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[This Act incorporates the Bankruptcy (Amendment) Act No 109 of 1992]
Arrangement of Rules
Part I: Proceedings from Act of Bankruptcy to discharge
Acts of Bankruptcy
|1.||Acts of bankruptcy.||2.||Bankruptcy notices.||3.||Jurisdiction to make receiving order.|
|4.||Conditions on which creditor may petition.||5.||Liability of firm to have receiving order made against it.||6.||Powers of Official Receiver and duties of debtor on petition being filed.|
|7.||Creditor’s petition and order thereon.||8.||Debtor’s petition and order thereon.||9.||Appearance of Official Receiver on petition.|
|10.||Effect of receiving order.||11.||Power to appoint interim receiver.||12.||Power to stay pending proceedings.|
|13.||Power to appoint special manager.||14.||Advertisement of receiving order.||15.||First and other meetings of creditors.|
|16.||Debtor’s statement of affairs.|
Public examination of debtor
|17.||Public examination of debtor.||18.||Compositions and schemes of arrangement.||19.|
Adjudication of bankruptcy
|20.||Adjudication of bankruptcy where composition not accepted or not approved.||21.||Appointment of trustee.||22.||Committee of inspection.|
|23.||Power to accept composition or scheme after adjudication.|
Control over person and property of debtor
|24.||Duties of debtor as to discovery and realization of property.||25.||Arrest of debtor under certain circumstances.||26.||Re-direction of debtor’s telegrams and letters.|
|27.||Inquiry as to debtor’s conduct, dealings and property.||28.||Discharge of bankrupt.||29.||Effect of discharge.|
|30.||Power of court to annul adjudication in certain cases.||31.||Automatic discharge of a bankrupt.|
Part II: Administration of property
Proof of debts
|32.||Description of debts provable in bankruptcy.||33.||Mutual credit and set off.||34.||Rules as to proof of debts.|
|35.||Priority of costs and charges.||36.||Priority of debts.||37.||Preferential claims in case of apprenticeship.|
|38.||Landlord’s power of distress.||39.|| Postponement of husband’s and wife’s claims.
Property available for payment of debts
|40.||Relation back of trustee’s title.||41.||Description of bankrupt’s property divisible amongst creditors.||42.||Provisions as to second bankruptcy.|
Effect of bankruptcy on antecedent and other transactions
|43.||Restriction of rights of creditor under execution or attachment.||44.||Duties of bailiff as to goods taken in execution.||45.||Avoidance of general assignments of book debts unless registered.|
|46.||Avoidance of preference in certain cases.||47.||Protection of bona fide transaction without notice.||48.||Recovery of property transferred without knowledge of receiving order.|
|49.||Validity of certain payments to bankrupt and assignee.||50.||Dealings with undischarged bankrupt.
Realisation of Property
|51.||Possession of property by trustee.||52.||Seizure of property of bankrupt.||53.||Sale of property out of Nigeria.|
|54.||Appropriation of portion of pay etc. to creditors.||55.||Vesting and transfer of property.||56.||Disclaimer of onerous property.|
|57.||Powers of trustee to deal with property.||58.||Powers exercisable by trustee with permission of committee of inspection.||59.||Power to allow bankrupt to manage property.|
|60.||Allowance to bankrupt for maintenance or service.||61.||Right of trustee to inspect goods pawned, etc.||62.||Limitation of trustees powers in relation to copyright.|
|63.||Protection of Official Receiver and trustee from personal liability in certain cases.|
Distribution of Property
|64.||Declaration and distribution of dividends.||65.||Joint and separate dividends.||66.||Provision for creditors residing at a distance, etc.|
|67.||Right of creditor who has not proved debt before declaration of a dividend.||68.||Interest on debts.||69.||Final dividends.|
|70.||No action for dividend.||71.||Right of bankrupt to surplus.|
|72.||The Official Receiver.||73.||Status of Official Receiver.||74.||Duties of Official Receiver as regards the debtor’s conduct.|
|75.||Duties of Official Receiver as to debtor’s estate.|
Part IV: Trustees in bankruptcy
|77.||Power to appoint joint or successive trustees.||78.||Proceedings in case of vacancy in office of trustees.|
Control of Trustee
|79.||Discretionary powers of trustee and control thereof.||80.||Appeal to court against trustee.||81.||Control of court over trustee.|
|82.||Remuneration of trustee.||83.||Allowance and taxation of costs.|
Receipts, payments, accounts and audit
|84.||Trustee to furnish list of creditors.||85.||Trustee to furnish statement of accounts.||86.||Annual statement of proceedings.|
|87.||Trustee not to pay into private accounts.||88.||Payment of money into banks.||89.||Records and account to be kept by trustee.|
|90.||Audit of trustee’s account.|
Vacation of Office by Trustee
|91.||Release of trustee.||92.||Office of trustee vacated by insolvency.||93.||Removal of trustee.|
Part V: Constitution, Procedure and Powers of Court
Review and Appeals
|96.||General rules of procedure.||97.||Discretionary power of court.||98.||Consolidation of petitions.|
|99.||Power to change or substitute creditors.||100.||Continuance of proceedings on death of debtor.||101.||Power to stay proceedings.|
|102.||Power to present petition against one partner.||103.||Power to dismiss petition against some respondents only.||104.||Actions by trustee and bankrupt’s partner.|
|105.||Actions on joint contracts.||106.||Proceedings in partnership|
Part VI: Supplemental Provisions
Disobedience to order of court
Application of Act
|108.||Exclusion of corporations and companies.||109.||Administration in bankruptcy of estate of person dying insolvent.|
Fees and Remuneration
|111.||Fees and remuneration.||112.||Disposal of Official Receiver’s fees.|
|113.||Evidence of proceedings at meetings of creditors.||114.||Evidence of proceedings in bankruptcy.||115.||Swearing of affidavit.|
|116.||Death of debtor or witness.||117.||Statements made by Official Receiver or trustee through an interpreter.||118.||Certificate of appointment of trustee.|
|119.||Computation of time.||120.||Service of notices.||121.||Formal defect not to invalidate proceedings.|
|122.||Exemptions of deeds, etc. from stamp duty.||123.||Action of corporations, partners, etc.||124.||Certain provisions to bind the State.|
Unclaimed Funds’ or Dividends
Part VII: Disqualification of Bankruptcy
|126.||Disqualifications of bankrupt.||127.||Offences and penalty.||128.||Vacation of office, etc. by bankrupt.|
Part VIII: Bankruptcy offences
|129.||Fraudulent debtors.||130.||Certain offences by persons other than the debtor.||131.||Undischarged bankrupt obtaining credit.|
|132.||Frauds by bankrupts, etc.||133.||Bankrupt guilty of gambling, etc.||134.||Bankrupt failing to keep proper account.|
|135.||Bankrupt absconding with property.||136.||Debtor concealing himself to avoid service, etc.||137.||False claim, etc.|
|138.||Order by court for prosecution on report of trustee.||139.||Criminal liability after discharge or composition.||140.||Trial and punishment of offences.|
Part IX: Supplementary
An Act to make provisions for declaring as bankrupt any person who cannot pay his debts of a specified amount and to disqualify him from holding certain elective and other public offices or from practicing any regulated profession (except as an employee).
[20th day of April 1979] [Commencement]
Part I: Proceedings from act of bankruptcy to discharge
Acts of Bankruptcy
(a) if a creditor –
(i) has obtained a final judgment or final order against him for any amount, and execution thereon not having been stayed, has a bankruptcy notice served on him, and
(ii) does not, within fourteen days after service of the notice, comply with the requirements of the notice or satisfy the court that he has a counter-claim, set off or cross demand which equals or exceeds the amount of the judgment debt or sum ordered to be paid, and which he could not set up in the action in which the judgment was obtained or the proceedings in which the order was obtained,
and for the purposes of this paragraph and of section 4. any person who is for the time being entitled to enforce a final judgment or final order shall be deemed to be a creditor who has obtained a final judgment or final order;
(b) if execution against him has been levied by seizure of his goods under process in an action, or proceedings in the court, and the goods have either been sold or held by the bailiff for twenty-one days:
Provided that, where an inter-pleader summons has been taken out in regard to the goods seized, the time elapsing between the date at which such summons is taken out and the date at which the proceedings on such summons are finally disposed of, settled or abandoned shall not be taken into account in calculating such period of twenty-one
(c) if he files in the court a declaration of his inability to pay his debts or presents a bankruptcy petition against himself.
(d) if he suspends or gives notice that he is about to suspend payment of his debts to any of his creditors; or
(e) if under a credit agreement the creditor becomes entitled to file a bankruptcy petition; or
(f) if, in Nigeria or elsewhere, he makes a conveyance or assignment of his property to a trustee or trustees for the benefit of his creditor generally; or
(g) if, in Nigeria or elsewhere, he makes a fraudulent conveyance gift, delivery or transfer of his property or any part thereof, with an intent to defeat or delay the claim of his creditors; or
(h) if, in Nigeria or elsewhere, he makes any conveyance or transfer of his property or any part thereof; or created any charge thereon, which would under this or any other Act be void as a fraudulent preference if he were adjudged bankrupt; or
(i) if, with intent to defeat or delay the claims of his creditors, he departs out of Nigeria, or being out of Nigeria remains out of Nigeria, or departs from his dwelling, or otherwise absents himself, or begins to keep house.
Provided that a bankruptcy notice-
(a) may specify an agent to act on behalf of the creditor in respect of any payment or other thing required by the notice to be made to, or done to the satisfaction of, the creditor;
(b) shall not be invalidated by reason only that the sum specified in the notice as the amount due exceeds the amount actually due, unless the debtor within the time allowed for payment gives notice to the creditor that he disputes the validity of the notice on the ground of such mis-statement; but if the debtor does not give such notice, he shall be deemed to have complied with the bankruptcy notice if within the time allowed he takes such steps as would have constituted a compliance with the notice had the actual amount due been correctly specified therein.
(a) the debt owing by the debtor to the petitioning creditor, or if two or more creditors join in the petition, the aggregate amount of debts owing to the several petitioning creditors, is not less than N2,000;
(b) the debt is a liquidated sum, payable either immediately or at some certain future time;
(c) the act of bankruptcy on which the petition is grounded has occurred within three months before the presentation of the petition; and
(d) the debtor is ordinarily resident in Nigeria, or within a year before the date of the presentation of the petition, has ordinarily resided or had a dwelling-house or place of business in Nigeria, or has carried on business in Nigeria, personally or by means of an agent or manager, or is or within the said period has been a member of a firm or partnership of persons which has carried on business in Nigeria by means of a partner or partners or an agent or manager.
(2) If the petitioning creditor is a secured creditor he shall in his petition either state that he is willing to give up his security for the benefit of the creditors in the event of the debtor being adjudged bankrupt, or give an estimate of the value of his security; in the latter case he may be admitted as a petitioning creditor to the extent of the balance of the debt due to him after deducting the value so estimated in the same manner as if he were an unsecured creditor.
(3) Notwithstanding the provisions of any other law or enactment and without prejudice to any other rights of the debtor, a creditor who is entitled to present a bankruptcy petition on or before the end of December, 1992 shall not be disentitled from presenting a petition by virtue only of the provisions of section 4(1) (c) of this Act if the petition is presented before the expiration of a period of six months.
(a) a creditor of the firm shall be entitled to present a bankruptcy petition against the firm, and a receiving order may be made against the firm in respect of an act of bankruptcy committed in reference to the business of the firm by any partner of the firm or by any person having control or management of the business of the firm. An act of bankruptcy shall be deemed to be committed in reference to the business of the firm in all cases in which the act relates to the property or creditors of the firm and would be an act of bankruptcy by such partner or person as aforesaid if it related to his property or creditors;
(b) it shall be sufficient that a receiving order against the firm be made in the firm’s name, without mentioning the names of the partners, and such receiving order shall affect the joint and separate property of all the partners;
(c) the right of a creditor to present a bankruptcy petition against the firm, and the jurisdiction of the court to make a receiving order or an adjudication of bankruptcy against the firm, shall not be affected by the fact, if it is so, that all or any of the partners of the firm are not citizens of Nigeria or are not resident in Nigeria.
6.(1) Immediately on the filing of any petition the Official Receiver may in cases where he has reason to believe that any offence under this Act or any fraud has been or is about to be perpetrated, by notice delivered to the debtor in person or by ordinary post, summon the debtor to attend before him to give such information as he requires, and may, either by himself or his agent authorised by him in writing, enter on any premises occupied by the debtor between the hours of 8 a.m. and 6 p.m. for the purpose of inspecting his property, stock in trade and books of account.
(2) It shall be the duty of the debtor to furnish the Official Receiver with all such information as it is in the debtor’s power to give or to obtain.
(3) If the debtor –
(a) fails without reasonable cause to attend to the Official Receiver as aforesaid or to furnish him with such information as aforesaid; or
(b) obstructs the search of the premises or the production of any book or document required in connection therewith; or
(c) authorizes or permits any obstruction,
the debtor shall be liable on summary conviction to imprisonment for a term not exceeding six months.
(4) Every person who takes any part in any obstruction mentioned in subsection (3)(b) and (c) of this section, whether authorised or permitted by the debtor or not, shall be liable to the like penalty.
7.(1) A creditor’s petition shall –
(a) be verified by affidavit of the creditor or of some person on his behalf, having knowledge of the facts; and
(b) be served in the same manner as a writ of summons unless some other manner of service be prescribed.
(2) At the hearing, the court shall require proof of
(a) the debt of the petitioning creditor;
(b) the service of the petition; and
(c) the act of bankruptcy, or if more than one act of bankruptcy is alleged, acts of bankruptcy,
and if satisfied with the proof, may make a receiving order in pursuance of the petition.
(3) If the court is not satisfied with the proof of the petitioning creditor’s debt or of the act of bankruptcy or of the service of the petition, or is satisfied by the debtor that he is able to pay his debts, or is not satisfied that the assets for division among the unsecured creditors, after payment of all costs, charges and expenses, and the debts which are preferential under this Act shall be sufficient to pay a dividend of fifteen per cent, or considers that for other sufficient cause no order ought to be made, the court may dismiss the petition.
(4) When the act of bankruptcy relied on is non-compliance with a bankruptcy notice to pay, secure or compound for a judgment debt or sum ordered to be paid, the court may, if it thinks fit, stay or dismiss the petition on the ground that an appeal is pending from the judgment or order.
(5) Where the debtor appears on the petition and denies that he is indebted to the petitioner, or that he is indebted to such an amount as would justify the petitioner in presenting a petition against him, the court, on such security (if any) being given as the court may require for payment to the petitioner of any debt which may be established against him in due course of law, and of the costs of establishing the debt, may, instead of dismissing the petition, stay all proceedings on the petition for such time as may be required for trial of the question relating to the debt.
(6) Where proceedings are stayed the court may, if by reason of the delay caused by the stay of proceedings or for any other cause it thinks just, make a receiving order on the petition of some other creditor, and shall thereupon dismiss, on such terms as it thinks just, the petition in which proceedings have been stayed as aforesaid.
(7) A creditor’s petition shall not after presentment be withdrawn without the leave of the court.
8.(1) A debtor’s petition shall allege that the debtor is unable to pay his debts, and the presentation thereof shall be deemed an act of bankruptcy without the previous filing by the debtor of any declaration of inability to pay his debts, and the court shall thereupon make a receiving order:
Provided that it shall be lawful for the court in its discretion to refuse the order if it is not satisfied that the assets for division among the unsecured creditors after payment of all costs, charges and expenses, and the debts which are preferential under this Act, will be sufficient to pay a dividend of fifteen per cent, or if the court considers for other sufficient cause that no order ought to be made.
(2) In subsection (1) of this section “sufficient cause” includes the non-attendance of the debtor, or in the case of a firm, of at least one of the partners thereof, on the hearing of the petition, the absence of any material book of account, or any fraud or misconduct not amounting to fraud by the debtor in relation to his affairs, or in the case of a firm or person carrying on business under a foreign firm name, the non-production of the partnership book or of the receipt used in connection with the business.
(3) A debtor’s petition shall not after presentment be withdrawn without the leave of the court.
(2) This section shall not affect the power of any secured creditor to realize or otherwise deal with his security.
(2) Where the court makes an order staying any action or proceeding, or staying proceedings generally, the order may be served by sending a copy thereof, under the seal of the court, by post to the address for service of the plaintiff and any other party to the proceedings or to the address of the legal practitioner of such party.
(3) Without prejudice to the provisions of subsection (1) of this section if the court orders the release of any debtor who is under execution for a civil debt, it may impose such conditions as it thinks fit, and in particular it may require as a condition of such release that the debtor finds security to attend in the subsequent bankruptcy proceedings and to abide by all orders of the court relating to the said proceedings.
(2) The special manager shall give security and account in such manner as the court may direct.
(3) The special manager shall receive such remuneration as may be prescribed.
(2) The Chief Judge of the court may, with the approval of the National Council of Ministers, make rules providing for the summoning of and proceedings at the first and other meetings of creditors.
(a) showing the particulars of the debtor’s assets, debts and liabilities, whether in Nigeria or elsewhere;
(b) showing the securities held by them respectively. and the dates when the securities were respectively given:
(c) giving such further or other information as may be prescribed or as the Official Receiver may require: and
(d) giving details of all property held by him in a name or under any alias, or by his wife or his children, or by any person in trust for him or them, with full particulars as to the manner and date of its being acquired.
(2) The statement shall be submitted within the following times, namely–
(a) if the order is made on the petition of the debtor, within seven days from the date of the order;
(b) if the order is made on the petition of a creditor, within fourteen days from the date of the order,
but the court may in either case for special reasons extend the time.
(3) If the debtor fails without reasonable excuse to comply with the requirements of this section, he may be punished for a contempt of court and the court may, on the application of the Official Receiver or of any creditor. adjudge him bankrupt.
(4) Any person stating himself to be a creditor of the bankrupt may, on payment of the prescribed fee, personally or by agent inspect the statement at all reasonable times and take any copy thereof or extract therefrom. but any person untruthfully so stating himself to be a creditor shall be guilty of contempt of court and shall be punishable accordingly on the application of the trustee or Official Receiver.
(2) The examination shall be held as soon as conveniently may be after the expiration of the time for the submission of the debtor’s statement of affairs.
(3) The court may adjourn the examination from time to time.
(4) Any creditor who has tendered a proof, or his representative authorised in writing, may question the debtor concerning his affairs and the causes of his failure.
(5) The Official Receiver shall take part in the examination of the debtor, and for the avoidance of doubt no legal practitioner shall be allowed to take part in the examination of the debtor or appear on his behalf at such examination.
(6) If a trustee is appointed before the conclusion of the examination he may take part therein.
(7) The court may put such questions to the debtor as it may think expedient.
(8) The debtor shall be examined upon oath and it shall be his duty to answer all such questions as the court may put or allow to be put to him.
(9) Such notes of the examination as the court thinks proper shall be taken down either in shorthand or longhand and they or a transcript thereof shall be read over either to or by the debtor and signed by him and may thereafter, save as in this Act provided, be used in evidence against him; they shall also be open to the inspection of any creditor at all reasonable times upon payment of the prescribed fee.
(10) When the court is of opinion that the affairs of the debtor have been sufficiently investigated, it shall by order declare that his examination is concluded, but such order shall not be made until after the day appointed for the first meeting of creditors.
(11) Where the debtor suffers from any mental or physical disability as in the opinion of the court makes him unfit to attend his public examination, or is absent from Nigeria, the court may make an order dispensing with such examination or direction that the debtor be examined on such terms, in such manner and at such place as to the court seems expedient.
Compositions and Schemes of Arrangement
(2) In such case the Official Receiver shall hold a meeting of creditors before the pubic examination of the debtor is concluded, and send to each creditor before the meeting a copy of the debtor’s proposal with a report thereon; and if at the meeting a majority in number and not less than two thirds in value of all the creditors who have proved resolve to accept the proposal, it shall be deemed to be duly accepted by the creditors, and when approved by the court shall be binding on all the creditors.
(3) The debtor may at the meeting amend the terms of his proposal, if the amendment is in the opinion of the Official Receiver calculated to benefit the general body of creditors.
(4) Any creditor who has proved his debt may assent to or dissent from the proposal by a letter addressed to the Official Receiver so as to be received by him not later than three days preceding the meeting, and any such assent or dissent shall have effect as if the creditor had been present and had voted at the meeting.
(5) The debtor or the Official Receiver may, after the proposal is accepted by the creditors, apply to the court to approve it, and notice of the time appointed for hearing the application shall be given to each creditor who has proved.
(6) The application shall not be heard until after the conclusion of the public examination of the debtor and any creditor who has proved may be heard by the court in opposition to the application, notwithstanding that he may, at a meeting of creditors, have voted for the acceptance of the proposal.
(7) For the purpose of approving a composition or scheme by joint debtors the court may, if it thinks fit and on the report of the Official Receiver that it is expedient so to do, dispense with the public examination of any of the joint debtors if they are or any one of them is prevented from attending the examination by illness or other sufficient cause or absence from Nigeria but one at least of such joint debtors shall be publicly examined.
(8) The court shall before approving the proposal hear a report of the Official Receiver as to the terms thereof and as to the conduct of the debtor, and any objections which may be made by or on behalf of any creditor.
(9) If the court is of opinion that the terms of the proposal are not reasonable or are not calculated to benefit the general body of creditors, the court shall refuse to approve the proposal.
(10) If any facts are proved on proof of which the court would be required either to refuse, suspend or attach conditions to the debtor’s discharge where he is adjudged bankrupt, the court shall refuse to approve the proposal unless it provides reasonable security for the payment of not less than twenty-five per cent on all the unsecured debts provable against the debtor’s estate.
(11) In any other case the court may either approve or refuse to approve the proposal.
(12) If the court approves the proposal, the approval may be testified by the seal of the court being attached to the instrument containing the terms of the proposed composition or scheme, or by the terms being embodied in an order of the court.
(13) A composition or scheme accepted and approved in pursuance of this section shall be binding on all the creditors so far as it relates to any debts due to them from the debtor and provable in bankruptcy.
(14) A certificate of the Official Receiver that a composition or scheme has been duly accepted and approved shall, in the absence of fraud, be conclusive as to its validity.
(15) The provisions of a composition or scheme under this section may be enforced by the court on application by any person interested, and any disobedience of an order of the court made on the application shall be deemed a contempt of court.
(16) If default is made in payment of any instalment due in pursuance of the composition or scheme, or if it appears to the court on satisfactory evidence that the composition or scheme cannot, in consequence of legal difficulties or for any sufficient cause, proceed without injustice or under delay to the creditors or to the debtor, or that the approval of the court was obtained by fraud, the court may, if it thinks fit, on application by the Official Receiver or the trustee or by any creditor, adjudge the debtor bankrupt and annul the composition or scheme, but without prejudice to the validity of any sale, disposition or payment duly made or thing duly done under or in pursuance of the composition or scheme.
(17) Where a debtor is adjudged bankrupt under subsection (16) of this section, any debt provable in other respects, which has been contracted before the adjudication, shall be provable in the bankruptcy.
(18) If under or in pursuance of a composition or scheme a trustee is appointed to administer the debtor’s property or manage his business or to distribute the composition, section 27 and Part IV of this Act shall apply as if the trustee were a trustee in bankruptcy and as if the terms “bankruptcy”, “bankrupt” and “order of adjudication” included respectively a composition or scheme of arrangement, a compounding or arranging debtor and an order approving the composition or scheme.
(19) Part II of this Act shall, so far as the nature of the case and the terms of the composition or scheme admit, apply thereto; the same interpretation being given to the words “trustee”, “bankruptcy”, “bankrupt” and “order of adjudication” as in subsection 18 of this section.
(20) No composition or scheme shall be approved by the court which does not provide for the payment in priority to other debts of all debts directed to be so paid in the distribution of the property of a bankrupt.
(21) The acceptance by a creditor of a composition or scheme shall not release any person who under this Act would not be released by an order of discharge if the debtor had been adjudged bankrupt.
(2) Notice of every order adjudging a debtor bankrupt, stating the name, address and description of the bankrupt, the date of the adjudication and the name of the trustee, shall be published in the Federal Gazette and shall be advertised in at least two newspapers, or as may be prescribed, and the date of the order shall, for the purposes of this Act, be the date of the adjudication.
(3) It shall be sufficient that an adjudication order against a firm be made in the firm’s name without mentioning the names of the partners, and such adjudication order shall affect the joint and separate property of all the partners.
(2) The person appointed shall, unless he is the Official Receiver, give such security as the court may direct or as may be prescribed, and the court, if satisfied with the security, shall certify under the hand of the Registrar that his appointment has been duly made, unless the appointment is disapproved by the court on the ground that it has not been made in good faith by a majority in value of the creditors voting, or that the person appointed is not fit to act as trustee, or that his connection with or relation to the bankrupt or his estate or any particular creditor makes it difficult for him to act with impartiality in the interests of the creditors generally.
(3) The appointment of a trustee shall take effect as from the date of the certificate.
(4) When a debtor is adjudged bankrupt after the first meeting of creditors has been held and a trustee has not been appointed prior to the adjudication, the Official Receiver shall forthwith summon a meeting of creditors for the purpose of appointing a trustee; and if no trustee is then appointed by the creditors the court shall on the application of the Official Receiver appoint the Official Receiver or some other fit person to be trustee.
(2) The committee of inspection shall consist of not more than five nor less than three persons, possessing one or other of the following qualifications, that is-
(a) that of being a creditor or the holder of a general proxy or general power of attorney from a creditor, provided that no creditor and no holder of a general proxy or general power of attorney from a creditor shall be qualified to act as a member of the committee of inspection until the creditor has proved his debt and the proof has been admitted; or
(b) that of being a person to whom a creditor intends to give a general proxy or general power of attorney, provided that no such person shall be qualified to act as a member of the committee of inspection until he holds such a proxy or power of attorney, and until the creditor has proved his debt and the proof has been admitted.
(3) The committee of inspection shall meet at such times as it shall from time to time appoint and failing such appointment, at least once a month, and the trustee or any member of the committee may also call a meeting of the committee as and when he thinks necessary.
(4) The committee may act by a majority of its members present at a meeting, but shall not act unless a majority of the committee is present at the meeting.
(5) Any member of the committee may resign his office by notice in writing signed by him and delivered to the trustee.
(6) If a member of the committee becomes bankrupt, or compound or arranges with his creditors, or is absent from five consecutive meetings of the committee, his office shall thereupon become vacant.
(7) Any member of the committee may be removed by an ordinary resolution at any meeting of creditors of which seven days’ notice has been given stating the object of the meeting.
(8) On a vacancy occurring in the office of a member of the committee, the trustee shall forthwith summon a meeting of creditors for the purpose of filling the vacancy, and the meeting may, by resolution, appoint another creditor or other person eligible as above to fill the vacancy.
(9) The continuing members of the committee, provided there be not less than three such continuing members, may act notwithstanding any vacancy therein and, where the number of members of the committee of inspection is for the time being less than five, the creditors may increase that number so that it does not exceed five.
(10) If there be no committee of inspection any act or thing or any direction or permission by this Act authorised or required to be done or given by the committee may be done or given by the court on the application of the trustee.
(2) If the court approves the composition or scheme it may make an order annulling the bankruptcy and vesting the property of the bankrupt in him or in such other person as the court may appoint on such terms and subject to such conditions, if any, as the court may declare.
(3) If default is made in payment of any instalment due in pursuance of the composition or scheme, or if it appears to the court that the composition or scheme cannot proceed without injustice or undue delay, or that the approval of the court was obtained by fraud, the court may, if it thinks fit, on application by any person interested, adjudge the debtor bankrupt and annul the composition or scheme, but without prejudice to the validity of any sale, disposition or payment duly made or thing duly done under or in pursuance of the composition or scheme.
(4) Where a debtor is adjudged bankrupt under subsection (3) of this section, all debts, provable in other respects, which have been contracted before the date of such adjudication shall be provable in the bankruptcy.
Control over Person and Property of Debtor
(2) Every aforementioned debtor shall–
(a) give such inventory of his property, such list of his creditor and debtors and of the debts due to and from them respectively;
(b) submit to such examination in respect of his property or his creditors;
(c) attend such other meetings of his creditors;
(d) wait as such times on the Official Receiver, special manager or trustee;
(e) execute such powers of attorney, conveyances, deeds and instruments; and
(f) generally do all such acts and things in relation to his property and the distribution of the proceeds amongst his creditors. as may be reasonably required by the Official Receiver, special manager or trustee or as may be provided by this Act; or be prescribed or be directed by the Court by any special order or orders made in reference to any particular case or made on the occasion of any special application by the Official Receiver, special manager, trustee or any creditor or person interested.
(3) Every aforementioned debtor shall, if adjudged bankrupt aid to the utmost of his power in the realisation of his property and the distribution of the proceeds among his creditors.
(4) If such a debtor willfully fails to perform the duties imposed on him by this section or to deliver up possession of any part of his property, which is divisible amongst his creditors under this Act which is for the time being in his possession or under his control, to the Official Receiver or to the trustee or to any person authorised by the court to take possession of it, he shall, in addition to any other punishment to which he may be subject, be guilty of a contempt of court and may be punished accordingly.
(a) if, after a bankruptcy notice has been issued under this Act or after presentation of a bankruptcy petition by or against him, it appears to the court that there is probable cause for believing that he has absconded, or is about to abscond, with a view of avoiding payment of the debt in respect of which the bankruptcy petition, or of avoiding appearance to any such petition, or of avoiding examination in respect of his affairs, or of otherwise avoiding, delaying or embarrassing proceedings in bankruptcy against him;
(b) if, after presentation of a bankruptcy petition by or against him, it appears to the court that there is probable cause for believing that he is about to dispose of or remove his goods with a view to preventing or delaying possession being taken of them by the Official Receiver or trustee, or that there is probable ground for believing that he has concealed or is about to conceal or destroy any of his goods or any books, documents or writings which might be of use to his creditors in the course of his bankruptcy;
(c) if, after service of a bankruptcy petition on him or after a receiving order is made against him, he removes any goods in his possession above the value of N50 or the aggregate of N50 in any one period of thirty days without the leave of the Official Receiver or trustee;
(d) if without good cause shown he fails to attend any examination ordered by the court;
(e) if there is probable cause of believing that he has committed an offence punishable under this Act:
Provided that no arrest upon a bankruptcy notice shall be valid and protected unless the debtor before or at the time of his arrest is served with such bankruptcy notice.
(2) No payment or composition made or security given after arrest made under this section shall be exempt from the provisions of this Act relating to fraudulent preferences.
(2) If any person so summoned, after having been tendered a reasonable sum, refuses to come before the court at the time appointed, or refuses to produce any such document, having no lawful impediment made known to the court at the time of its sitting and allowed by it, the court may, by warrant, cause him to be apprehended and brought up for examination.
(3) The court may, by itself or by. a commissioner for oaths appointed for the purpose, examination on oath, either by word of mouth or by written interrogatories, any person so brought before it concerning the debtor, his dealings property.
(4) If any person on examination before the court admits that he is indebted to the debtor, the court may, on the application of the Official Receiver or trustee, order him to pay to the Official Receiver or trustee, at such time and in such manner as to the court seems expedient, the amount admitted or any part thereof either in full discharge of the whole amount in question or not, as the court thinks fit, or without costs of the examination.
(5) If any person on examination before the court admits that he has in his possession any property belonging to the debtor, the court may, on the application of the Official Receiver or trustee, order him to deliver to the Official Receiver or trustee such property or any part thereof, at such time and in such manner and on such terms as the court may seem just.
(6) The court may, if it thinks fit, order that any person who if in Nigeria would be liable to be brought before it under this section shall be examined in any place out of Nigeria by a commissioner for oaths appointed for the purpose.
(7) In the case of the death of the debtor or his wife or of any other witness whose evidence has been duly taken under this Act, the deposition of the person so deceased purporting to be sealed with the seal of the court, or a copy thereof purporting to be so sealed, shall in all legal proceedings be admitted as evidence of the matters therein deposed to, saving all just exceptions.
(2) Where the bankrupt does not of his own accord, within such time as the court may deem reasonable, apply for his discharge, the court may, of its own motion or on the application of the Official Receiver or the trustee or any creditor who has proved, make an order calling upon the bankrupt to come up for his discharge on a day to be fixed by the court, and on due service of the order, if the bankrupt does not appear on the day fixed thereby, the court may make such order as it thinks fit, subject to the provisions of this section, and the debtor shall, in addition to any other punishment to which he may be subject, be guilty of a contempt of court and may be punished accordingly.
(3) On the hearing of the application, or on the day on which the bankrupt has been ordered to come up for his discharge or any subsequent day, the court shall take into consideration a report of the Official Receiver as to the bankrupt’s conduct and affairs (including a report as to the bankrupt’s conduct during the proceedings under his bankruptcy) and may either grant or refuse an absolute order of discharge, or suspend the operation of the order for a specified time, or grant an order of discharge subject to any conditions with respect to any earnings or income which may afterwards become due to the bankrupt or with respect to his after acquired property:
Provided that where the bankrupt has committed any offence connected with his bankruptcy under this Act, or where in any case any of the facts hereinafter mentioned in subsection (4) below are proved, the court shall-
(a) refuse the discharge; or
(b) suspend the discharge until a dividend of not less than fifty per cent has been paid to the creditors; or
(c) require the bankrupt as a condition of his discharge to consent to judgment being entered against him by the Official Receiver or trustee for any balance or part of any balance of the debts provable under the bankruptcy which is not satisfied at the date of the discharge, such balance or part of any balance of the debts to be paid out of the future earnings or after acquired property of the bankrupt in such manner and subject to such conditions as the court may direct; but execution shall not be issued on the judgment without leave of the court, which leave may be given on proof that the bankrupt has since his discharge acquired property or income available towards payment of his debts:
Provided further that, if at any time after the expiration of two years from the date of any order made under this section the bankrupt satisfies the court that there is no reasonable probability of his being in a position to comply with the terms of such order, the court may modify the terms of the order or of any substituted order in such manner and upon such conditions as it may think fit.
(4) The facts referred to in subsection (3) of this section are –
(a) that the bankrupt’s assets are not of a value equal to fifty per cent of his unsecured liabilities, unless he satisfies the court that the fact that the assets are not of a value of fifty per cent of his unsecured liabilities has arisen from circumstances for which he cannot justly be held responsible;
(b) that the bankrupt has omitted to keep such books of account as are usual and proper in the business carried on by him and as sufficiently disclose his business transactions and financial position within the three years immediately preceding his bankruptcy, or in the case of a firm, that a partnership book has not been kept, or that such books have not been available for the trustee during the bankruptcy proceedings, unless they have been accidentally lost or destroyed, the onus of proof of such accidental loss or destruction being on the bankrupt;
(c) that the bankrupt has continued to trade after knowing himself to be insolvent;
(d) that the bankrupt has contracted any debt provable in the bankruptcy without having at the time of contracting it any reasonable or probable ground of expectation (proof whereof shall lie on him) of being able to pay it;
(e) that the bankrupt has failed to account satisfactorily for any loss of assets or for any deficiency of assets to meet his liabilities;
(f) that the bankrupt has brought on or contributed to his bankruptcy by rash and hazardous speculations, or by unjustifiable extravagance in living, or by gambling, or by culpable neglect of his business affairs;
(g) that the bankrupt has put any of his creditors to unnecessary expense by a frivolous or vexatious defence to any action properly brought against him;
(h) that the bankrupt has brought on or contributed to his bankruptcy by incurring unjustifiable expense by bringing a frivolous or vexatious action;
(i) that the bankrupt has within three months preceding the date of the receiving order, when unable to pay his debts as they become due, given an undue preference to any of his creditors;
(j) that the bankrupt has within three months preceding the date of the receiving order incurred liabilities with a view to making his assets equal to fifty per cent of his unsecured liabilities;
(k) that the .bankrupt has on any previous occasion, whether m Nigeria or elsewhere, been adjudged bankrupt or made a composition or arrangement with his creditors;
(l) that the bankrupt has been guilty of any fraud or fraudulent breach of trust.
(5) The court may, on proof to its satisfaction of any of the facts mentioned in paragraph (b), (c), (d), (f), (g), (h), (i) or (l) of subsection (4) of this section, summarily sentence the bankrupt to imprisonment for one year.
(6) For the purposes of this section, a bankrupt’s assets shall be deemed of a value equal to fifty per cent of his unsecured liabilities when the court is satisfied that the property of the bankrupt has realised or is likely to realise, or with due care in realisation might have realised, an amount of not less than fifty per cent of his unsecured liabilities, and a report by the Official Receiver or the trustee shall be prima facie evidence of the amount of such liabilities.
(7) For the purposes of this section, the report of the Official Receiver shall be prima facie evidence of the statements therein contained.
(8) Notice of the appointment by the court of the day for hearing the application for discharge shall be published as the court may direct or as may be prescribed and shall be sent fourteen days at least before the day so appointed to each creditor who has proved, and the court may hear the Official Receiver and the trustee and may also hear any creditor; at the hearing the court may put such questions to the debtor and receive such evidence as it may think fit.
(9) The powers of suspending and of attaching conditions to a bankrupt’s discharge may be exercised concurrently.
(10) A discharged bankrupt shall, notwithstanding his discharge, give such assistance as the trustee may require in the realisation and distribution of such of his property as is vested in the trustee, and if he fails to do so he shall be guilty of a contempt of court; and the court may also, if it thinks fit, revoke his discharge, but without prejudice to the validity of any sale, disposition or payment duly made or thing duly done subsequent to the discharge but before its revocation.
(a) from any debt or a recognizance nor from any debt with which the bankrupt may be chargeable at the suit of the State or of any person for any offence against a statute relating to any branch of the public service on a bail bond entered into for the appearance of any person prosecuted for any such offence; or
(b) from any debt or liability incurred by means of any fraud or fraudulent breach of trust to which he was a party, or from any debt or liability whereof he has obtained forbearance by any fraud to which he was a party.
(2) An order of discharge shall release the bankrupt from all other debts provable in bankruptcy.
(3) An order of discharge shall be conclusive evidence of the bankruptcy and of the validity of the proceedings therein, and in any proceedings that may be instituted against a bankrupt who has obtained an order of discharge in respect of any debt from which he is released by the order, the bankrupt may plead that the cause of action occurred before his discharge.
(4) An order of discharge shall not release any person who at the date of the receiving order was a partner or co-trustee with the bankrupt or was jointly bound or had made any joint contract with him, or any person who was surety or in the nature of a surety for him.
(2) Where an adjudication is annulled under this section all sales and dispositions of property and payments duly made, and all acts theretofore done, by the Official Receiver, trustee or other person acting under their authority, or by the court, shall be valid, but the property of the debtor who was adjudged bankrupt shall vest m such person as the court may appoint, or in default of any such appointment revert to the debtor for all his estate or interest therein on such terms and subject to such conditions, if any, as the court may order.
(3) Notice of the order annulling an adjudication shall be forthwith be published in the Federal Gazette and unless otherwise prescribed shall be advertised in at least two daily newspapers.
(4) For the purposes of this section, any debt disputed by a debtor shall be considered as paid in full if the debtor enters into a bond, in such sum and with such sureties as the court approves, to pay the amount to be recovered in any proceedings for the recovery of or concerning the debt, with costs, and any debt due to a creditor who cannot be found or cannot be identified shall be considered as paid in full if paid into court.
Part II: Administration of property
Proof of debts
(2) A person having notice of any act of bankruptcy against the debtor shall not prove in bankruptcy for any debt or liability contracted by the debtor subsequently to the date of his so having the notice.
(3) Save as aforesaid, all debts and liabilities, present or future, certain or contingent, to which the debtor is subject at the date of the receiving order, or to which he may become subject before his discharge by reason of any obligation incurred before the date of the receiving order, shall be deemed to be debts provable in bankruptcy.
(4) An estimate shall be made by the trustee of the value of any debt or liability provable as aforesaid which by reason of its being subject to any contingency or contingencies, or for any other reason, does not bear a certain value.
(5) Any person aggrieved by any estimate made by the trustee as aforesaid may appeal to the court.
(6) If in the opinion of the court the value of the debt or liability is incapable of being fairly estimated, the court may make an order to that effect, and thereupon the debt or liability shall, for the purposes of this Act, be deemed to be a debt not provable in bankruptcy.
(7) If in the opinion of the court the value of the debt or liability is capable of being fairly estimated, the court may direct the value to be assessed before the court itself and may give all necessary directions for this purpose, and the amount of the value when assessed shall be deemed to be a debt provable in bankruptcy.
(8) For the purposes of this Act, “liability” includes-
(a) any compensation for work or labour done;
(b) any obligation or possibility of an obligation to pay money or money’s worth, on the breach of any express or implied covenant, contract, agreement or undertaking, whether the breach does or does not occur, or is or is not likely to occur or capable of occurring, before the discharge of the debtor;
(c) generally, any express or implied engagement, agreement or undertaking to pay or capable of resulting in the payment of money or money’s worth, whether the payment m, as respects amount, fixed or unliquidated, as respects time, present or future, certain or dependent on any one contingency or on two or more contingencies, or, as to mode of valuation, capable of being ascertained by fixed rules or as matter of opinion.
(a) the actual expenses incurred by the Official Receiver in protecting or attempting to protect the property or assets of the debtor or any part thereof and any expenses or outlay incurred by him or by his authority in carrying on the business of the debtor;
(b) the fees, percentages and charges payable to, or costs, charges and expenses incurred or authorised by, the Official Receiver, whether acting as Official Receiver or trustee;
(c) the remuneration of the special manager, if any; and (d) the taxed costs of the petitioner, so far as the same may not have been disallowed by the court.
(2) Whenever the court is satisfied that property of a debtor in respect of whose estate a receiving order has been made has been preserved for the benefit of the creditors by means of legal proceedings brought by a creditor against the debtor without notice of any available act of bankruptcy committed by the debtor, the court may in its discretion order the payment of the costs of such legal proceedings or any part of them (taxed as between party and party) out of the estate, with the same priority as to payment as is herein provided in respect of the taxed costs of the petitioner.
(a) all debts due from the bankrupt to the State at the date of the receiving order and having become due and payable within twelve months next before that time;
(b) all wages or salary (including commission, provided that the amount thereof is fixed or ascertainable at the date of the receiving order) of any employee in respect of services rendered to the bankrupt during four months next before the date of the receiving order, not exceeding N300;
(2) The foregoing debts shall rank equally between themselves and shall be paid in full unless the property of the bankrupt is insufficient to meet them, in which case they shall abate in equal proportions between themselves.
(3) Subject to the provisions of section 35 of this Act and to the retention of such sums as may be necessary for the costs of administration or otherwise, the foregoing debts shall be discharged forthwith so far as the property of the debtor is sufficient to meet them.
(4) In the event of a landlord or other person distraining or having distrained on any goods or effects of a bankrupt within three months next before the date of the receiving order the debts to which priority is given by this section shall be a first charge on the goods or effects so distrained on or the proceeds of the sale thereof:
Provided that in respect of any money paid under any such charge the landlord or other person shall have the same rights of priority as the person to whom such payment is made.
(5) This section shall apply in the case of a deceased person who dies insolvent as if he were a bankrupt and as if the date of his death were substituted for the date of the receiving order.
(6) In the case of partners the joint estate shall be applicable in the first instance in payment of their joint debts and the separate estate of each partner shall be applicable in the first instance in payment of his separate debts. If there in a surplus of the joint estate, it shall be dealt with as part of the respective separate estates in proportion to the right and interest each partner in the joint estate.”
(7) Subject to the provisions of this Act, all debts proved in the bankruptcy shall be paid pari passu.
(8) If there is any surplus after payment of the foregoing debts, it shall be applied in payment of interest from the date of the receiving order at the rate of one per cent above the prevailing bank rate on all debts proved in the bankruptcy.
(2) Where it appears expedient to a trustee, he may, on the application of any apprentice or articled clerk to the bankrupt or any person acting on behalf of such apprentice or articled clerk, instead of acting under the provisions of subsection (1) of this section, transfer the indenture of apprenticeship or articles of agreement to some other person.
39.(1) Where a married woman has been adjudged bankrupt, her husband shall not be entitled to claim any dividend as a creditor in respect of any money or other estate lent or entrusted by him to her until all claims of the other creditors of his wife for valuable consideration in money or money’s worth have been satisfied.
(2) Where a debtor has been adjudged bankrupt, any money or other estate of his wife lent or entrusted by her to him shall be treated as assets of his estate, and the wife shall not be entitled to claim any dividend as a creditor in respect of any such money or other estate until all claims of the other creditors of the debtor for valuable consideration in money or money’s worth have been satisfied.
(3) In this section “married woman” and “wife” include women married under any law in force in any part of Nigeria relating to marriages.
(a) all such property as may belong to or be vested in the bankrupt at the commencement of the bankruptcy or may be acquired by or devolve on him before his discharge;
(b) the capacity to exercise and to take proceedings for exercising all such powers in or over or in respect of property as might have been exercised by the bankrupt for his own benefit at the commencement of his bankruptcy or before his discharge;
(c) all goods being at the commencement of the bankruptcy in the possession, order or disposition of the bankrupt, in his trade or business, by the consent and permission of the true owner, under such circumstances that he is the reputed owner thereof:
Provided that things in action other than debts due or growing due to the bankrupt in the course of his trade or business shall not be deemed goods within the meaning of this section.
(2) The property of the bankrupt divisible amongst his creditors shall not include the following –
(a) property held by the bankrupt on trust for any other person;
(b) the tools (if any) of his trade and the necessary wearing apparel and bedding of himself and his family dependent on and residing with him, to a value, inclusive of tools and apparel and bedding, not exceeding N1000 in the whole.
(2) In the event of a second or subsequent receiving order made against a bankrupt being followed by an order adjudging him bankrupt, or in the event of an order being made for the administration in bankruptcy of the estate of a deceased bankrupt, any property acquired by him since he was last adjudged bankrupt, which at the date when the subsequent petition was presented had not been distributed amongst the creditors in such last preceding bankruptcy, shall, subject to any disposition thereof made by the Official Receiver or trustee in that bankruptcy, without knowledge of the presentation of the subsequent petition, and subject to the provisions of section 50 in this Act, vest in the trustee in the subsequent bankruptcy or administration in bankruptcy as the case may be.
(3) Where the trustee in any bankruptcy receives notice of a subsequent petition for the administration of his estate in bankruptcy, the trustee shall hold any property then in his possession which has been acquired by the bankrupt since he was adjudged bankrupt until the subsequent petition has been disposed of, and if on the subsequent petition an order of adjudication or an order for the administration of the estate in bankruptcy is made, he shall transfer all such property or the proceeds thereof (after deducting his costs and expenses) to the trustee in the subsequent bankruptcy or administration in bankruptcy, as the case may be.
Effect of bankruptcy on antecedent and other transactions
(2) For the purposes of this Act, an execution shall be deemed to be completed –
(a) in the case of movable property in the possession of the debtor or of negotiable instruments or of money, by receipt or recovery by the judgment creditor of the full amount of the levy, after due compliance by the bailiff with the provisions of section 44 of this Act;
(b) in the case of movable property to which the debtor is entitled subject to a lien or right of some person to the immediate possession thereof, by attachment by prohibitory order and sale;
(c) in the case of lands, houses or other immovable property or any interest therein, either at law or in equity, by attachment by prohibitory order and due registration thereof in the appropriate land registry;
(d) in the case of an attachment of a debt not being a negotiable instrument, by receipt of the debt;
(e) in the case of shares in any public company or corporation, by attachment by prohibitory order;
(f) in the case of property in the custody or under the control of any public officer in his official capacity or in custodia legis, by attachment by prohibitory order duly obtained and served; and
(g) in the case of any equitable interest in lands, houses or other immovable property, by the appointment of a receiver or manager.
(3) An execution completed as aforesaid is not invalid by reason only of its being an act of bankruptcy, and a person who purchases the goods in good faith under a sale by the bailiff shall in all cases acquire a good title to them against the trustee in bankruptcy.
(2) Where under an execution in respect of a judgment for a sum exceeding N100, the property of a debtor is sold or money is paid in order to avoid sale, the bailiff shall deduct his costs of the execution from the proceeds of sale or the money paid and pay the balance into court, and if within fourteen clear days of such sale or payment as aforesaid a bankruptcy petition is presented by or against the debtor, the said balance shall remain in court and if the debtor is adjudged bankrupt the balance shall be paid out to the trustee in the bankruptcy, who shall be entitled to retain the same as against the execution creditor, but otherwise it shall be dealt with as if no bankruptcy petition has been presented.
(2) For the purposes of this section, “assignment” includes assignment by way of security and other charges on book debts.
(2) This section shall not affect the rights of any person making title in good faith and for valuable consideration through or under a creditor of the bankrupt.
(a) any payment by the bankrupt to any of his creditors;
(b) any payment or delivery to the bankrupt;
(c) any conveyance or assignment by the bankrupt for valuable consideration;
(d) any contract, dealing or transaction by or with the bankrupt for valuable consideration:
Provided that both the following conditions are complied with, namely –
(i) that the payment, delivery, conveyance, assignment, contract, dealing or transaction, as the case may be, takes place before the date of the receiving order, and
(ii) that the person (other than the debtor) to, by or with whom the payment, delivery, conveyance, assignment, contract, dealing or transaction was made, executed or entered into has not at the time of the payment, delivery, conveyance, assignment, contract, dealing or transaction notice of any available act of bankruptcy committed by the bankrupt before that time.
(2) Where any individual, company or firm has ascertained that a person having a deposit, whether a deposit in respect of capital or not, or a credit balance, with such individual, company or firm is an undischarged bankrupt. then it shall be the duty of such individual, company or firm forthwith to inform the Official Receiver and the trustee in the bankruptcy of the existence of the deposit or credit balance. and such individual, company or firm shall not make any payment out of or in respect of the deposit or credit balance with instructions from the Official Receiver or the trustee in the bankruptcy.
(3) In case of any contravention of the provisions of subsection (2) of this section the individual, or the directors and officers of the company, or the partners and manager of the firm, as the case may be, shall be liable on summary conviction to a fine of N1000 and to imprisonment for six months.
(2) The trustee shall, in relation to and for the purpose of acquiring or retaining possession of the property of the bankrupt, be in the same position as if he were a receiver of the property appointed by the court, and the court may on his application enforce such acquisition or retention accordingly.
(3) Where any part of the property of the bankrupt consists of stocks, shares in ships, shares, or any other property transferable in the books of any company, office or person. the trustee may exercise the right to transfer the property to the same extent as the bankrupt might have exercised it if he had not become bankrupt.
(4) Where any part of the property of the bankrupt consists of things in action, such things shall be deemed to have been duly assigned to the trustee.
(5) Subject to the provisions of this Act with respect to property acquired by a bankrupt after adjudication. any treasurer or other officer or any banker. attorney, employee, employer or agent, of a bankrupt, shall. pay and deliver to the trustee all money and securities in his possession or power, which such person is not by law entitled to retain as against the bankrupt or the trustee and any person aforementioned who fails to do so shall be guilty of a contempt of court and may be punished accordingly on the application of the trustee.
(2) Where a bankrupt is in receipt of a salary or income other than as aforesaid, the court, on the application of the trustee, may from time to time make such order as it thinks just for the payment of the salary or income or of any part thereof to the trustee, to be applied by him in such manner as the court may direct.
(3) Nothing in this section shall take away or abridge any power to dismiss a bankrupt or pursuant to any enactment to declare the pay, pension, allowance, compensation, salary or income of any bankrupt to be forfeited.
(2) On the appointment of a trustee the property shall forthwith pass to and vest in the trustee appointed.
(3) The property of the bankrupt shall pass from trustee to trustee, including under that term the Official Receiver when he fills the office of trustee, and shall vest in the trustee for the time being during his continuance in office, without any conveyance, assignment or transfer whatever.
Provided that, where any such property has not come to the knowledge of the trustee within one month after such appointment, he may disclaim such property at any time within twelve months after he has become aware thereof or such extended period as may be allowed by the court.
(2) The disclaimer shall operate to determine, as from the date of disclaimer, the rights, interests and liabilities of the bankrupt and his property in or in respect of the property disclaimed, and shall also discharge the trustee from all personal liability in respect of the property disclaimed as from the date when the property vested in him, but shall not, except so far as is necessary for the purpose of releasing the bankrupt and his property and the trustee from liability, affect the rights or liabilities of any other person.
(3) A trustee shall not be entitled to disclaim a lease without the leave of the court, except in any cases which may be prescribed by general rules, and the court may, before or on granting such leave, require such notices to be given to persons interested, and impose such orders with respect to fixtures, tenant’s improvements and other matters arising out of the tenancy, as the court thinks just.
(4) The trustee shall not be entitled to disclaim any property in pursuance of this section in any case where an application in writing has been made to the trustee by any person interested in the property requiring him to decide whether he will disclaim or not and the trustee has for a period of twenty-eight days after the receipt of the application, or such extended period as may be allowed by the court, declined or neglected to give notice whether he disclaims the property or not; and in the case of a contract, if the trustee after such application as aforesaid does not within the said period or extended period disclaim the contract, he shall be deemed to have adopted it.
(5) The court may, on the application of any person who is, as against the trustee, entitled to the benefit or subject to the burden of a contract made with the bankrupt, make an order rescinding the contract on such terms as to payment by or to either party of damages for the non-performance of the contract, or otherwise, as to the court may seem equitable, and any damages payable under the order to any such person may be proved by him as a debt under the bankruptcy.
(6) The court may, on application by any person claiming either to have any interest in any disclaimed property or to be under any liability not discharged by this Act in respect of any disclaimed property, and on hearing such persons as it thinks fit make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the court thinks just, and on any such vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any conveyance or assignment for the purpose:
Provided that where the property disclaimed is of a leasehold nature the court shall not make a vesting order in favour of any person claiming under the bankrupt, whether as under-lessee or as mortgagee by demise except upon the terms of making that person –
(a) subject to the same liabilities and obligations as the bankrupt was subject to under the lease in respect of the property at the date when the bankruptcy petition was filed; or
(b) if the court thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date, and in either event (if the case so requires) subject only to the same liabilities and obligations as if the lease had comprised only the property comprised in the vesting order; and any mortgagee or under-lessee declining to accept a vesting order upon such terms shall be excluded from all interest in and security upon the property, and if there is no person claiming under the bankrupt who is willing to accept an order upon such terms, the court shall have power to vest the bankrupt’s estate and interest in the property in any person liable either personally or in a representative character and either alone or jointly with the bankrupt to perform the lessee’s covenants in the lease, freed and discharged from all estates, incumbrances and interests created therein by the bankrupt.
(7) Where on the release, removal, resignation or death of a trustee in bankruptcy the Official Receiver is acting as trustee, he may disclaim any property which might be disclaimed by a trustee under the foregoing provisions, notwithstanding that the time prescribed by this section for such disclaimer has expired, but such power of disclaimer shall be exercisable only within twelve months after the Official Receiver has become trustee in the circumstances aforesaid or has become aware of the existence of such property whichever period may last expire.
(8) Any person injured by the operation of a disclaimer under this section shall be deemed to be a creditor of the bankrupt to the extent of the injury and may accordingly prove the same as a debt under the bankruptcy.
(a) sell all or any part of the property of the bankrupt (including the goodwill of the business, if any, and the book debts due or growing due to the bankrupt), by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels;
(b) give receipts for any money received by him, which receipts shall effectually discharge the person paying the money from all responsibility in respect of the application thereof;
(c) prove, rank, claim and draw a dividend in respect of any debt due to the bankrupt;
(d) exercise any powers the capacity to exercise which is vested in the trustee under this Act and execute any powers of attorney, deeds and other instruments for the purpose of carrying into effect the provisions of this Act.
(a) carry on the business of the bankrupt so far as may be necessary for the beneficial winding up of the same;
(b) bring, institute or defend any action or other legal proceeding relating to the property of the bankrupt;
(c) employ a legal practitioner or other agent to take any proceedings or do any business which may be sanctioned by the committee of inspection;
(d) accept as the consideration for the sale of any property of the bankrupt a sum of money payable at a future time subject to such stipulations as to security and otherwise as the committee think fit;
(e) mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts;
(f) refer any dispute to arbitration, or compromise any debts, claims and liabilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have incurred any liability to the bankrupt, on the receipt of such sums, payable at such times and generally on such terms as may be agreed on;
(g) make such compromise or other arrangement as may be thought expedient with creditors or persons claiming to be creditors in respect of any debts provable under the bankruptcy;
(h) make such compromise or other arrangement as may be thought expedient with respect to any claim arising out of or incidental to the property of the bankrupt made or capable of being made on the trustee by any person or by the trustee on any person;
(i) divide in its existing form amongst the creditors, according to its estimated value, any property which from its peculiar nature or other special circumstances cannot be readily or advantageously sold.
(2) The permission given for the purposes of subsection (1) of this section shall not be a general permission to do all or any of the above-mentioned things but shall only be a permission to do the particular thing or things for which permission is sought in the specified case or cases.
Distribution of property
(2) The first dividend, if any, shall be declared and distributed within four months after the conclusion of the first meeting of creditors, unless the trustee satisfies the court that there is sufficient reason for postponing the declaration to a later date.
(3) Subsequent dividends shall, in the absence of sufficient reason to the contrary, be declared and distributed at intervals of not more than six months.
(4) Before declaring a dividend, the trustee shall cause notice of his intention to do so to be published in the Federal Gazette and shall also send reasonable notice thereof to each creditor mentioned in the bankrupt’s statement who has not proved his debt.
(5) When the trustee has declared a dividend he shall cause to be published in the Federal Gazette and shall send to each creditor who has proved a notice showing the amount of the dividend and when and how it is payable.
(2) Where joint and separate properties are being administered, dividends of the joint and separate properties shall, unless otherwise directed by the court on the application of any person interested, be declared together and the expenses of and incidental to such dividends shall be fair apportioned by the trustee between the joint and separate properties, regard being had to the work done for and the benefit received by each property.
(2) He shall also make provision for any disputed proofs or claims, and for the expenses necessary for the administration of the estate or otherwise.
(3) Subject to the foregoing provisions, he shall distribute as dividend all money in hand.
(2) In dealing with the proof of the debt the following rules shall be observed–
(a) any account settled between the debtor and the creditor within three years preceding the date of the receiving order may be examined, and if it appears that the settlement of the account forms substantially one transaction with any debt alleged to be due out of the debtor’s estate (whether in the form of renewal of a loan or capitalisation of interest or ascertainment of loans or otherwise), the account may be re-opened and the whole transaction treated as one;
(b) any payments made by the debtor to the creditor before the receiving order, whether by way of bonus or otherwise, and any sums received by the creditor before the receiving order from the realisation of any security for the debt shall, notwithstanding any agreement to the contrary, be appropriated to principal and interest in the proportion that the principal bears to the sum payable as interest at the agreed rate;
(c) where the debt due is secured and the security is realised after the receiving order, or the value thereof is assessed in the proof, the amount realised or assessed shall be appropriated to the satisfaction of principal and interest in the proportion that the principal bears to the sum payable as interest at the agreed rate.
(2) After the expiration of the time so limited or if the court on application by any such claimant grants him further time for establishing his claim, then on the expiration of such further time, the property of the bankrupt shall be divided among the creditors who have proved their debts, without regard to the claims of any other person.
(2) A person designated by virtue of sub-section (1) of this section shall be a qualified legal practitioner in Nigeria who shall have been so qualified for a period not less than ten years.
(3) The Minister may designate such number of officers of the Ministry who are qualified legal practitioners as he may determine as Deputy official Receivers.
(4) Every Deputy Official Receiver shall act under the general authority and direction of the official Receiver for the time being, who shall in turn act under the general authority of the Minister.
(2) The Official Receiver may, for the purpose of affidavits verifying proofs, petitions, or proceedings under this Act administer oaths.
(3) All provisions in this Act referring to the trustee in a bankruptcy shall, unless the context otherwise requires or the Act otherwise provides, include the Official Receiver when acting as trustee.
(4) The trustee shall supply the Official Receiver with such information, and give him such access to and facilities for inspecting the bankrupt’s books and documents, and generally shall give him such aid, as may be requisite for enabling the Official Receiver to perform his duties under this Act.
(a) to investigate the conduct of the debtor and to report to the court, stating whether there is reason to believe that the debtor has committed any act which constitutes an offence under this Act or which would justify the court in refusing, suspending or qualifying an order for his discharge;
(b) to conduct the public examination of the debtor:
(c) to take such part and give such assistance in relation to the prosecution of any fraudulent debtor as the Attorney-General of the Federation may direct.
(a) pending the appointment of a trustee, to act as interim receiver of the debtor’s estate, and where a special manager is not appointed. as manager thereof;
(b) to raise money in any case where in the interests of the creditors it appears necessary so to do:
(c) to summon and preside at the first meeting of creditors;
(d) to issue forms of proxy for use at the meetings of creditors:
(e) to report to the creditors as to any proposal which the debtor may have made with respect to the mode of liquidating his affairs;
(f) to advertise the receiving order. the date of the creditors’ first meeting and of the debtor’s public examination, and such other matters as it may be necessary to advertise;
(g) to act as trustee during any vacancy in the office of trustee;
(h) to assist the debtor in preparing his statement of affairs in case the debtor has no solicitor acting for him and is unable properly to prepare it himself, and for this purpose he may employ at the expense of the estate any person or persons to assist in its preparation.
(2) For the purpose of his duties as interim receiver or manager the Official Receiver shall have the same powers as if he were a receiver and manager appointed by the court, but shall, as far as practicable, consult the wishes of the creditors with respect to the management of the debtor’s property, and may for that purpose, if he thinks it advisable, summon meetings of the persons claiming to be creditors and shall not, unless the court otherwise orders, incur any expense beyond such as is requisite for the protection of the debtor’s property or the disposing of perishable goods.
(3) The Official Receiver shall account to the court and pay over all moneys and deal with all securities in such manner as the court from time to time directs.
Part IV: Trustees in bankruptcy
(2) The creditors may also appoint persons to act as trustees in succession in the event of one or more of the persons first named declining to accept the office of trustee or failing to give security, or of the appointment of any such person being approved by the court.
(2) The Official Receiver shall, on the requisition of any creditor, summon a meeting for the purpose of filling any such vacancy.
(3) If the creditors do not within three weeks after the occurrence of a vacancy appoint a person to fill the vacancy, the Official Receiver shall report the matter to the court, and the court may appoint a trustee.
(4) During any vacancy in the office of trustee the Official Receiver shall act as trustee.
Control over trustee
(2) The trustees may from time to time summon general meetings of the creditors for the purpose of ascertaining their wishes, and it shall be his duty to summon meetings at such times as the creditors, by resolution, either at the meeting appointing the trustee or otherwise may direct, and it shall be lawful for any creditor, with the concurrence of one-fourth in value of the creditors (including himself), at any time to request the trustee or Official Receiver to call a meeting of the creditors, and the trustee or Official Receiver shall call such meeting accordingly within fourteen days:
Provided that the person at whose instance the meeting is summoned shall, if so required, deposit with the trustee or the Official Receiver, as the case may be, a sum sufficient to pay the costs of summoning the meeting, such sum to be repaid to him out of the estate if the court so directs.
(3) The trustee may apply to the court in manner prescribed for directions in relation to any particular matter arising under the bankruptcy.
(4) Subject to the provisions of this Act the trustee shall use his discretion in the management of the estate and its distribution among the creditors.
(2) The court may either of its own motion or on the application of the Official Receiver at any time require any trustee to answer any inquiry made by the court or the Official Receiver in relation to any bankruptcy in which the trustee is engaged and may examine on oath the trustee or any other person concerning the bankruptcy.
(3) The court may also direct an investigation to be made of the books and vouchers of the trustee.
Remuneration and costs
(2) The remuneration shall cover all expenses except actual out of pocket expenses properly incurred and no liability shall attach to the bankrupt’s estate or to the creditors in respect of any other expenses.
(3) Where a trustee acts without remuneration he shall be allowed out of the bankrupt’s estate such proper expenses incurred by him in or about the proceedings of the bankruptcy as the court may approve.
(4) A trustee shall not under any circumstances whatever make any arrangement for or accept from the bankrupt, or any solicitor, auctioneer or any other person who may be employed about a bankruptcy, any gift, remuneration or pecuniary or other consideration or benefit whatever beyond his said remuneration payable out of the estate, nor shall he make any arrangement for giving up, or give up, any part of his remuneration, whether as receiver, manager or trustee, to the bankrupt or any solicitor or other person who may be employed about a bankruptcy.
(2) Where the trustee is a legal practitioner he may contract that the remuneration for his services as trustee shall include all professional services.
(3) All bills and charges of legal practitioners, managers, accountants, auctioneers, brokers and other persons, not being trustees, shall be taxed by the Registrar and no payments in respect thereof shall be allowed in the trustee’s accounts without proof of such taxation having been made.
(4) The Registrar shall satisfy himself before passing such bills and charges that the employment of such legal practitioners and other persons, in respect of the particular matters out of which such charges arise, has been duly sanctioned; and the sanction shall be obtained before the employment, except in cases of urgency, and in such cases it must be shown that no undue delay took place in obtaining the sanction.
(5) Every such person shall, on request by the trustee (which request the trustee shall make a sufficient time before declaring a dividend), deliver his bill of costs or charges to the Registrar for taxation, and if he fails to do so within seven days after receipt of the request or such further time as the court on application may grant, the trustee shall declare and distribute the dividend without regard to any claim by him, and thereupon any such claim shall be forfeited as well against the trustee personally as against the estate.
Receipts, payments, accounts and audit
Provided that the person at whose instance the accounts are furnished shall, if so required, deposit with the trustee or Official Receiver, as the case may be, a sum sufficient to pay the costs of furnishing and transmitting the accounts, which sum shall be re-paid to him out of the estate if the court so directs.
(2) The Official Receiver shall cause the statements so transmitted to be examined, and shall call the trustee to account for any misfeasance, neglect or omission which may appear on the said statements or in his accounts or otherwise, and may apply to the court for an order that the trustee do make good any loss which the estate of the bankrupt may have sustained by the misfeasance, neglect or omission.
(2) If a trustee at any time retains for more than ten days a sum exceeding N500, or such other amount as the court in any particular case may authorise him to retain, then unless he explains the retention to the satisfaction of the court, he shall pay interest on the amount so retained in excess at the rate of five per cent above inter bank lending rate and shall have no claim to remuneration and may be removed from his office by the court and shall be liable to pay expenses occasioned by reason of his default.
(3) Any trustee paying money into his private banking account or using it otherwise than in the administration of the estate may without prejudice to any other liability be dismissed from office without remuneration and may be ordered by the court to make good. all losses and expenses which the creditors may suffer in consequence of his conduct.
(2) The trustee shall also keep an account, to be called the estate account, in the form of an ordinary debtor and creditor account, in which he shall enter from day to day all his receipts and payments as trustee.
(3) The trustee shall produce at every meeting of creditors and at every meeting of committee of inspection the record and account above mentioned and also the pass-book of the estate’s bank account, and such documents shall be open to the inspection of any creditor at all reasonable times.
(2) The account shall be in the prescribed form, shall be made in duplicate and shall be verified by an affidavit in the prescribed form.
(3) The Official Receiver shall cause the accounts so sent to be audited, and for the purposes of the audit the trustee shall furnish the Official Receiver with such vouchers and information as he may require, and he may at any time require the production of and inspect any books or accounts kept by the trustee.
(4) When any such account has been audited it shall be filed and kept by the Official Receiver and shall be open on payment of the prescribed fee to the inspection of any creditor or of the bankrupt or of any person interested.
(5) The court may if it so desires examine the trustee and after hearing the explanation, if any, of the trustee, make such order as it may think just for compelling the trustee to make good any loss to the estate which after such audit or examination, may appear to the court to have been occasioned by any misfeasance, neglect or improper conduct or omission of the trustee.
Vacation of officer by trustee
(2) Where the release of a trustee is withheld the court may, on the application of any creditor or person interested, make such order as it thinks just, charging the trustee with the consequences of any act or default he may have done or made contrary to his duty.
(3) An order of the court releasing the trustee shall discharge him from all liability in respect of any act done or default made by him in the administration of the affairs of the bankrupt, or otherwise in relation to his conduct as trustee, but any such order may be revoked on proof that it was obtained by fraud or by suppression or concealment of any material fact.
(4) The provisions of subsections (1), (2) and (3) of this section shall apply to the Official Receiver when he is or is acting as trustee, and when the Official Receiver has been released under this section or any previous similar enactment he shall continue to act as trustee for any subsequent purposes of the administration of the debtor’s estate but no liability shall attach to him personally by reason of his so continuing in respect of any act done, default made or liability incurred before his release.
(5) Where the trustee has not previously resigned or been removed, his release shall operate as a removal of him from his office, and thereupon the Official Receiver shall be the trustee.
(6) Where on the release of a trustee the Official Receiver is or is acting as trustee, no liability shall attach to him personally in respect of any act done or default made or liability incurred by any prior trustee.
(2) If the court is of opinion –
(a) that a trustee appointed by the creditors is guilty of misconduct or fails to perform his duties under this Act; or
(b) that his trusteeship is being needlessly protracted without any probable advantage to the creditors; or
(c) that he is by reason of mental or physical disability or absence incapable of performing his duties; or
(d) that his connection with or relation to the bankrupt or his estate or any particular creditor might make it difficult for him to act with impartiality in the interest of the creditors generally; or
(e) that the interests of the creditors require it, the court may remove him from his office and appoint another person in his place.
Part V: Constitution, Procedure and Powers of Court
Review and appeals
(2) Every order of the court shall be subject to appeal to the Court of Appeal.
(3) The appeal shall be commenced within twenty-one days from the time when the decision appealed against is pronounced or made.
(2) The Registrar shall in cases of urgency have power to make interim orders and to hear and determine unopposed or ex parte applications and any order so made shall, subject to an appeal to the court, be deemed to be an order of the court.
(2) The court may at any time adjourn any proceedings before it upon terms, if any, as it may think fit to impose.
(3) The court may at any time amend any written process or proceeding under this Act upon such terms, if any, as it may think fit to impose.
(4) Whereby this Act or by general rules the time for doing any act or thing is limited, the court may extend the time either before or after the expiration thereof upon such terms, if any, as the court may think fit to impose.
(5) Subject to the general rules, the court may in any matter take the whole or any part of the evidence viva voce or by interrogatories or upon affidavit or, out of Nigeria, by commission.
Disobedience to order of court
Provided that the power given by this section shall be deemed to be in addition to and not in substitution for any other right, remedy or liability in respect of such default.
Application of Act
(2) The petition shall be served on the legal personal representative of the deceased debtor or, if there is none in Nigeria, on the appropriate Administrator-General, and the court may in the prescribed manner, upon proof of the petitioner’s debt, unless the court is satisfied that there is a reasonable probability that the estate will be sufficient for the payment of the debts owing by the deceased, make an order for the administration in bankruptcy of the deceased debtor’s estate or may upon cause shown dismiss the petition with or without costs.
(3) Upon an order being made for the administration in bankruptcy of a deceased debtor’s estate the property of the debtor shall vest in the Official Receiver as trustee thereof and he shall forthwith proceed to realise and distribute it in accordance with the provisions of this Act:
(a) the creditors shall have the same powers as to appointment of trustees and committees of inspection as they have in other cases where the estate of a debtor is being administered or dealt with in bankruptcy, and the provisions of this Act relating to trustee and committees of inspection shall apply to trustees and committees of inspection appointed under the power so conferred;
(b) if no committee of inspection is appointed, an}, act or thing or any direction or permission which might have been done or given by a committee of inspection may be done or given by the court.
(4) With the modifications hereinafter mentioned, all the provisions of Part II (relating to the administration of the property of a bankrupt) and, subject to any modification that may be made therein by general rules under subsection (9) of this section, the following provisions, namely section 27 of this Act (which relates to inquiries as to the debtor’s conduct, dealings and property) and section 85 of this Act (which relates to the costs of trustees, managers and other persons) shall, so far as the same are applicable, apply to the case of an administration order under this section in like manner as to an order of adjudication under this Act, and section 38 shall apply as if for the reference to an order of adjudication there were substituted a reference to an administration order under this section.
(5) In the administration of the property of the deceased debtor under an order of administration the Official Receiver or trustee shall have regard to any claim by the legal personal representative of the deceased debtor to payment of the proper funeral and testamentary expenses incurred by him in and about the debtor’s estate, and such claims shall be deemed a preferential debt under the order and shall, notwithstanding anything to the contrary in the provisions of this Act relating to the priority of other debts, be payable in full out of the debtor’s estate in priority to all other debts.
(6) If on the administration of a deceased debtor’s estate any surplus remains in the hands of the Official Receiver or trustee, after payment in full of all the debts due from the debtor together with the costs of the administration and interest as provided by this Act in case of bankruptcy, such surplus shall be paid over to the legal personal representative of the deceased debtor’s estate, or failing such representative, to the appropriate Administrator-General.
(7) Service on the legal personal representative of a deceased debtor or on any Administrator-General of a petition under this section shall, in the event of an order for administration being made thereon, be deemed to be equivalent to notice of an act of bankruptcy, and after such service no payment or transfer of property made by the legal personal representative shall operate as a discharge to him as between himself and the Official Receiver or trustee, and save as aforesaid nothing in this section shall invalidate any payment made or any act or thing done in good faith by the legal personal representative before the date of the order for administration.
(8) A petition for the administration of the estate of a deceased debtor under this section may be presented by the legal personal representative of the debtor or by the appropriate Administrator-General, and where a petition is so presented by such a representative or by such Administrator-General this section shall apply subject to such modifications as may be prescribed by general rules made under subsection (9) of this section.
(9) General rules for carrying into effect the provisions of this section may be made in the same manner and to the like effect and extent as in bankruptcy.
Fees and Remuneration
(2) Until the contrary is proved every meeting of creditors in respect of the proceedings whereof a minute has been so signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings had thereat to have been duly passed or had.
(2) Where the limited time so appointed or allowed is less than six days, holidays shall not be reckoned in the computation of such time.
(3) Where the limited time so appointed or allowed expires on one of the days specified in this section, the act or proceedings shall be considered as done or taken in due time if it is done or taken on the next day afterwards which is not one of the days specified.
(4) The provisions of this section shall take effect notwithstanding anything contained in sections 23, 24 and 25.
(2) No defect or irregularity in the appointment or election of a receiver, trustee or member of a committee of inspection shall vitiate any act done by him in good faith.
(a) deed, assignment, surrender or other assurance relating solely to interests in land, or to any mortgage, charge or other incumbrance on, or any estate, right or interest in, any real or personal property, which is part of the estate of any bankrupt, and which, after the execution of the deed, assignment, surrender or other assurance, either at law or in equity, or remains the estate of the bankrupt or of the trustee under the bankruptcy; and
(b) power of attorney, proxy paper, writ, order certificate, affidavit, bond or other instrument or writing relating solely to the property of any bankrupt, or to any proceeding under any bankruptcy,
shall be exempt from stamp duty except in respect of fees under this Act.
Unclaimed Funds or Dividends
(2) The Registrar’s receipt for the money so paid shall be a sufficient discharge to the trustee in respect thereof.
(3) The trustee, whether he has obtained his release or not, may be called upon by the court to account for any unclaimed funds or dividends and any failure to comply with the requisitions of the court in this behalf may be dealt with as a contempt of court.
(4) Any person claiming to be entitled to any moneys paid into the Bankruptcy Estates Account under this Act may, within five years of the date when the same was so paid m, apply to the Registrar for payment to him of the same, and the Registrar, if satisfied that the person claiming is entitled, shall make an order for the payment to such person of the sum due.
(5) Any person dissatisfied with the decision of the Registrar may appeal to the court.
(6) After any money has remained unclaimed in the Bankruptcy Estates Account for a period of five years it shall be paid into the Consolidated Revenue Fund of the Federation.
Part VII: Disqualification of bankrupt
(a) being elected to the office of President or Vice-President, Governor or Deputy Governor;
(b) being elected to, or sitting or voting in, either House of the National Assembly or in a State Assembly;
(c) being elected to, or sitting or voting in, any local government council in any State in the Federation or the Federal Capital Territory, Abuja;
(d) being appointed to, or sitting or voting in, any governing board (howsoever known or described) of any statutory corporation or any other statutory body (whether corporate or unicorporate) or, as provided by section 253 of the Companies and Allied Matters Act, of any company as defined in that section;
(e) being appointed or acting as a justice of the peace; (f) being appointed or acting as a trustee of a trust estate; (g) being admitted to practice any profession for the time being regulated by law on his own or in partnership or in any other form of association (other than as an employee) with any other person.
(2) The disqualifications to which a bankrupt is subject under this section shall, unless otherwise provided by any other enactment, be removed and cease if and when –
(a) the adjudication of bankruptcy against him is annulled; or
(b) he is automatically discharged pursuant to the Act; or (c) he obtains from the court his discharge with a certificate to the effect that his bankruptcy was caused by misfortune without any misconduct on his part.
(3) The court may grant or withhold the certificate mentioned in paragraph (c) of subsection (2) of this section as it thinks fit, but any refusal of such certificate shall be subject to appeal.
(2) Subject to the provisions of any other enactment, if a person is adjudged bankrupt whilst practising any of the professions mentioned in paragraph (g) of section 126(1) of this Act, he shall thereupon cease to be entitled to practise, and shall accordingly cease to practise, the profession concerned on his own or in partnership or any other form of association (other than as an employee) with any other person.
(2) If any person disqualified under this Part of this Act from being appointed to any office and, knowing that he is so disqualified, puts himself forward for any such appointment, he shall be guilty of an offence under this Part.
(3) If any person disqualified under this’ Part of this Act from sitting or voting in any legislative or other body specified in paragraphs (b) to (d) of section 126(1) of this Act and, knowing that he is so disqualified, sits or votes in any such body, he shall be guilty of an offence under this Part.
(4) If any person disqualified under this Part of this Act from entering upon the practice of any profession as provided therein and, knowing that he is so disqualified, puts himself forward to be called, nominated or otherwise invited to practice the profession concerned on his own or in partnership or any other form of association (other than as an employee) with any other person, he shall be guilty of an offence under this Part.
(5) If any person disqualified under this Part of this Act from continuing to hold any office or appointment or from continuing the practice of any profession on his own or in partnership or any other form of association (other than as an employee) with any other person, and, knowing that he is so disqualified, continues so to do, he shall be guilty of an offence under this Part.
(6) Any person guilty of an offence under this Part, in respect of which no penalty is imposed pursuant to any other enactment, shall be liable on conviction to a fine of N1,000 or imprisonment for six months or to both such fine and imprisonment.
Part VIII: Bankruptcy offences
(a) if he does not to the best of his knowledge and belief fully and truly discover to the trustee all his property, real and personal, and how and to whom and for what consideration and when he disposed of any part thereof, except such part as has been disposed of in the ordinary way of his trade (if any) or laid out in the ordinary expenses of his family, unless he proves that he had no intent to defraud;
(b) if he does not deliver up to the trustee, or as he directs, all such part of his movable property as in his custody or under his control and which he is required by law to deliver up, unless he proves that he had no intent to defraud;
(c) if he does not deliver up to the trustee, or as he directs, all books, documents, papers and writings in his custody or under his control relating to his property or affairs, unless he proves that he had no intent to defraud;
(d) if, after the presentation of a bankruptcy petition by or against him or within twelve months next before such presentation, he conceals any part of his property to the value of N50 or upwards or conceals any debt due to or from him, unless he proves that he had no intent to defraud;
(e) if, after the presentation of a bankruptcy petition by or against him or within twelve months next before such presentation, he fraudulently removes any part of his property to the value of N50 or upwards;
(f) if he makes any material omission or misstatement in any statement relating to his affairs, unless he proves that he had no intent to defraud;
(g) if, knowing or having any reason to believe that a false debt has been proved by any person under the bankruptcy, he fails for the period of a month to inform the trustee thereof;
(h) if, after the presentation of a bankruptcy petition by or against him, he prevents or is party or privy to preventing the production of any book, document, paper or writing affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law;
(i) if, after the presentation of a bankruptcy petition by or against him or within twelve months next before such presentation, he removes, conceals, destroys, mutilates or falsities or is privy to the removal, concealment, destruction, mutilation or falsification of any book or document affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law;
(j) if, after the presentation of a bankruptcy petition by or against him or within twelve months next before such presentation, he fraudulently parts with, alters or makes any omission in, or is privy to the fraudulently parting with, altering or making any omission in, any document affecting or relating to his property or affairs;
(k) if, after the presentation of a bankruptcy petition by or against him or at any meeting of his creditors within twelve months next before such presentation, he attempts to account for any part of his property by fictitious losses or expenses;
(l) if after the presentation of a bankruptcy petition by or against him or at any meeting of his creditors within twelve months next before such presentation, he attempts to account for any part of his property by fictitious losses or expenses;
(m) if, within twelve months next before the presentation of a bankruptcy petition by or against him or after the presentation of a bankruptcy petition and before the making of a receiving order, he by false representation or other fraud has obtained any property on credit, and has not paid for the same;
(n) if, within twelve months next before the presentation of a bankruptcy petition by or against him or after the presentation of a receiving order, he obtains under the false pretence of carrying on business, and if a trader, of dealing in the ordinary way of his trade, any property on credit and has not paid for the same, unless he proves that he had no intent to defraud;
(o) if, within twelve months next before the presentation of a bankruptcy petition by or against him or after the presentation of a bankruptcy petition and before the making of a receiving order, he pawns, pledges or disposes of any property which he had obtained on credit and has not paid for, unless, in the case of a trader such pawning, pledging or disposing is in the ordinary way of his trade, and unless in any case he proves that he had no intent to defraud;
(p) if he is guilty of any false representation or other fraud for the purpose of obtaining the consent of his creditors or any of them to an agreement with reference to his affairs or to his bankruptcy, and shall be liable on conviction to a fine of N200 or imprisonment for twelve months or to both fine and imprisonment.
(2) A person who has sent out of Nigeria any property which he has obtained on credit and has not paid for shall until the contrary is proved be deemed to have disposed of the same otherwise than in the ordinary way of his trade if, such property not having been paid or accounted for at the date of the receiving order by the person to whom the same was sent, such last-mentioned person does not pay or account for the same within a reasonable time after being called upon to do so by the trustee or cannot be found within a reasonable time.
(2) Where any person pawns, pledges or disposes of any property in circumstances which amount to an offence under this Act under paragraph (a) of subsection (1) of section 129 of this Act, every person who takes in pawn or pledge or otherwise receives the property, knowing it to be pawned, pledged or disposed of in such circumstances as aforesaid, shall be guilty of an offence under this Act and shall be liable on summary conviction to imprisonment for one year or upon conviction on indictment to imprisonment for five years.
(a) if either alone or jointly with any other person he obtains credit to the extent of N100 or upwards from any person without first informing that person that he is an undischarged bankrupt; or
(b) if he engages in any trade or business under a name or names other than that or those under which he was adjudicated bankrupt and in the course of such trade or business obtains credit from any person without first disclosing to such person the name or names under which he was adjudicated bankrupt; or
(c) if he engages in any trade or business under a name or names other than that or those under which he was adjudicated bankrupt without first publishing., once in the Federal Gazette, and in three successive issues of two daily newspapers, a notice containing the following particulars-
(i) the name or names under which he was adjudicated bankrupt;
(ii) the last address at which he carried on any trade or business prior to the adjudication;
(iii) the name or names under which he intends to carry on the trade or business;
(iv) the nature of the trade or business which he intends to carry on; and
(v) the address or addresses at which he intends to carry it on,
and shall on conviction be guilty of an offence and be liable to imprisonment for one year or to a N200 fine or to both such fine or imprisonment.
(a) if in incurring any debt or liability he has obtained credit under false pretences or by means of any other fraud; or
(b) if with intent to defraud his creditors or any of them he has made or caused to be made any gift or transfer of or charge on his property; or
(c) if with intent to defraud his creditors he has concealed or removed any part of his property since or within two months before the date of any unsatisfied judgment or order for payment of money obtained against him; or
(d) if with intent to defraud his creditors or any of them he has caused or connived at the levying of any execution against his property,
and shall on conviction be liable to imprisonment for one year or to N200 fine or to both such fine and imprisonment.
(a) he has within two years prior to the presentation of the bankruptcy petition materially contributed to or increased the extent of his insolvency by gambling or by rash and hazardous speculations and such gambling or speculations are unconnected with his trade or business; or
(b) he has between the date of the presentation of the petition and the date of the receiving order lost any part of his estate by such gambling or rash and hazardous speculations as aforesaid; or
(c) on being required by the Official Receiver at any time, or in the course of his public examination by the court, to account for the loss of any substantial part of his estate incurred within a period of a year next preceding the date of the presentation of the bankruptcy petition or between that date and the date of the receiving order, he fails to give a satisfactory explanation of the manner in which such loss was incurred;
and shall be liable on conviction to imprisonment for one year or N200 fine or to both such fine and imprisonment.
(2) In determining for the purposes of subsection (1) of this section whether any speculations were rash and hazardous, the financial position of the accused person at the time when he entered into the speculations shall be taken into consideration.
(3) A prosecution shall not be instituted against any person under this section except by order of the court.
(2) A person who has not kept or has not preserved such books of account shall not be convicted of an offence under this section–
(a) if his unsecured liabilities at the date of the receiving order did not exceed, in the case of a person who has not on any previous occasion in Nigeria or elsewhere been adjudged bankrupt or made a composition or arrangement with his creditors, N5,000, or in any other case N1,000; or
(b) if he proves that in the circumstances in which he traded or carried on business the omission was honest and excusable.
(3) A prosecution shall not be instituted against any person under this section except by order of the court.
(4) For the purposes of this section, a person shall be deemed not to have kept proper books of account if he has not kept such books or accounts as are necessary to exhibit or explain his transactions and financial position in his trade or business, including a book or books containing entries from day to day in sufficient detail of all cash received and cash paid, and where the trade or business has involved dealings in goods, statements of annual stock-takings, and (except in the case goods sold by way of retail trade to the actual consumer) accounts of all goods sold and purchased showing the buyers and sellers thereof in sufficient detail to enable the goods and the buyers and sellers thereof to be identified.
(2) For the purposes of this section a person who, after the presentation of a bankruptcy petition by or against him or within three months next before such presentation, conceals or absents himself as aforesaid or quits Nigeria shall until the contrary is proved be deemed to have concealed or absented himself or quitted Nigeria with such intent as is mentioned in this section.
(2) Summary proceedings in respect of any such offence shall not be instituted after one year from the first discovery thereof either by the Official Receiver or by the trustee in the bankruptcy, or in the case of proceedings instituted by a creditor, in no case shall they be instituted by the creditor after three years from the commission of the offence.
(3) In any prosecution for an offence under this Act shall be sufficient to set forth the substance of the offence charged in the words of this Act specifying the offence, or as near thereto as circumstances admit, without alleging or setting forth any debt, act of bankruptcy, trading, adjudication, or any proceedings in, or order, warrant or document of, the court acting under this Act.
(4) The Official Receiver or any Deputy Official Receiver shall be competent to prosecute an offence under this Act.”
Part IX: Supplementary
“affidavit” includes statutory declaration or affirmation;
“available act of bankruptcy” means any act of bankruptcy available for a bankruptcy petition at the date of the presentation of the petition on which the receiving order is made;
“bailiff” includes any officer charged with the execution of a writ or other process;
“Minister” means the Minister charged with responsibility for bankruptcy administration;
“court” means the Federal High Court sitting in its bankruptcy jurisdiction;
“debt provable in bankruptcy” or “provable debt” includes any debt or liability by this Act made provable in bankruptcy; “goods” includes all chattels personal;
“oath” includes affirmation. declaration and attestation on honour;
“Official Receiver” means the person appointed pursuant to section 72 of this Act;
“ordinary resolution” means a resolution decided by a majority in value of the creditors present, personally or by proxy. at a meeting of creditors and voting on the resolution;
“prescribed” means prescribed by general rules within the meaning of this Act;
“property” includes money, goods, things in action, transferable interests. and every description of property. whether real or personal and whether situate in Nigeria or elsewhere, also obligations, easements and every description of estate, interest and profit, present or future, vested or contingent, arising out of or incidental to property as above defined;
“Registrar” includes the Chief Registrar of the Federal High Court and any Deputy Chief Registrar; “resolution” means ordinary resolution;
“secured creditor” means a person holding a mortgage, charge or lien on the property of the debtor or any part thereof, as a security for a debt due to him from the debtor;
“special resolution” means a resolution decided by a majority in number and three-fourths in value of the creditors present, personally or by proxy, at a meeting of creditors and voting on the resolution;
“trustee” means the trustee in bankruptcy of a debtor’s estate.