Others will set a date and time for you to attend court. You can phone the court beforehand to ask which procedure they follow.
Which court will I attend?
Usually, a bankruptcy hearing will take place at your local county court. You’ll need to have lived in the area for at least six months. However, in some cases it will be the court local to where you work. The system in London is slightly different, as you’ll be required to attend the high court. If you’re not sure where to go, contact your nearest county court (or the high court in London) and they’ll tell you what to do.
What should I wear to court?
It’s a good idea to look smart when you arrive at the court, so you can make the best possible impression. Try to avoid wearing jeans, sportswear or trainers. A smart jacket with trousers or a skirt will be fine, or you can wear a formal suit if you prefer.
What do I do when I arrive?
Start by going to the reception desk and handing over your bankruptcy paperwork, if you haven’t dropped this off at an earlier date. You’ll need to have three copies. You’ll also need to pay your bankruptcy fees, usually in cash, so make sure you have the money with you. The receptionist will then show you where to wait whilst the judge or registrar goes through your documents.
What happens during the hearing?
The judge may go through your paperwork and come to a decision about your bankruptcy in private. Or you may be asked to meet with them in person, normally in their private chambers rather than in a court room. The judge might simply want to confirm a few points, or they may want to go through your application in detail. However, it’s not uncommon for bankruptcy applicants to have no contact with the judge or registrar at all.
How is a Bankruptcy Order made?
If the judge decides to proceed with your bankruptcy, you’ll be given the necessary paperwork with your Bankruptcy Order number on it. You’ll also be given a time and date for your phone interview with the Official Receiver, who’ll go through your paperwork and any queries they might have. Once you have your Bankruptcy Order, you can go home.
What are the other possible outcomes?
There are several other possible outcomes from your bankruptcy hearing. These are:
- Issuing a stay, or delay, to the proceedings because the court feels that more information is required.
- Dismissing your bankruptcy because the court feels you can repay your debts.
- Referring you to an approved Debt Relief Order (DRO) adviser if this would be a better way of managing your debts.
- Referring you to a licensed Insolvency Practitioner for assistance, if the court thinks that an Individual Voluntary Arrangement (IVA) would be your best bet.
What happens next with a Bankruptcy Order?
When your Bankruptcy Order is made, the Official Receiver will take control of your estate and distribute any money or assets to your creditors. You’ll need to cooperate with them throughout the term of your bankruptcy. You may also be asked to make regular or one-off payments towards your debts through an Income Payments Arrangement or Order. These could continue for up to three years, although your bankruptcy would normally be discharged after 12 months.