Bankrupts' pensions in danger
A discharged bankrupt has withdrawn an appeal to the House of Lords in a landmark case that could mean bankrupts' pensions are removed to pay off creditors.
John Dennison, the bankrupt, withdrew his appeal in the case of Krasner v Dennison a few months ago, and the paper confirming the withdrawal was released this week. The appeal had been granted by the House of Lords on 23 November 2000.
Trustee Gerald Krasner, senior insolvency practitioner at Bartfield and Co. Chartered Accountants, said he could not comment on the reasons for the withdrawal, but that it was done ‘by mutual agreement’.
Krasner said the case means Dennison has lost his pension, despite the fact he is no longer a bankrupt. ‘We have the right to that pension for the remainder of his life.’
The case is likely to affect over 1,000 bankrupts whose bankruptcies occurred between December 1986 and May 2000, according to Krasner.
But bankruptcies which occurred after May 2000, when the law was changed, are safe.
Krasner said: ‘The case means that we now have a bit more certainty than we did before concerning the rights of the trustees and the rights of the bankrupts.’
The insolvency practitioner had won the Dennison case in April 2000, when the Court of Appeal ruled in Krasner, deciding Dennison’s pension should be treated as a realisable asset, so trustees could seize the bankrupt’s pension to pay off creditors.
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