INS11109 - Introduction
Insolvency proceedings are not a recovery procedure
Insolvency proceedings are not to be used to
‘punish’ non-payers, nor used solely to recover debt.
The object is to preserve the debtor's assets for distribution
amongst creditors.
Your actions are governed by the need to comply with the
insolvency legislation and the decisions of the Court.
- Registrars in the Bankruptcy and Companies Courts
are likely to criticise creditors using court processes as
collection devices.
- Do not use the courts as a threat to ensure
instalment arrangements are honoured.
- Avoid phrases such as ‘Bankruptcy
proceedings will be continued for recovery of the debt’.
- Repeated monthly adjournments for the next payment
may be regarded as an abuse, they also block other creditors from
taking action.
