Jump to ContentJump to Main Navigation
Transaction Avoidance in Insolvencies$
Users without a subscription are not able to see the full content.

Rebecca Parry, James Ayliffe, Sharif Shivji, Hamish Anderson, and William Trower

Print publication date: 2018

Print ISBN-13: 9780198793403

Published to Oxford Scholarship Online: March 2021

DOI: 10.1093/oso/9780198793403.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 28 November 2021

Extortionate Credit Transactions (Insolvency Act 1986, Sections 244 and 343)

Extortionate Credit Transactions (Insolvency Act 1986, Sections 244 and 343)

Chapter:
(p.197) 6 Extortionate Credit Transactions (Insolvency Act 1986, Sections 244 and 343)
Source:
Transaction Avoidance in Insolvencies
Author(s):

Rebecca Parry

Publisher:
Oxford University Press
DOI:10.1093/oso/9780198793403.003.0008

Companies and, in particular, individuals in financial difficulties may suffer from an inequality of bargaining power with lenders. Unscrupulous lenders may exploit the debtor’s need for cash by demanding an excessive credit rate, fee, or equity. Debtors may be left with little choice but to comply if other lenders refuse to give them credit. Naturally, a high credit rate may be justified as a potential debtor with financial difficulties may be regarded as a credit risk; however, the rate charged may go far beyond that which would reflect this risk. In these circumstances, the lender is getting far more than he would have been able to obtain if the rate or terms of the transaction had been entered into fairly. This may be seen to disadvantage other creditors who have been reasonable in their dealings with the debtor. The legislation accordingly provides for such transactions to be adjusted, on grounds that they constitute extortionate credit transactions.

Keywords:   Court’s equitable jurisdiction, alternative remedies, extortionate credit transactions, general equitable jurisdiction, grossly exorbitant terms, security, substantive requirements, time limit, unforeseen events, urgent borrowing

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .