Bankruptcy - Creditor's Petition

If you are owed a substantial debt by an individual debtor who refuses to pay then you may need to consider bankrupting that person by using a “Creditor’s Petition”.  

Generally, the petition is based on “an act of bankruptcy”. The “creditor’s petition” must be presented within 6 months of the date of the act of bankruptcy ~ s 44 (1) (c) to the Bankrupty Act 1966 (Cth). This six-month period cannot be extended.

Some of the requirements of a creditor's petition are: -

• The petition must set out the debtor's connection to Australia (as at that time of the act of bankruptcy). 
• The debt must be liquidated and payable.
• The debt does not have to be a judgement debt although that helps.
• The debt must be for $5000 (or more). It may comprise more than one debt which together exceed $5000. 
• Two or more creditors can join in a petition. The debt, of $5000 or more, must exist as at the time of the act of bankruptcy and also at the time of presentation of the creditors petition. 

* This content does not purport to give legal advice. Readers must obtain their own legal advice, that applies to the particular circumstances of their case, before taking any action at all.