Act of bankruptcy

ACT OF BANKRUPTCY. An act which subjects a person to be proceeded against asa bankrupt. The acts of bankruptcy enumerated in the late act of congress,of 19th Aug. 1841, s. 1, are the following: 1. Departure from the state,district, or territory of which a person, subject to the operation of thebankrupt laws, is an inhabitant, with intent to defraud his creditors. See,as to what will be considered a departure, 1 Campb. R. 279; Dea. & Chit.4511 Rose, R. 387 9 Moore, R. 217 2 V. & B. 177; 5 T. R. 512; 1 C. & P. 77;2 Bini,. R. 99; 2 Taunt. 176; Holt, R. 175.
2. Concealment to avoid being arrested. 1 M. & S. 676 ; 2 Rose, R. 137;15 Ves. 4476 Taunt. R. 540; 14 Ves. 86 Taunt. 176;1 Rose, R. 362; 5 T. R.512; 1 Esp. 334.
3. Willingly or fraudulently procuring himself to be arrested, or hisgoods and chattels, lands, or tenements to be attached, distrained,sequestered, or taken in execution.
4. Removal of his goods, chattels and effects, or concealment of themto prevent their being levied upon, or taken in execution, or by otherprocess.
5. Making any fraudulent conveyance, assignment, sale, gift, or othertransfer of his lands, tenements, goods, or chattels, credits, or evidencesof debt. 15 Wend. R. 588; 5 Cowen, R. 67; 1 Burr. 467, 471, 481; 4 C. & P.315; 18 Wend. R. 375; 19 Wend. R. 414; 1 Dougl. 295; 7 East, 137 16 Ves.149; 17 Ves. 193; 1 Smith R. 33; Rose, R. 213.

Act of Bankruptcy

An action by a debtor that can be a basis for creditors to file a bankruptcy petition against the debtor. Examples of such actions are concealing assets, defrauding creditors, favoring one creditor over another, or admitting in written a willingness to be adjudged bankrupt.

Act of Bankruptcy

An involuntary admission of bankruptcy by a debtor. In general, going into default and consistently missing payments may be considered acts of bankruptcy. Before 1978 in the United States, an act of bankruptcy involved the transfer of assets to another party with the intent to defraud creditors, but this is no longer the case. Upon committing an act of bankruptcy, creditors have the ability to petition to force the debtor into legal bankruptcy.