Terminology

Act of bankruptcy

This in a declaration or an action, if it is seen through it can be used by a creditor in order to apply to the Court to make a person bankrupt.

^Back To Top

Administrator

An eligible person whom the debtor nominates to handle a Debt Agreement on their behalf.

^Back To Top

Asset

Anything a person owns before going bankrupt, or buys or receives during bankruptcy, they can be divide into two kinds Exempt and Divisible assets.

^Back To Top

Bankruptcy

A process where people, who cannot pay their debts as they fall due. It means that the property can be fairly distributed amongst the creditors and that there can be prosecution of dishonest debtors.

^Back To Top

Creditor

A creditor of a company is the person to whom the money is owed to.

^Back To Top

Creditor's Petition

This is where the creditor applies to the court to make a debtor bankrupt.

^Back To Top

 Debt Agreement

A debt agreement allows a debtor to enter into an arrangement with their creditors to satisfy their debts without being made bankrupt.

^Back To Top

Debtor  

A debtor is a person who owes money to a creditor
 

^Back To Top

Divisible Assets

Assets/property which can legally be sold in bankruptcy by the trustee.
 

^Back To Top

Insolvent

A person is considered to be insolvent when they are unable to pay their debts as and when they fall due.

^Back To Top

ITSA

Insolvency and Trustee Service, Australia. It is the Commonwealth Government agency that becomes the trustee when a private bankruptcy trustee is not appointed in a bankruptcy or other arrangement under the Bankruptcy Act.
 

^Back To Top

Liquidation

Liquidation is the process which prepares a company for deregistration.
 

^Back To Top

Official Receiver

Is a person who administers statutory functions under the Bankruptcy Act for the government and the ITSA.
 

^Back To Top

Official Trustee in Bankruptcy

This is the government counterpart of a registered trustee. This role is performed by employees at ITSA.
 

^Back To Top

Part IX

This is commonly known as a Debt Agreement. It is a flexible formal agreement entered into with creditors.
 

^Back To Top

Part X

This is a formal arrangement also known as a Personal Insolvency Agreement whereby an insolvent individual enters into an agreement with creditors.  

^Back To Top

Resolution

A resolution passed by a majority in value of the creditors present personally, by telephone, by attorney or by proxy at a meeting of creditors and voting on the resolution.

^Back To Top

Receivership

It is a form of administration which can apply to corporations, partnerships and individuals when they are in financial difficulty.

^Back To Top

Trustee