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On the Legal Position of a Purchaser (for Value) from the Assignee under a Voluntary Settlement, in the event of the subsequent Bankruptcy of the Settlor

Published online by Cambridge University Press:  18 August 2016

George J. Lidstone
Affiliation:
Alliance Assurance Company

Extract

It would appear, from some of the answers given by candidates in the recent Final Examination for the Fellowship of the Institute of Actuaries, that considerable misapprehension exists as to the effect of the latest decision of the Courts with reference to the subject of this note. It may, therefore, be useful to deal briefly with the question in the pages of the Journal.

Type
Research Article
Copyright
Copyright © Institute and Faculty of Actuaries 1900

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References

page 371 note * The section does not apply to the administration in bankruptcy of the estate of a deceased insolvent under Section 125 of the Act (Exp. O.R., in re Gould, 19 Q.B.D. 92).

page 372 note * The fact that a settlement has been set aside under the Section does not entitle the trustee to stand in the position of the beneficiaries under the settlement so as to take priority over mortgagees and incumbrancers ranking after the settlement; the trustee takes the property subject to all such mortgages and incumbrances (provided they were created bonâ fide prior to the bankruptcy)—see Sanguinetti v. Stuckey's Banking Co., 1895, 1 Ch. 176. It would seem that the settlement is only avoided so far as is necessary to satisfy the debts of the bankrupt and pay the costs of the bankruptcy, and that the title to the balance (if any) is unaffected (Re Sims, exp. Sheffield, 3 Mans. 340).

page 372 note † As to the time when the bankruptcy is deemed to commence, see Section 43 of the Act.

page 378 note * This case has not yet appeared in the Law Reports, but was reported in The Times newspaper.