Solicitor for Bankruptcy and Insolvency Law in Dublin

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Bankruptcy and Insolvency Law in Ireland: Navigating Financial Distress

Bankruptcy and insolvency law are critical legal frameworks that help individuals and businesses addre...

Bankruptcy and Insolvency Law in Ireland: Navigating Financial Distress

Bankruptcy and insolvency law are critical legal frameworks that help individuals and businesses address situations where they are unable to meet their financial obligations. Whether you’re an individual facing personal financial difficulties or a business struggling with debt, understanding bankruptcy and insolvency law is essential to finding the right legal solution. If you’re based in Dublin or anywhere else in Ireland, consulting a solicitor who specialises in this area can provide you with the guidance needed to make informed decisions and navigate the complexities of insolvency procedures.

What Is Bankruptcy and Insolvency Law?

Bankruptcy and insolvency law governs the legal processes by which individuals and businesses who are unable to pay their debts can seek relief. The law provides mechanisms for restructuring debt, liquidating assets, and distributing the proceeds to creditors. It offers individuals and businesses a chance to make a fresh start while ensuring that creditors receive fair treatment.

In Ireland, bankruptcy is primarily governed by the Personal Insolvency Act 2012, which provides a legal framework for individuals to deal with excessive debt. For businesses, insolvency law is governed by the Companies Act 2014, which covers company liquidation, receivership, and examinership. Whether you are an individual or a business entity, a solicitor specialising in bankruptcy and insolvency law can help you navigate these procedures and ensure that you comply with all relevant regulations.

Key Aspects of Bankruptcy and Insolvency Law

  1. Personal Bankruptcy
    Personal bankruptcy in Ireland is a legal process where an individual who cannot pay their debts can have their liabilities reduced or eliminated. The process typically involves the appointment of an Official Assignee, who is responsible for overseeing the sale of the individual’s assets to repay creditors. Bankruptcy in Ireland typically lasts for a period of one year, but it can be extended depending on the individual’s circumstances.

The Personal Insolvency Act also allows individuals to enter into a Debt Settlement Arrangement (DSA) or Personal Insolvency Arrangement (PIA), which enables them to restructure their debts and avoid full bankruptcy. These processes allow individuals to make reduced payments over a fixed period while preserving certain assets like their home.

  1. Business Insolvency
    Business insolvency can take several forms, depending on the type of company and its financial situation. There are three main processes available under Irish law for businesses facing insolvency:

    • Liquidation: This is the most common process for businesses that are insolvent and cannot continue trading. In liquidation, the company’s assets are sold to repay creditors. If the assets are insufficient to pay all debts, creditors may not receive full repayment.
    • Receivership: In cases where a company owes money to a secured creditor (such as a bank), that creditor can appoint a receiver to take control of the company’s assets and attempt to recover the debt.
    • Examinership: This process allows a company to continue trading while attempting to reach an agreement with creditors to restructure its debts. Examinership is typically used by businesses that believe they can become solvent again with financial restructuring.
  2. Insolvency for Partnerships
    Insolvency laws also apply to partnerships, though they are slightly different from those for corporations or individuals. Partnerships can enter into an agreement to restructure their debts, similar to a company going into examinership. The key difference lies in the liability of the partners: in most cases, partners are personally liable for the debts of the partnership.
  3. Creditor Rights and Protection
    In the context of bankruptcy and insolvency, creditor rights are central to the process. Creditors are typically divided into secured and unsecured creditors, with secured creditors having a higher priority in the repayment process. Insolvency law ensures that creditors receive fair treatment and that the legal procedures are followed to recover as much debt as possible from the bankrupt individual or company.

However, while creditors are given priority in repayment, the law also provides mechanisms to ensure that individuals and businesses are not unduly penalised. For example, personal bankruptcy allows for certain exemptions from asset seizure, such as the family home, depending on specific circumstances.

  1. Corporate Rescue and Restructuring
    In some cases, businesses facing financial difficulties may not need to resort to liquidation or receivership. Examinership is a legal process available to companies that are facing temporary financial issues and are still capable of being profitable. Under examinership, the company is given temporary protection from its creditors to allow it to attempt restructuring its business and financial affairs. This protection typically lasts for 70 to 100 days and can be extended if necessary.

When is it Necessary to Consult a Solicitor for Bankruptcy and Insolvency Law?

Understanding when to seek legal advice is crucial for anyone facing financial difficulties. Whether you are an individual struggling with debt or a business dealing with insolvency, consulting a solicitor can help ensure that you are aware of your legal rights and obligations. Here are some common situations where legal assistance is essential:

  • Personal Bankruptcy: If you are unable to meet your personal financial obligations and are considering bankruptcy or a personal insolvency arrangement, consulting a solicitor is important to ensure you understand the legal consequences and explore the best available options.
  • Business Insolvency: If your business is struggling with debt, a solicitor specialising in business insolvency can advise on whether liquidation, receivership, or examinership is the most appropriate course of action.
  • Negotiating with Creditors: If you are facing aggressive creditor actions or are unsure how to negotiate with creditors, a solicitor can help you explore options such as a Debt Settlement Arrangement (DSA) or Personal Insolvency Arrangement (PIA).
  • Cross-Border Insolvency: If your business or personal financial situation involves international elements, such as creditors in other jurisdictions, you will need a solicitor who understands the complexities of cross-border insolvency law.
  • Protecting Assets: A solicitor can advise on how to protect your assets, such as your home or business, from being seized in bankruptcy or insolvency proceedings.

Why is Bankruptcy and Insolvency Law Important?

Bankruptcy and insolvency law serve several key purposes:

  1. Financial Relief: For individuals and businesses facing overwhelming debt, bankruptcy and insolvency law provides a path to relief. It offers a chance to start over, either through debt restructuring or the discharge of liabilities.
  2. Fairness and Transparency: Bankruptcy and insolvency procedures ensure that the process is fair to both debtors and creditors. The law ensures that creditors are repaid as much as possible, while debtors are given a clear process to resolve their financial troubles.
  3. Economic Stability: By allowing businesses and individuals to recover from financial setbacks, bankruptcy and insolvency law helps maintain economic stability and encourages a healthy economy by ensuring businesses can be restructured or liquidated efficiently.

Conclusion

Bankruptcy and insolvency law is essential in Ireland to help individuals and businesses overcome financial distress. If you find yourself or your business in financial difficulty, it’s vital to consult a solicitor who specialises in bankruptcy and insolvency law to understand your rights, the legal processes involved, and the best path forward. Whether you are facing personal bankruptcy, business insolvency, or dealing with creditor disputes, expert legal advice can help you navigate these challenges effectively and make informed decisions. If you are in Dublin or anywhere in Ireland, seeking legal assistance can provide you with the support needed during financially challenging times.

About Deirdre

Deirdre is a Partner in our Dispute Resolution team. Specialising in Insurance Litigation, she acts for clients in the defence of public and employer’s liability, professional negligence, and other insurance related claims. She has a particular expertise in dealing with the ...

About Deirdre

Deirdre is a Partner in our Dispute Resolution team. Specialising in Insurance Litigation, she acts for clients in the defence of public and employer’s liability, professional negligence, and other insurance related claims. She has a particular expertise in dealing with the defence of defamation claims and also advises on insurance coverage issues.

As well as dealing with claims, Deirdre provides regular training to clients on health and safety risk, statutory requirements and changes and developments in insurance defence litigation.

She has a keen interest in emerging trends and innovations and how these can benefit her clients. She is also a CEDR accredited mediator.

dmunnelly@mhc.ie
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About James

James is a Partner on our Dispute Resolution team. He advises on all aspects of commercial dispute resolution (including alternative dispute resolution) and has a particular focus on the law of corporate restructuring and insolvency.

James has significant experience in ...

About James

James is a Partner on our Dispute Resolution team. He advises on all aspects of commercial dispute resolution (including alternative dispute resolution) and has a particular focus on the law of corporate restructuring and insolvency.

James has significant experience in high-value and complex disputes across a broad range of industry sectors. He specialises in contractual, shareholder, financial services, debt recovery and enforcement disputes, and his clients comprise financial institutions, corporates, private equity funds and shareholders.

James also regularly acts for insolvency practitioners, companies and creditors in relation to solvency issues and in formal insolvency processes including receivership, liquidation, examinership, SCARP and related litigation. He regularly advises directors in relation to their fiduciary duties.

He is also experienced in high value, complex, and multi-jurisdictional commercial litigation arising from supply chain disputes, shareholder disputes, professional negligence and civil fraud.

jmorrin@mhc.ie
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About Aoiffe

A Consulting Partner in our Public, Regulatory & Investigations team, Aoiffe helps public bodies to comply with public and administrative law requirements, with a particular focus on statutory interpretation, freedom of information, regulatory investigations and governance.Next

About Aoiffe

A Consulting Partner in our Public, Regulatory & Investigations team, Aoiffe helps public bodies to comply with public and administrative law requirements, with a particular focus on statutory interpretation, freedom of information, regulatory investigations and governance.

Aoiffe has specialised in public and regulatory law for over fourteen years. Aoiffe regularly works with clients providing strategic advice on key compliance and governance issues and the implementation of policies and procedures. Aoiffe has represented statutory bodies in judicial reviews and other public law litigation in the High Court and Supreme Court.

The regulatory landscape is constantly changing and evolving. Aoiffe recognises the challenges faced by public and private bodies and works to ensure that her clients are well briefed about what is coming down the tracks. Aoiffe has been described as an expert in freedom of information law and has been commended by clients for her quality of support and excellent level of work.

amoran@mhc.ie
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About Colin

Colin is a partner in our Dispute Resolution and Investigations team. He specialises in commercial litigation with a particular emphasis on internal and regulatory investigations, technology disputes, financial services litigation, competition litigation, commercial property d...

About Colin

Colin is a partner in our Dispute Resolution and Investigations team. He specialises in commercial litigation with a particular emphasis on internal and regulatory investigations, technology disputes, financial services litigation, competition litigation, commercial property disputes, shareholder disputes, and negligence claims.

Colin advises on all aspects of the litigation process and alternative dispute resolution mechanisms in Ireland, including arbitration and mediation. He has extensive experience in dealing with multi-party disputes before the Commercial List of the High Court.

Colin has a particular expertise in technology litigation and public law regulatory disputes. Over the last number of years, Colin has been the lead partner in proceedings before the Irish and European courts in respect of data transfers from the EEA to the U.S. arising from the Schrems II decision of the Court of Justice of the European Union. This is the most important and high-profile piece of technology litigation in Europe at present.

Colin is also particularly experienced in advising on data breach claims under the GDPR before the Irish courts and in acting for US clients in taking depositions in Ireland to obtain evidence for use in proceedings in the U.S.

Colin was selected as the International Client Choice Awards winner for Litigation in Ireland for 2015. Established in 2005, Client Choice recognises those lawyers around the world that stand apart for the excellent client care they provide and the quality of their service.

cmonaghan@mhc.ie
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About Niall

Niall is a Litigation Partner in our Public, Regulatory & Investigations team. He specialises in the areas of sectoral and professional regulation, and professional discipline. In addition, Niall is an acknowledged expert in Freedom of Information.

Niall frequently appe...

About Niall

Niall is a Litigation Partner in our Public, Regulatory & Investigations team. He specialises in the areas of sectoral and professional regulation, and professional discipline. In addition, Niall is an acknowledged expert in Freedom of Information.

Niall frequently appears for clients in the course of investigations, before investigatory bodies and in other forums. He also litigates on behalf of clients in high-profile and sometimes ground-breaking judicial review and statutory appeal proceedings in the courts.

He assists both regulators and regulated persons in navigating complex issues, including compliance, investigation and enforcement.

Clients appreciate Niall’s ability to distil intricate legal issues and provide clear, concise legal advice.

nmichel@mhc.ie
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About Nicholas

Nick is a Partner on our Corporate Governance team and advises on complex group reorganisations, from planning to delivery, as well as providing technical company law and corporate governance advice. In addition, Nick provides bespoke training to boards of directors of Iris...

About Nicholas

Nick is a Partner on our Corporate Governance team and advises on complex group reorganisations, from planning to delivery, as well as providing technical company law and corporate governance advice. In addition, Nick provides bespoke training to boards of directors of Irish companies.

This means that Nick advises on mergers, both domestic and cross-border, capital reductions and transactions involving regulated businesses as well as on more routine matters such as directors’ duties, the conduct of general meetings and the approval and payment of dividends.

His experience in complex reorganisations and his technical expertise allow Nick to identify and analyse issues at an early stage and suggest practical and solutions to any company law issues which may arise.

Understanding that importance of balancing company law obligations with the requirements of clients’ businesses, Nick is known for finding workable solutions for his clients.

nmetcalfe@mhc.ie
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About Fiona

Fiona is a Partner in our Health and Prosecutions department.

She advises across a broad range of healthcare law matters, including child care law, vulnerable adults and High Court inherent jurisdiction applications. With extensive advocacy skills and experience,...

About Fiona

Fiona is a Partner in our Health and Prosecutions department.

She advises across a broad range of healthcare law matters, including child care law, vulnerable adults and High Court inherent jurisdiction applications. With extensive advocacy skills and experience, Fiona appears regularly before the courts on behalf of statutory agency and healthcare clients such as the HSE, Tusla and Children’s Health Ireland. She has considerable expertise in the areas of wardship and assisted decision-making, and is appointed to the Decision Support Service panel of decision-making representatives. She acts for the Health Service Executive in Mental Health Act applications in respect of minors.

Fiona advises large technology companies and other organisations on various aspects of criminal prosecutions and investigations, including search warrants, production orders and mutual legal assistance requests. She acts for healthcare bodies in disclosure applications in criminal trials.

fmcnulty@mhc.ie
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About Peter

Peter is a Partner in our Energy sector. He advises on all relevant Irish and European Law and regulation applicable to Irish energy projects.

Peter advises clients on all aspects of the Irish electricity, natural gas and petroleum sectors. Peter has significant experie...

About Peter

Peter is a Partner in our Energy sector. He advises on all relevant Irish and European Law and regulation applicable to Irish energy projects.

Peter advises clients on all aspects of the Irish electricity, natural gas and petroleum sectors. Peter has significant experience of associated law such as environmental permitting and energy efficiency obligations. Peter also advises large energy consumers on efficient and diverse procurement strategies.

Peter has advised on major Irish renewable and electricity generation projects, as well as the development of an Irish LNG gasification terminal. He is particularly noted for his regulatory experience and ability to balance detail with a strategic view.

pmclay@mhc.ie
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About David

David McGovern is a partner in the Financial Services team and Head of the Aviation and International Asset Finance team, specialising in all aspects of the financing and leasing of aviation assets.

David has acted for a range of clients on domestic and multi-jurisdict...

About David

David McGovern is a partner in the Financial Services team and Head of the Aviation and International Asset Finance team, specialising in all aspects of the financing and leasing of aviation assets.

David has acted for a range of clients on domestic and multi-jurisdictional asset financing transactions involving corporate and commercial aircraft, shipping assets and other moveable equipment.

David has advised lessors on leases to operators of fixed wing and rotary aircraft across all key continents. David has extensive experience advising clients on financing structures used to finance and lease aviation assets including pre-delivery-financing, revolving credit facilities and ABS facilities.

David also advises clients on the establishment and running of leasing companies in Ireland.​​

dmcgovern@mhc.ie
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About Justin

Justin is a Partner in our Corporate team. He is recognised as an exceptional lawyer in corporate finance and private equity transactions in Ireland.

Justin has advised numerous clients on some of the highest value public-to-private transactions, which have taken place...

About Justin

Justin is a Partner in our Corporate team. He is recognised as an exceptional lawyer in corporate finance and private equity transactions in Ireland.

Justin has advised numerous clients on some of the highest value public-to-private transactions, which have taken place in Ireland.

Justin has extensive experience in corporate transactions with particular emphasis on public offers of equity securities by Irish and foreign issuers, private equity transactions and investment and acquisition transactions involving management groups.

Justin also acts as trusted advisor on the resolution of issues between shareholders and in complex and sensitive investment and shareholder matters.

Justin is a member of the board of directors of the Irish Takeover Panel as the nominee of the Law Society of Ireland. International directories have consistently ranked Justin as one of Ireland's leading corporate lawyers over the last several years.

jmckenna@mhc.ie
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Questions and answers about Bankruptcy and Insolvency Law

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What rights do I have regarding property and custody during a divorce in Ireland? How do Irish courts decide on child custody and asset distribution?

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