Sequestration (Voluntary)

Voluntary sequestration is also known as extra judicial sequestration and it is a process where the debtor voluntarily conveys his or her estate to the trustee.

A person wishing to be voluntarily sequestrated may approach the Accountant in Bankruptcy (AiB) directly. It should be noted that this is the policy since 1 April 2008. Prior to this date the debtor would have had to go through the Sheriff Courts. 

The AiB will satisfy himself that the appropriate criteria have been met and will award sequestration against the debtor. If the AiB awards sequestration, they will appoint a trustee or act themselves as trustee if no-one else is appointed. If the AiB refuses to award sequestration, the debtor can appeal to the sheriff court. If successfully appealed, the trustee is appointed on the award of sequestration by that court. If the criteria are met, a determination awarding sequestration will be granted and the AiB must send a certified copy of the determination to the Keeper for recording in the ROI.

Either the AiB or another agent appointed by him as permanent trustee will manage the sequestrated person’s estate for the benefit of the creditors.

As with judicial sequestration, the inhibitory effect lasts for three years after which time it prescribes unless renewed by the trustee. Inhibitions based on both judicial and voluntary sequestrations may be renewed by the permanent trustee.

It should be noted that although debtors will be discharged from bankruptcy after one year (instead of three years for pre 1 April 2008 sequestrations), the inhibitory effect of a sequestration is three years.