Modern sense of 'to go bankrupt'

mplsray

Senior Member
In the thread "Creditors," forum member NHHL proposed the following scenario:

You owe a lot of people a lot of money. Now you go bankrupt. You cannot pay them back, you run away to hide so they cannot find you.
The use of "go bankrupt" here struck me as odd, unless applied in a historical context. From my own perspective, as an American, "to go bankrupt" no longer means simply "to become insolvent" but "to go through the legal process of bankruptcy." Once one has gone bankrupt, there would be no point in fleeing from one's creditors because one would no longer have a legal obligation to pay them back.

One exception: Some debts cannot be discharged through bankruptcy, including, in the US, school loans, so there would still be creditors one might flee.

In the the US, Chapter 11 bankruptcy leaves one owing creditors, but it is a process in which the debtor takes part in a plan to pay back a part of his debt, so in that case it would seem pointless to flee one's creditors.

What I am asking, then, is that if you were to hear today that someone "went bankrupt," would you not assume, as I do, that they would have gone through the legal process of discharging their debts (noting the exception mentioned above)? In the case of Chapter 11 bankruptcy, I would really not expect the words "to go bankrupt" or "went bankrupt" to be used as such. Rather I would expect "to file for Chapter 11 bankruptcy" or "filed for Chapter 11."

In other words, is the sense of "to go bankrupt," with no legal meaning, now no longer in use and likely to be misunderstood by the modern public?

I understand that different varieties of English may have resulted in their speakers having a different view of things, and I would be interested in hearing about such cases.
 
  • I understand "go bankrupt" the same way you do, mplsray. If I hear that someone "went bankrupt," I assume they went through the legal process. If I heard that someone had "fled from creditors," I would assume that he was hiding assets from creditors - assets he planned to live on in his hiding place - and avoiding the legal process of bankruptcy (in which the assets would be taken to pay his debts).
     

    cycloneviv

    Senior Member
    English - Australia
    I think the term/word is still at a bit of a cross-over point in Australian English. "They went bankrupt" and "They lost all their money" was pretty much synonymous for many, many years hereabouts. To my generation at least, it would generally be used and understood (outside of legal documents) to mean running out of money rather than going through the legal process of applying for bankruptcy, even though we know that technically that is what it ought​ to mean.
     
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    ewie

    Senior Member
    English English
    I think the term/word is still in a bit of a cross-over point in Australian English. "They went bankrupt" and "They lost all their money" was pretty much synonymous for many, many years hereabouts. To my generation at least, it would generally be used and understood (outside of legal documents) to mean running out of money rather than going through the legal process of applying for bankruptcy, even though we know that technically that is what it ought​ to mean.
    I'd say exactly the same for British English too:thumbsup:
     
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