|n.||1.||The state of being actually or legally bankrupt.|
|2.||The act or process of becoming a bankrupt.|
|3.||Complete loss; - followed by of.|
|Noun||1.||bankruptcy - a state of complete lack of some abstract property; "spiritual bankruptcy"; "moral bankruptcy"; "intellectual bankruptcy"|
|2.||bankruptcy - inability to discharge all your debts as they come due; "the company had to declare bankruptcy"; "fraudulent loans led to the failure of many banks"|
|3.||bankruptcy - a legal process intended to insure equality among the creditors of a corporation declared in bankruptcy|
BANKRUPTCY. The state or condition of a bankrupt.
2. Bankrupt laws are an encroachment upon the common law. The first in England was the stat. 34 and 35 H. VIII., c. 4, although the word bankrupt appears only in the title, not in the body of the act. The stat. 13 Eliz. c. 7, is the first that defines the term bankrupt, and discriminates bankruptcy from mere insolvency. Out of a great number of bankrupt laws passed from time to time, the most considerable are the statutes 13 Eliz. c. 7; 1 James I., c. 19 21 James I., c. 19 5 Geo. II., c. 30. A careful consideration of these statutes is sufficient to give am adequate idea of the system of bankruptcy in England. See Burgess on Insolvency, 202-230.
3. The Constitution of the United States, art. 1, s. 8, authorizes congress "to establish an uniform rule of naturalization, and uniform laws on the subject of bankruptcies throughout the United States." With the exception of a short interval during which bankrupt laws existed in this country, this power lay dormant till the passage of the act of 1841, since repealed.
4. Any one of the states may pass a bankrupt law, but no state bankrupt or insolvent law can be permitted to impair the obligation of contracts; nor can the several states pass laws conflicting with an act of congress on this subject 4 Wheat. and the bankrupt laws of a state cannot affect the rights of citizens of another state. 12 Wheat. It. 213. Vide 3 Story on the Const. Sec. 1100 to 1110 2 Kent, Com. 321 Serg. on Const. Law, 322 Rawle on the Const. c. 9 6 Pet. R. 348 Bouv. Inst. Index, h. t. Vide Bankrupt.