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shareholders and on personal bankruptcies. 148 Members of the company still
continued to be personally liable for the debt of the company and creditors were
allowed to pursue their own actions against individual members of the company. 149
Even so, before creditors could proceed to bring an action against an individual
member of the company, they had to prove their debts and obtain leave of the Court
of Chancery. 150
The passing of the successive Acts from 1862 onwards allowed for the development
of specialised winding up procedures. 151 The transfer of jurisdiction to the Court of
Chancery by the 1862 Act presented further opportunity to develop specialised
winding up procedures and also provided an appropriate moment for case law to
progress along its own particular lines and to diverge from the principles of the law
of bankruptcy. 152 This Act also resolved the conflict of jurisdiction between the
bankruptcy court and Court of Chancery under the previous Acts by transferring
matters pertaining to winding up of companies to the Court of Chancery. 153
Insolvency law later developed into two specialised branches of law; individual and
corporate and by the end of the nineteenth century, two separate statutes, the
Bankruptcy Act and the Companies Act governed the two branches of insolvency
law. 154
148 Cornish and Clark above n14 at 255.
149 Formoy above n33 at 73.
150 Holdsworth A History above n147 at 51.
151 Ian Fletcher The Law of Insolvency ( Sweet & Maxwell, London 2002) at [1-021].
152 Ibid.
153 Ibid.
154 Ibid at [1-022].
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