Bankruptcy Ordinance [New Version]

District Court

174. The jurisdiction of every court invested with jurisdiction to adjudicate in Bankruptcy as a court of first instance shall, subject to the provisions of this Ordinance, extend to the whole territory of the State.

672 Book of Laws 34 28 Elul 5740 09.09.1980

Transfer of Proceedings

[[(901(2)]]

The authority designated for that purpose may, whether on the application of a party or without such application, transfer Bankruptcy proceedings at any time and at any stage from one court to another, or direct that the proceedings shall continue in the court in which they were commenced even though it is not the court in which they ought to have been commenced.

Legal

Where a legal question arises in any Bankruptcy proceedings before a Magistrate's Court so invested, and all the parties to the proceedings, or one party and the court, desire the District Court to decide it in the first instance, the court shall state the facts in the form of a case for the opinion of the District Court, and the case and the proceedings, or such of the proceedings as are necessary, shall be transferred to the District Court for determination.

Court Sitting in Chambers

A judge adjudicating in Bankruptcy may, subject to the provisions of this Ordinance and the Regulations, sit in chambers.

Compliance

[[(93(4)]]

Where a trustee, debtor, or other person has failed to comply with any order or direction given by the court, the Official Receiver, or any other officer of the court in the exercise of jurisdiction under this Ordinance, the court may, on the application of the Official Receiver or any other duly authorized person, order them to comply with the order or direction, and may, on such application, order the imprisonment of the person in default, and this in addition to any other right and remedy in respect of such non-compliance.

Where a judgment creditor has applied for the imprisonment of a debtor under Section 70(a) of the Execution Law, 5727-1967, the court may, in lieu of an order of imprisonment, make, with the consent of the judgment creditor and after payment of the prescribed fee, a Receiving Order against the debtor; where the court has done so, the debtor shall be deemed to have committed an act of Bankruptcy at the time of the making of the order, the provisions of this Ordinance, except Sections 216 to 229, shall apply, and wherever reference is made to a Bankruptcy petition by or against a person, it shall be read as a reference to the making of the Receiving Order.

[[(941(1)]]

The Court may reconsider any Order it has issued in the exercise of its Bankruptcy jurisdiction, and may cancel or vary it.

Appeal Time Limits

The costs incurred in any proceeding before the Court under this Ordinance shall be in the discretion of the Court, subject to the provisions of the Ordinance and the Regulations made thereunder.

The Court may, upon such terms as it has prescribed —

As to Procedure

The Court may, subject to Regulations, receive in any matter all or any of the evidence, whether orally, by affidavit, or outside Israel by a commissioner.

Where a petitioner does not proceed with due diligence in the Bankruptcy petition proceedings that the petitioner has filed, the Court may substitute in the petitioner's place another creditor who is owed by the debtor the amount required under this Ordinance in respect of a creditor filing a Bankruptcy petition.

Where a debtor in respect of whom a Bankruptcy petition has been filed by or against him dies, the proceedings in the matter shall continue as if he were alive, unless the Court otherwise directs.

Death of Debtor

The Court may at any time, for sufficient cause, Order a stay of proceedings, either absolutely or for a limited period, upon such terms as it considers just.

674 Sefer HaHukim 34 28 Elul 5740 09.09.1980

Petition Against a Partner or Partnership

191. A creditor whose debt entitles him to file a Bankruptcy petition against a Partnership may not file such petition against a partner or partners therein unless he is entitled to bring an action against him or them under partnership law.

Where there are several Respondents to a Bankruptcy petition, the Court may dismiss the petition in respect of one or more of them, without prejudice to its effect against the remaining Respondents.

Partner

Where a receiving Order has been made on the basis of a Bankruptcy petition filed by or against a partner in a Partnership, the following provisions shall apply:

and the Partnership

Bankrupt

A person who is a party to a Contract together with a Bankrupt may sue and be sued under the Contract without joining the Bankrupt.

Bankruptcy Proceedings in the Name of an Unregistered Partnership

Partners in a Partnership that has not been duly registered, and any person conducting business in the name of such a Partnership, may take or have taken against them proceedings under this Ordinance in the name of the Partnership; however, the Court may, on the application of an interested party, Order that the names of the partners or the name of the person conducting the business be set out in such manner as it directs and be verified by oath or in such other manner as it directs.

With One Another

Courts, together with their officers, shall assist one another in all matters of Bankruptcy; an Order of a court requesting assistance from another court having jurisdiction in Bankruptcy shall be sufficient to enable the requested court to exercise, in respect of the matters stated in the Order, such jurisdiction as it or the requesting court possesses in similar matters within their respective jurisdictions.

A search Order issued by the Court for the discovery of a debtor's assets shall be executed in the manner prescribed, or in the manner in which a search Order is executed under the Criminal Procedure Ordinance (Arrest and Search) [New Version], 5729-1969.

Each partner shall be liable for the debts and obligations of the Partnership in accordance with partnership law.

Partners

The provisions of this Ordinance shall apply, subject to modifications in the Regulations made thereunder, to a limited Partnership as if it were a general Partnership; where all its general partners have been adjudicated Bankrupt, its assets shall vest in the trustee.

Limited Partnerships

Application to Small Bankruptcies

in Bankruptcy

For the purpose of a Muslim debtor

676 Book of Laws 34 28 Elul 5740 09.09.1980

under this Ordinance had the debtor been alive, and that the Estate is insolvent, the Qadi shall transfer the administration of the Estate to the Court competent in Bankruptcy matters, and an Order of transfer shall have the same effect as an Administration Order.

Powers of the Official Receiver and the Creditors

204. Upon the making of an Administration Order, the assets of the debtor shall be vested in the Official Receiver attached to the Court, in the capacity of Trustee thereof, and the Official Receiver shall immediately commence to realise and distribute them in accordance with the provisions of this Ordinance; however, the creditors shall have rights with respect to the appointment of trustees and committees of inspection as they have in other cases where the assets of a debtor are administered in Bankruptcy, and the provisions of this Ordinance relating to trustees and committees of inspection shall apply to trustees and committees of inspection appointed by virtue of this Section.

Effect of Administration Order as Declaration of Bankruptcy

205. All provisions of this Ordinance relating to the administration of the assets of a bankrupt shall apply, subject to what is stated in Sections 206 to 208 and to the extent that they are capable of application to an Administration Order, in the same manner as they apply to a declaration of Bankruptcy under this Ordinance.

The reasonable expenses of the funeral of the deceased debtor and the expenses of the Estate and its administration shall be given priority and shall be paid in full out of the debtor's Estate before any other debt.

Where a surplus remains in the hands of the Official Receiver or the Trustee, after all debts due from the debtor have been paid in full, together with the costs of administration and interest as prescribed in this Ordinance for the case of Bankruptcy, the surplus shall be paid to the heirs or to the legal personal representative of the Estate of the deceased debtor, or shall be dealt with as the Court may direct.

Application for Administration Order

Notice to the heirs of a debtor or to the legal personal representative thereof of the filing of an application by a creditor under