New Zealand Legislation: Acts

17 Failure to comply with bankruptcy notice

• (1) A debtor commits an act of bankruptcy if—

  • (a) a creditor has obtained a final judgment or a final order against the debtor for any amount; and

  • (b) execution of the judgment or order has not been halted by a court; and

  • (c) the debtor has been served with a bankruptcy notice; and

  • (d) the debtor has not, within the time limit specified in subsection (4),—

    • (i) complied with the requirements of the notice; or

    • (ii) satisfied the court that he or she has a cross claim against the creditor.

  (2) The form that the bankruptcy notice must take is set out in section 29.

  (3) The debtor must have been served with the bankruptcy notice in New Zealand, unless the court gave permission for the service of the notice on the debtor outside New Zealand.

  (4) The time limit referred to in subsection (1)(d) is,—

  • (a) if the debtor is served with the bankruptcy notice in New Zealand, 10 working days after service; or

  • (b) if the debtor is served outside New Zealand, the time specified in the order of the court permitting service outside New Zealand.

  (5) In this section, a creditor who has obtained a final judgment or a final order includes a person who is for the time being entitled to enforce a final judgment or final order.

  (6) In this section, if a court has given permission for enforcing an arbitration award that the debtor pay money to the creditor,—

  • (a) final order includes the arbitration award; and

  • (b) proceedings includes the arbitration proceedings in which the award was made.

  (7) In subsection (1)(d)(ii), cross claim means a counterclaim, set-off, or cross demand that—

  • (a) is equal to, or greater than, the judgment debt or the amount that the debtor has been ordered to pay; and

  • (b) the debtor could not use as a defence in the action or proceedings in which the judgment or the order, as the case may be, was obtained.

  Compare: 1967 No 54 s 19(1)(d), (2)