Duhaime's Law Dictionary

Duhaime's Bankruptcy Law Dictionary

All legal terms related to and explaining the law of bankruptcy and insolvency.

Absolute Discharge
A sentence of a person guilty of a crime in which the accused is deemed to have not been convicted. In bankruptcy law, to be fully absolved of former debts and the status of bankrupt.
Absolute Priority Rule
The highest rank amongst creditors; he who gets paid in full before any other creditor.
Annulment
To make void forever; to cancel an event or judicial proceeding both retroactively and for the future so that in the eyes of the law, it never occurred.
Automatic Stay
In bankruptcy law; a stay of collection and other similar debt enforcement proceedings against a bankrupt.
Bank
A corporation empowered to deal with cash, domestic and foreign, and to receive the deposits of money and to loan those monies to third-parties.
Bankrupt
A person who has legally declared bankruptcy.
Bankruptcy
The formal condition of an insolvent person being declared bankrupt under law.
Bankruptcy Trustee
An officer generally appointed by the court, who takes over the assets of a bankrupt to the benefit of creditors.
Co-debtor
One of two or more debtors who are primarily liable to the same debt.
Co-debtor Stay
A stay upon the debt enforcement or collection upon a co-debtor.
Consumer Debt
Debt incurred by an individual primarily for a personal, family, or household purpose.
Consumer Debtor
A term of bankruptcy law designating debtors who have debts under a prescribed amount.
Consumer Proposal
A summary form of bankruptcy for qualified individuals.
Cramdown
In a bankruptcy proceeding, forcing a secured creditor to lose his collateral and instead to take a specified cash payment.
Creditor
A person to whom money, goods or services are owed by the debtor.
Debt
An amount of money due and payable, from one person to another.
Debtor
A person who owes money, goods or services to another, the latter being referred to as the creditor.
Foreclosure
The sale of real property secured by a mortgage, in order to satisfy an outstanding loan.
Insolvent
A person not able to pay his or her debts as they become due.
Liquidation
The converting of the the assets of a person into cash.
Personal Living Expenses
Expenses reasonably necessary to maintain health and well-being, to enjoy life's activities, and the capacity to earn money.
Personal Use
Non-business use.
Stay
To stop; to suspend; also known as a stay of proceedings; when a law suit is suspended either indefinitely or until the occurrence of a condition imposed by the court.
Substantial Abuse
A term of American bankruptcy law which precludes a debtor from availing him or herself of bankruptcy protection.
Tax
A payment to a public authority, required by statute, for a public purpose.

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