Bankruptcy (konkurs)
Also known as bankruptcy proceedings, insolvency proceedings, gone bankrupt, konkurs, konkursbehandling, gået konkurs
Bankruptcy is a collective winding-up of an insolvent debtor's estate, in which the creditors are paid according to a fixed order of priority.
In practice
Bankruptcy does not mean the money is gone — it means there is not enough for everyone, and that the distribution now follows the order of priority in Konkursloven (the Danish Bankruptcy Act) instead of whoever shouts loudest.
The decisive question for a creditor is therefore rarely whether the debtor goes bankrupt. It is where in the queue your claim stands when he does. If you hold a charge or a retention of title, you stand outside the queue and take your security. If you do not, you are an unsecured creditor — and unsecured creditors as a rule get very little, often nothing at all.
That is the single strongest reason why waiting never pays. The creditor who obtained an attachment four months ago stands in an entirely different position from the one who is still sending reminders.
Where it commonly goes wrong
- The claim is never filed in the estate. A claim that is not filed receives no dividend — however well founded it is.
- The creditor gives up at once. If there is a charge, a retention of title or personal liability on the part of an owner, the case is not over just because the company is.