Act of Bankruptcy, an act, the commission of which by a debtor renders him liable to be adjudged a bankrupt if the petition is presented within three months thereafter.
Under s. 1 of the (English) Bankruptcy Act, 1914 (4 & 5 Geo. 5, c. 59), any one of the following acts of a debtor is an act of bankruptcy:-
(a) Having made an assignment of his property in trust for his creditors generally.
(b) Having made a fradulent conveyance, gift, delivery, or transfer of his property, or of any part thereof.
(c) Having made a conveyance amounting to a 'fradulent preference.'
(d) Having, with intent to defeat or delay his creditors, departed out of England, or being out of England, remained out of England; or having absented himself; or begun to keep house.
(e) If execution against him has been levied by seizure of his goods under process in any Court or in any civil proceeding in the High Court, and the goods have been either sold or held by the sheriff for 21 days:
Provided that where an interpleader summons has been taken out in regard to the goods seized, the time elapsing between the date at which such summons is taken out and the date at which the sheriff is ordered to withdraw, or any interpleader issue ordered thereon is finally disposed of, shall not be taken into account in calculating such period of 21 days.
(f) Having filed, in the Bankruptcy Court, a declaration admitting his inability to pay his debts or having presented a bankruptcy petition against himself.
(g) Having neglected to pay or secure a judgment debt after service of a 'bankruptcy notice,' or satisfied the Court that he has a good cross claim. See BANKRUPTCY NOTICE.
(h) If the debtor gives notice to any of his creditors that he has suspended or is about to suspend payment of his debts.
A bankruptcy commences at the actual time of day on which an act of bankruptcy is committed [Re Bumpus, (1908) 2 KB 330].
Act of bankruptcy, means an event, such as a debtor's fraudulent conveyance of property, that triggers an involuntary bankruptcy proceeding against a debtor, Black Law Dictionary, 7th Edn., p. 34.
See BANKRUPT; DEBTOR'S SUMMONS; Williams on Bankruptcy.