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Developer hit with 10-year bankruptcy order 17 January 2011

Leeds-based property developer Simon Morris was made bankrupt in October 2009, but the court recently decided to suspend his discharge from bankruptcy for 10 years, rather than revert to the usual period of one year.

The court issued the order after Morris’s creditors argued that he had failed to disclose information over his financial affairs, and that he handled money in his accounts before and after the date of his bankruptcy, to the detriment of his creditors.

On 23 October 2009 Kevin Mawer and Richard Hill from KPMG’s restructuring practice were appointed joint trustees in bankruptcy to Morris.

The secretary of state appointed KPMG at the request of Morris’s major personal creditors. This government appointment avoided the requirement to hold a creditors meeting to approve the joint trustees, which enabled their work to start immediately.

The joint trustees’ objective is to identify and realise Morris’s personal assets for the benefit of his personal creditors – many of whom are creditors of his businesses who hold personal guarantees. These guarantees enable business creditors to seek a return from Morris personally.

Mawer said: “A 10-year suspension of discharge is extremely unusual. An individual is normally entitled to an automatic discharge from bankruptcy one year after being made bankrupt.

“However, a trustee in bankruptcy can make an application to court for that automatic discharge to be suspended in instances where a bankrupt has failed to cooperate with the trustee's enquiries."

He added: “Our appointment allows us to begin representing the interests of Simon Morris’s creditors. They can expect an energetic investigation, firstly focusing on establishing the existence of assets owned by him.

“Anyone with information about his affairs and knowledge of any assets that may be in his ownership is invited to make contact with us.”

Mawer leads KPMG’s Forensic Recovery practice nationally - a team of insolvency specialists who deal with contentious insolvency appointments where there are concerns about fraud or hidden assets.

 

 

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