Part II The Commission's Proposals
2.1 As we remarked in the Consultation Paper we found no evidence of
any public debate at the time of passing of the Bankruptcy (Désastre) (Jersey) Law, 1990 ("the 1990 Law") as to the relative merits and demerits of retaining the dégrèvement procedure. The procedure was simply retained by Article 1(6) of the 1990 Law.
2.2 We believe that dégrèvement, though a bold reform when first introduced, has now become outdated and inequitable and enables creditors and debtors to contract out of the provisions of the 1990 Law. We consider this to be undesirable. In our view there should be a single modem procedure for all Jersey bankruptcies (other than for the winding up of companies which is governed by the Companies (Jersey) Law 1991) and this should be the désastre procedure as set out in the 1990 Law.
2.3 The Commission therefore proposes that dégrèvement be abolished.
2.4 The abolition of dégrèvement can be achieved by abolishing the customary practice of cession de biens. All the procedures that depend either on a cession or on an adjudged renunciation - i.e. décret, dégrèvement and réalisation - will then fall away naturally.
2.5 The provisions of Article 4 of the 1990 Law should be amended to allow a désastre to be declared in respect of the estate of a deceased person if the estate includes immoveable property which all the heirs and/or devisees have renounced. With dégrèvement abolished, the ability to declare the estate en désastre will give creditors secured on the immoveable estate the necessary means of proceeding against their security. If the heirs or devisees have taken the immoveable estate of the deceased the creditors may under the existing law proceed against them directly in which case the immoveable property of the deceased inherited by the heirs and/or devisees would also be available in the désastre. The amendment to Article 4 should make this clear.
2.6 Remise de biens, which still serves a useful purpose and does not depend on a cession or renunciation, should be retained, but with its procedure adapted to relate to désastre where at present it relates to dégrèvement.