01 November 2012
Bankruptcy no defence for non-payment of lump sum- family lawyer Edward Kitchen discusses
My colleague Jennifer Nash blogged here last week about the case of Mr amd Mrs McRoberts who have been embroiled in proceedings over Mr McRoberts' failure to pay a proportion of a lump sum to his ex wife.
His case was based on the fact that he was declared bankrupt in 2006. Upon coming out of that bankruptcy his liability to his ex wife should be cleared. Not so, said Mr Justice Hildyard, the judge who heard the case. It is reported that various factors led him to his decision, including the fact that Mr McRoberts had made a Christmas visit to the Maldives which was unrelated to his business activities. We are also told that Mrs McRoberts' barrister argued that any other decision would create a loophole, enabling any bankrupt to escape payments of lump sums ordered within Divorce proceedings.
Whilst no doubt there will be more debate over this case in the next few weeks, there is no doubt that this is a very important decision and one which confirms a degree of protection to anyone who has to face the prospect of dealing with a bankrupt former spouse who still owes a lump sum.
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