How Has The Bankruptcy Law Changed Over Time

In ancient times, it tells of Moses talking about Jubilee. This would allow peoples debts to be rid of every fifty years. After a period of time fifty years was reduced to seven years. Interestingly enough, Chapter 7 bankruptcy cannot be filed any more than seven years apart. Ancient Greece did not forgive debt. Instead, if a man had a debt that they could not pay back, his family and servants were forced to work the debt off by physical labor known as “debt slavery.” In the sixteenth century in England, when the bankruptcy law first came about, it punished the debtors that wanted to get rid of their financial responsibilities. The debtors were punished by imprisonment. As the eighteenth century began they revised the law. Instead of imprisonment,

However, the first bankruptcy laws in the United States came from England’s earlier law. Each state had their own laws that had a wide range, which helped settle disputes between the creditor and debtor. These state laws came into effect after the Declaration of Independence was signed. The United States Constitution allowed, in 1789, for a federal bankruptcy law that had uniformity. It was finally adopted around ten years later as the Bankruptcy Act of 1800. The bankruptcy law in the United States has changed many times over many years. As stated before, the Constitution allowed for a federal bankruptcy law with uniformity in 1789 and a decade later the Bankruptcy Act of 1800 was passed. This act allowed a creditor to file bankruptcy toward a debtor. This would allow the debtors assets to be split up to pay the creditors back. A debtor could not file for voluntary bankruptcy their self, but could talk to a creditor that was friendly enough to help out and file bankruptcy for the debtor. However, just two years later that law was repealed. There were complaints of corruption and too many expenses. National politics, for the most part, did not speak of any bankruptcy laws until the Panic of 1839. At this point there were many petitions being

It told about the many businesses that were failing because of the conditions, economic wise, and that these conditions were out of the owners’ control. The Bankruptcy Act of 1841 was made into a law and it went into effect on the second of February in 1842. The Bankruptcy Act of 1841, just like the Bankruptcy Act of 1800, was repealed a short time later. This Act was repealed just over a year after it was passed on the third of March in 1843. Although this Act was short lived, there were more than 41,000 petitions for bankruptcy filed and most of them were voluntary. The Bankruptcy Act of 1841 began to allow debtors to voluntarily file bankruptcy on their own, instead, of seeking the help of a friendly creditor. In the previous act only traders could file bankruptcy, but in the act of 1841 it was open to more occupations. Now traders, brokers, bankers, marine insurers, factors and underwriters could file involuntary bankruptcy while anyone else could seek voluntary bankruptcy. Congress again quit talking about bankruptcy until the Panic of 1857. The Civil War caused stress financially on the Northern states and again caused for demands of a bankruptcy law. After the war ended, the Bankruptcy Act of 1867 was set