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Bankruptcy
The administration of the affairs of an insolvent individual, by an Insolvency Practitioner, appointed by the court and known as the trustee in bankruptcy, whereby the bankrupt's assets are realised for the benefit of the creditors.

Bankruptcy Order
A court order declaring an individual is bankrupt.

Creditor
A person or organisation owed money by a company or an individual.

Fixed Charge
Specific assets, named in a debenture, are charged to a creditor (often a bank) - the company is thus prevented from realising or dealing with the assets without the consent of this secured creditor.

Floating Charge
A charge granted to a creditor that is a 'floating charge' - that is the assets may change over time in the normal course of business.

Meeting of Creditors
A formal meeting where creditors appoint an Insolvency Practitioner as trustee or liquidator in place of the Official Receiver, or, at fixed periods during the administration, receivership or liquidation, when creditors meet to discuss the progress of an appointment.

Official Receiver
A civil servant employed by the DTI who is ultimately responsible for bankruptcies and compulsory liquidations.

Proxy
Authority given by a creditor or member to another person (proxy holder) to attend, speak and vote at a meeting on behalf of the creditor or member.

Statement of Affairs
A document detailing the assets and liabilities of the bankrupt or the insolvent company completed by the director of the company concerned.

Statutory Demand
A formal notice requiring payment of a debt exceeding £750 within 21 days, in default of which bankruptcy or winding up proceedings may be commenced.

Unsecured Creditor
A creditor who does not hold security (eg. a mortgage) over a debt and one who is not given preferential status under the Insolvency Act 1986. In general most creditors other than employees are unsecured.

Winding up Petition
A petition presented to the court on behalf of a creditor, usually by a solicitor to grant a winding up order over an insolvent company.

Winding up Order
An order made by a court for a company to be placed in compulsory liquidation.

 

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