The trustee in bankruptcy, Financial Accounting

THE TRUSTEE IN BANKRUPTCY

1) Appointment of trustee

The trustee is appointed:

  • By the creditors by ordinary resolution, or
  • By the committee of inspection, if so resolved by the creditors, or
  • By the court if a trustee is not otherwise appointed within four weeks of the adjudication or within seven days of rejection of a composition or scheme.

 

A vacancy is filled in the same way, the court having power to appoint if the vacancy is not filled within three weeks. A trustee appointed by the court may be replaced by a new trustee appointed by the creditors or committee of inspection.

2) Court objections
The court may object to a trustee appointed by the creditors or committee of inspection on any of the following grounds:

  • Appointment not made in good faith by a majority in value of creditors voting;
  • Person appointed not fit to act as trustee;
  • Trustee’s relationship with bankrupt or a creditor makes it difficult for him to act impartially;
  • Misconduct or failure to render accounts or deal properly with unclaimed moneys, in a previous trusteeship.
Posted Date: 12/12/2012 6:44:58 AM | Location : United States







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