Insolvency

Del. Code tit. 10, ch. 73
in effect

Del. Code tit. 10, § 7301 Right of discharge from imprisonment for debt; conditions.

Whoever is imprisoned for debt, damages, or costs, by virtue of any process or commitment, in a civil action (except process or commitment of the Court of Chancery), having resided in this State for 1 year next preceding such imprisonment, may obtain discharge from such imprisonment upon petition to the Superior Court of the county wherein he or she is imprisoned, and compliance with the provisions of this subchapter.

Del. Code tit. 10, § 7302 Contents of petition.

The petition for discharge shall set forth the imprisonment and the cause thereof, the insolvency of the petitioner, a full and true account of all the petitioner’s real and personal estate, debts, credits, rights, money, and effects whatsoever, with the sums and dates of all the petitioner’s bonds, notes, or other securities, and a true list, according to the best of the petitioner’s knowledge and belief, of all the petitioner’s creditors, with the sums due to them respectively. If the petitioner at any time has given, conveyed, assigned, settled, or disposed of money, stock, or property of any kind, upon trust, it shall be mentioned.

Del. Code tit. 10, § 7303 Summons to creditors; service.

The petition being preferred, the court shall award process for summoning the creditors of the petitioner to appear in the court, on some certain day, and show cause, if any they have, why the petitioner should not be discharged from imprisonment upon assigning his or her property for the benefit of his or her creditors. Service of such summons upon the agent or attorney of a creditor not residing in the State shall be a valid service as to such creditor. Service of a summons upon 1 of several parties, joint plaintiffs, or joint creditors, shall be sufficient so far as concerns a partnership, or joint debt.

Del. Code tit. 10, § 7304 Proof of service; appearance as waiver.

Proof of the service of a summons under § 7303 of this title shall be by the affidavit of the person serving the same written upon the summons. An appearance entered, either personally or by attorney, shall be as effectual as proof of the service of the summons.

Del. Code tit. 10, § 7305 Creditor’s affidavit of fraud; jury trial.

Any creditor in any sum not less than $50, the amount of which shall be proved by affidavit, may file an allegation of fraud against the petitioner, specifying the supposed fraudulent transactions, to which allegation the petitioner may plead. Thereupon the same shall be tried by a jury at the same term to which the petition is preferred.

Del. Code tit. 10, § 7306 Hearing by court in absence of allegation of fraud.

If an allegation of fraud is not filed, or being filed is withdrawn, the court shall hear what is alleged and proved for or against granting the prayer of the petition.

Del. Code tit. 10, § 7307 Interrogatories to petitioner.

Interrogatories may be proposed by any creditor to the petitioner, touching the causes of the petitioner’s insolvency, the ownership, disposal and state of any property, the time of contracting any debt, or of executing any security, deed, or other instrument, and the consideration thereof, and any other matter which the court deems a proper subject of such inquiry. The petitioner shall, upon the requirement of any creditor, fully and distinctly answer the interrogatories upon oath or affirmation. The petitioner’s answers, being reduced to writing, shall be signed by the petitioner.

Del. Code tit. 10, § 7308 Order to surrender property.

Upon sufficient cause shown, the court may order the petitioner to produce any money in the petitioner’s possession or control, or any deeds, bonds, notes, books of account, or other writings relating to his or her estate, and remand the petitioner until such order is complied with.

Del. Code tit. 10, § 7309 Penalties for fraud of petitioner.

If it appears to the court that the petitioner has fraudulently secreted, transferred, disposed of, or removed any goods, chattels, rights, credits, money, or other property, or has been guilty of deception or fraud in contracting any debt, or has not fully and truly answered the interrogatories proposed, or has committed any fraud by which the petitioner’s creditors may be injured, the petition shall be dismissed and the petitioner remanded.

Del. Code tit. 10, § 7310 Discharge of petitioner.

If it appears to the court that there is no sufficient cause for remanding the petitioner, it shall order that the petitioner be discharged from imprisonment after first fulfilling the requirements of §§ 7311 and 7312 of this title.

Del. Code tit. 10, § 7311 Oath of insolvency upon discharge.

Before an order for a petitioner’s discharge, the petitioner shall take an oath or affirmation according to the following form, the same being first distinctly read to him or her: “I ________________________ do solemnly swear (or affirm) that the account set forth in my petition to be discharged from imprisonment, is a full and true account of all my real and personal estate, legal and equitable, in possession, reversion and remainder, and of every nature and description, including all my debts, credits, rights, money and effects whatsoever; and that I have not at any time, given, conveyed, assigned, settled, disposed of, or delivered any lands, goods, money, stock, securities, or other real or personal estate, so as to expect any benefit or advantage therefrom, or upon any trust otherwise than as mentioned in said petition; that I have not contracted any debt, nor executed any bonds, or security, nor done any other act or thing to defraud my creditors; and that I have not intentionally or knowingly omitted from the list set forth in my petition any one of my creditors, nor misstated any debt due from me; so help me God. (Or so I do solemnly affirm.)”

Del. Code tit. 10, § 7312 Petitioner’s assignment in trust for creditors on discharge.

The petitioner shall also, before an order for his or her discharge, execute a deed of assignment, to a trustee, or trustees, appointed by the Court. Such deed shall be endorsed upon, or annexed to the petition, and shall be according to the following form: “I ________________________ do grant and assign to ______________________________________________ their heirs and assigns, as joint tenants, upon trust for all my creditors, all my lands, tenements, hereditaments, goods, chattels, rights, credits, and real and personal estate, of every nature and description, wheresoever situate or being. Witness my hand and seal the ________________________ day of ________________________ A.D. 20____________ Signed, sealed, and delivered, ____________________________ LS.” in open court, before If 1 trustee only be appointed, the deed may be adapted to the case.

Del. Code tit. 10, § 7313 Petition in Chancery for discharge.

Whoever is imprisoned for the nonperformance of any order or judgment for the payment of money, or costs, by virtue of attachment, or other process, issued out of the Court of Chancery, having resided within the State for 1 year next before his or her imprisonment, may prefer to the Court of Chancery, held in the county wherein he or she is imprisoned, a petition of the same purport prescribed in § 7302 of this title. Thereupon the Court of Chancery shall have and exercise jurisdiction over the subject of such petition, in the same manner and by like proceedings, as is provided in this subchapter in the case of a petition to the Superior Court, except as it regards the directing of an issue.

Del. Code tit. 10, § 7314 Records of proceedings.

Every petition, and all proceedings, orders and adjudications in cases of insolvency, shall be recorded by the prothonotary, or Register in Chancery, in suitable books kept for the purpose. A correct alphabetical index shall be kept for each book.

Del. Code tit. 10, § 7321 Deed of assignment as court record; copy as evidence.

A deed of assignment, executed pursuant to § 7312 of this title, shall be deemed to be a record of the court in which it is executed. A certified copy thereof shall be competent evidence.

Del. Code tit. 10, § 7322 Vesting of title under assignment.

The assignment shall vest in the trustee or trustees therein named, all the property and estate of the petitioner at the time of executing the same, real and personal, legal and equitable, and of every nature and description, as well as rights, whether real or personal, credits and things in action, as property in possession.

Del. Code tit. 10, § 7323 Possession of property by trustees; exemption and valuation.

The trustee or trustees shall take possession of all property and estate, except wearing apparel and the necessary bedding of the petitioner and the petitioner’s family, and the tools, or implements, of the petitioner’s trade or calling, not exceeding in value in the whole $50; which articles, and the value thereof, shall be ascertained by 2 judicious and impartial citizens of the county wherein the petitioner resides, to be appointed, and sworn or affirmed to the faithful performance of their duty, by a justice of the peace of the county. The articles so ascertained shall be exempt from any execution or legal process against the petitioner, except execution in a criminal case.

Del. Code tit. 10, § 7324 Rental liability of property assigned; payment before removal.

If the petitioner is a tenant holding any lands or tenements under rent, the petitioner’s goods and chattels that are on the demised premises at the time of executing the assignment, shall be liable for the rent of such premises for the current or preceding year, if such rent be not paid, but for 1 year only. The landlord may require that such rent be paid before the removal of the goods or chattels from the demised premises.

Del. Code tit. 10, § 7325 Duties and powers of trustees.

The trustee or trustees, or the survivors or survivor of them, or the executors or administrators of such trustee or survivor, shall collect, recover and reduce into possession all the rights, whether real or personal, credits and things in action of the petitioner; and for that purpose may, in his or her or their own name or names institute and prosecute to judgment and execution any actions real, personal, or mixed; and shall also convert into money all the property and estate assigned, and for that purpose may sell, dispose of and convey the same, in parcels or otherwise, as may be deemed expedient.

Del. Code tit. 10, § 7326 Abatement of actions pending at assignment.

No action or proceeding of the petitioner at law, or in equity, shall be abated by the assignment, but such action or proceeding may be continued and execution may be issued on any judgment recovered by the petitioner, as if no such deed of assignment had been executed. Such action, proceeding, or execution shall be for the use or benefit of the trustee or trustees, or the survivors or survivor of them, or the executors or administrators of such trustee or survivor.

Del. Code tit. 10, § 7327 Release after assignment.

No release, acquittance, or receipt, made by the petitioner after executing the deed of assignment, of any debt, demand, right, action, or cause of action, existing at or before the time of executing the deed, shall be of any force or effect.

Del. Code tit. 10, § 7328 Disposition of proceeds from petitioner’s estate.

The net proceeds of the petitioner’s estate, after deducting just expenses of executing the trust and a reasonable commission to the trustees, shall be applied towards payment of such demands against the petitioner as are exhibited to the trustees within 1 year after the date of the assignment, and no others. If the proceeds are insufficient to pay the whole amount of the demands, they shall be apportioned pro rata. Any overplus shall be returned to the petitioner, the petitioner’s heirs, executors, or administrators.

Del. Code tit. 10, § 7329 Admission of demands payable in future.

A demand existing at the time of executing the deed of assignment, but payable at a future day (subject to the proper discount if payable without interest) shall be admitted in the distribution of the petitioner’s estate.

Del. Code tit. 10, § 7330 Determination of controversies respecting demands or claims.

Controversies arising in the course of the execution of the trust, respecting any disputed demands or claims, may be referred, compromised, or settled, as may be deemed expedient.

Del. Code tit. 10, § 7331 Court’s powers with respect to trustees.

The court may, in its discretion, require the trustee or trustees to give bond with security to the State for the faithful execution of the trust. It may, in its discretion, remove the trustee or trustees and compel an assignment of the trust estate to others appointed in their stead. It may order an inventory and appraisement of the trust estate and effects to be made and returned to the court, and may require accounts, touching the execution of the trust, to be rendered, and shall adjust and settle such accounts. Any order by the court in the premises may be enforced by attachment and imprisonment.

Del. Code tit. 10, § 7341 Freedom from arrest; after-acquired property.

A person discharged from imprisonment, pursuant to subchapters I and II of this chapter, shall not be afterwards arrested or imprisoned for any debt or demand contracted or existing before such discharge, except debts and demands of the United States, and also of persons who shall not have been summoned, nor appeared. Such discharge shall have no further effect. If any debt or demand, due or existing, at the time of such discharge, against the petitioner, shall not be fully satisfied out of the estate and property assigned, because of the insufficiency thereof, such debt, or any balance thereof remaining after a proper application of the estate and property assigned, may be recovered and levied out of any property or estate, which the petitioner may acquire or become entitled to, after the date of the assignment, excepting that exempted from execution under this chapter.

Del. Code tit. 10, § 7351 Petition for maintenance.

Whoever is imprisoned for debt, damages, or costs of a civil action, or for nonperformance of an order or judgment for the payment of money, by virtue of original execution, other process, or commitment, may prefer to the Superior Court of the county wherein such person is imprisoned, a petition stating the imprisonment and the cause thereof, and the inability of the petitioner to maintain himself, herself or his or her family, and praying for relief.

Del. Code tit. 10, § 7352 Hearing on petition; order for recognizance of.

(a) If, upon the hearing of a petition filed under § 7351 of this title and reasonable notice in writing of the time and place thereof to the party at whose suit the petitioner is imprisoned, or the party’s attorney or agent, if there be such party, attorney or agent within the county, it shall appear that there is ground to apprehend that the petitioner or the petitioner’s family, in consequence of the petitioner’s imprisonment, will be chargeable to the county, the court shall order that the person at whose suit the petitioner is imprisoned, shall with sufficient surety enter into a recognizance to the State in the penal sum of $250, with condition to be void if the recognizor, the recognizor’s heirs, executors, or administrators, shall keep the county harmless and indemnified of and from all damages and charges in consequence of the imprisonment of the petitioner, either for the maintenance, or through the sickness, of the petitioner or the petitioner’s family. The order with the petition shall be filed in the office of the prothonotary in the county wherein the petitioner is imprisoned. (b) If notice of such hearing cannot be given, by reason of the fact that the party, at whose suit the petitioner is imprisoned, resides out of the county, and has no attorney or agent therein, the same proceedings shall be had as if notice had been duly served.

Del. Code tit. 10, § 7353 Recognizance.

The prothonotary may approve the surety and take the recognizance directed by the order issued under § 7352 of this title. The recognizance shall be joint and several.

Del. Code tit. 10, § 7354 Discharge upon failure to give recognizance.

If the order issued under § 7352 of this title is not complied with by the person on whom it is made (or by some 1 of them if there be several) within 10 days after the same is made, the prothonotary shall certify the order and the failure to comply therewith to the sheriff, or jailer, of the county. Thereupon the petitioner shall be discharged from imprisonment.

Del. Code tit. 10, § 7355 Discharge upon creditor’s action to discontinue liability.

(a) The principal in any recognizance entered into under the provisions of this subchapter may, at any time, cause an entry to be made upon the recognizance, or the record thereof, and signed by the principal, to the effect that the principal is unwilling to continue liable touching any further imprisonment of the person upon whose petition the order was made. (b) The prothonotary shall forthwith certify the substance of such order, recognizance and entry to the sheriff, or jailer, of the county. The petitioner shall thereupon be discharged from imprisonment at the suit of the party causing such entry to be made. (c) Such entry shall in no manner impair the recognizance or have any other effect than to discharge the petitioner from further imprisonment at the suit of the party causing it to be made.

Del. Code tit. 10, § 7356 Petition by prisoner to give security for debt.

Whoever is imprisoned for the reasons stated in § 7351 of this title may prefer a petition to the Superior Court setting forth that such person is willing and able to give to the creditor good and sufficient security for the payment of the debt, damages or costs within a reasonable time. If, upon the hearing of the petition, and reasonable notice in writing of the time and place thereof to the party at whose suit the petitioner is imprisoned, or the party’s attorney or agent, if there be such party, attorney or agent within the county, it appears that the petitioner is able to give such security, the Court shall proceed to order security to be given and taken in such form, and for the payment of such debt, damages and costs, in such time and manner as to the Court seems meet and proper in the case, and on such security being given and approved by the Court, an order shall be made for the immediate discharge of the petitioner from imprisonment.

Del. Code tit. 10, § 7357 Arrest upon same process; continuation of obligations.

A person discharged from imprisonment pursuant to § 7354, § 7355 or § 7356 of this title shall not be again arrested upon the same process, but such imprisonment and discharge shall have no other effect. No judgment, debt, or demand shall be thereby extinguished or invalidated.

Del. Code tit. 10, § 7358 Special proceedings; affidavit of fraud.

(a) The provisions of this subchapter for the discharge of a person imprisoned on civil process, upon failure of the party at whose suit such person is imprisoned to indemnify the county, shall not apply to the case of a prisoner remanded by the court upon the trial of allegations of fraud; nor to the case of a citizen of this State imprisoned by virtue of a capias ad satisfaciendum, or for the nonperformance of an order or judgment for the payment of money, upon an affidavit of fraud; nor to the case of any person whatsoever imprisoned by virtue of civil process, whether original, or final, or whether issuing out of a court of law or equity, if the plaintiff in such process, within 5 days after the imprisonment of such person, files in the office of the prothonotary, or Register in Chancery, issuing the process, an affidavit of fraud against the person so imprisoned, in the same form as by law is required to be filed before the issuing of a capias ad satisfaciendum against a citizen of this State. (b) A person so imprisoned, against whom such affidavit of fraud is filed within 5 days after such person’s imprisonment, as provided in this section, shall have the same benefit of a hearing of the specifications of fraud in such affidavit set forth before the court, and upon like proceedings, as in the case of an affidavit of fraud filed before the issuing of a capias ad satisfaciendum.

Del. Code tit. 10, § 7371 Appearance in actions.

The appearance of any person who is discharged from imprisonment according to subchapters I-IV of this chapter may be entered in any action, from process in which such person is so discharged. Such action may be proceeded in on the ground of such appearance.

Del. Code tit. 10, § 7372 Imprisonment by United States or for other cause.

No proceeding or order under subchapters I-IV of this chapter shall discharge any person imprisoned by the authority of the United States from such imprisonment, nor shall any such proceeding or order discharge any person from imprisonment for any other cause than that to which it relates. Such person, notwithstanding such proceeding or order, shall be detained for such other cause, according to the nature and effect thereof.

Del. Code tit. 10, § 7373 Preservation of liens and liability of sureties and others.

No proceeding under subchapters I-IV of this chapter shall in any way impair the lien of any mortgage, judgment, recognizance, execution, or any other lien, or the liability of one who, as surety, joint debtor, or otherwise, is liable for a debt or demand existing against the person to whom such proceeding relates.

Del. Code tit. 10, § 7374 Penalties for false swearing.

Whoever, to whom an oath or affirmation is administered under subchapters I-IV of this chapter, wilfully and falsely swears or affirms, in any matter, shall be guilty of wilful and corrupt perjury, and shall forfeit all benefit under such subchapters, and shall not be permitted to plead, or insist upon the same, or to avail himself or herself thereof in any manner whatever. The penalties prescribed by this section shall be in addition to the penalties prescribed by law for the crime of wilful and corrupt perjury.

Del. Code tit. 10, § 7381 Filing inventory of property assigned [For application of this section, see 85 Del. Laws, c. 291, § 9] [Repealed].

Del. Code tit. 10, § 7382 Appointment and duties of appraisers [For application of this section, see 85 Del. Laws, c. 291, § 9] [Repealed].

Del. Code tit. 10, § 7385 Assignees’ accounts and exceptions [For application of this section, see 85 Del. Laws, c. 291, § 9] [Repealed].

Del. Code tit. 10, § 7387 Void preferences of creditors [For application of this section, see 85 Del. Laws, c. 291, § 9] [Repealed].

Source: DE Code (Official Site)URL: https://delcode.delaware.gov/title10/c073/sc01/index.htmlFetched: 10/4/2026

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