Bankruptcy term to be shortened


Bankruptcy will be dischargeable after five years rather than the current 12 under new legislation published by Minister for Justice Alan Shatter.

The Minister has published a Civil Law (Miscellaneous Provisions) Bill 2011 providing for a number of legislative changes relating to domestic violence, immigration, the victims of trafficking, licensing, "good Samaritans" and family maintenance as well as bankruptcy.

The amendments to the Bankruptcy Act 1988 will reduce the application period to the court for discharge of bankruptcy and also provide for the automatic discharge of bankruptcy on the 12th anniversary of the adjudication order. This will lead to the discharge of over 300 "legacy bankruptcies".

These are early reforms to the law on bankruptcy, in line with a commitment in the Programme for Government, according to Mr Shatter. More extensive reforms will follow in a Personal Insolvency Bill, expected in early 2012 and being drawn up in the context of a commitment under the EU/IMF Programme of Financial Support for Ireland.

In order for the court to consider an application for discharge from bankruptcy after five years, the bankrupt will have to have discharged the expenses, fees and costs of the bankruptcy and the preferential payments. The court will also have to be satisfied that the estate of the bankrupt has been fully realised and all property acquired after the bankruptcy has been disclosed.

The Bill will amend the Civil Legal Aid Act to allow the Legal Aid Board provide legal advice to alleged victims of trafficking offences, bringing Irish law into compliance with a range of European conventions and protocols on human trafficking.

The provisions on "good Samaritans" follow a 2009 report from the Law Reform Commission and protect from civil liability those coming to the assistance of others, who act in good faith, without expectation of payment or reward, seeking to provide assistance, advice or care during an accident or emergency.

Such protection will also be provided to those who provide sports, recreation and rescue services on a voluntary basis, provided it is done in a way that does not constitute gross negligence.

The Bill will also provide statutory support for codes of practice in relation to the sale of alcohol. It is proposed such a code is drawn up in consultation with the industry. Failure to comply with the code will constitute a ground on which an objection to a licence may be lodged.

The new Bill also contains measures to separate the collection of family maintenance payments from other civil debt. This follows a High Court judgment which found existing debt enforcement measures through the courts to be unconstitutional, leading to new legislation which made the collection of family maintenance payments more difficult.

The amendment to the law is based on the premise that a court has already deliberated in setting an appropriate level of maintenance. If the debtor breaches that order, without a significant change in circumstances, that will constitute contempt of court.

The Bill amends the Domestic Violence Act 1996 so that a parent may now apply for a safety order against the other parent of their child, even where the parents do not live together and may never have lived together.

The Bill also contains an amendment to the 2004 Immigration Act to replace a measure making it a criminal offence for a non-national to fail to produce a passport.
This was recently struck down by the High Court as unconstitutional.