11 September 2015: With more than a billion people now said to have an active facebook account, it was perhaps unsurprising to learn of a recent County Court judgment, in which a district judge allowed a trustee in bankruptcy to notify the bankrupt that he had been ordered to appear before the court, by posting on the bankrupt’s facebook page.
A trustee in bankruptcy is often faced with elusive bankrupts who are reluctant to provide information about their assets and liabilities, despite a clear duty to do so under the provisions of the Insolvency Act 1986. When dealing with non co-operative bankrupts, trustees are increasingly turning to the internet to retrace a bankrupt’s online footprint, with a view to bringing their affairs to account. Due to the vast amounts of information about an individual which can be found online, it could be argued that attempts to evade the enquiries of a trustee in bankruptcy are becoming fruitless.
In the recent judgment, in the Tunbridge Wells County Court, the bankrupt, a car dealer, had failed to co-operate with the Official Receiver and also his trustee in bankruptcy, in spite of an order suspending his discharge from bankruptcy being in force. The trustee applied for an order requiring the bankrupt to be publicly examined before the court. The bankrupt had been personally served with the notice but failed to attend the hearing and notified the trustee that he intended to leave the country. The trustee’s enquiries had established that the bankrupt appeared to be trading and in addition, was very active on facebook. In the bankrupt’s absence, the the court made an order requiring him to appear before the court for a public examination. Apparently satisfied with the evidence before it, the court ordered that the trustee could post notice of the order on the bankrupt’s facebook account.
The decision is by no means confirmed law; this was a county court decision which is yet to be endorsed by a higher court. The judgment raises more than a few cynical questions – how can you be certain that the account belongs to the person it purports to belong to? The very nature of the internet allows for impersonation. In addition, is it right that a bankrupt’s social media friends (and friends of their friends), and possibly the whole world, should be privy to sensitive information about an individual’s affairs.
Despite the potential limitations of the ruling, what this judgment does is indicate a willingness by the courts, to permit Insolvency Practitioners appointed over the affairs of an individual, to use social media as a practical tool to assist them in discharging their duties. We will have to wait and see how this area of law develops as more cases are heard before the courts and decisions are appealed to higher courts.
If you or your client need advice on any of the issues raised in this aricle, please contact one of the management team at BRI.