The term “annulled” in the context of bankruptcy means that a bankruptcy order is terminated in the course of an annulment process. An annulment effectively means that the bankruptcy is undone before the end of the bankruptcy period, and the debtor is restored to their pre-bankruptcy financial status.
A bankruptcy can be annulled in the following events:
- If the debtor pays off all their outstanding debts in full, including any interest and fees (section 153A of the Bankruptcy Act);
- If the debtor proposes a composition or arrangement in satisfaction of the debts that is approved by the creditors (sections 73 and 74 of the Bankruptcy Act); or
- If the bankruptcy order was made in error or the court did not have jurisdiction to make the order (section 153B of the Bankruptcy Act).
If the annulment is successful, the debtor’s name remains listed on the National Personal Insolvency Index with the bankruptcy marked as ‘annulled’.