Under current law, a bankrupt individual can file multiple appeals or annulment applications, even after earlier ones are dismissed. Each new filing automatically stops trustees from paying creditors until the court process ends.
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We believe this loophole allows debtors to delay payments to creditors for years, which in turn can cause hardship for creditors, and can delay the courts with repeat claims. A review could consider mechanisms to protect creditors, reduce abuse of process, and ensure trustees can make distributions promptly while still safeguarding a debtor’s right to one fair hearing. We believe creditors deserve timely justice. A review of the current law could find ways to stop bankrupt individuals intentionally using the appeals process to delay payments and restore confidence in the fairness of the insolvency system.