A legal proceeding in which a person or business is requested to go into bankruptcy by creditors, rather than on the person or business' own accord. Creditors seeking involuntary bankruptcy must petition the court to initiate the proceedings, and the indebted party can file an objection to force a case.
Involuntary bankruptcy is requested by creditors who feel that they will not be paid if bankruptcy proceedings are not entered into, and seek a legal requirement to force the debtor to pay. In order for involuntary bankruptcy to be brought forward, the debtor must have a certain amount of debt that must be met. This amount depends on whether the debtor is an individual or a business.
Investment dictionary. Academic. 2012.
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involuntary bankruptcy — a bankruptcy initiated by at least three creditors holding unsecured claims aggregating at least $5,000 against the debtor. Data from the U.S. Administrative Office of the Courts subdivides bankruptcies into voluntary and involuntary (Glossary of … Glossary of Bankruptcy
involuntary bankruptcy — ➔ bankruptcy * * * involuntary bankruptcy UK US noun [U] LAW ► a situation in which a business or a person becomes unable to pay their debts, and is made officially bankrupt after people who are owed money go to court to try to get some of their… … Financial and business terms
involuntary bankruptcy — n: bankruptcy declared upon petition of creditors see also bankruptcy Merriam Webster’s Dictionary of Law. Merriam Webster. 1996. involuntary bankruptcy … Law dictionary
involuntary bankruptcy — /ɪnˌvɒlənt(ə)ri bæŋkrʌptsi/ noun US an application by creditors to have a person or corporation made bankrupt (NOTE: The UK term is compulsory winding up.) … Dictionary of banking and finance
involuntary bankruptcy proceeding — A proceeding in a court of bankruptcy instituted by the creditors of a person, firm, or corporation, without his or its consent, to have him or it adjudicated and declared to be a bankrupt. Re Murray (DC Iowa) 96 F 600, 602. See involuntary… … Ballentine's law dictionary
involuntary case — Creditors of a debtor may petition the court to force the debtor into a bankruptcy proceeding. This may also be referred to as a creditors petition. If the debtor has 12 or more creditors, the petition must be filed by three or more creditors… … Glossary of Bankruptcy
bankruptcy — bank·rupt·cy / baŋ ˌkrəp sē/ n pl cies 1: the quality or state of a bankrupt filed for bankruptcy 2: the administration of an insolvent debtor s property by the court for the benefit of the debtor s creditors the debt was discharged in bankruptcy … Law dictionary
involuntary — in·vol·un·tary /in vä lən ˌter ē/ adj: done, made, or initiated contrary to or without one s choice an involuntary confession an involuntary lien an involuntary plaintiff joined in the action in·vol·un·tar·i·ly adv Merriam Webster’s Dictionary of … Law dictionary
bankruptcy petition — ➔ petition * * * bankruptcy petition UK US noun [C] ► LAW, FINANCE a formal letter to a court asking that a person or company be declared bankrupt: »The latest bankruptcy petition was filed April 14. »Lawyers are considering an involuntary… … Financial and business terms
Bankruptcy in the United States — The United States Constitution (Article 1, Section 8, Clause 4) authorizes Congress to enact uniform Laws on the subject of Bankruptcies throughout the United States. Congress has exercised this authority several times since 1801, most recently… … Wikipedia