Daniel Gigiano Reviews Bankruptcy In The United States
Bankruptcy is in the United States Constitution. The Framers wanted to ensure that there would be a uniform system of bankruptcy so that one state would not put someone in debtor's prison for a debt that was discharged in another state.
Bankruptcy Is ConstitutionalDid you know that bankruptcy is mentioned in the United States Constitution? In other words, bankruptcy is constitutional. The United States Constitution states: "[The Congress shall have Power] to establish . . . uniform laws on the subject of Bankruptcies throughout the United States." Look it up! U.S. Constitution, Art. I, Section 8, clause 4.
Bankruptcy Laws Changed A Lot In The United StatesThe first bankruptcy law was passed in 1800 and only lasted until 1803. Another bankruptcy law was passed in 1841 and lasted until 1843. Yet another bankruptcy law lasted from 1867 to 1878. The first permanent bankruptcy law in the United States was passed in 1898, which lasted until 1978. In 1978, the current structure of bankruptcy laws were enacted, replacing the structure that had existed for eighty years. In 1984, 1986, 1994, and 2005, the bankruptcy act was revised, but the basic structure remained intact. The 2005 act added the means test and limits on restructuring vehicle loans.