Thursday, 2 July 2009

HOBS - Purposes of Bankruptcy and the Bankruptcy Mesh- an early 20th century view

In the 17th edition of Ringwood's Principles of Bankruptcy (Sweet & Maxwell, London, 1936) the then editor, Mr Alma Roper, observed that:
"The law of bankruptcy is designed to meet the case of an individual who has no reasonable prospect of being able to pay his debts...The task of weaving a mesh coarse enough to let the honest man through, but fine enough to catch the scoundrel, has proved to be one of extraordinary difficulty, and the tendency to tighten up the bankruptcy law has been pronounced of recent years."
This statement was published in 1936. Some commentators might argue that the mesh has now been relaxed to a sticky paper like substance that is easily cast to one side in terms of general discharge but that the BRO/BRU procedures ensure that the "scoundrels" cannot escape their liability quite so easily. Others would posit that the aftermath of passing through the mesh for general discharge is still something which should be avoided at all costs because of the attendant stigma, bank account access, and so forth. Have we struck the right balance yet? This blog has a number of quizzes on the right hand side. One asks: Is a one year automatic discharge period prior to discharge from bankruptcy unduly lenient? We might also add - does the BRO/BRU procedure work to filter out the miscreants? Is the mesh sufficiently tight?

Picture Credit: http://s3.images.com/huge.85.428168.JPG

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