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| Bankruptcy is not about morality, or else there would be no exemptions at all. I write on what the law is (lege lata) not on what it ought to be (lege ferenda). If you don't like the law don't shoot the messenger, write to your MP, Congressperson, National Assemblyperson, etc.
Exemptions aren't about loopholes. They have and had a practical basis. The guru on this, now long dead, was Kurt H. Nadelmann, an escapee from Nazi Germany and a noted Harvard professor: http://www.nytimes.com/1984/01/31/ob...l-scholar.html
Continental Europe did not have a law of consumer bankruptcy -- only commercial insolvency -- until the advent of the credit card. Now Germany and the Scandinavian countries have consumer discharge provisions; France has the Loi Neiertz (a 5-year standstill). There are alternatives to bankruptcy, encouraged by the 1995 amendments to the US Bankruptcy Code: Chapter 13; and also in the English bankruptcy law: IVAs.
But the job of the jurist is to instruct on what the law is when asked. Don't blame me for the law's encouragement if profligacy. If the OP or his Friend wants to run off to Texas and buy a ranch near GW Bush's and claim exemption -- well £100,000 would certainly be enough in this depressed market to get him some land, and probably he could wait out the 91 days or whatever. But he couldn't legally work unless he got the right kind of visa, or was a writer or artist, etc. And you can't effectively file bankruptcy while on a visa waiver.
In England, as a matter of practicality, he's probably stuck. But I ranked the question with those college prank letters to sex magazines: the OP just wanted to start something. And since I had (I'm retired) a professional interest in the matter I wrote what the law is. After all, when the creditor was the Society of Lloyd's -- a criminal gang if there ever was one -- who could blame the scammed investors for taking off to Florida and filing bankruptcy? We don't know who the creditors are here. If they are payday lenders and the £100,000 is a recent inheritance, more power to him. (Of course any overindebted person should have a will in his favour re-drafted to put the money into a discretionary trust. But that's too complex for this forum.) | |
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We do, banks and credit cards
You have to be an ex lawyer or accountant to not see the base immorality of you say. Running up debts and not paying them, especially when you have the means is alien to most people. Further if you have the means to pay (£100k) but run up debt and then default to bankruptcy to avoid paying them, is an intentional action that only a lawyer or bean counter would find acceptable.