Is joint property included in the bankruptcy estate in the event of bankruptcy of one of the spouses’ companies?

Bankruptcy of the spouse’s company – joint property

Polish law regulates two forms of matrimonial property regimes: statutory and contractual. The first of them automatically arises at the time of marriage in accordance with the law. It covers assets acquired by both spouses during the marriage, both individually and jointly.

The second type results from an agreement concluded between spouses, which may expand, limit or determine the separation of property. In the event of bankruptcy of one of the spouses, if there was marital property ownership, both statutory and contractual, at the time of bankruptcy declaration, it is terminated.

As a result of the provisions of the Act, property separation is established between spouses. The spouses’ joint property automatically becomes part of the bankruptcy estate and its separation is prohibited. The personal property of the bankrupt spouse is also included in the bankruptcy estate.

Is property separation effective?

First of all, the separation of property established by the spouses through a marriage contract is effective in the context of the bankruptcy estate only if the contract was signed at least two years before the date of filing the bankruptcy petition. The same applies to situations where the community of property is limited by a property agreement. In the case of a shorter period, this agreement has no effect on the bankruptcy estate, which means that the marital property will be included in the bankruptcy estate.

However, there is an exception in a situation where the petition for separation of property was filed at least two years before filing for bankruptcy. It is worth noting that the bankrupt’s spouse may, by submitting a case to court or a plea, demand that the separation of property be recognized as effective in relation to the bankruptcy estate, provided that at the time of establishing the separation of property, he was not aware of the existence of grounds for declaring bankruptcy, and the establishment of the separation of property itself was not contributed to damage to creditors.

Does the bankrupt’s spouse have any legal protection?

The legislator provides the possibility of claiming receivables due to share in joint property in the form of reporting the claim by the spouse of the bankrupt person to the bankruptcy estate of the bankrupt person.

Outside the bankruptcy estate there are rights and items belonging to the personal property of the bankrupt’s spouse. Pursuant to the provisions of bankruptcy law, items that are used exclusively to conduct the business or professional activity of the bankrupt spouse are also excluded, even if they are covered by marital property. However, the only exceptions are those items that were acquired as joint property within 2 years before the date of filing the bankruptcy petition.

If the trustee incorrectly includes property items in the bankruptcy estate that should remain outside it, the spouse of the bankrupt person may request their exclusion on the basis of the provisions contained in Art. 70-74 of the Bankruptcy Law.